Post Office scandal victim wins appeal over £2m trial split

A high-profile victim of the Post Office scandal has won a preliminary argument about his own civil claim in the Court of Appeal. Former sub-postmaster Lee Castleton challenged the court’s decision from earlier this year that his claim against the Post Office should be broken into split trials.

The Post Office and Fujitsu, which operated the flawed system on which the scandal was based, successfully argued in the High Court in January that the split solution would save money for all parties.

But the Court of Appeal this week concluded that the approach suggested by the Post Office ‘creates too many practical difficulties to be workable’.

Castleton was suspended from his Bridlington branch in 2004 due to cash shortfalls that had appeared in accounts prepared with the Horizon computer system. Post Office successfully sued him in 2007 for the £25,000 that was apparently missing and was awarded more than £300,000 in costs.

Castleton was made bankrupt as a result, but was a claimant in the group litigation Bates & Ors v Post Office which prompted two judgments from Mr Justice Fraser and a settlement agreed in December 2019.

Last year, Castleton started proceedings against Post Office and Fujitsu, seeking a declaration that the 2007 judgment was obtained by fraud and claiming damages of more than £2 million. The defendants challenged the substance of Castleton’s claims and argued that the settlement deed in the 2019 Bates litigation prevented such action.

The High Court originally agreed with the defendants that a separate trial should determine preliminary matters, effectively splitting issues concerning the 2019 settlement, and the rest of Castleton’s claims.

On appeal, one of the three judges, Lord Justice Zacaroli, said that delaying investigation of the full facts about what the Post Office knew about Horizon problems would make its examination of the unconscionability issue unworkable. 'There would be a material risk of overlap in the evidence required for the two trials that may now be required, and the associated risk of inconsistent findings,' the judge added.

Simon Goldberg, a partner with London firm SMB which is representing Castleton, said that by trying to split the trial in order, as the defendants had argued, to save costs, the Post Office had achieved the exact opposite. Goldberg said he would be writing to MPs, to ask for this case to be raised in parliament in order to question the 'enormous and unnecessary' legal costs, which are being funded from the public purse. 

‘Mr Castleton is delighted to have won his appeal, but incredibly frustrated by his elusive quest for justice, which and is all that he and his family have wanted for the best part of twenty years,’ said Goldberg.

The Court of Appeal has yet to determine – and will consider submissions – as to whether the matter is to be remitted to the original judges or whether they should themselves make the directions as to how the case progresses from here.