Mr. Bates vs. The Post Office Spurs Possible Law Change

The following is a guest post by Clare Feikert-Ahalt, a senior foreign law specialist at the Law Library of Congress covering the United Kingdom and several other jurisdictions. Clare has written numerous posts for In Custodia Legis, including Revealing the Presence of Ghosts; Weird Laws, or Urban Legends?; FALQs: Brexit Referendum; 100 Years of “Poppy Day” in the United Kingdom; and 100 Year Anniversary of Restrictions on Alcohol in England and Wales for Those Under 18.

There have been instances where a “docu-drama” has highlighted legal issues that lead to legal change. The most recent one in England involves the post office and a number of subpostmasters and subpostmistresses (hereinafter referred to collectively as SPM) who are self-employed and, upon approval from the Post Office, act as agents on its behalf in running individual post office branches. The relevant court case and surrounding scandal, which has been described as “one of the greatest miscarriages of justice in our nation’s history,” was dramatized in a four-part television show titled Mr Bates vs The Post Office, and demonstrated the ability of these shows to raise public awareness and anger regarding an issue, leading to rapid proposals for legislative action.

In this case, the television series highlighted the plight of a group of 550 SPMs, led by Mr. Alan Bates. Mr. Bates had his contract with the Post Office terminated after he extensively documented, and refused to accept, the numbers provided by the the Post Office’s computer sales and accounting system, known as Horizon, which showed him having a shortfall of money in his account. Other SPMs were also similarly affected.

The Scandal

Horizon was installed in 1999 at post office branches across the nation and, almost immediately, the Post Office received reports of issues with the software, with a number of SPMs discovering and reporting shortfalls in cash and stock in relation to the data produced by Horizon, often numbers in the tens of thousands of pounds. Despite this information, the Post Office claimed the system was reliable and robust and required SPMs to rectify the shortfall with their own money (at 18).

Where SPMs could not, or refused to, rectify the shortfalls shown by Horizon, they had their contracts terminated by the Post Office. Many had to declare bankruptcy as a result of the errors and, in a large number of cases, the shortfalls shown by Horizon led to the Post Office taking both public and private prosecutions against SPMs across the UK.

Over 900 SPMs who found losses caused by the Horizon system were prosecuted for a variety of offenses including theft, embezzlement, fraud and false accounting between the years 1999-2015, and convictions were obtained using evidence provided by Horizon. During this time, the Post Office did not disclose any knowledge of faults with Horizon. Of the 900 prosecutions, 700 were private prosecutions carried out by the Post Office itself using section 6 of the Prosecution of Offences Act 1985. There was significant, often very negative, publicity for the SPMs charged as the Post Office pays the state pension and benefits, thus SPMs were being accused of stealing money from the elderly and people in need. The human cost of the accusations and prosecutions for the SPMs was significant.

Litigation from the Subpostmasters

Mr. Bates led a group of SPMs who formed a group, known as the Justice for Subpostmasters Alliance, and pursued the Post Office in a group litigation involving over 550 individuals in the case of Bates et al v Post Office Ltd that resulted in six court judgments. The SPMs claimed Horizon was defective and resulted in erroneous accounting shortfalls that the Post Office did not adequately investigate and then, incorrectly, held the SPMs liable for the shortfalls. In 2019, the high court ruled that there were errors and defects in the Horizon software, meaning that those convicted could move to have their convictions overturned and claim compensation. In Bates et al v. The Post Office (No. 6) the court opined:

The approach by the Post Office to the evidence . . . demonstrates a simple institutional obstinacy or refusal to consider any possible alternatives to their view of Horizon, which was maintained regardless of the weight of factual evidence to the contrary. That approach by the Post Office was continued, even though now there is also considerable expert evidence to the contrary as well (and much of it agreed expert evidence on the existence of numerous bugs) . . . It amounts to the 21st century equivalent of maintaining that the earth is flat.

Evidence showed that the Post Office knew there were serious issues about the reliability of Horizon but failed to both investigate the issues or disclose these issues to the SPMs prosecuted for the shortfalls. The courts found that due to the Post Office’s “failures to discharge its clear duties it prevented SPMs from having a fair trial on the issue of whether that data was reliable” (para. 5) and that its failure to investigate reports of faults in Horizon and disclose this information was “so egregious as to make the prosecution of any of the ‘Horizon cases’ an affront to the conscience of the court.”(Para. 137.) The courts later determined that the Post Office had “pervasive failures of investigation and disclosure” (para.123) and “effectively steamrolled over any SPM who sought to challenge its accuracy.” (Para 4.)

The court awarded the SPMs £58 million (approximately US$73 million) in compensation, although most of these funds were used to pay legal costs and the parties received relatively small payouts. The Group Litigation Scheme has provided for an offer of £75,000 (approximately US$95,000) for each party to the case, but reports indicate they are going to request more.

Overturning the Convictions

The Criminal Cases Review Commission (CCRC), which is responsible for considering cases of people who have lost appeals and who believe they have been wrongly convicted of an offense, stated that the Horizon scandal is “the most widespread miscarriage of justice the CCRC has ever seen, and represents the biggest single series of wrongful convictions in British legal history.” Despite the issue being covered in newspapers extensively, along with an ongoing public inquiry by the government, only 95 convictions had been overturned as of March 5, 2024.

The CCRC stated that, despite the acknowledged unreliability of the Horizon data that was used in numerous cases as evidence to secure conviction, it is unable to collectively refer all cases involving the Post Office where Horizon evidence was relied upon to the courts to be overturned. It states that this is due to its obligations under the Criminal Appeal Act to evaluate each individual case and determine “whether there is a real possibility that new evidence or argument will lead to a successful appeal.” The Criminal Cases Review Commission has stated that “each individual assessment is crucial to ensure the integrity and fairness of the review process.” The participation of the individual convicted is also required. In some cases, these individuals are deceased and their family do not wish to pursue the case, or the individuals are unwilling to revisit their convictions, which would prevent the case being referred to the court.

Public Inquiry

An independent statutory public inquiry was established in 2021 to help understand the implementation and failings of the Horizon system and is still ongoing. The inquiry consists of seven phases covering a range of issues, including the actions against SPMs; the group litigation; the impact of the failings of the Horizon system on those it adversely affected; the Horizon system itself; how disputes were resolved; how Horizon was monitored and is currently used, along with recommendations for the future.

Impact of the Airing of Mr. Bates vs. The Post Office

Mr. Bates vs. The Post Office first aired in the United Kingdom on January 1, 2024, and completed its run on January 4, 2024. Six days later, on January 10, 2024, the level of public outcry led the government to announce that it would introduce legislation that would “swiftly exonerate and compensate victims” and overturn the wrongful convictions of hundreds of SPMs whose convictions relied upon Horizon evidence. The Prime Minister stated the Post Office Horizon scandal is “one of the greatest miscarriages of justice in this country’s history . . . We must do everything we can to exonerate and compensate these innocent people, and make sure they finally get the justice they deserve.” The government stated that it would also expedite compensation payments for those who took the first legal action against the Post Office.

The Bill

The Prime Minister promised to introduce a bill to overturn the convictions of SPMs that relied on evidence from the Horizon software used by post offices in the 1990s-2000s. The legislative proposal stated that the convicted individuals would be required to sign a form stating they are innocent in order to have their conviction overturned. Overturning the convictions would mean that these individuals could apply to receive compensation. When announcing the legislation, the government acknowledged that it would encompass some individuals who had been correctly convicted of offenses. The government took the wishes of the victims of these crimes into account and stated that it would introduce safeguards to ensure that anyone rightfully convicted who attempts to seek compensation can be prosecuted.

On March 13, 2024, the government announced that it would introduce the Post Office (Horizon System) Offences Bill on that day to quash the conviction of hundreds of SPM. At the time of publication, this bill was not yet available.

A House of Commons Committee report, published on March 7, 2024, made a number of recommendations, including that the Post Office be removed from any involvement in providing redress for the SPM affected by the scandal. It also recommended that the government establish an independent intermediary to help SPMs overturn their convictions and claim compensation.

Compensation

As of  December 1, 2023, the government has paid £138 million (approximately US$174 million) across three schemes to over 2,700 claimants, and 93 convictions have been overturned. In September 2023, the compensation plans, including the Horizon Shortfall Scheme and the Group Litigation Order, paid out over £120 million (approximately US$150 million).

The government has established a fund of £1 billion (approximately US$1.26 million) to pay compensation to those wronged by the Horizon scandal. Under the Overturned Conviction process, a fast-tracked payment of £600,000 (approximately $756,000) is available, as a final settlement, for every wrongfully convicted SPM once their conviction is overturned. These individuals may apply for the money to settle their claim without the need to bring a formal claim. Individuals who were not convicted, but who experienced shortfalls due to Horizon, can apply for an independent assessment of their case and may be able to receive compensation under the Horizon Shortfall Scheme.

Other Issues

Due to the significant miscarriage of justice in this case, a number of issues have been raised, not only in overturning the convictions of and providing compensation to the SPMs. The use of private prosecutions was raised in parliament, and newspapers have reported that the metropolitan police is investigating the Post Office over potential fraud offenses relating to the prosecutions. The role of private prosecutions in England will also be subject to further review.

The Post Office has not conducted a private prosecution relating to Horizon since 2015. It continues to use the Horizon system and claims that the latest version is robust.