Post Office chief Vennells complained that GC put professional integrity ‘above the business’

Former Post Office chief executive Paula Vennells expressed frustration that her general counsel put professional obligations above the interests of the business, the public inquiry into the Horizon scandal has heard.

The relationship between Vennells and Susan Crichton deteriorated rapidly in the middle of 2013 after the lawyer was shut out of a board meeting, the inquiry heard. This was despite Crichton being listed on the meeting agenda as presenting a paper about the review of the Horizon IT system.

The inquiry heard that the pair met at a coffee shop near work in early September 2013 where Vennells claimed Crichton became angry and shouted at her. Crichton told the inquiry she had no recollection of the meeting and did not recognise the characterisation of herself.

Following this meeting, the Post Office decided to commission another review into how Crichton was handling the Horizon review. The solicitor was said to be ‘very emotional’ and her ‘ego and self-esteem have been undermined’.

Vennells wrote in a meeting note that Crichton ‘was possibly more loyal to her professional conduct requirements and put her integrity as a lawyer above the interests of the business’.

Asked by inquiry counsel Julian Blake if this was true, Crichton said that at all times she had been focused on delivering an independent report through forensic accountants Second Sight. ‘If that meant I put my integrity as a lawyer above the interests of the business then that is what I did,’ she added.

The inquiry heard that, by the end of September 2013, Crichton had effectively left the role she had worked in for three years. The lawyer said she did not believe Vennells had understood her reasons for leaving and that her bosses had wanted a review that could be ‘managed and manipulated’.

The Second Sight report had been commissioned by Crichton although she denied having a friendly previous relationship with its investigator Ron Warmington as had been implied by Post Office executives. The report went on to uncover issues with the evidence of expert witness Gareth Jenkins who had discovered two defects with Horizon.

Crichton produced a draft response for the July board meeting following the Second Sight report and offered two options: reactively waiting for sub-postmasters who had been convicted based on Horizon evidence to get in touch, or pro-actively seeking people out to tell them there may have been an issue. The board discussed the report but did not invite Crichton in to discuss it, instead leaving her waiting outside for more than an hour before proceeding with the reactive approach.

Crichton told the inquiry it appeared that executives had expected the Post Office to be run like civil service organisations and to influence Second Sight.

Post Office chair Alice Perkins noted at the time that Crichton believed it was ‘inappropriate’ for her to influence key stakeholders and that she would have been criticised if she had become close to Second Sight. Perkins wrote that ‘privately I am astonished at this view which I simply do not recognise from my experience elsewhere’.

Crichton had said she was unhappy at being shut out of the board meeting and urged the board not to make her a ‘scapegoat’ for the findings of the Second Sight report. She told the inquiry: ‘I felt at the time I had delivered what was requested but I had not been allowed to explain my position and was kept outside… it was a significant issue for the board and there should have been a full discussion.’

The inquiry heard that at the same time as Vennells was criticising Crichton for producing a ‘bland’ summary of the Second Sight report, she had not immediately responded when it was suggested by the Post Office head of security that documents might need to be ‘shredded’ to avoid disclosure.

Blake said Crichton ‘had effectively drunk the corporate Kool-Aid’ and was worrying about having given Second Sight too much information. She denied this was the case.

The hearing continues tomorrow with the conclusion of Crichton’s evidence. She will be followed by former general counsel Chris Aujard.