Hundreds of Post Office workers ‘vindicated’ by High Court ruling over faulty IT system that left them bankrupt and in prison

‘Bugs, errors and defects’ caused shortfalls in branch accounts, concludes judge as he approves £58m settlement

The government is due to end its subsidy of the Post Office network in 2021 (PA Wire/PA Images)

Hundreds of former Post Office workers who claimed a faulty IT system led to some of them being prosecuted and others going bankrupt due to cash shortfalls have been "vindicated" after a High Court ruling in their favour.

A senior judge in London concluded a number of “bugs, errors and defects” in the Horizon system had caused “discrepancies” in subpostmasters’ branch accounts.

Mr Justice Fraser approved a £57.8m settlement – announced last week – between the Post Office and more than 550 claimants at a hearing in London on Monday.

He also delivered his ruling in the second of two trials, in which he made findings about the reliability of the system at the centre of the dispute.

His ruling that there was a “material risk” that shortfalls in Post Office branch accounts were caused by Horizon is a major step in workers’ attempts to have convictions for fraud and theft overturned.

A lawyer who represented the claimants said the judgment was “vindication” for his clients after a lengthy legal battle.

In a statement outside court after the hearing, James Hartley, partner at Freeths law firm, said: “They they have finally been proved to have been right all along when they have said that the Horizon system was a possible cause of shortfalls in their branch accounts.

“These claimants can now walk with their heads held high after all these years.

“This judgment, together with the settlement reached last week, are important stepping stones to achieving much-needed closure for these postmasters.

“They can now start to move on with their lives.”

There was standing room only in the court as more than 100 of the claimants attended the hearing, some of whom said they had been left suicidal by the fiasco.

Represented by a group of six lead claimants, the subpostmasters alleged the Horizon system contained a large number of software defects which caused errors in their accounting.

Some were left bankrupt, while others were prosecuted and even jailed for offences including false accounting, fraud and theft.

Speaking outside court, Tracey Merritt, who was a subpostmaster in Yetminster, Dorset, said: “It’s been a very long road. It’s been a real rollercoaster of emotions.

“But now I can honestly say the relief is immense. When people say anything now, I can say, ‘I told you all along that I didn’t do anything wrong’.”

She said she struggled find work since being accused, adding: “I lost my dignity, I lost my reputation. I couldn’t get a job.”

Without admitting liability, the Post Office announced on Wednesday last week that it had agreed to settle the case with a £57.8m payout.

Mr Justice Fraser said he would refer the case to the Director of Public Prosecutions in relation to evidence given by employees of Fujitsu, which developed and maintained the Horizon system, in previous court cases.

He said: “Based on the knowledge that I have gained, I have very grave concerns regarding veracity of evidence given by Fujitsu employees to other courts in previous proceedings about the known existence of bugs, errors and defects in the Horizon system.”

There are also more than 30 criminal convictions of former subpostmasters which are being reviewed by the Criminal Cases Review Commission, which investigates possible miscarriages of justice.

Lawyers for the claimants told the court that the confidential terms of the settlement agreed with the Post Office will not prevent individual subpostmasters from bringing separate legal action over allegations of malicious prosecution.

The Post Office has previously denied there were problems with the Horizon system.

But in a statement following Monday’s hearing, its chairman Tim Parker said: “In reaching last week’s settlement with the claimants, we accepted our past shortcomings and I, both personally and on behalf of the Post Office, sincerely apologised to those affected when we got things wrong.

“We have given a commitment to learning lessons from these events, and today’s judgment underlines the need to do so.”

Mr Parker insisted the current Horizon system was “robust relative to comparable systems” and said the Post Office was implementing changes to “the ways in which we support our postmasters”.

Post Office chief executive Nick Read said: “We are now working to shape a modern and dynamic Post Office, with changes at every level of the organisation placing our postmasters and our customers at the centre of the business.

“The task ahead is to improve, be clear about our direction and purpose, and to give all of those who work for and with us the guidance and support they need to help us build a Post Office fit for the future, serving in communities throughout the UK.”

Additional reporting by Press Association