CAV Part 2

PART 2

CHAPTER FOUR

Fast Track Arbitration Procedure

21st April, 1994:  Mr Schorer, Ms Garms and Alan Smith all sign the arbitration agreement under duress.  Under instruction from Warwick Smith, Peter Bartlett threatens all three that if they did not sign the FTAP that day, the TIO would refuse to continue in his role as administrator.  The signing of the agreement and the pressure applied by Mr Bartlett and the TIO is addressed throughout Alan’s absentjustice.com webpage.

The phone and fax problems continue

22nd April, 1994:  Alan returns to Cape Bridgewater to find two notes on his desk, reporting staff registering two more phone faults.  Alan faxes three 008/1800 incorrectly charged billing accounts to AUSTEL.  AUSTEL’s fax journal registers three faxes from Alan, lasting from 01.40 to 02.22 seconds, but only blank paper appears ( AS-CAV 70).  Where did the information on these faxes end up?  How can a fax transmit through to the receiving end, without the sender’s identification, date and time the fax was sent being displayed on the document received?

From late in October 1993 until 26th April, 1994 numerous people reported that, after Alan hung up his end of the phone line, they could still hear him talking in his office. These people included Graham Schorer, clients and friends, including Cliff Mathieson (AUSTEL) and Peter Gamble (Telstra).  It was bad enough that they could hear what Alan was saying, but it is worse to realise that Alan was being charged at STD rates, as though the call was still connected.  This TF200 phone shared a line with his fax machine.

Cliff Mathieson and John MacMahon, General Manager – AUSTEL’s Consumer Affairs Department, were both part of the AUSTEL Management team involved in the preparation of the AUSTEL COT Report.  During Alan’s assessment/arbitration processes, they asked Alan to pass on to them anything he uncovered that would support the evidence he had already provided regarding the lock-up and short duration problems on his 800/1800 line.

26th April, 1994:  Alan telephones Mr Mathieson using the EXICOM TF200 on his 055 267 230 line.  During their conversation, Alan mentions the lock-up problems he was experiencing and describes how numerous people commented on this strange phenomenon.  Mr Mathieson suggests Alan put the receiver back in the cradle and count aloud to 10 before picking it up again to see if it was still connected (and it is). They then try counting to 15 seconds: the line remains open.  Mr Mathieson suggests Alan take the phone off the 055 267 230 line and switch it with the phone that was connected to his 055 267 267 line.  More tests confirm that the lock-up fault still occurs on this different TF200 ALCATEL phone.  Mr Mathieson agrees that the fault must be originating in the exchange and suggests that, since Alan is in arbitration, Alan should bring this fault to the attention of Peter Gamble, Telstra’s Chief Engineer.

Alan switches the phones back to their original lines and phones Mr Gamble, but does not tell him Mr Mathieson and Alan have already tested both phones on the 055 267 230 line.  Mr Gamble and Alan then carry out similar tests on the 055 267 230 line. Mr Gamble says he will arrange for someone to collect the phone, for testing purposes, the following day.  Telstra emails, see FOI K00940 dated 26th April, 1994 show they believe this lock-up fault was being caused by a heat problem in the RCM exchange at Cape Bridgewater (AS-CAV 72).  This document also suggests Mr Gamble believed the problems were caused by heat in the exchange.

This is the same Peter Gamble whose SVT equipment couldn’t perform the AUSTEL required Service Verification Tests correctly (at Alan’s business during his arbitration) and who later swore under oath in Telstra’s arbitration defence that the tests were ALL successful.

27th April, 1994:  Telstra collects Alan’s faulty TF200 EXICOM telephone.  During the FTAP, Alan received Telstra document R37911 under FOI.  This document shows Ross Anderson, a Telstra technician from Portland, tested the TF200 EXICOM fax phone at least 18 times without it once displaying this lock-up fault.  Had he first visited the RCM at Cape Bridgewater (10 minutes away) to release hot air from the RCM un-manned exchange?  In his Witness Statement to the FTAP, he acknowledges connecting a fan to the RCM to alleviate the heat problem.  Further documents in the CAV Target Files suggest the problem may have been related to moisture or a combination of both moisture and heat. (AS-CAV 73)

The Call Charge Analysis (CCAS) data for the 27th April, 1994 shows that after Alan’s faulty EXICOM is collected and a new EXICOM installed in his office, there is still a lock-up problem affecting his service.  The CCAS data shows that, at 22:23 hours, an incoming caller waited for 3,599 seconds (59min:59sec) before the call was answered.  This CCAS data also suggests that, after Alan answered this phantom caller, he talked for a further 14,718 seconds (4hr:5min:18 sec). (AS-CAV 74).

In his official report, George Close, Alan’s technical advisor, uses the limited amount of Telstra’s own data, received under FOI during the FTAP, to show the lock-up fault was apparent from at least December 1993 through to February 1994.  He calculates that 863 hours were unavailable over 77 days, due to this one fault (AS-CAV 75).  Mr Close also found a similar pattern of faults in other FOI documents relating to Alan’s Gold phone coin-operated service, which recorded a fault rate of 59 per cent over the same period.

During the FTAP, Alan also received Telstra FOI documents K01031, 32, 33, K00957 and K01398, which further substantiate the relationship between the fault and the exchange.  First, in document K01398, Tony Watson of Telstra states:-

“Probably caused by RCM, no need to investigate. Spoke to Bruce, who said not to investigate also.”

Then, in document K01032, Bruce Pendlebury, Telstra’s Fault Manager tells Jim Holmes, Telstra’s Corporate Secretary, three test calls to Cape Bridgewater appeared to be answered, but no conversation took place.  Did Telstra even care about Alan’s problems?  How could three test calls be designated successful if they were not answered at the receiving end?  How did the technician know what the receiving person was (or was not) hearing?

According to Telstra archival documents, this lock-up fault was apparent on Alan’s phone/fax line as early as August 1993.  The new owner of Alan’s business, Darren Lewis, provided a Statutory Declaration and other testaments to the Hon. David Hawker MP, stating that the lock-up problems on the fax line were severe at least up until November 2002.

2nd May, 1994:  Dr Hughes writes to John Rundell (Arbitration Project Manager) of Ferrier Hodgson Corporate Advisory (FHCA) stating:-

“I am anxious for these matters to proceed as expeditiously as possible. In the circumstances I believe it would be appropriate for the Resource Unit to familiarise itself with documentation which will unquestionably be placed in evidence, namely:

  1. Bell Canada International Inc, ‘Report to Telecom Australia’, 1 November 1993;
  2. Coopers & Lybrand ‘Review of Telecom Australia’s Difficult Fault Policies and Procedures’, November 1993;3Telecom Australia
  3. ‘Response to Coopers & Lybrand Report and Bell Canada International Report’, December 1993
  4. AUSTEL, ‘The COT Cases: AUSTEL’s Findings and Recommendations’, April 1994.” (GS-CAV 187)

6th May, 1994:  While the Commonwealth Ombudsman Ms Philippa Smith’s letter of 20th January 1994 (GS-CAV 148) is addressed in Chapter 2, it is important to remember Ms Smith’s statement that, if the FTSP was to be effective, Telstra had to supply FOI documents to the COT claimants in a timely manner.  Ms Smith also raised these issues again with Telstra’s Frank Blount, on 6th May, 1994 stating:-

“I should be grateful if you would now respond to the outstanding matters raised in my letter of 25 March 1994 ie

  1. Comment on my views that:
  • it was unreasonable for Telecom to impose a condition for release of certain documents that the participants make further assurances that they will participate in the FTSP; and
  • it was unreasonable for Telecom to require the participants to make the assurances while Telecom was considering the agreement related to the FTSP (the Agreement) and thereby denying the participants the opportunity to consider the rules that Telecom wished to have included in the Agreement.”

“Please inform me whether Telecom intends releasing information to Mr Smith, Mrs Garms, Mr Schorer and Ms Gillan in accordance with the undertaking in Mr Black’s letter to Mr Schorer dated 27 January, 1994(copy attached) and subsequently confirmed in communications to my officers by Mr Black and Mr Rumble.” (GS-CAV 188)

Telstra had still not complied with the agreed release of the COT FTSP documents under the agreed FOI Act.

The arbitrations FTSP rules (agreement) Ms Philippa Smith refers to are Telstra’s preferred Rules of Arbitration, which Telstra agreed to release to Graham (through FOI), once the COTs signed the Arbitration Agreement.  It is interesting to note Mr Pinnock would only supply Ms Moore, Secretary Environment, Recreation, Communications and the Arts legislation committee a copy of Telstra’s preferred Rules of Arbitration under confidentiality. (GS-CAV 321)

Believe it or not!

Before Alan and Graham signed for arbitration, Warwick Smith, Peter Bartlett and Dr Hughes all assured them the documents they required from Telstra would begin to flow through to them once their signatures were on the agreement.  The Arbitration Agreement was secretly altered just 36 hours, before it was signed.

By May 1994, one month before Alan had to submit his claim, the flow of documents had all but dried up and so he arranges to go to Melbourne on 14th May 1994 to look at some FOI documents that Telstra stated they would show him, in their offices.

14th May, 1994:  Alan arrives at Telstra’s Exhibition Street FOI viewing room at 9:00am, as previously arranged, to view FOI documents that Telstra had sent him without schedules.  Alan is introduced to Telstra FOI staff, including George Sutton and Rod Pollock.  He is informed he has the room until 6pm.  Alan also arranged this meeting so he could apply for other material he had requested, but not received.

Rod Pollock offers fabricated reasons to explain why documents Alan had received some days before were heavily censored by blanking out information.  Alan receives some of the documents he should have received under his December 1993 and February 1994 FOI requests.  Mr Pollock provides some heavily blanked out documents, including about 56 fax cover sheets, with attached documents.  One of the documents refers to the MELU Exchange that caused Alan massive problems between August 1991 and March 1992, so he asks Mr Pollock if he could supply the document, without the blanking out.  Mr Pollock leaves and Alan continues to check the documents provided.

Alan has some of the documents that Telstra had previously supplied with him.  He notices faxes that were only half received in the past are now not only incomplete, but they are attached to documents they had no connection to.  Some of the 56 fax-cover sheets he had seen before, now have completely different material attached.  Nothing seemed to match.  For example, documents relating to a fault in 1991 were attached to a fault record dated 1993 that stated no fault had been found.  Alan is so alarmed at this discovery, that he phones Detective Superintendent Jeff Penrose of the Australian Police and describes the situation to him.  At his suggestion, Alan prepared a Statutory Declaration and provided it to both the TIO and the arbitrator. (GS-CAV 189-A)

16th May, 1994:  A TIO file note, which Alan received late in December 2001 (under the TIO policy privacy Act), confirms Alan’s visit to the TIO’s office (two blocks from Telstra House) and his request for a witness to accompany him back to the Telstra viewing room to see the altered documents for themselves. Exhibit GS-CAV 189-A marked Warwick and URGENT, confirms Alan Smith left some of the censored/blanked out FOI documents with the deputy TIO, Sue Harlow.  In the last paragraph of this document the deputy TIO, Sue Harlow, refers to the proof Alan left confirming Telstra altered information on the supplied documents, noting, “He left an example of this with us (also attached).”

Even though the TIO was acting as administrator to Alan’s arbitration, they refused to send anyone back with him.  As already noted, on 11th January and 11th July, 1994 Telstra’s Steve Black wrote to Warwick Smith regarding the TIO-appointed Resource Unit and AUSTEL censoring Telstra documents before the COT claimants were allowed to use them to support their claims.  Perhaps this is why no one from the TIO’s office would help investigate this discovery matter?

When assessing the following segment, remember that Graham Schorer had still not agreed to submit his final arbitration claim, as Telstra had not provided him with all the relevant information he needed to support his claim.

In Alan’s Statutory Declaration, Alan names Rod Pollock as one of the culprits who had not supplied him with the correct FOI documents.  Compare this statement with the following statement made by Graham Schorer under oath

“On 29th September, 1994 two Senior Commonwealth Ombudsman officers, Mr Hind and Mr Wynack, interviewed Graham Schorer regarding the non-supply or drip supply of FOI documents. Under oath, Graham states:-“I rang a gentleman by the name of Rod Pollock

and I put the question to him. All he would say to me was, ‘Graham, my instructions are you get no documents until such time as you’re fully immersed in the arbitration procedure.’ I said, ‘Whose instructions?’ He said, ‘I can’t tell you that; but I can tell you that I’ve got instructions you won’t get them until that happens. (AS-CAV 78)

On the 13th October, 1994 a Telstra whistleblower (possibly Lindsay White) wrote to Minister Lee stating that Steve Black and Rod Pollock were altering and changing information on the COT cases’ requested FOI documents, in their attempt to minimise Telstra’s liability. In the side column of this letter, someone has handwritten the statement:  “Warwick Smith has been critical of Pollock on some issues.  

The FOI identification numbering on this letter is AUSTEL’s, the regulator during the COT arbitrations; perhaps someone from AUSTEL handwrote this statement?

On 6th May, 1994 prior to the revealing of the Steve Black and Rod Pollock’s FOI issues, Ms Philippa Smith wrote to Telstra’s Frank Blount stating:-

“Mr Black replied on your behalf on 31 March 1994, but his letter addressed only some of the matters I raised.”

“I should be grateful if you would now respond to the outstanding matters raised in my letter of 25 March 1995 ie

  1. Comment on my views that:
    • it was unreasonable for Telecom to impose a condition for release of certain documents that the participants make further assurances that they will participate in the FTSP; and
    • it was unreasonable for Telecom to require the participants to make the assurances while Telecom was considering the agreement related to the FTSP (the Agreement) and thereby denying the participants the opportunity to consider the rules that Telecom wished to have included in the Agreement.
  2. Provide information about the steps Telecom has taken to locate files containing information relating to Mr Smith’s contacts prior to June 1991 and the personal files which allegedly were destroyed.” (AS-CAV 80)

18th May, 1994:  Alan writes to Dr Hughes, asking him to extend his claim preparation time to 15th June, 1994 due to Telstra’s delaying FOI tactics.  Dr Hughes replies to Alan’s request on 23rd May, 1994 advising him that Telstra has agreed to an extension until 15th June, 1994 but says Telstra’s “Mr Rumble has indicated that Telecom would be opposed to a further extension of time beyond 15 June 1994.”
(AS-CAV 81)

LOST CLAIM DOCUMENTS

Alan faxes Dr Hughes further claim material

23rd May, 1994:  This fax billing account confirms five attempts of Alan’s office to fax this information to Dr Hughes failed (AS-CAV 82).  Telstra’s B004 defence document stated the fax couldn’t get through because Dr Hughes’ fax machine was busy.  If this is so, why was Alan charged for the five calls?

MISSING FAXES

After numerous faxes sent from Alan’s office to Dr Hughes do not get through, Alan becomes more and more agitated.  He had no idea where these faxes might be disappearing to, or why.

Documentation obtained from Ferrier Hodgson Corporate Advisory (FHCA) and the TIO-appointed arbitration Resource Unit confirm numerous documents forwarded to Dr Hughes’ office did not appear on their list of documents as being received.  See Dr Hughes (attachment 3) in main Dr Hughes target files.

COMMENTARY:

Between Alan signing the Fast Track Settlement Proposal, 23rd November, 1993 and realising Dr Hughes’ office was not getting all of his transmitted faxes, he participated in these official inquiries and investigations:-

  • The Coopers & Lybrand investigation.
  • The AFP investigation, which was still in progress.
  • The AUSTEL investigation into his matters.
  • The Commonwealth Ombudsman investigation into Alan’s FOI matters, which was not completed until May 1997, two years after Alan’s arbitration was deemed finalised.

Question:

How could anybody believe that it was reasonable to expect Alan and Graham to successfully prepare their claims while they were involved in the above investigations?  In Graham’s case, he was also involved in the Senate Working Party investigation, from 1997 to 1999, while the TIO was pressuring him to submit an arbitration claim.

25th May, 1994:  Graham Schorer writes to Dr Hughes:-

“Due to circumstances and events beyond the direct and/or indirect control of Graham Schorer plus other related claimants, companies etc., I am formally applying for an extension of time on behalf of Graham Schorer plus other related claimants, companies etc. pursuant to Clause 7.1 in the ‘Fast-Track’ arbitration procedure…”

“The reason for the request are as follows:-

  1. A substantial burglary in Golden’s premises on the 4 March, 1994 and the theft of vital equipment and records. …
  2. The inability to commence using outside resources to assist in preparation of the interim statement of claim etc. until such time as they are in receipt of new confidentiality clauses.The equipment stolen on 4th March comprised:

(a)   One of two word processors with its laser printer and back up disks containing Golden’s sales quotas, customer agreements, facsimiles and all the correspondence facsimiles and most of the documentation relating to telephone service difficulties, problems and faults relating to our present claim.” (GS-CAV 190)

Please note:

On 4th March, 1994 approximately one-and-a-half hours after Golden Messenger’s burglary, another COT claimant’s business, Dawson Pest Control, was also burgled. Mr Dawson remarked he found it strange the burglars only stole business records and Telstra-related information.  On 11th October, 1994 during Alan Smith’s arbitration Oral Hearing he informed the arbitrator that the Cape Bridgewater Holiday Camp booking information and banking statements had disappeared from his office.  Telstra FOI documents provided to the Australian Federal Police in 1994, by Alan, confirm Telstra was able to document dates when Alan would be in Melbourne (away from his business).  In one instance, Telstra documented an intended Melbourne trip, weeks beforehand.

Telstra charges for calls not answered by Alan or staff

3rd June, 1994:  Alan is working in his lounge (adjacent to the office) with Wendy Trigg, a bus service operator, when the 055 267 267 phone in his office rings with two short bursts and stops before he can reach it.  The line is dead when he picks up the receiver.  Since this is a problem he has experienced for some months, he immediately rings Telstra’s 1100 fault line in Bendigo.  Mrs Trigg observes (and later documents) the process.

Alan uses his fax phone to phone Telstra.  This equipment is on a separate line to his 008/1800 free-call service, which is the line he is complaining about.  He asks the fault operator if she will phone his free-call number and see if she has problems getting through.  Moments later, while Alan was still holding on the fax line, there is a faint, one-ring burst on his free-call line.  Both Mrs Trigg and Alan hear this short ring but when he picks up the receiver, again, the line is dead and so he doesn’t bother to speak and hangs up the phone.

A few moments after Alan hangs up the free-call phone, the Telstra operator comes back to his fax phone and announces someone answer the free-call line, and it sounded like “Cape Bridgewater Holiday Camp”.  Alan hadn’t mentioned anything about the holiday camp, so who answered the call?  Where was her call answered, and by whom?

Alan rings 1100 again and asks the same operator if she wondered why he didn’t say more when he answered her test call?  Why didn’t he say something like ‘It looks like the phone’s OK after all’?  Alan then spoke to the operator’s supervisor and records show that, all up, he was on the phone for 12 minutes and seven seconds.  Mrs Trigg provided her testimony to the arbitrator.

The following day Alan books “Powerhouse Productions of Portland” to produce a professional video, including a six-minute interview, explaining this incident.  Graham Sawyer interviews him, asking a set of prepared questions.  See Alan’s letter to Dr Hughes dated 21st June, 1994 concerning this issue (AS-CAV 83).

10th June, 1994:  AUSTEL’s John MacMahon writes to Steve Black, stating:-

“AUSTEL is continuing to receive complaints as to the quality of service from a number of the COT Cases

  • Mr Smith at Cape Bridgewater continues to express concern about his ability to receive and send facsimiles.
  • Mr Schorer at North Melbourne continues to claim that customers are reporting an inability to make a successful phone call to his business.” (AS-CAV 84)

The Implementation of the Recommendations of the COT Cases Report (see Alan Smith CAV Service Verification Test LGE File), states, on page 15:-

“The role of the Service Verification Tests (SVT) in the determination of the adequacy of a DNF service is that the SVT clearly have to be conducted well before 30 May 1995 to meet the requirement of recommendation 25. For example, if the SVT indicate an unacceptable level of service then a considerable amount of time may be required to rectify the service in question, particularly if major replacement of exchange equipment is required to bring the service to the accepted standard.”

In regards to the adequacy of the telephone service provided to Golden Messenger by Telstra, it is apparent from the exhibits (see above), that the service was less than adequate.

Telstra’s Paul Rumble threatens Alan

31st June, 1994:  Mr Rumble is angry that Alan has supplied a number of Telstra FOI documents to the AFP, to assist the AFP in their interception investigations.  Mr Rumble rings Alan and says Telstra will not supply him the rest of the relevant claim material needed, unless Alan promises not to supply any more FOI documents to the AFP.  Due to the stressful situation Alan is in, including no support from the arbitrator or the TIO, he gives his word to Mr Rumble, in blind hope he can reach an early end to this dreadful saga.

4th July, 1994:  Alan responds to Mr Rumble’s threats in a letter:-

“I gave you my word on Friday night that I would not go running off to the Federal Police etc, I shall honour this statement, and wait for your response to the following questions I ask of Telecom below.” (AS-CAV 85)

At the time of writing this letter, Alan did not intend to provide the AFP with any further FOI documents.  However, when the AFP came back to Cape Bridgewater on 26th September, 1994, they started asking a number of questions concerning this Paul Rumble letter.

Page 12, of the AFP transcript of Alan’s second interview at Q57, states:-

“The thing that I’m intrigued by is the statement here that you’ve given Mr Rumble your word that you would not go running off to the Federal Police etcetera.”

It is clear from the AFP statements in this transcript that they believe Telstra is intercepting Alan’s telephone calls without his knowledge or consent. (AS-CAV 86)

On 29th November, 1994 Senator Ron Boswell asked Telstra’s Legal Directorate, David Krasnostein, numerous questions concerning the AFP investigations into Telstra’s interception of the COT telephone conversations. Included is this question:

“Why did Telecom advise the Commonwealth Ombudsman that Telecom withheld FOI documents from Alan Smith because Alan Smith provided Telecom FOI documents to the Australian Federal Police during their investigation?” (AS-CAV 87)

Alan informed Dr Hughes and Warwick Smith that Telstra had breached the Privacy Act including confirmation that Mr Rumble refused to supply him with any further FOI documents until Alan agreed not to pass the information on to the Australian Federal Police (AFP).  Neither Graham nor Alan received ANY support from either Dr Hughes or Warwick Smith, regarding access to documentation.

11th July, 1994:  Steve Black writes to Warwick Smith, stating:-

“Telecom will also make available to the arbitrator a summarised list of information which is available, some of which may be relevant to the arbitration. This information will be available for the resource unit to peruse. If the resource unit forms the view that this information should be provided to the arbitrator, then Telecom would accede to this request.”

The statement in Mr Black’s letter:-

“If the resource unit forms the view that this information should be provided to the arbitrator”,

confirms both Warwick Smith and Mr Black were fully aware that the TIO-appointed Resource Unit, Ferrier Hodgson Corporate Advisory, were secretly assigned to vet most, if not all, the arbitration procedural documents en route to Dr Hughes.  If FHCA decided a particular document was not relevant to the arbitration process, it would not be passed to Dr Hughes, or the other parties. (AS-CAV 590)

Page 5 of the Commercial Arbitration Act 1984, under Part 11 – Appointment of Arbitrators and Umpires states:-

(6) Presumption of single arbitrator

“An arbitration agreement shall be taken to provide for the appointment of a single arbitrator unless –
(a) the agreement otherwise provides; or
(b) the parties otherwise agree in writing.”
(GS-CAV 193-B)

The FTAP agreement Graham and Alan signed, on 21st April, 1994 mentions only one arbitrator.  They have never seen any written agreement that allows a second arbitrator to determine what information the first arbitrator will see.

12th July, 1994:  Telstra’s Paul Rumble writes to Graham Schorer saying:-

“I confirm my understanding that you wished to make an informed decision as to which documents were required and that you might take a few days in order to make an informed decision.” (GS-CAV 194)

15th July 1994: Graham Schorer responds to Paul Rumble’s letter, noting:

“Regarding the meeting of Thursday 7 July 1994, which commenced at 10.00 am.”

“The meeting opened with Schorer tabling a tape recorder to record the meeting.”

“Schorer stated that he did this on the understanding that Telecom, in their own internal documents (obtained under FOI), have recommended Telecom employees recording Telecom customer’s conversations without other parties’ knowledge. Therefore Telecom should not be adverse to the meeting being recorded with Telecom’s knowledge.”

“Telecom rejected the use of the tape recorder on the basis of it being inappropriate under the circumstances.”

And when referring to the 7 July, 1994 meeting, Graham states:-

“Schorer went on to say that there was a serious flaw in the Bell Canada testing results of Alan Smith’s service. Telecom’s internal documents stated that all tests required a minimum of 30 seconds between test calls to allow the network to reset itself.”

“Some of the tests done on Alan Smith’s service had a time separation of approximately 7 seconds between test calls.”

“Furthermore, in the testing of Golden’s service, Bell Canada conducted most of the testing at times and delays when North Melbourne exchange was in idle capacity, and outside Golden’s normal operating hours.”

18th July, 1994:  Dr Hughes accepts the BCI report as Arbitration Evidence.  This letter, from Dr Hughes to Paul Rumble, states:-

“On 13 July 1994, the Resource Unit requested copies of the Bell Canada Report, the Coopers & Lybrand Report and the Telecom response to these Reports. The purpose of the request was to enable the Resource Unit to commence perusing relevant background documentation.” (AS-CAV 88)

19th July, 1994:  Steve Black writes to Graham Schorer, stating:-

“The purpose of this letter is to acknowledge that I have received a cheque for $2,000 made payable to Telstra Corporation Limited and delivered by your Courier this afternoon.”

“I have not yet had time to read your letter and respond. However I note one comment that refers to the information provided to the arbitrator. This information has been supplied to the arbitrator for onforwarding to you under the rules of the procedure.” (GS-CAV 196)

Questions arising out of the above 11th and 19th July, 1994 letters:-

  1. What motivated Mr Black, to send Graham’s FOI released documents directly to Dr Hughes and not to Graham?
  2. Were these Telstra-released FOI documents labelled: “To the Attention of the Resource Unit?”
  3. How many other similar Telstra-released FOI documents have ended up at the arbitrator’s office labelled: “To The Attention of the Resource Unit”, and NOT forwarded onto the other COT claimants?

21st July, 1994:  Steve Black writes to Graham Schorer, stating:-

“I refer to your letter dated 19 July 1994 which refers to the information provided to the TIO under the ‘Fast Track’ arbitration procedure for onforwarding to yourself. …”

“I have noted your statement that, “if … [Telecom is] supplying the information as part of the arbitration process on [Telecom’s] own account, then [Telecom] should be supplying Schorer with copies as a matter of right and it should not be dependent on whether I ask the arbitrator to supply it or not and whether or not it is without charge.” (GS-CAV 197)

22nd July 1994: Warwick Smith writes to Steve Black, stating:-

“I refer to your related letters of 15 and 19 July 1994 and your two letters of 20 July 1994, the six boxes of documents which have been delivered to the TIO office, and your request that these be forwarded to Mr Schorer, ostensibly under the Fast-Track Arbitration Agreement.”

“In contacting Mr Schorer by phone on 19 July and again on 21 July 1994 to arrange delivery of these boxes, he categorically declined to receive them, stating that he wished to receive his documents under FOI, and not through any other avenue. …”

“The documents will be held at the TIO office until you indicate what should be done with them.” (GS-CAV 198)

29th July, 1994:  On page 4 of AUSTEL’s first Quarterly Report Status of implementation of recommendations of COT Cases report, under the heading Service Verification Tests, it states:-

“In its briefing, Telecom indicated (and we will seek confirmation and further detail in writing) that if the SVT indicates an unacceptable level of service then the required replacement of network equipment will be undertaken.” (GS-CAV 199)

9th August, 1994:  Graham Schorer’s letter to the arbitrator, Dr Hughes, states:-

“I am writing to you to confirm what progress has been made to date regarding documents being received under three different FOI applications.”

“Documents relating to Graham Schorer and Golden Application consist of many duplicate copies and does not represent all of the documents applied for under the two FOI Applications, being 24 November 1993 and 21 April 1994.”

“I will advise the Arbitrator in writing what action I intend…” (GS-CAV 200)

Graham Schorer also writes to Dr Hughes:-

“I have enclosed a facsimile from Telecom, received at my premises on 26 July 1994, at 11.41 pm.”

“This facsimile states that Telecom has forwarded all of the documents that fall within my FOI Applications to the TI.O. for onforwarding to the Arbitrator.”

“Would the Arbitrator please advise in writing as to what date the documents were delivered to the Arbitrator’s premises. Also please advise myself as to what arrangements that I need to comply with for the viewing of the same documents [sic].” (GS-CAV 201)

IMPORTANT

Grant Campbell: Alan Smith’s CAV Chronology file and the TIO Abuse of Power exhibit both confirm Grant Campbell signed official TIO letters on behalf of Warwick Smith (TIO) during the FTSP.  Mr Campbell was acknowledged as Manager of Disputes, which included Alan’s faxing and FTSP problems.  Although the TIO’s Annual Report of June 1994 includes a list of all the staff employed in the year to that date, Mr Campbell’s name is not on that list as a TIO employee.

Pia Di Mattina was seconded from Minter Ellison around the same time that Grant Campbell apparently assisted Warwick Smith in the administration of the COT arbitrations, but Ms Mattina’s name is not on the TIO’s employee list either.

Since Ms Mattina was only seconded to the TIO’s office, it is likely that Minter Ellison continued to pay her salary – but who picked up the wage bill for Grant Campbell?  From Alan Smith’s CAV list of contacts and supporting targets it is obvious that, in January 1995, just a week or so after apparently working with the TIO’s Arbitration Unit, Mr Campbell was working in Telstra’s Arbitration Unit, with Ted Benjamin.

Neither Graham nor Alan were ever told exactly when Mr Campbell defected to Telstra, the defendants in their arbitrations.  Who knows what confidential arbitration material Grant Campbell had access to before he went to Telstra?  Was the vetting of arbitration documents by a TIO officer on the agenda of the TIO and Telstra before Alan and Graham signed the FTAP?  Exhibit GS-CAV 193-A confirms both the TIO and Telstra knew documents would be vetted by the TIO’s Resource Unit before they were passed on to the arbitrator and the claimants, (if they were lucky)!!

12th August, 1994:  Alan writes to Dr Hughes, and copies the letter to Paul Rumble (AS-CAV 89).  Because the BCI report was to be used as arbitration library material, see (AS-CAV 88), Alan reminds Dr Hughes Telstra have still not supplied Alan with the relevant raw data BCI used to support their reporting.

15th August, 1994:  Alan again writes to Dr Hughes, and again copies to Paul Rumble.  He asks Dr Hughes to convene a meeting so the Resource Unit and the claimants can view technical documents that Telstra are withholding under legal profession privilege:-

“I forwarded you a very interesting document last week which was tabled under this Professional Privilege Act. That document was of a network fault. That document has since been viewed by John Wynack, Commonwealth Ombudsman, FOI as being illegal under the Act to be umbrellaed [sic] in legal privilege documents.” (AS-CAV 90)

16th August, 1994:  Dr Hughes writes to Paul Rumble:-

“I enclose copy facsimile from George Close & Associates Pty Ltd, undated but received 12 August 1994.”

“You will note Mr Close is seeking information to which he has apparently not yet had access. Presumably this may lead to a formal application by one or more of the Claimants pursuant to clause 7.5 of the ‘Fast-Track’ Arbitration Procedure.” (AS-CAV 91) Exhibit AS-CAV 92 includes Mr Close’s letter.

Dr Hughes again favours Telstra

On the same day, Dr Hughes writes a second letter to Paul Rumble:-

“As requested in my covering facsimile enclosing a copy of Mr Close’s letter, I would be grateful if you would provide me with your initial reaction to the request so that I can consider appropriate directions on the matter.”

“Mr Smith also makes a second request, that is, for me, the Resource Unit and certain claimants to view privileged information in the possession of Telecom. I am seeking further clarification of this request from Mr Smith but my inclination is to disallow it.” (AS-CAV 92)

The 17th February, 1994 Arbitration Minutes, confirm Mr Bartlett stated the reason for starting the arbitrations was so the arbitrator could order the production of documents, as some of the COT cases had still not received their FTSP documents.  Dr Hughes stated:-

there were two ways to proceed in relation to the problem of outstanding documents:

  • the procedure is put on hold until all the documents are exchanged in accordance with the FOI procedure; or
  • the arbitration procedure commences and then the arbitrator gives appropriate directions for the production of documents.”

“Dr Hughes indicated that one party can ask for documents once the arbitration has commenced. … and that as arbitrator, he would not make a determination on incomplete information.(AS-CAV 53)

Why did Dr Hughes break his commitment to the COT cases?

Please note:  these are two examples of the type of technical material that were withheld from Alan under LPP.

“Poor performance of Telecom – historically March data problem, local Portland problem fixed in October”

“Slow resolution by Telecom of past problems of Smith – both technical and claims …”

Smith Grade of Service Complaint, Fax cover sheet from B Watson to M Ross, (LPP)”

“Smith Service Grade Complaint, Minute from R Denmead to B Watson (LPP)” (AS-CAV 93)

With AUSTEL’s letter of 9 December, 1993 before them, Telstra still used the BCI Report as Arbitration Defence Material.  What is just as alarming, is that regardless of Dr Hughes, Warwick Smith and the TIO- appointed Resource Unit being provided this same BCI information, they still allowed the BCI Report to be placed into evidence. (GS-CAV 195)

Again, on the same day, Dr Hughes sends a third letter to Mr Rumble. He states:-

“If Mr Smith does seek to rely upon the raw data or the results of any analysis of the raw data, and if such information is to be made available to him, then I could not accept his submission as being ‘complete’ as at 18 August 1994.” (GS-CAV 202-C)

At the time of writing this letter, Dr Hughes had already provided the BCI Report to the Resource Unit (on 24th May, 1994) for their perusal.  It is important to show Dr Hughes clarified in this letter by stating:-

“if Mr Smith does seek to rely upon the raw data or the results of any analysis of the data”

(then Alan’s claim was not complete), yet, he still brought down his findings on Alan’s incomplete submission.

25th August, 1994:  Paul Rumble responds to Dr Hughes’ letters of 16th August:-

“Mr Smith has requested ‘all raw data associated with the Bell Canada testing’. …”

“I have obtained files containing some test results and working documents belonging to Bell Canada International which they created while preparing their Reports, and subsequently left with Telecom. I have been informed by Bell Canada International that they have not retained any other files containing such documents. These files consist of approximately 700 pages plus six disks of data.” (GS-CAV 203-A)

The 700 pages and six disks, containing Bell Canada International data, referred to by Mr Rumble has never been provided to Alan Smith.  When Graham requested this BCI information, Ted Benjamin informed him on 7th March, 1995 that it was still unavailable. (GS-CAV 213)

Paul Rumble responds to another of Dr Hughes’ letters:-

“I have obtained files containing some tests results and working documents. … These files consist of approximately 500 pages.” (AS-CAV 95)

28th August, 1994:  Alan again writes to Dr Hughes re FOI BCI matters.  This letter acknowledges Alan contacted Telstra’s Mr Stockdale:-

“as I wanted to identify which person in National Network Investigations was advising in writing the Telecom staff responsible for making decisions to exempt or delete information from me under the FOI procedures on the basis that the information contained in the documentation that he was supplying would be considered harmful to Telecom…” (AS-CAV 94)

13th September, 1994:  Paul Rumble writes to Dr Hughes:-

“I refer to my letter of 25 August 1994 concerning Mr Smith’s request for ‘all raw data associated with the Bell Canada testing’, and your reply later that day. …

“Telecom has not received any direction from you to supply any of Bell Canada International documents to Mr Smith…” (AS-CAV 96)

16th September, 1994:  Alan responds to Telstra’s Interrogatories.  This 42-page reply is addressed to Dr Hughes.  Pages 15 and 16 questions Telstra as to how Alan can respond to the BCI information requested, as per the interrogatories.  Alan’s answer to Telstra’s question 14:-

“28th October 1992 produce this raw data to the resource team and I shall prove calls came in as answered but they were not. Go on, prove I am wrong. If I am right, then you produce all raw data that I have asked for, including Bell Canada.  If I am wrong, then let the Assessor decide and make a judgement for 1992.”

Telstra’s question 2 could have been better answered on the BCI matter had Alan received the BCI raw data under FOI and or through Dr Hughes. (AS-CAV 97)

18th September, 1994:  Alan’s letter to Mr Wynack, of the Commonwealth Ombudsman’s Office, concerns the BCI FOI documents.  Again, Alan condemns Telstra for the way in which they are not abiding by the FOI Act, or the spirit of the Arbitration Agreement.  This letter is copied to Dr Hughes, Paul Rumble and Warwick Smith. (AS-CAV 98)

Please note:  During the entire arbitration process, from 21st April 1994 to 11th May, 1995, Alan never received a letter from either Dr Hughes or Warwick Smith, advising they were concerned Telstra was not providing him the relevant FOI documents he needed to support his claim.

20th September, 1994:  Telstra’s FOI schedule pertaining to Graham’s FOI requests shows that a FOI document, dated 20th September, 1994 entitled Extract – Litigation Cots Fast Track pt 4 – Emails between Joy Geary and Paul Rumble and Jessie Lewis was withheld from Graham and Alan under the heading Exempt in Full.  The schedule notes:-

“This document contains a confidential communication between a lawyer and client created for the dominant purpose of giving or receiving legal advice.” (GS-CAV 203-B)

Telstra’s Paul Rumble was Graham and Alan’s Arbitration Liaison Officer and Joy Geary, Telstra’s FOI Officer, so this FOI information should not have been withheld from Graham and Alan.

Could this exempt FOI document be associated with the Bell Canada information that Graham and Alan were seeking from Mr Rumble?

21st September, 1994:  Dr Hughes writes to Paul Rumble:-

“I confirm I have not directed the production by Telecom of any Bell Canada International documents.”

“At this stage I would be encouraging Mr Smith to defer any request for discovery until Telecom’s defence documents have been submitted.” (AS-CAV 99)

Did Dr Hughes not think Alan was entitled (as the claimant) to be provided the correct information so he could properly support his reply to Telstra’s interrogatories and his claim?

As mentioned previously, Graham Schorer swore under oath that Rod Pollock told him:-

“Graham, my instructions are you get no documents until such time as you’re fully immersed in the arbitration procedure.”

The TIO File notes for 14th and 16th May, 1994 shows Alan Smith also warned the TIO’s office and the arbitrator Dr Hughes, that Rod Pollock did not provide Alan with the correct FOI documentation he requested during his time at Telstra’s FOI viewing room.  The TIO internal memo dated 16th May, 1994 confirms that Alan left samples of altered documents with the deputy TIO, Sue Harlow.

As shown below for the date 13th October, 1994 a Telstra whistleblower wrote to Parliament House Canberra, alleging that Steve Black and Telstra’s Rod Pollock were the two main offenders who were altering information of FOI documents legally requested by COT claimants, in an attempt to minimise Telstra’s liability.   In the margin of the first page of this document, someone has added a hand-written comment:  Warwick Smith has been critical of Pollock on some issues.

29th September, 1994:  Peter Gamble, Telstra’s Arbitration Engineer, experiences problems getting verification-testing equipment to work correctly at Cape Bridgewater.  He blames Alan’s telephones, saying the phone in the camp kiosk, connected to the phone line, is causing the problems.  Cathy Ezard (Alan’s partner) and Alan disagree:  they disconnected the phone themselves when the Telstra technicians initially arrived on site.  They both later prepare and sign Statutory Declarations confirming their belief that Mr Gamble was wrong and that it appeared there were problems with the verification equipment.  Both documents are forwarded to Dr Hughes.

Documents received (2001) under FOI from the ACA

Two documents are particularly relevant to the SVT problems:

11th October, 1994:  AUSTEL writes to Peter Gamble regarding the deficient SVT and ask what Telstra intends to do about this deficiency. (AS-CAV 123)

16th November, 1994:  AUSTEL writes to Steve Black of Telstra outlining its concerns regarding the deficiencies in the SVT process conducted at Cape Bridgewater, with particularly emphasis on the simulated 008/1800 calls. (AS-CAV 124)

Even though AUSTEL expressed serious concerns about obvious deficiencies in the SVT process, Telstra still used the test result to support their arbitration defence. Telstra’s CCAS data, for the testing that took place at Alan’s premises on 29th September, 1994 confirms none of the tests on his three business lines met the Regulator’s requirements.

Brian Hodge, B Tech, MBA (B.C. Telecommunications) declared, in his 27th July, 2007 Report, the SVT process conducted by Peter Gamble, 29th September 1994, was fundamentally flawed.

Telstra’s own billing records, including documentation given to Telstra by John Wynack of the Commonwealth Ombudsman’s office, show Telstra continued to incorrectly charge Alan on his 008/1800 line up until at least 1997.  Finally, as a direct result of this faulty charging, Alan asked Telstra to disconnect this service.  All the continuing complaints about the bill faults during Alan’s arbitration should have prompted John Rundell, of Ferrier Hodgson Corporate Advisory, to re-assess the merit of the SVT process.  Instead, FHCA blamed the limited timeframe in the Arbitration Agreement for the reason why the Technical Resource Unit was unable to investigate technical issues like the billing faults.

Mr Rundell wrote to TIO John Pinnock, on 15th November, 1995 alleging Alan only raised the billing faults in April 1995 (AS-CAV 104).  Four transcript pages, 91 to 94, from the Oral Arbitration Hearing on 11th October, 1994 that John Rundell attended, confirm Alan discussed the billing problems that were attached to his letter of claim dated 15th June, 1994.  Why did Mr Rundell deceive the TIO about when Alan raised the billing problems? (AS-CAV 105)

If Telstra had been honest and advised Dr Hughes that AUSTEL alerted Telstra’s Arbitration Liaison Officers to deficiencies in the SVT at Cape Bridgewater, and then repeated the tests, it would have been obvious to Telstra, or the Technical Resource Unit, that major faults were still occurring on the 008/1800 service, the Gold Phone service and the facsimile line.  The arbitration would have been halted immediately, as the arbitrator could not hand down his award if the phone faults, which sent Alan into arbitration in the first place, were not fixed.

30th September, 1994:  Warwick Smith writes to Graham Schorer, stating:-

“Telecom have changed some of the management team for the COT process. Today I asked Mr Ted Benjamin to accompany me to briefly meet Dr Hughes formally. Yesterday Mr Benjamin, in my presence, received an overview of the current position from Mr Peter Bartlett and Ms Di Mattina. … At this critical stage the impact of such a change needs to be minimal and advantage the process. I hope this will be the case.(GS-CAV 204)

This letter does not advise Graham that Mr Benjamin has been a TIO Council member since June 1993.  This letter shows, once again, an illicit meeting of parties involved in the COT arbitration, without any COTs or their representatives being present.  Of interest, contrast these meetings with Dr Hughes’ statement to Mr James, President of the Institute of Arbitrators Australia, on 16 February, 1996:-

“Mr Smith’s assertion … that a technical expert, Mr Read, refused to discuss technical information at his premises …is correct – in this regard, Mr Read was acting in accordance with his interpretation of my direction which prohibited him from speaking to one party in the absence of the other party…” (AS-CAV 503)

Was there one rule for the complainants and another for the defendants?

2nd October, 1994:  Alan complains to Ted Benjamin about the deficient SVTs conducted at his premises.  On 6th October, 1994 Telstra writes to Dr Hughes, asking him to order Alan to comply with their interrogatories and

“direct the claimant to provide Telecom, on or before 20th October 1994, with the particulars set out in Schedule 1 of this letter, and the documents set out in Schedule 2 of this letter”.

But some of the documents they were seeking could only be supplied by Telstra themselves, under one of the many FOI requests which they had not yet complied with!

Letters exchanged between Dr Hughes and Telstra, on 15th and 21st July, and 16th August, 1994 together with two letters on 25th August, 1994 (five letters in all) show Dr Hughes was well aware Telstra admitted some of the information Alan was seeking was stored in their archives.  Why didn’t Dr Hughes order Telstra to produce these documents so Alan could complete his claim?  Why was Dr Hughes not concerned about the copied 2nd October, 1994 letter condemning the SVT process?  Who was protecting Alan’s rights?

How could Alan reply properly to Telstra’s interrogatories and complete the final presentation of his claim, when the arbitrator had not accessed the information Alan required, despite promising to do so on 17th February, 1994?

By the end of August 1994, Alan suspected Paul Rumble’s threat of withholding FOI documents, if Alan assisted the AFP, was being played out.  What was really behind Telstra’s reluctance to supply the documents Alan needed? – was this anything to do with his previous contact with the AFP?

  • When Telstra advised the arbitrator that at least some of the documents Alan wanted were held in their archives, why didn’t the arbitrator order Telstra to pass them on to Alan?
  • How did Telstra know, on 7th April, 1994 that Alan would be away from his business on the following 5th August to 8th August, 1994?
  • Why was Telstra live monitoring Alan’s business during the arbitration process?
  • Was Telstra involved in the disappearance of Alan’s booking and banking records?

The transcript of a second interview with the AFP on 26th September, 1994 confirms Telstra records, held by the AFP, proved Telstra was indeed bugging Alan’s phones. Was Telstra retaliating because Alan dobbed in Paul Rumble?

3rd October, 1994:  Graham Schorer drafts a response to Warwick Smith’s letter of 30th September, 1994 (above).  Graham’s solicitor, William Hunt, advises Graham to edit it before sending it because of the risk of being accused of slander, by Mr Benjamin, Mr Rumble or Ms Geary.  The letter was finally reduced to two pages and faxed to Warwick Smith on 5th October, with copies also going to Telstra’s CEO (Frank Blount), the TIO’s Legal Counsels (Peter Bartlett and Pia Di Mattina), the Arbitration Project Manager (John Rundell) and the Arbitrator (Dr Gordon Hughes).

Even after William Hunt’s advice, Graham’s letter still condemned Mr Rumble’s actions:-

Mr Rumble’s conduct and treatment towards the CoT Members involved or attempting to become involved in the arbitration process, in the opinion of the individual C.o.T. Case Members, failed to meet the minimum standards of conduct regarding adequacy, reasonableness and fairness.”

“It should be noted that Mr Rumble performed his duties under the directions of the senior Telecom Group General Manger of Customer Affairs controlling the whole unit that directly interfaces with CoT Members, Mr Black.” (GS-CAV 204-B)

Graham was already in receipt of a previous letter, dated 4th July, 1994 from Alan Smith to Paul Rumble (copied to the AFP, Dr Hughes and Warwick Smith) in which Alan raised concerns regarding Mr Rumble threatening Alan into promising not to provide FOI documents to the AFP.  Mr Rumble implied that continuing to provide information to the AFP would result in Telstra stopping the supply of the FOI documents Alan needed to support his claim.  Alan’s claim was never investigated. The Alan Smith CAV Chronology LGE file, and supporting documents including a copy of the transcript of the AFP interview with Alan on 26th September, 1994 reveal the AFP’s clear concern regarding Mr Rumble’s threats.  Exhibit GS-CAV 204-C contains page 180 from Senate Hansard records for 29th November, 1994 and records Senator Boswell asking Telstra:-

“Why did Telecom advise the Commonwealth Ombudsman that Telecom withheld FOI documents from Alan Smith because Alan Smith provided Telecom FOI documents to the Australian Federal Police during their investigation?”

In Graham’s letter of 3rd October, 1994 Graham also raises Steve Black’s involvement in the matters discussed, as Mr Rumble answered to Mr Black.  Further, on 13th October,1994 (see below), a Telstra whistleblower identifies Steve Black as one of the culprits attempting to minimise Telstra’s liability by altering information on FOI documents legally requested by various COT claimants.  This accusation further supported Graham’s claims regarding Mr Black as well as Graham’s challenge of the appointment of Ted Benjamin to replace Mr Rumble as Telstra’s Arbitration Liaison Officer.  Graham did not know Mr Benjamin was already a TIO Council member, and, as shown above on 30th November, 1993 provided confidential TIO council COT-related information to Telstra’s hierarchy after attending a TIO Council meeting.

Also noted above, Dr Hughes, Peter Bartlett and John Rundell, all received a copy of Graham’s October 1994 letter to Warwick Smith, therefore all four were a party to Graham’s concerns, yet nothing was done.  Later, Mr Rundell wrote to Warwick Smith (18th April, 1995) copying to Dr Hughes and Peter Bartlett, alerting, “It is unfortunate that there have been forces at work collectively beyond our reasonable control that have delayed us undertaking our work.  Even more amazing – Dr Hughes also wrote to Warwick Smith (12th May, 1995) and declared the Arbitration Agreement to be not “a credible process”.

Did the Paul Rumble/AFP issue stop the arbitration process?  NO.

Did the allegations of Steve Black and Rod Pollock tampering with documents initiate an investigation into the arbitration process?  NO.

Did the “forces at work” letter result in the arbitration process being postponed until the matter could be investigated?  NO.

Did Dr Hughes’ letter declaring the Arbitration Agreement to be not credible stop the arbitration process?  NO.

All this indicates that, in his letter to Warwick Smith, Graham was obviously correct to challenge Paul Rumble and the appointment of Ted Benjamin.

Steve Black writes to Graham stating:-

“Subject to the confirmation of the consent and availability of the Arbitrator I confirm my agreement to meet with him, Mr Smith, Mrs Garms and yourself on Wednesday 5 October 1994, or such other date as the Arbitrator is available. …”

“The purpose of the meeting is to address the means by which these Arbitrations may be progressed promptly. In particularly the meeting will focus on issues relating to the production of documents both by Telecom and between the parties.” (GS-CAV 205)

Even though Graham Schorer and Alan Smith continued to raise the production of document issues with Dr Hughes from February 1994, the meeting of 5th October, 1994 never took place.  In Dr Hughes’ letter to Warwick Smith, dated 12th May, 1995 (see below), he actually blames the poor timeframe in the Arbitration Agreement for the production of documents, as one of the reasons the Arbitration Agreement was not credible.

Although Dr Hughes did not convene this meeting to discuss the production of documents between the aforementioned parties, as will be seen from the oral hearing discussed below, a meeting to discuss Telstra’s request for documents from Alan was convened.  Are we to assume some sort of favouritism by the arbitrator?

During the AUSTEL COT report period, in April 1994, Cliff Mathieson, a Technical Advisor to AUSTEL, asked Alan to keep AUSTEL informed of any evidence he found during his arbitration, that might assist AUSTEL in their investigations into 008/1800 billing and short-duration call problems.  AUSTEL actually wrote to Telstra’s Steve Black on 10th June, 1994 (on Alan’s behalf), expressing concern at the problems he was experiencing with sending and receiving faxes.  To keep AUSTEL up to date, Alan writes to them, on 3rd October, 1994 providing evidence, using Telstra’s own data, which showed they charged Alan for two non-connected recorded voice faults (RVA) on 27th May, 1994.  Alan’s evidence was supported by the fact that the person who complained about these two faults was his Arbitration Claim Advisor, Gary Ellicot, ex-national crime detective.

This letter to AUSTEL on 3rd October, 1994 later became pivotal to Alan’s increasing anger, particularly when he then received the following information from Dr Hughes in a letter dated 15th November, 1994:-

“As I have indicated previously, I believe it would be inappropriate for me to order the production of documents in connection with the preparation of your claim, until Telecom has submitted it defence. I will then understand the parameters of the claim.” (AS-CAV)

Alan’s frustration is clear from his response, dated 27th November, 1994:-

“I refer to your letter dated 15 November, 1994.”

“In paragraph three you have noted that, if newly released F.O.I. material is made available by Telecom, and if that makes it necessary for me to amend my claim, I should advise you accordingly.”

“I have continually corresponded with both yourself and Telecom about my concerns with regard to the conduct of Telecom Management; Simon Chalmers; Freehill, Hollingdale & Page and their delaying tactics. Their drip feeding procedure, where the release of these F.O.I. documents is some twelve months late, has disadvantaged me in the preparation of my submission under the Fast Track Arbitration Procedure.”

“Newly released documents on their own may only show limited evidence, painting a small picture. However, had this newly released F.O.I. material been released some twelve months ago, as it should have been under the F.O.I. Act, this material, when combined with documents already released, would have helped in many instances to further the point made on certain issues.”

“Telecom Management, by using this destructive system, has disadvantaged C.O.T. and its members throughout this Arbitration Procedure. By not allowing all the evidence to be viewed by C.O.T., Telecom has stopped us from substantiating all our claims with all the available material. ‘A Jigsaw Puzzle Can Only Be Finished When All The Pieces Are Tabled’: and didn’t Telecom Management play this to a break! …”

“So, in response to your letter of 15th November, 1994: How can I amend my claim? Telecom have already had five months to view my first submission as presented in June, 1994, and three months to view my second submission presented in August, 1994. I am already living on borrowed time, in more ways than one, and each delayed week is having an effect, particularly where advertising for next year is concerned – this has already been disadvantaged. …”

“I do not have the resources to have a professional team view these additional F.O.I. documents which have just been released by Telecom. I have spent time writing reference to these examples and enough is enough. All future F.O.I. that has not been provided will have to stay put. I am today mentally exhausted and unable to continue taking part in Telecom’s façade, their Merry Go Round.”

“I thank you for your time, and that of the Resource Team.” (AS-CAV 119)

This letter was sent the following day, 28th November, and that evening, totally overcome with anger and frustration, Alan smashed a single barrel shotgun that had been given to him by his father-in-law, Noel Wagner, some 16 or 17 years earlier.

LODGEMENT OF ARBITRATION CLAIM

The first part of Alan’s claim was lodged with Dr Hughes on 15th June, 1994.  Paul Rumble, of Telstra’s Customer Response Unit and Graham Schorer, COT spokesperson, were also at that meeting.  At the time, Alan makes it very clear to Dr Hughes and Mr Rumble that:-

  • The FOI documents Telstra had supplied had not been numbered so Alan numbered them, from 1 to 2,158.
  • It was extremely difficult to submit a complete claim when Telstra provided so much heavily censored documentation without schedules.
  • Because of these problems, Alan would therefore be submitting further documents to support his submitted claim,
  • George Close, Alan’s technical advisor, had not yet received the relevant technical data requested under FOI and so his report would be somewhat delayed.

The Arbitration Agreement states the arbitrator should pass the claim onto Telstra WHEN THE CLAIM IS COMPLETE, and allow Telstra one month to complete their defence.  George Close was not able to submit his report until late in August 1994, but a letter from Dr Hughes to Mr Rumble on 22nd June shows Dr Hughes sent Alan’s interim claim to Telstra on 15th June.  Since Alan’s claim was not complete until George’s report was submitted, this meant Dr Hughes was arranging for Telstra to have at least two months, from first receiving Alan’s interim claim, to present their defence.  As it happened, Telstra did not submit their defence until 12th December, 1994 – almost six months after receiving Alan’s interim claim.  How much more one-sided can a process be?

This 13-page document, dated 30th March, 1995 from FHCA to Warwick Smith, is submitted in full in the CAV Peter Bartlett Target.  Two relevant pages confirm FHCA noted that Alan’s claim was not formally certified as complete until November 1994. (AS-CAV 103)

What this FHCA letter doesn’t say is, that due to Telstra withholding FOI documents from Alan, Alan was still drip-feeding claim material to Dr Hughes, but this material was never assessed.

10th October, 1994:  Alan again complains to Telstra regarding the SVT tests.

Like his letter of 2nd October, 1994 (AS-CAV 106), this SVT complaint was also copied to Dr Hughes and Warwick Smith.  Likewise, it received no response (AS-CAV 107).

Alan’s one-sided Oral Hearing

11th October, 1994:  Back to the Oral Hearing with Telstra, see (AS-CAV 101).

When Alan is unable to comply with Telstra’s interrogatories, Telstra asks the arbitrator to convene an Oral Hearing, which he does.  Dr Hughes advises Alan to attend this hearing alone as Telstra’s lawyers won’t be involved but, as the transcript of this gruelling, five-hour, non-stop examination shows, Telstra is actually represented by two officers who have some sought of legal expertise: Steve Black and Ted Benjamin. Note, the FTAP rules prohibit cross-examination.

The transcript of this hearing also shows Dr Hughes accepts Alan’s claim material as factual and enters it into evidence.  Claim document SM18 is highlighted and discussed at great length at this hearing.  Evidence, inadvertently provided by Dr Hughes’s secretary in August 1995, confirms documents SM 18 & SM 19 do not appear on the list of assessed documents, in the DMR and Lane Report.  See Alan Smith Relevant Information File, exhibit 5, DMR and Lane Report.

Comparing Alan’s summary at exhibit AS-CAV 322-A to F  with exhibit AS-CAV 108 shows the comprehensive log of complaints he provided to the arbitrator during his arbitration. Page 2 in the DMR and Lane report states: “A comprehensive log of Mr Smith’s complaints does not appear to exist.” (AS-CAV 322-C)  The listed numbers in the far right column of AS-CAV 108 comprise the number of the claim document as well also a cross-reference to a brief description of the document.  How much more comprehensive could the first 10 pages of this 12-page document be?

Transcript pages 37 to 41 (AS-CAV 106) show Dr Hughes explaining that if Alan wants him to address the phone bugging issues in his claim then Telstra had the right to order him to provide relevant information to support the claim.  Twice Alan confirms he wants the phone bugging and privacy issues to remain in his claim.  Steve Black’s letter to Warwick Smith, dated 17th October, 1994 regarding the voice-bugging issues, states:-

“Mr Smith has also raised Telecom’s fault investigation procedures (including voice monitoring) as an issue in his claim which is under arbitration. Telecom is currently in the process of responding to that claim under the agreed arbitration procedure.” (AS-CAV 109)

Please note:  Neither, Telstra (in their defence) nor Dr Hughes (in his award) addressed the phone-bugging claim issues, even though the Arbitration Agreement, clause 11, states, “The Arbitrator’s reasons will be set out in full in writing and referred to in the Arbitrator’s award.” (AS-CAV 110)

On 27th October, and again on 3rd November, 1994 Alan wrote to Telstra seeking relevant CCS7 and CCAS Bell Canada International data (AS-CAV 111 and AS-CAV112).  Some of this data was included in documents supposedly held in Telstra’s archives and Telstra had previously advised the arbitrator the documents were ready for release (AS-CAV 96 and AS-CAV 99).

The transcript shows Alan’s claim document (“Smith 18”).  The arbitrator and Alan spoke at great length about this billing document (AS-CAV 101).

Telstra Minimise their Liability

13th October, 1994:  The Office of the Hon Michael Lee, MP, Minister for Communications, receives AUSTEL FOI document folio 94/0269-05 (22): a Telstra whistleblower letter, originally sent to Parliament House, Canberra.  This letter alleges two of Telstra’s executives, Steve Black and Rod Pollock, were involved in altering or removing information on documents requested by the COT claimants under FOI.

Please note:  someone has added a handwritten comment on page one, pointing to Rod Pollock’s name and noting, “Warwick Smith has been critical of Pollock on some issues.”  In the Alan Smith – CAV Chronology LGE file, Alan provides documentation confirming that, on 16th May, 1994 he left irrefutable evidence with Sue Harlow (Deputy TIO), for her to pass on to Warwick Smith.  He also left his Statutory Declaration naming Rod Pollock as one of the Telstra employees who removed information on requested documents or didn’t provide the correct documentation that should have accompanied existing received FOI documents.  Did Alan’s evidence force Warwick Smith to ask questions prompting the whistleblower to come forward? (GS-CAV 206)

Comment:

Warwick Smith must have told someone – either in Government or in a regulatory position – that two different sources named Rod Pollock.

The whistleblower’s letter was passed to Graham Schorer by the Regulator (then the ACA, now ACMA) during the Major Fraud Group inquiry.  Despite this type of information being available to both the TIO and the arbitrator, still nothing was done during Alan and Graham’s arbitrations to investigate these FOI matters.

In this letter under the heading, “Concerns and Issues”, this document states:-

“Mr Steven Black Group General Manager of Customer Affairs who has the charter to work to address and compensate Telecom’s ‘COT’ customers as well as the management of other customer issues related to Telecom is involved in and initiates conduct and work practices that are totally unethical. …”

“There are three main areas which Steve Black and his senior executives have sought to influence and manipulate:

  • Remove or change clear information on the position of liability
  • Diminish the level of compensation payable to COT customers
  • Dismissive of breaches in relation to matters regarding customer privacy.”

“In relation to the Robert Bray case Steve Black has sought to cover up the true facts of disclosure of customer information. Particularly he has sought to cover up ‘broadcasting’ of the customers [sic] private information.”

10th November, 1994:  Dr Hughes writes to Mr Schorer:-

“Telecom has indicated in its letter of 26 October 1994 that it is ‘keen to have all issues in dispute’ dealt with in the arbitration process. It is, therefore, prepared to classify the allegations of unauthorised telephone tapping as falling within the description of ‘alleged service difficulties, problems and faults’. …”

“If you submit a claim which makes no reference to the allegations of unauthorised telephone tapping, and if Telecom makes no comment about the exclusion of such allegations, then they will fall outside the scope of this arbitration.” (GS-CAV 207)

Alan Smith raised the issue of his phone being illegally tapped on 15th June, 1994 in his Letter of Claim, in his response to Telstra’s interrogatories on 16th September, 1994 and during his Oral Arbitration Hearing on 11th October, 1994.  Since Alan’s phone tapping issues were never addressed in his arbitration, did Dr Hughes ever intend to address Graham Schorer’s phone tapping issues? (or did he plan to ignore them, as he ignored them in Alan’s case?).

The wording “alleged service difficulties and faults” is incorporated into clause 10.2.2 of the Arbitration Agreement.

This letter from Dr Hughes further confirms his knowledge that the phone bugging issues were part of the arbitration procedure and were to be addressed by Telstra during the procedure.  Why did Dr Hughes allow Telstra not to address the information contained in Alan’s arbitration claim, which confirmed the AFP transcript stated Telstra had listened to Alan’s phone conversations without his knowledge or consent?

11th November, 1994:  John Wynack, Director of Investigations at the Commonwealth Ombudsman’s Office, writes to Frank Blount, Telstra’s CEO.  The letter is copied to Dr Hughes and Warwick Smith and indicates how desperate Alan was becoming.  Alan believes that Mr Wynack made it quite clear to Mr Blount that he would be more than a little concerned if Alan’s allegations were proved correct regarding Telstra deliberately blanking out information on documents previously supplied under FOI and withholding relevant documents from Alan.  Mr Wynack’s concerns were justified. (AS-CAV 114)

In Dr Hughes’ draft award on page 4 at 2.3, he states:-

“Although the time taken for completion of the arbitration may have been longer than initially anticipated, I hold neither party and no person responsible. Indeed, I consider the matter has proceeded expeditiously in all the circumstances. Both parties have co-operated fully.(AS-CAV 115)

What is amazing about this draft award, inadvertently provided by the TIO office 2001, is that at the side column of this clause someone has handwritten Do we really want to say this?”  Did someone believe the arbitration process was not being as transparent as it should have been?  In the final award, there is no clause 2.3. Comparing both the draft and final awards show that the technical findings are the same; however, it is evident, from a date discussed in the draft, the technical findings were prepared before the TIO appointed DMR Canada as the Technical Consultant.

Telstra admitted, to Mr Pinnock on 7th September, 1995 it withheld at least 40 per cent of the documents Alan requested during his arbitration until after Dr Hughes deliberated on his claim. (AS-CAV 116)

It is significant that Dr Hughes knew Telstra were not abiding by the FOI Act, including not abiding to the agreed Process of Discovery.  On page 4 of John Pinnock’s report to the Senate, dated 26th September, 1997 he states:-

“In the process leading up to the development of the Arbitration procedures, the Claimants were told that documents would be made available under the Freedom of Information Act.” (AS-CAV 117)

As per section 15(1) of the Ombudsman’s Act 1976, Ms Philippa Smith, Commonwealth Ombudsman, released her findings regarding Graham Schorer’s FOI complaints against Telstra:-

121:     “In my opinion, Telecom acted unreasonable in failing to notify Mr Schorer that the (FOI) fee was waived when Mr Schorer met Telecom’s condition by signing the FTAP on 21 April 1994.”

138:     In my opinion, Telecom, it was unreasonable for Telecom to impose the condition in the letter of 15 March 1994 to Mr Schorer that it would provide certain documents after receiving confirmation that the FTSP was to proceed.”

140:     “In my opinion, Telecom acted unreasonable in refusing access to those documents for a further five weeks. (Delay in granting access to the files mentioned in B above)”

151:     “In my opinion, it was unreasonable for Telecom to delay sending the documents while the solicitors examined them for contentious issues. (Verification of exemptions)”

155:     “In my opinion, it was unreasonable for Telecom to delay sending the documents while the solicitors examined the documents to verify that exemptions had been applied wherever possible.”

Ms Smith’s full report is attached to Graham Schorer’s CAV Relevant Information file exhibit 9.

Alan Smith writes to Dr Hughes (GS-CAV 209), copying a letter from John Wynack, also dated 11th November, 1994 to Telstra’s CEO Frank Blount, which states:-

“At the request of Ms Geary, I am notifying you of the details of the complaints made to the Ombudsman by Mr Alan Smith. …

24.3.94            Telecom claimed that documents given to Telecom by Mr Smith in 1992 had been destroyed or lost.

Telecom unreasonably refused to give any further documents to Mr Smith.

Telecom has lost or destroyed a number of files relating to his contacts with Telecom prior to 1991. …

5.5.94              Telecom unreasonably delaying providing access to many documents. …

7.11.94            Telecom unreasonably refused to provide the ‘Portland/Cape Bridgewater Log Book associated with the RCM at Cape Bridgewater’ for the period 2 June 1993 to 6 March 1994.” (GS-CAV 209-B )

Dr Hughes plays arbitrator

21st November, 1994:  After sending his letter of 15th November (AS-CAV 118), but before Alan’s reply is drafted, Dr Hughes writes to Alan again, with the following statement:-

“If I form the view, or if the Resource Unit forms the view, that there are any relevant documents in the possession of either party which have been deliberately or inadvertently withheld, I shall make an appropriate order for production.” (AS 120)

In relation to this statement, consider the whistleblower’s letter, of 13th October, 1994 previously discussed:-

“Circumstances and past actions of senior staff within Telecom have made it necessary to bring your attention to some very concerning facts that can no longer be ignored or dismissed.”

“We hesitate to bring the following instances to your attention but decided it was necessary as this situation is far too serious to be allowed to continue, and attempts we have made within the organisation to bring our concerns to light have fallen unheard. …”

“The management of COT customers by Rod Pollock is nothing more than an unprofessional, adversorial approach towards customers. …”

“Their general position has been to sit behind legal word and its many interpretations in so doing avoiding full disclosure of information [sic]. …”

“There are three main areas which Steve Black and his senior executives have sought to influence and manipulate:

  1. Remove or change clear information on the position of liability.
  2. Diminish the level of compensation payable to COT customers.
  3. Dismissive of breaches in relation to matters regarding customer’s Privacy.” (AS-CAV 79)

Rod Pollock and Steve Black were Telstra’s Liaison Officers in Alan’s arbitration.  The situation becomes even more fraught because Rod Pollock was in charge of the release of FOI documents during Alan and Graham’s arbitrations – a fact that probably goes a long way towards explaining why so many requested documents were never supplied!  Rod Pollock wrote to Dr Hughes, informing him Telstra had the information Alan was requesting.  What was going on between Dr Hughes and Rod Pollock to make Dr Hughes ignore this?  Why didn’t Dr Hughes order Telstra to provide this material for Alan and Graham’s Technical Advisor when he, George Close, had asked for it as part of his report preparation?

Warwick Smith’s name is handwritten on this 13th October letter to Parliament and, as the TIO, he was the administrator of my arbitration.  Alan and Graham believe that, along with AUSTEL, Warwick Smith probably received a copy of this letter.  Why where the COT claimants never alerted to the existence of this letter?  Being unaware of this accusation of unlawful acts by senior Telstra staff severely disadvantaged them in their claim attempts, and the right to have the matter addressed legally.  Was Dr Hughes also aware of this letter?

After Alan’s arbitration, he received a letter from Telstra under FOI.  This letter, arbitration number L69364/5, confirms that Dr Hughes wrote to Telstra on 30 November, 1994 stating:-

“Whilst I am prepared to grant an extension of time in the Smith arbitration, I am doing so in the hope that in the spirit of co-operation, Telecom will use its best efforts to submit its defences in Garms and Valkobi on or before the same date.”

“If Telecom is able to submit all three defences on or about the same date, I shall prevail upon the claimants to submit their replies (if any) prior to Christmas. …”

“I do not propose forwarding a copy of this letter to the claimants as I do not consider it appropriate for me to discuss any individual’s claim with other Claimants.” (AS-CAV 121)

This certainly appears to indicate that Dr Hughes was willing to grant extra time in Alan’s arbitration as a trade-off in relation to Telstra’s defence on the other two COT claimants, Garms and Valkobi, who were, like Alan, still waiting for documents so they could finalise their claims.  On the other hand, how could any of them be expected to successfully submit their replies (if any) by Christmas, when Dr Hughes knew Telstra had still not supplied the documents they needed to support their claims? Nothing adds up.

In Alan’s own case, it also seems that Dr Hughes had completely forgotten his previous letter of 21st November (see above).

Telstra’s own records of Alan’s complaints show that he was still suffering the same problems that sent him into arbitration in the first place, right through his arbitration until 1995.  How could Alan’s 15th June, 1994 letter of claim be successfully investigated when the problems and faults were still prevalent on the day the arbitrator brought down his technical findings contained in his award?

Four letters the FHCA admitted to withholding from Alan during his arbitration

  1. 4th October 1994: AUSTEL’s Bruce Matthews letter to Steve Black asking questions of Mr Black regarding the discrepancies in Alan’s 008 service line and (on average) 11 per cent incorrect charging on his facsimile 267230 line. (AS-CAV 126)
  2. 11th November 1994: Ted Benjamin’s response to Bruce Matthews’ letter, noting, “Each of the questions put by you in your letter of 4 October, 1994 will be answered as part of Telecom’s defence to Mr Smith’s claims lodged under the Fast Track Arbitration (AS-CAV 127)
  3. 1st December 1994: Bruce Matthews’ letter to Ted Benjamin, stating, I note that your letter states that ‘Each of the questions put by you in your letter of 4 October 1994 will be answered as part of Telecom’s to Mr Smith’s claim lodged under the Fast Track Arbitration Procedure.’ ” (AS-CAV 128)
  4. 16th December 1994: Ted Benjamin’s letter to Dr Hughes, with the three letters (AS-CAV 126, AS-CAV 127, and AS-CAV 128) Mr Benjamin states:-

“The question has also been raised of whether discussion between yourself and Austel on the content of the claim and defence in Mr Smith’s arbitration might itself breach the confidentiality rules of the Fast Track Arbitration Procedure.”

“The simplest way forward may be for Mr Smith and Telecom and yourself to all confirm in writing that this information can be provided to Austel if this meets with your approval.” (AS-CAV 129)

Alan received none of these letters during his arbitration.

Clause 6 of the Arbitration Agreement states:-

“A copy of all documents and correspondence forwarded by a party to the Arbitrator shall be forwarded by the Arbitrator to the Special Counsel and the other party.” (AS-CAV 130)

Sue Hodgkinson, FHCA, wrote to Dr Hughes, (15 MONTHS) after Alan’s arbitration, on 2nd August, 1996 admitting to withholding the above letters.  This is addressed in more detail later.

5th December 1994:  Graham Schorer writes to Dr Hughes stating:-

“Telecom have knowingly violated the FOI Act and their obligations to supply myself with Telecom documents in accordance with my valid FOI applications. …

Telecom even gave an undertaking to the Chairman of Austel, Mr Robin Davey to pass on to myself and the other COT members on the 22nd November 1993 that Telecom undertook to fast track mine and the other COT members FOI applications prior to Mr Davey emphasising that Telecom were serious in withdrawing from all negotiations if I the other COT members did not sign the fast track seminar proposal by 5.00 pm Tuesday, 23rd November 1993. …

Peta of Warwick Smith’s office can substantiate that Telecom is knowingly misleading other COT members regarding Telecom supply of documents [sic].” (GS-CAV 210)

TELSRA’s FLAWED DEFENCE DOCUMENT B004

Page 26 (index)

23rd June 1994Smith reported he received a call from Canberra.  A minute after hanging up, phone received one burst of ring. Few mins later Schorer rang from 287 7099.  Said he had just called & received busy tone. Smith believes his phone takes up to 90 secs to release.”

23rd June 1994Smith reported that his 008 number service had long post dialling delays and the phone would give 1-2 bursts of ring after he finished a call.” (AS-CAV 122-A)

Page 50

“On 19th August 1994, Smith reported that the Australian Federal Police had been trying to call him from Canberra via his 008 number and got busy for 1 hour at approximately 11.10 am.” (AS-CAV 122-B)

These three examples show Telstra defending faults Alan registered AFTER he submitted his letter of claim.  The faults were not fixed and the arbitration, set up by AUSTEL to fix the phone problems and compensate the claimants, certainly failed, in Alan’s case at least.  How could the arbitrator arrive at an accurate compensation figure when it was obvious the faults were going to continue after he had finished his award?

IMPORTANT

Exhibits AS-CAV 122-C, AS-CAV 122 -D and AS-CAV 122-E are three Telstra FOI documents confirming Telstra was aware this post-dialling delay 008/1800 fault was a national RVA problem in October and November 1993 (also see exhibits AS – CAV 35 to 37).  Also, exhibit AS-CAV 122-F is a letter from AUSTEL to Telstra’s Steve Black, dated 27th January, 1994 alerting him to the same type of 008 short-duration calls Alan’s customers were complaining about.  This included a Statutory Declaration provided to AUSTEL by Ms Tina Velthuyzen declaring having heard repeatedly a recorded message when ringing Alan’s 008 number.  The recorded message stated the number you are calling is not connected.  Ms Velthuyzen’s sworn testament is exhibit AS – CAV 39. Exhibit AS-CAV 122-G is a Telstra internal letter, dated 25 November, 1993 stating:-

“The following is an assessment of the individual disputes highlighted by Mr Smith. From the information given, little more can be offered for explanation than ‘This is not the way it should work, we need to investigate to find the cause.’

When Frank Blount, Telstra’s CEO, left Telstra in 1996 he co-published a manuscript entitled, Managing in Australia.  On pages 132 and 133, the author exposes the problems Telstra were hiding from their 1800 customers:

___

“[A] young woman arrived in his office whom Blount learned was a bright MBA graduate with responsibility for the 1-800 product. Again, Blount recalls the conversation:

Blount:          ‘I want to talk about the 1-800 service.’

Staff:              ‘Yes sir’

Blount:          ‘There are some issues that have arisen on the product management side, specifically maintenance of the product, fixing some problems with it how it is billed.’

Staff:              ‘I know the type of things you are talking about, sir, because we studied product management in school, but, strictly speaking, my job was to launch the product. I have no way of knowing how it performs once it has been launched.’

“Blount was shocked, but his anxiety level continued to rise when he discovered this wasn’t an isolated problem. …”

“The picture that emerged made it crystal clear that performance was sub-standard.” (AS-CAV 122-I)

___

And here Alan was in 1994/95, in a legal nightmare with the arbitration procedure having already cost him in excess of a $200,000 dollars (to prepare his claim), and here was Telstra, Australia’s largest Corporation, hiding their knowledge and awareness regarding this 1800 problem!

Boo4 and Verification testing

Peter Gamble’s witness statement

Concerning the Service Verification Tests (SVT), Peter Gamble states, at point 38:-

“The service passed all of the Customer Specific Line Tests and the two Public Network Call Delivery Tests that were carried out.” (AS-CAV 122-H)

On 27th July, 2007 Brian Hodge, B Tech, MBE; Technical Consultant, provided Alan with a Technical Report (see Appendix 1) confirming Telstra’s own CCAS data for the SVT tests do not support Mr Gamble’s Witness Statement.

Two letters (AS-CAV 106 and AS-CAV 107, mentioned previously) confirm this Statutory Declaration is very far from the truth.  Both Cathy and Alan are still willing to swear under oath that they gave one of the three technicians so many documents confirming the problems were not fixed that the young lad was aghast, and Peter Gamble, the Chief Engineer in charge, pulled the lad away in embarrassment.  Alan has already referred to the problems Peter Gamble had with trying to get the SVT equipment to function and Alan’s believes, if Telstra had re-tested his phone lines correctly, they would have discovered the faults were still evident.  As already reported, Telstra later knowingly used the results of this SVT in their defence despite AUSTEL advising them the tests were deficient.

Exhibit AS-CAV 123, a letter from AUSTEL to Peter Gamble, dated 11th October, 1994 confirms the SVT (testing process) was deficient.

A 16th November, 1994 letter from AUSTEL to Steve Black, confirms the Regulator wanted Mr Black to provide information as to what Telstra intended doing in regards to the deficient tests conducted at the Cape Bridgewater Holiday Camp. (AS-CAV 124).

Telstra’s 12th December, 1994 defence included numerous inaccuracies and misleading Witness Statements.  The flawed defence documents are discussed throughout this Chronology, but it is important to refer to Telstra’s letter to Dr Hughes, on 23rd December, 1994 which includes this statement:-

“The purpose of this letter is to update you on the status of a voluntary review that Telecom had conducted of exemptions applied to documents referrable to requests made by the above persons for access under the Freedom of Information Act.”

The names referred to were Smith, Garms and Gillan.  Eleven days after Telstra submitted their defence, they had still not provided Alan with the documents he needed.  This meant Telstra only had to defend part of the claim that Alan could have submitted, if Telstra abided by the FOI Act.

20th December, 1994:  Telstra’s letter to Alan, titled FOI – Internal Review, notes:-

“I refer to Telecom’s letter to you dated 16 December 1994 which was delivered with a box of documents being specific to your telephone service.”

Why did Telstra wait until after they had submitted their Defence before they provided this FOI information?

Please note: between 4th October and 16th December, 1994 Telstra and AUSTEL generated enough letters between them (and copied to Dr Hughes) the devil himself would be convinced there were “forces at work” intent on stopping Telstra and Dr Hughes from addressing Alan’s billing claim documents. (AS-CAV 125)

23rd December, 1994:  Questions are raised regarding Ian Joblin’s Witness Statement.

Ian Joblin was a Clinical Psychologist appointed by Telstra to ascertain the state of mind of the COT claimants.  Before he interviewed Alan, Telstra supplied him with at least one copy of the Cape Bridgewater Addendum BCI Report that they knew was flawed, but which supported their case.  As noted previously, under the Bell Canada report heading, Telstra wrote to Bell Canada about problems with this report.  If Alan had seen a copy of Telstra’s letter to Bell Canada, he would not only have had grounds to challenge the report itself, because of its numerous faults, but he could also have challenged the arbitration, and Ian Joblin’s Witness Statement.

In a letter dated 23rd December, 1994 Telstra notified Dr Hughes they had supplied Mr Joblin with “1AJ-I”, before he assessed the state of Alan’s mental health.  Further Telstra evidence has since been provided to the Australian Government and AFP in support of this.  According to Mr Joblin’s Witness Statement, he also received “IAJ-2” as well.  In this letter, Telstra writes:-

“I note that the copy in Telecom’s set of defence documents is signed and complete and cannot understand how an unsigned copy went to you.” (AS-CAV 144)

Question:

Why didn’t the Arbitrator or Administrator correctly investigate the illegal act of a Witness Statement being submitted during an arbitration process when it was only signed by Telstra’s solicitor, and not Ian Joblin, the witness?

FOI Documents withheld until after Telstra submitted their defence

24th December, 1994:  After Telstra submits their arbitration defence, Alan receives three Telstra FOI document, C04006, C04007 and C04008, confirming Telstra was aware of these previous problems (AS – CAV 5).  Even though Alan attaches these documents to his reply to Telstra, it appears the TIO-appointed Technical Consultants, DMR and Lane, did not receive them.

It is most important to recap below, the devastation these problems caused Alan and his then-partner, Karen Gladman.

Not long after Karen moved in, it became blatantly obvious the phone problems were not fixed by the installation of the new exchange.  People were still reporting:-

  • they couldn’t get through to the camp on the phone and that either the line rang as if they weren’t there, and the answering machine didn’t pick up; or
  • they received a constant engaged signal.

Many were reporting reaching the recorded message (RVA) stating that the phone line was not connected.  Telstra FOI document C04006, acknowledges the RVA was often heard if lines into Cape Bridgewater were congested.  Why were Karen and Alan told this was NOT a problem?

In January 1992, aware the phone problems were not resolved, in an attempt to battle on Alan and Karen decided to contact various over-40s singles clubs, by mail and personal visits, to entice them to visit Cape Bridgewater on weekends for social gatherings with other similar clubs.

Alan personally visited clubs such as “the Australian Singles Centre” in Hartwell, “Phoenix Singles” in Camberwell, “Frenze” in Box Hill, “Capers” in the City of Knox and “Partners in Dining” @ Warrnambool.  After each visit, Alan heard, from at least one (and sometimes three or four people), stories about the numerous problems they encountered in trying to secure a booking or make an enquiry of their business by telephone.

The RVA stating: “The number you are calling is not connected,” was, in Alan’s opinion, the most insidious and damaging of all the faults.  Telstra’s Senior Management agreed with Alan on this one!  Telstra FOI documents A03544 and C00757 confirm their concerns regarding the RVA fault. Document C00757, written on 3 November, 1993 states the words of this RVA message needs to change as this message tends to give the caller the impression that the business they are calling has ceased trading, and they should try another trader”. (AS – CAV 6)

The correspondence discussed for the dates of 4th October and 11th November, 1994 confirms callers were still hearing the RVA faults at the holiday camp as late at May 1994, one month into Alan’s arbitration and five years after Telstra acknowledged this was a major network fault.  Telstra file notes, dated 16 January, 1998 confirm this issue and are held in Government archives.

28th December, 1994:  Alan faxes two letters to Dr Hughes asking for access to all CCS7 and CCAS data, including all the Bell Canada working notes for the tests at Cape Bridgewater on 5th, 8th and 9th November 1993, because he is concerned Telstra misled the arbitration process with this report.  Alan concludes this letter saying:-

“This information sought by the Cape Bridgewater Holiday Camp, is vital to assess Telecom’s defence of their Network during the Bell Canada testing period.” (AS-CAV 131)

Dr Hughes faxes Alan’s letters to Ted Benjamin noting:-

“As you are aware, I have the power under clause 7.6 of the Fast-Track Arbitration Procedure to order the production of documentation.” (AS-CAV 132)

At no time, during Alan’s arbitration, did Dr Hughes execute this power.

Late delivery of FOI documents

6th January, 1995:  Alan again asks Dr Hughes to access numerous documentation from Telstra so Alan can respond to their defence. Alan states the information is needed “to substantiate incorrect details as presented in Telecom’s Defence Documents”.

Alan received no reply because, as he discovered on 12th January, Dr Hughes was away on holiday and there was no one in his office who would help Alan regarding an extension of time to submit his reply to Telstra’s defence.  Alan states in the postscript:-

“I am now disadvantaged even further. It is the 6th January, 1995, and still my own Resource Team have not been provided with Telecom’s defence on disk.” (AS-CAV 133)

Alan had only one month after Telstra’s submission of their Defence, on 12th December, to prepare and lodge his reply.  Of course, this was the busiest time of the year for Alan’s business.  To make the situation even worse, Telstra released 24,000 FOI documents that Alan received on 24th December.  Was this time line pre-planned to cause him the most possible trouble in preparing his reply?  Did Telstra plan to dump all these documents on Alan at his busiest time AND while the arbitrator was away on holidays?  Did Telstra deliberately use the two-week Christmas legal fraternity shutdown for lawyers for this document dump?

And so, under enormous stress, Alan, without access to the arbitrator, began to sort through all these documents in the hope that he would find something to help him with the preparation of his reply – which he finally managed to lodge on 20th January, 1995 incomplete.

13th January, 1995:  Ted Benjamin writes to Dr Hughes:-

I refer to your letter dated 27 (sic) December 1994 enclosing a copy of a letter dated 28 December 1994 from Mr Smith. …”

Mr Smith has now requested CCAS and CCS7 call statistics for the dates 5 November, 8 November and 9 November 1993. Telecom has not denied Mr Smith access to these documents but is unable to provide documents which do not, as far as I am aware, exist for the specific dates requested by Mr Smith.” (AS-CAV 134)

The BCI Report, used by Telstra as defence material and provided to the Resource Unit by the arbitrator as arbitration library material, states they used the CCS7 data at Cape Bridgewater RCM to trap the tests calls generated on 4, 5, 6, 8 and 9 November, 1993.  It has now been confirmed by Brian Hodge, B Tech, MBA, in his Report dated 27th July, 2007 that the RCM system could never have facilitated the CCS7 data which the BCI Report states captured the 13,000 successful tests generated to Cape Bridgewater.  Brian Hodge provided a detailed report: see Alan Smith CAV Relevant Information file exhibit 12.

Therefore, Ted Benjamin was correct when he stated the CCS7 data for those dates did not exist.  Which exchange received these alleged 13,000 BCI tests?

On 26th May, 1995 two weeks after Dr Hughes brought down his award, Telstra supplied Alan with FOI documents numbered N00005, N00006 and N00037.  These documents confirm Telstra knew, as early as 23rd August, 1994 (three months before they submitted the BCI tests as Defence material), that at least one day’s testing was impracticable (AS-CAV 135 and AS-CAV 136).  Brian Hodges’ Report confirms NONE of the five tests could have been generated through the CCS7 equipment.

TF 200 report

The TF 200 report was one of the main documents submitted by Telstra in their Defence.  It refers to the same EXICOM TF200 problem originally raised with Cliff Mathieson of AUSTEL, on 26th April, 1994 and which Alan referred to previously asAS-CAV 71 to 74.  Mr Mathieson believed the fault was in the RCM exchange at Cape Bridgewater.

Telstra’s Peter Gamble tested Alan’s TF200 at his Melbourne office on 26th April and, after testing the phone, reported he believed a heat build-up in the unmanned Cape Bridgewater RCM was causing the problem. (AS-CAV 71) and (AS-CAV 72) also support this theory.

Telstra fault records, FOI R37911, show Ross Anderson, a Portland Telstra technician, collected the EXICOM phone on 27th April and used it to make 18 test calls, without encountering any lock-up faults at all (AS-CAV 73).  Mr Anderson then forwarded the phone to Telstra’s laboratories for further testing.  Amazingly, the phone took nine days to reach the laboratory, arriving on 6th May and waiting another four days before laboratory testing commenced.  The report included a number of photos of the dissected phone, and stated the phone arrived at the laboratory in a very dirty condition and contained a sticky substance.

The laboratory staff concluded beer in the phone had caused the lock-up faults, which, remember, Ross Anderson was unable to find on the day he took the phone from Alan’s premises).  The full 29-page TF200 report is attached to the Ted Benjamin file Appendix 32.

This B004 report uses part of the TF200 report as Defence material. Pages 68 and 69 of Telstra’s main B004 arbitration report, state:-

“A brown sticky liquid substance which contained chemicals typically found in beer was found in the T200. This was causing the switch hook mechanism in the T200 to lock up. It is the customer’s responsibility to ensure that foreign substances are not introduced into their CPE (reference document to 4.02 which includes a detailed report of analysis of T200 which is also known as a TF200.” (AS-CAV 137 and AS-CAV 138)

After Alan received this report, he asked Dr Hughes to access, on his behalf, all the laboratory working-notes from Telstra, so Alan could discover how the laboratory technical staff arrived at their conclusion.  On 3rd March, 1995 Alan wrote again with the same question.  On 12th April, 1995 Telstra gave Dr Hughes another copy of the original completed report that they had already submitted in their Defence.  On 17th April, 1995 Alan wrote to Dr Hughes yet again, expressing his disgust at the 35 days it took Telstra to supply the wrong document, and saying:-

“I believed, when I asked the Arbitration Process to access, from Telecom, all written, original notes regarding the TF 200 (267 230), that this would include all original report notes and the contents of the TF 200 report, however, all I received from your office, by courier, was a copy of the report, in printed form, which had already been viewed in Telecom’s Defence documents.”

TF200 saga continues

On 28th November, 1995 six months after Dr Hughes deliberated on Alan’s claim, Telstra finally sent some of the laboratory working notes and graphs, under FOI.  One file note, FOI A64535, dated 26th May, 1995 confirms Telstra twice tested a TF 200 by pouring beer into it and leaving it overnight.  The note recorded the beer had dried out within 24 hours.  The second set of tests states the beer dried out within 48 hours. Since Alan’s TF 200 was removed from his premises 13 days before it was tested, hence the ‘beer’ residue is clearly suspect.

The Ted Benjamin Appendix 32 file confirms many discrepancies in Telstra’s TF200 Defence Report.  These documents alone, if supplied during Alan’s arbitration, would have been enough evidence to initiate an investigation by the Arbitration Technical Resource Unit.  Even the graphs show a wet substance of a high level, tested on the 25th, was almost dry by the 26th.  Yet, Telstra only submitted their first manufactured report to the arbitration, alleging the fault was caused by beer, while knowing the time frame between uplifting the phone from Alan’s premises to testing at the laboratory means this is impossible.

A brief summary before we get back to January 1995

  1. Brian Hodge, Technical Consultant, declared the BCI report, used in Alan’s arbitration as defence and library material, is fundamentally flawed.
  2. AUSTEL and Brian Hodge both declared the SVT process, conducted at Alan’s premises, on 29th September, 1994 was deficient.
  3. Telstra’s late-received laboratory working notes for the TF200 investigation do not coincide with Telstra’s TF200 Arbitration Report.

25th January, 1995:  Alan writes to Dr Hughes providing accompanying material confirming his 008/1800 account shows Telstra has a billing software problem in their network at least up and until 13th January, 1995 – four months after Telstra submitted the deficient SVT tests. (AS-CAV 139)

30th January, 1994:  Alan again writes to Dr Hughes, explaining many alarming facts and noting:-

“A ruling regarding information associated with the Defence Documents being presented in this manner must be addressed. I had no intention of drip feeding information to the Arbitration Dr Hughes, once my final Submission had been completed.”

“It is now thirteen months since the first of four FOI applications was presented to Telstra and yet, even after all this time, Telecom have not supplied the material sought: NNI documentation, technician’s diary notes, ELMI raw data, CCS7, CCAS and EOS data and voice monitoring fault records. Very little of this information has been supplied under the Arbitration Procedure.” (AS-CAV 146)

Alan also writes to John Wynack, Director of Investigations at the Commonwealth Ombudsman’s Office, noting:-

“Even at this late date, Telecom are still withholding documents requested under my FOI applications.” (AS-CAV 148)

In this same letter, Alan details other inaccuracies being reported by Telstra. For example, in regard to Commonwealth Ombudsman officer, Ms Jill Cardiff:-

“Telecom states that on 2/10/92 a faulty register was found and fixed five days later. This is again incorrect. The fault was detected on the 2/9/92 and fixed some 35 days later.…”

“We have faults down-played on the 2/9/92 by 30 days, we have deceptive and misleading statements to Ms Jill Cardiff, and now also to Ms Fay Hothuzen [sic].  It appears that Telecom will stop at nothing, just to starve C.O.T. and its members from gaining the truth.”

1st February, 1994:  Dr Hughes writes to Ted Benjamin re Alan’s 30th January letter:-

“I enclose copy letter received from the claimant dated 30 January 1995.”

“…I have the right to request that information and, if necessary, issue a subpoena.”

“I emphasise I have not formed any view of the matters raised in the claimant’s letter of 30 January 1995.” (AS-CAV 146)

15th February, 1995:  Alan’s letter to Dr Hughes again raises the SVT problems, noting:-

“My previous letters to you in January 22nd and 26th also confirmed we were still experiencing problems with our service lines.”

“As you are aware the verification testing was prepared in consultation with Austel and was to form the basis for determining whether the CoT cases individual telephones service was operating satisfactory at the time of our arbitration. Out previous statutory declarations confirmed the testing was not conducted as they should have under the agreed testing process.” (AS-CAV 140)

16th February, 1995:  Any reasonable person would have to conclude, after reading Graham Schorer’s letter of 5th December, 1994 and his letter to Dr Hughes (GS-CAV 211), there was something radically wrong with the way the arbitration procedure was conducted.  Even a non-legal-minded person would conclude there were forces at work, beyond the Arbitrator’s reasonable control, that interfered with the arbitration process.  Why did Dr Hughes ignore all these signs?  As shown below, Dr Hughes, Warwick Smith and Peter Bartlett, also ignored John Rundell’s letter, dated 18th April, 1995 warning them all there were forces at work that delayed the arbitration process. Did they act on this information or the information shown in Graham’s letter?  NO.

21st February, 1995:  Sussan Hodgkinson, of FHCA, visits Cape Bridgewater.  Alan and Cathy provide Ms Hodgkinson with a number of documents proving the business is much more than just a school holiday camp.  Alan has never seen this information again, not even after FHCA supposedly returned all of Alan’s submitted arbitration material.

2nd March, 1995:  Graham writes jointly to Telstra’s Joy Geary, Steve Black and Paul Haar, regarding the non-supply of the Bell Canada FOI information, including numerous complaints associated with the non-supply of further relevant FOI documents. (GS-CAV 212)

3rd March 1995: Alan writes to Dr Hughes, attacking the TF200 report:-

“I believe, as I have already stated in my reply to Telecom’s Defence Documents, that Telecom must show not only the phone and original photos taken of the phone when it was given to the laboratories, but also all evidence used by the laboratories to derive this information.” (AS-CAV 141)

Point 5.8 (a) in the Arbitrator’s Final Award is titled Faults Caused by Claimant.

The author states, “A simple example is said to involve the claimant leaving the phone off the hook.” (AS-CAV 143).

Why was the issue of a spilt liquid removed from the final award?  Did the author or Dr Hughes secretly investigate the TF200 report issue and discover the report was manufactured?  (By viewing many statements in Alan’s and other COT cases’ awards, it appears there was more than just Dr Hughes making the findings.)

7th March, 1995:  Ted Benjamin responds to Graham’s letter of 2nd March, noting:-

“I refer to your letter 2 March 1995 in which you state that Telecom has omitted to discover and supply raw data and summary reports that Telecom compiled on diskette and the working papers of the Telecom technicians associated with the monitoring testing programme being:-

  • The monitoring testing preformed [sic] by Telecom in accordance with Austel directive;
  • The monitoring and testing programme performed by Telecom technicians under the directives of Bell Canada International that became the first of the Bell Canada Reports produced in November 1993.”…

“On 22 February 1995 a set of data disks that Telecom had sought … were received. … We are currently arranging for them to be converted to DOS and once the data has been checked for privacy implications, (some of the files do not relate specifically to you or to the other 6 signatories of COT’s Shared Access Agreement), they will be forwarded to you.” (GS-CAV 213)

17th March, 1995:-  The Australian Senate writes to Graham Schorer.  Under the heading of “Telecommunications (Interception) Amendment Bill 1994”, it states:-

“Thank you for agreeing to participate in the Committee’s hearing on 21 March in Canberra. …”

“The Committee members who will be attending on the day will be Senators Cooney (Chair), Spindler (Deputy Chair), Ellison, Evans, Vanstone, McKieran and O’Chee.”

“The hearings are conducted with minimum formality. Witnesses are usually grouped in blocs although we suggest that you be available at the commencement of the hearing. You may wish to give some consideration to making a brief statement, 10 – 15 minutes …” (GS-CAV 214)

Alan Smith, Graham Schorer, Ann Garms and Robert Bray (from Ballarat) all spoke at this hearing and all introduced documents to support their claims that Telstra voice monitored their phone lines.

Before Alan left Melbourne to go to Canberra for this hearing, he phoned Warwick Smith regarding the evidence Alan obtained from AUSTEL, Telstra and the Australian Federal Police, and passed onto Dr Hughes and the TIO’s office, regarding Telstra’s interception of Alan’s phone conversations.  Alan called the TIO because he was concerned his appearance before the Senate Committee Hearing might interfere with the arbitration process, particularly regarding the phone interception matters. Warwick Smith assured Alan his arbitration interception issues were confidential, but stressed it was important to provide the evidence to the Senate Committee as well.

Not long after this conversation, Alan and Warwick Smith had a chance meeting at Tullamarine airport, and these same interception issues were discussed again.  At this point the TIO told Alan that, before his appointment as administrator of the COT arbitrations, the TIO believed the COT claimants, including Graham Schorer, were paranoid in their belief they were all under surveillance or being voice monitored, but since he had seen the evidence going through his office he had changed his mind.  This comment is interesting, because it shows the evidence the COT claimants were supplying was convincing, but it also raises the question of who, within the TIO’s office, was reading and vetting the claim material before it was passed on to the arbitrator?  More importantly, is this question of the TIO’s office possibly vetting interception documents relating to the letter Steve Black wrote to Warwick Smith on 11th July, 1994 which acknowledges Telstra was to submit material to the Resource Unit, who would decide, whether the material was relevant for Telstra to pass to the arbitrator (see GS-CAV 201)

In Sussan Hodgkinson’s letter to Dr Hughes on 2nd August, 1996 (discussed later), she states:-

“At the time of the letter from Austel, Mr Smith’s telephone problems were being addressed in the Arbitration. Due to a number of factors including confidentiality, it was felt not appropriate to answer Austel’s comments in detail, in particular the issue was under consideration in the Arbitration, As agreed the Resource Unit did not respond to the Austel letter.” (AS-CAV 220)

However, what Ms Hodgkinson does not reveal in this letter, is the FHCA opened another letter addressed to him, this time from Telstra dated 16th December, 1994 which had multiple attachments for him to assess as part of Alan Smith’s arbitration.  In other words, while Ms Hodgkinson was assessing Graham Schorer’s arbitration issues during August 1996, she was also misinforming Dr Hughes about the 16th December, 1994 letter.

24th March, 1995:  It is important to point out the following issues showing that Alan’s phone interception issues were not addressed during his arbitration and, although Graham Schorer’s phone interception issues were briefly discussed in the CAV LGE Telephone Interception LGE target documents, the following issues were not being covered in any detail:-

  • From February to September 1994, the Australian Federal Police interviewed Graham and Alan a number of times regarding the alleged illegal interception of their telephone conversations.
  • Warwick Smith and Peter Bartlett agreed that, under the Arbitration Agreement, the claimants could submit their interception issues to the arbitrator, as part of their claims.
  • Evidence included in Alan Smith’s CAV LGE Telephone Interception target documents (see attached) confirm Telstra wrote to Warwick Smith, on 17th October, 1994 agreeing to address the voice monitoring issues raised by Alan Smith in his arbitration claim, as part of Telstra’s defence of Alan’s claim.
  • On 10th November, 1994 Dr Hughes wrote to Graham Schorer notifying him that Telstra agreed to address his allegations of phone interception as part of Telstra’s defence of Graham’s arbitration claim.
  • Telstra did not address the phone interception issues, in either Alan Smith’s nor Graham Schorer’s arbitrations.
  • The Commonwealth Ombudsman’s office confirmed Telstra were defective in their supply of FOI documents during Graham Schorer and Alan Smith’s arbitrations and Telstra FOI schedules confirm Telstra withheld interception information from Alan under Legal Professional Privilege (LPP). The Commonwealth Ombudsman’s Office and the Senate Working Party agreed Telstra were defective in their supply of FOI documents during Graham Schorer’s arbitration and Telstra FOI schedules confirm that Telstra withheld numerous non-legal and privacy related documents from Graham, also under LPP.
  • On 24th March, 1995 Warwick Smith stated publicly:- I have been asked to enquire as to whether or not there has been a breach of internal privacy arrangements by Telecom” and he had “conducted interviews with Telecom employees”, but he had “yet to conclude that enquiry”.

It would be reasonable to assume that, while the Australian Federal Police (AFP) were investigating the COT interception issues, they might have discussed some of these matters with Warwick Smith.  Although clearly, they would have limited this to matters relevant to Warwick Smith as the administrator of the COT arbitrations.  It is most unlikely the AFP investigators would have allowed or instructed Warwick Smith to interview Telecom employees regarding these same interception issues, as that would have cut across the AFP investigations.

In his public statement of 24th March, Warwick Smith also stated:-

“There are still matters of concern. The recent decision by the director of Public prosecutions not to proceed with a prosecution, following an Australian Federal Police investigation into voice monitoring issues raises questions which have already been canvassed elsewhere and are not appropriate for me to discuss.”

Warwick Smith’s public statement, regarding being asked to “enquire as to whether or not there has been a breach of internal privacy arrangements by Telecom”, indicates he was investigating the interception issues as the administrator of Alan and Graham’s arbitrations.  However, he did not consult Alan or Graham’s Arbitration Technical Advisors nor provide either Alan or Graham with an opportunity to challenge (as was their right) any statements made by Telstra’s employees.  This indicates Warwick Smith took it upon himself to interview Telstra employees regarding interception matters and therefore, this part of the arbitration process was conducted in camera by the administrator (and, it also now seems, by the arbitrator too), without allowing the claimants their legal right to challenge the information Telstra provided to the administrator, even though the transparency process in the Arbitration Agreement provided the claimants with a right to challenge evidence submitted by the defendant.

Warwick Smith’s public statement re “I am yet to conclude that enquiry” confirms the TIO’s office would have on record a report regarding the interception issues the four original COT claimants raised with him and the arbitrator, as part of their arbitration claims.  Such a report should have been provided to the COT claimants and the arbitrator during their respective arbitrations.  Graham and Alan are entitled to a copy of this report since they both raised these interception issues during the TIO-administered arbitration process.

It is also important to point out that, while the AFP were officially investigating the COT interception issues, both Graham and Alan were expected to provide information to the AFP and the arbitration, at the same time, which leads to the question of how any lay person could be expected to carry out such complex tasks?  Telstra was also working with the AFP on the same matters the arbitration administrator, Warwick Smith, was secretly investigating (see Alan Smith – CAV Relevant Information file).

30th March 1995, Sue Hodgkinson reports to Warwick Smith

This report by Sue Hodgkinson of FHCA, to Warwick Smith, TIO, confirms Warwick Smith and his Resource Unit were fully aware Alan did not receive the bulk of his requested FOI documents until two weeks after Telstra submitted their Defence.  In this letter, Ms Hodgkinson states:-

“Alan Smith … has included volumes of documents and the direct relevance of all this information is difficult to ascertain. Nonetheless, Smith has gone to a lot of trouble to assemble his FOI information which, as you may be aware, was not provided in full by Telecom until 23rd December 1994. …

  • Smiths [sic] claim was formally certified as complete in November 1994. …
  • On 13 December 1994, Telecom delivered its defence to the Arbitrator.
  • Smith has stated verbally to myself that, on 23 December 1994, he received 90 kilograms of FOI material. As his claim was ‘finalised’, he did not have the ability to examine these documents and add to his claim.” (AS-CAV 103)

With regard to Ms Hodgkinson’s difficulty in understanding the relevance of the material Alan submitted, these were highly technical documents that were presented to him by Telstra, (in apparently unrelated batches).  Many documents didn’t even arrive until long after Alan had submitted his claim.  It is actually amazing that he managed to make any sense out of them at all!

That Alan’s claim was certified as complete in November 1994 is correct, according to the Resource Unit.  This means that the attachments Alan later forwarded to Dr Hughes were never addressed.

The last point made here by Ms Hodgkinson, regarding the weight of the documents delivered to Alan on 23rd December, 1994 is also correct:  Alan was aware of the weight because they were delivered to him by air-freight; however, her comment regarding his ‘ability’ to assess the documents is not completely accurate.  Alan recalls asking her how the arbitrator could expect any claimant to look through all this information in the 11 days he had left to reply to Telstra’s Defence of his claim.  Part of Alan’s assessment process would have had to include the revision of documents provided in separate batches that were delivered in February, May, July, August, September and November 1994.  It was like an enormous jigsaw puzzle: worse, it was like an enormous jigsaw puzzle without any defined edges!

Furthermore, these documents often turned out to contradict each other, as the following example illustrates:-

Telstra stated, in their B004 Defence Report, on page 25, that a lightning strike on 21/11/92 damaged RCM equipment and the fault lasted four days (AS-CAV 149).

DMR and Lanes’ Technical Evaluation Report agrees with this, on page 23 where, under the heading “RCM 1 Failure due to lightning strike 21st November 1992 Affected Service for Four Days”, is stated at point 2.8:-

“A lightning strike on 21st November damaged the Cape Bridgewater RCM equipment:  Telecom received 22 customer complaints from CB customers for No dial tone, No ring received, noisy.  No complaint was identified from CBHC, however RCM 1 was affected and this was the unit CBHC services were on.  The condition affected services for 4 days, before restorative action was taken, which may have been less than successful…” (AS-CAV 150)

After Alan had lodged his interim Letter of Claim, he received Telstra FOI document K01173, which paints an entirely different picture, confirming that, contrary to the two reports above, he DID report this fault.  K01173 is dated 9th February, 1993 and states:-

“I contacted Don Bloomfield (Portland Customer ops) to discuss Alan Smiths [sic] problems. It is his opinion, and this is supported by data retrieved from OPAS, that there were problems in the RCM caused by a Lightening [sic] strike to a bearer in late November. these problems (damaged PCB’s etc) appeared to be resolved by late January…” (AS-CAV 151)

On page 33 in the Arbitrator’s Award, Dr Hughes goes one step further.  He states:-

“damage was caused to Cape Bridgewater RCM equipment by a lightning strike on 21 November 1992, resulting in a variety of complaints which affected services for 4 days before restorative action was taken. The restorative action ‘may have been less than successful’… (AS-CAV 152)

This shows that, at least in this instance, Telstra provided incorrect information that not only affected the Arbitrator’s decision, but also swayed the Technical Resource Unit into believing a long-standing problem only existed for four days, instead of 60 or more days.

In the Dr Hughes CAV Target page 44, Alan shows, at point 3, another startling downplaying of the actual faults affecting his business, due to the incorrect information supplied by Telstra in their defence. He states:-

“At point 2.23, headed ‘Calls Directed to RVA, March 1992’, Mr Read only uses Telstra’s defence figures. If he had read the AUSTEL information, or my fault material, Mr Read would have seen that this fault lasted for eight months and not the 16 days he reported. This particular MELU exchange fault is discussed more in Exhibit 9 of the Benjamin file.”

Some of the information supporting this MELU fault is available at exhibits (AS – CAV 12) and (AS – CAV 13).  Page 21 of the DMR and Lane findings, states this MELU fault lasted “for at least 16 days and possibly longer” (AS-CAV 153).  On page 32 of the Arbitrator’s Award, states this fault lasted for 16 days and possibly longer (AS-CAV 154).

In Telstra’s Arbitration Defence and in the DMR and Lanes Report they acknowledge this MELU RVA, the recorded message saying the number you have called is not connected, was fixed on 16th March, 1992.  The cutover from the old RAX to the RCM was in August 1991.  Therefore the fault had lasted between 7 and 8 months, NOT 16 days.

Alan tried to explain this kind of problem, and the disadvantages that came with it, to Ms Hodgkinson.

The downplaying of the MELU fault could have been avoided as this information was submitted in Alan’s claim.  Unfortunately for Alan, during the FHCA vetting process they decided this part of Alan’s submission to DMR and Lanes was irrelevant to Alan’s overall claim.  Remember, Warwick Smith and Steve Black saw nothing wrong in allowing FHCA to view this type of material and judge its worth or relevance, before supplying it to the arbitrator! (AS-CAV 590)

Telstra also acknowledged that, in 1991 and 1992, between 33 and 50 per cent of all metropolitan calls from Melbourne to Cape Bridgewater went through the MELU route.  Alan believes any reasonably minded person would conclude that the recorded message, telling prospective clients for seven to eight months that the number they dialled was not connected, would have far more reaching repercussions than if the message lasted for only 16 days.

David Read’s controversial visit to Cape Bridgewater

6th April, 1995:  Due to David Read’s previous involvement with Telstra Management (Alan and Graham were led to believe at the time he had been a Telstra employee for some 20 years), the COT cases argued that Lanes should not have been assessing their matters.  Warwick Smith compromised on their involvement, agreeing that Lanes would only assist DMR Group (Canada), who would be the Principal Technical Consultants.  Warwick Smith’s letter of 9th March, 1995 further confirms this (AS-CAV 161).  However, suffice to say, while he was in Cape Bridgewater, Mr Read did not make one visit to assess the phone configuration Alan complained of, regarding the incoming lines to the Camp Kiosk and the extension line to his office.

It is well documented that Alan continued to complain about phone and fax problems throughout his arbitration, and after, including complaints to local technicians where Alan enquired about the phone alarm system, and associated wiring, which was installed by Telstra during ELMI monitoring of his service lines in 1991/2.  Although Alan asked Mr Read to look at this wiring and some of the evidence he had which proved incorrect billing on all his phone lines, Mr Read made it quite clear Dr Hughes ordered him not to look at any new evidence during his site visits.  Dr Hughes later confirmed these orders in a letter to Laurie James, President of the Institute of Arbitrators (AS-CAV 157).  Mr Read did relent and peruse one of the examples Alan had showing two calls to Alan’s 800/1800 service on 13th January, 1995 that were wrongly charged to his account by Telstra.

Mr Read insisted he only had limited time before he flew out of Portland that evening. Here Alan was, still in an arbitration process that had been dragging on for 18 months, from 23rd November, 1993, and the Technical Resource Unit, appointed by the TIO, couldn’t spend three or four hours investigating the wiring at Alan’s premises??  Mr Read wouldn’t even make half a dozen test phone calls to his 008/1800 line, or the gold phone customer service line, to see if Alan’s continuing complaints about the poor service were valid.  Was his reluctance to investigate the equipment installed and supplied by Telstra due to the deficient Verification Tests that Telstra unlawfully used in their defence?  At the conclusion of his visit, Alan was astounded to see Mr Read drive off with Peter Gamble, Telstra’s Arbitration Technical Engineer, who had also attended the meeting with Mr Read.

A newspaper article in the Portland newspaper on 8th November, 2002 reported the new owner of the Holiday Camp, Darren Lewis said he had experienced several problems with the phone and fax service since taking over the Cape Bridgewater Holiday Camp (AS-CAV 167).  The significance of raising a 2002 issue here is that the following exhibit relates to a TIO letter, dated 28th January, 2003, describing that since Telstra rewired Mr Lewis’ business “the phone problems have decreased dramatically” (AS-CAV 168).  Had David Read inspected the same wiring when he was asked on 6th April, 1995, he would no doubt have condemned the wiring and had it replaced under the umbrella of the arbitration process.

12th April, 1995:  Ted Benjamin writes to Dr Hughes regarding the TF200.

“I refer to your facsimile of 7 March 1995 and the attached facsimile of the letter of 3 March 1995 from Mr Smith. …”

“I advise that Telecom is prepared to make available the further data being sought by the Claimant. …”

“A copy of the Technical Report is enclosed.”

Please note:  it took over a month for Telstra to respond to a simple request for Further and Better Particulars, and when they did finally respond they provided a replica of the information they had already provided in their Defence on 12th December, 1994. (AS-CAV 158)

Ted Benjamin writes to Dr Hughes

13th April, 1995:  This letter is in response to the letter from David Read of Lane Telecommunications dated 31st March, 1995.  Please note Ted Benjamin states:-

“Attached is a copy of a facsimile from Peter Gamble of Telecom to David Read of the Resource Unit dated 31 March 1995.  It is being made available to you for your information and in case you consider Mr Smith should be provided with a copy.”

This letter, dated 31 March (AS-CAV 156), confirms David Read contacted Peter Gamble and discussed relevant technical issues concerning the increase of Call Line Identification (CL) at the Warrnambool AXE exchange during March 1993.  What discussions followed between Mr Gamble and Mr Read after this telephone conversation, and what information was provided regarding the Warrnambool AXE exchange CL issue? What other information did Mr Gamble provide Mr Read?  Was it information similar to the MELU or TF200 issues?  How many other private telephone conversations occurred in this fashion, discussing technical issues that neither Alan’s Technical Advisor, George Close, nor Alan were privy to?

On 16th February, 1996 Dr Hughes wrote to the president of the Institute of Arbitrators, Laurie James. Dr Hughes stated:-

“Mr Smith’s assertion on page 4 that a technical expert, Mr Read, refused to discuss technical information at his premises on 6 April 1995 is correct – in this regard, Mr Read was acting in accordance with his interpretation of my direction which prohibited him from speaking to one party in the absence of the other party at any site visit.” (AS-CAV 157)

17th April, 1995:  Alan provides evidence to Dr Hughes and copies to Ted Benjamin:-

“I refer to Mr Benjamin’s letter of 12th April 1995, addressed to Dr Gordon Hughes, points 1 and 2.”

“I believed when I asked the Arbitration Procedure to access, from Telecom, all written, original notes regarding the TF200 (267 230) that this would include all original report notes and the contents of the TF200 report, however, all I received from your office, by courier, was a copy of the report, in printed form, which had already been viewed in Telecom’s Defence documents.” (AS-CAV 159)

The attachments accompanying Alan’s letter to Dr Hughes probably swayed the author of the Arbitrator’s Award (AS-CAV 142) to remove the segment “damaging the equipment by spilling a liquid into it”.  Of course, no one in Alan’s office spilt any sought of liquid into the TF200 and beer does not form a sticky liquid as Alan’s testing has proved.  Alan’s tests also confirm beer in a vessel (Alan used a TF200) dries within a very short period of two days.  Telstra had Alan’s TF200 from 27th April,1994 and it was not provided to the laboratory until 10th May, 1994. Why did Telstra wait 15 days before sending the TF200 to its laboratory?

18thApril, 1995:  John Rundell (FHCA) writes to Warwick Smith.  Alan did not receive this until 2001, under the TIO Privacy Policy Act.  This document advises:-

“Paul Howell, Director of DMR Inc. Canada arrived in Australia on 13 April 1995 and worked over Easter Holiday period, particularly on the Smith claim. Any technical report prepared in draft by Lanes will be signed off and appear on the letterhead of DMR Inc.” (AS-CAV 160)

This letter is relevant for the following points:

  • DMR (Australia) signed an agreement with TIO Warwick Smith in April 1994 (as displayed in the arbitration agreement) to act as the independent Arbitration Technical Resource Unit.
  • On March 9, 1995 Warwick Smith advised Alan that DMR Australia was unavailable to provide locally based technical assistance and confirms Paul Howell of DMR Canada was appointed as the Principal Technical Advisor to the Resource Unit. Lane, based in Adelaide, would assist Mr Howell.  “Could you please confirm with me in writing that you have no objection to this appointment so the matter can proceed forthwith.” (AS-CAV 161).
  • Please note: the 18 April, 1995 statement by Mr Rundell confirms he was prepared to transfer Lane’s technical findings onto the letterhead of DMR Canada as a guise that Mr Howell prepared the Final Report.
  • AS-CAV 162 confirms Mr Howell, on 21st March, 1995, only received three of Alan’s 22 submitted claim documents along with Telstra’s Defence.
  • AS-CAV 163 confirms FHCA advised Mr Howell, on 5th April, 1995 that David Read would have his draft Technical Report prepared by 7th April, 1995.
  • Dr Hughes’ Draft Award, on page 3 at (i) and (j), states:-

“pursuant to paragraph 8 of the arbitration agreement, I had power to require a ‘Resource Unit’, comprising Ferrier Hodgson, Charted Accountants, and DMR Group Australia Pty Ltd, to conduct such inquiries or research as I saw fit;”

“on 21 February 1995, by which time I was satisfied that the submission of all relevant material by both parties was complete, I instructed Ferrier Hodgson (and, through them, DMR) to conduct certain inquiries on my behalf …”
(AS-CAV 164).

However, Dr Hughes’ final award states, at (i) and (j):-

“pursuant to paragraph 8 of the arbitration agreement, I had power to require a ‘Resource Unit’ comprising Ferrier Hodgson, Charted Accountants, and DMR Group Australia Pty Ltd, to conduct such inquiries or research as I saw fit. By consent of the parties, the role of DMR Group Australia Pty Ltd was subsequently performed jointly by DMR Group Inc. and Lane Telecommunications Pty Ltd;”

“on 21 February 1995, by which time I was satisfied that the submission of all relevant material by both parties was complete, I instructed the Resource Unit to conduct certain inquiries on my behalf …” (AS-CAV 165).

In summary, AS-CAV 160 to AS-CAV 165 show:-

  1. Paul Howell didn’t receive the Technical Claim and Defence Material until 21st March, 1995. (AS-CAV 162)
  2. Paul Howell and David Read weren’t officially appointed by the TIO until 9th March, 1995 and/or officially accepted by Letter of Consent (AS-CAV 161).

All the technical findings, in both the Draft and Final Awards (except for the removal of the alleged liquid spillage segment), are the same.  However, in the Draft Award, the author states he called on DMR Group Australia Pty Ltd to conduct inquiries (who were sacked prior to 21st February, 1995 for conflict of interests).  As DMR Canada was not appointed as a replacement until 9th March, 1995 and didn’t receive the Technical Claim and Defence Material until 21st March, 1995 how could DMR Canada have prepared the technical findings in the Final Award, when the technical findings in both awards are one of the same?

18th April, 1995:  This letter, from the TIO-appointed Arbitration Project Manager, John Rundell, of Ferrier Hodgson Corporate Advisory, to Warwick Smith (copied to Peter Bartlett and Dr Hughes) states:-

“It is unfortunate that there have been forces at work collectively beyond our reasonable control that have delayed us in undertaking our work.”

Neither Graham Schorer nor Alan Smith were ever told about these “forces at work” nor were they ever warned that, under the noses of the Arbitration Administrator and his Legal Advisor, Peter Bartlett, unnamed forces were allowed to infiltrate and manipulate the arbitration process. (AS-CAV 160)

27th April, 1995:  Ted Benjamin writes to Dr Hughes, including attachments.  The information referred to was never provided to Alan nor his Technical Advisor, George Close.  This letter includes seven points that were apparently sourced by DMR and Lane directly from Telstra, without any formal request directed through the transparency process of the arbitration.  This letter is discussed in more detail in the Dr Hughes Target file.  Had George Close and Alan received a copy of this letter during the arbitration procedure, they would have been entitled to request from Telstra, through Dr Hughes, copies of the technical data to which Mr Benjamin refers in this letter:  they were not afforded this opportunity. (AS-CAV 166)

28th April, 1995:  Warwick Smith and Peter Bartlett conjure a draft letter, dated 28th April, 1995 confirming Warwick Smith and his legal counsel, Peter Bartlett, are prepared to pressure Dr Hughes to conclude Alan’s award quickly:-

“However, I understand you are to present a paper in Greece in mid May.”

“I would expect that the Award would be delivered prior to your departure.”

“It would be unacceptable to contemplate the delivery of the Award being delayed until after your return.” (AS-CAV 169)

This letter further supports Alan’s assertions that the arbitration was not a transparent process and that the arbitrator was not independent.  It is also clear that Warwick Smith and Peter Bartlett had no regard for justice, or for Alan’s right to present the facts as they really were.

28th April, 1995:  Mr Schorer writes to Ms Lesley Gordon, AUSTEL’s FOI co-ordinator:-

“Austel know from their own experience, as a result of the Austel investigation and report, the relevance, and more importantly, the importance and dependency of myself to receive the documentation contained in the following Austel categories:-

  1. Early papers/drafts COT Case Report. 6 files.
  2. Bell Canada, Coopers and Lybrand Reports and assoc papers. 4 files.
  3. Telecom internal docts. 4 files.
  4. Monitoring and testing: general. 5 files.
  5. Telecom monitoring, qualitative maint. difficult network fault data. 2 files.” (GS-CAV 216)

By 28th April, 1995 Alan Smith and Graham Schorer had still not received all the required raw Bell Canada International data requested under FOI.

DMR and Lanes present their Technical Evaluation Report

30th April, 1995:  There were many problems with this report, not the least being that DMR and Lane skipped a six-month period of Alan’s claim, from August 1994 to April 1995, including only assessing 23 fault claim examples from 200 fault complaints (see point 3 in the conclusion).  They also failed to investigate or address numerous bound volumes of evidence that demonstrated Telstra’s continuing incorrect charging on all of Alan’s phone lines.

The DMR and Lane report, dated 30th April 1995, which Alan has hand-marked Arbitrators copy, and the Final copy, both contain lists including the words,

“The information provided in this report has been derived and interoperated from the following documents.”

Any person would expect both reports, dated the same day, cover the same 23 assessments and include the same technical information.  The arbitrator’s list of sourced documents is minus 13 bound claim documents (comprising over 3,000 documents) that appear on the Final Report List.  Who added the 13 sets of claim documents to the final list?

In the DMR and Lane Report, provided to Dr Hughes, there is one difference – although not a technical matter.  Included on page 2 of this report are the words:-

“There is, however, an addendum which we may find it necessary to add during the next few weeks on billing, i.e. possible discrepancies in Smith’s Telecom bills,”

and on page 3,

“one issue in the Cape Bridgewater case remains open, and we shall attempt to resolve it in the next few weeks, namely Mr Smith’s complaints about billing problems. Otherwise, the technical Report on Cape Bridgewater is Complete.”

The report Dr Hughes provided for Alan’s official written response (as directed by the Arbitration Agreement) was different to the report stating extra weeks are needed to finish and therefore it is incomplete.  Not only had an extra 13 volumes of sourced documents been added, but the reference to billing discrepancies had been removed, along with the reference to the report being incomplete.

Questions:

  1. How could the report Alan received be complete, when the arbitrator’s version, of the same date, stated extra weeks were needed to complete it?
  2. How can two reports have identical technical findings when their conclusions were apparently reached after one of the reports assessed 3,000 more claim documents than the other?
  3. How can a report that sourced 3,000 more claim documents (mostly consisting of billing claim material) not disclose one single billing issue as being addressed?
  4. Who disallowed DMR and Lane the extra weeks they needed to complete their report?

3rd May, 1995:  Dr Hughes writes to Alan, advising he has five days to respond to the DMR and Lane Report.  Alan is forced to prepare his response himself since he can no longer afford to pay his Technical Advisor.  Even though he has no technical expertise in the telecommunications field, he is still able to refute many of the assertions in this so-called independent report, but has to agree with some assessments, due to his inexperience in technical issues.

Alan could not understand why the billing part of his claim was not addressed in the report.  He didn’t completely solve this until January 2001, when he discovered John Rundell, of FHCA, had written to the TIO on 15th November, 1995 advising the TIO that FHCA ordered DMR and Lanes NOT to investigate Alan’s billing evidence. AS 104).  Mr Rundell and FHCA caused all Alan’s heartache and worry as he attempted to put together a response to a highly technical report.

At point 2.23 in this report DMR and Lane state:-

“Continued reports of 008 faults up to the present.  As the level of disruption to overall CBHC [Cape Bridgewater Holiday Camp] service is not clear, and fault causes have not been diagnosed, a reasonable expectation is that these faults would remain ‘open’. (AS-CAV 170)

Why didn’t DMR and Lane diagnose the fault causes for these billing problems?

5th May, 1995:  Dr Hughes writes to Alan noting:-

“I refer to your telephone message of 4 May and your facsimiles of 4 and 5 May, 1995 and advise I do not consider grounds exist for the introduction of new evidence or the convening of a hearing at this stage.”

He also reiterates his previous instructions:-

“any comments regarding the factual content of the Resource Unit reports must be received … by 5:00pm on Tuesday 9 May 1995”. (AS-CAV 171)

Alan’s facsimile of 4th May, 1995 advises Dr Hughes FHCA did not take into account a similar type of business, Camp Rumbug (with a reliable phone and fax service), which he had helped set up in Foster Gippsland (Victoria). (AS-CAV 172)

Alan also asks Dr Hughes to look at the late evidence he had provided to Sue Hodgkinson.  This evidence confirmed that the operators of six other camps wrote to Cathy and Alan supporting that booking two different groups into a camp at the same time, was a good way to create more revenue and would also encourage group bookings in the future.  Dr Hughes’ would not accept this, labelling it as “new” evidence (AS-CAV 171).  Alan raises the same issues again in a second letter faxed to Dr Hughes on 5th May, 1995 but to no avail (AS-CAV 173).  Pages 100 to 102 from the Oral Arbitration Hearing held on 11th October, 1994 confirm Alan attempted to submit similar evidence, eight months earlier, but this was not allowed.  The transcripts of the Oral Hearing confirm the sensitivity of the information Alan was attempting to submit. (AS-CAV 174).

The phone/fax account for 4th October, 1994 (AS-CAV 175) shows that Alan phoned Dr Hughes’ office at 5:06 pm and spoke for 5 minutes and 11 seconds.  Alan believes he made this phone call to discuss Telstra’s reluctance to provide FOI documents and to request a meeting to discuss the matter further (AS-CAV 100).  Alan believes he detailed his reasons for not submitting the list of names and addresses of the singles club patrons with his letter of claim, because of the sensitivity of the private information.  Dr Hughes should remember this conversation, as it was his suggestion that Alan bring the singles club material to the Oral Hearing for discussion.  What changed Dr Hughes’ mind between this phone conversation and the Oral Hearing?

These documents, including the contact information for the singles club patrons, were relevant to Alan’s claim as they showed the business clientele Alan was losing and proved Alan was losing more than only the “school market” because of the continuing phone problems.

Why did FHCA only look at the school-booking rate per head when valuing the lost camp bookings?  A student price per two night stay, during 1993/94, with all meals provided cost approximately $30 per person.  A singles club patron staying two nights cost approximately $140-$160 per person.

Important:

As the TIO allowed FHCA to assess the validity of information, before deciding whether it should or should not be provided to the arbitrator, this appears to be the root cause of Dr Hughes’ failure to see the most relevant information.

9th May, 1995:  DMR Corporate lodges its response to the FHCA Financial Report. Alan’s accountant, Derek Ryan, of DMR Corporate, makes it very clear that, in his professional opinion, the FHCA Financial Report was factually incomplete and this made it impossible for him to address how FHCA arrived at its findings.

Derek Ryan was so incensed with the FHCA Report that, without Alan’s knowledge, he wrote to the then Shadow Minister for Communications, Senator Richard Alston, on 6th December, 1995 to alert him to what Mr Ryan believed was a miscarriage of justice.  In this letter, Mr Ryan noted:-

“The FHCA report was inaccurate and incomplete. I have since been advised by a staff member of FHCA that a large amount of information was excluded from their final report at the request of the arbitrator. This has left the report in an incomplete state and it is impossible for anyone to re-calculate how the FHCA loss figures were determined” (AS-CAV 177-A).

Alan has the full 39-page letter referred from Derek Ryan, dated 9th May, 1995 to Dr Hughes.  Only pages 1 and 39 are exhibits, because of the voluminous nature of the document (AS-CAV 178-A).

Dr Hughes brings down his award on incomplete information

11th May, 1995:  Both the draft and final award can be located in the Ted Benjamin exhibits 4 and 5 and exhibits 6 and 7 of the Alan Smith CAV Relevant Information file.

It is evident, from these two awards, that Dr Hughes was provided false and misleading information by persons who did not want the truth of Alan’s case disclosed.

12th May, 1995:  Dr Hughes writes to Warwick Smith.  Alan only received a copy of this letter (see Dr Hughes and Warwick Smith Targets) from the TIO’s office in 2001/2, and he has so far only touched briefly on its significance.  A more in-depth study of this letter raises the following questions: (AS-CAV 180)

Dr Hughes states, “as far as I could observe, both Telecom and Smith co-operated in the Smith arbitration”.

  • How could he make such a statement when he had received written notification that the Government Solicitors were brought in to force Telstra to comply with FOI requests by three COT members?
  • How could he make such a statement after seeing a copy of John Rundell’s letter of 18th April, 1995 to the TIO, which stated: “It is unfortunate that there have been forces at work collectively beyond our reasonable control that have delayed us in undertaking our work.”

Why was Dr Hughes afraid to expose the truth?

Also in this same letter, Dr Hughes makes the following comments, which all needs to be explained by the TIO’s office: (GS-CAV 217)

  • “the time frames set in the original Arbitration Agreement were, with the benefit of hindsight, optimistic;”
  • “in particular, we did not allow sufficient time in the Arbitration Agreement for inevitable delays associated with the production of documents, obtaining further particulars and the preparation of technical reports; …”
  • “In summary, it is my view that if the process is to remain credible, it is necessary to contemplate a time frame for completion which is longer than presently contained in the Arbitration Agreement.”

On receipt of this letter, as the Administrator of the Arbitrations, Warwick Smith should have abandoned the process and intervened to allow a review and allow Alan more time to obtain further particulars, produce documents and prepare his technical

report.  John Rundell’s letter to Mr Pinnock on 15th November,1995 (refer John Pinnock Target), regarding the inadequate time frame and how it affected the completion of the DMR and Lane Technical Report, adds further weight to the allegation that the process was severely flawed.

12th May, 1995:  Dr Hughes writes to Graham Schorer, copied to Warwick Smith, Peter Bartlett and others stating:-

“I am departing today for two weeks leave.  When I return, I intend convening a directions hearing in order to determine whether the parties wish this arbitration to proceed.”

“I would be interested to receive any comments from you (or Telecom) in the meantime.” (GS-CAV 218)

There is no reference in this letter stating:  It is my view that if the process is to remain credible, it is necessary to contemplate a time frame for completion which is longer than presently contained in the Arbitration Agreement.

24th May, 1995:  Mr Benjamin’s letter to Alan, re late-released FOI documents, again confirms Alan and Graham had no chance of ever receiving justice.  Two weeks after Dr Hughes deliberated on Alan’s claim, Telstra released 745 new FOI documents under the heading “Your FOI Request of May 1994”, and includes the following:-

“Further documents have recently come to light that fall within your FOI request of 1994.”

“Copies of these documents are enclosed. At this time a table has not been prepared giving decisions in relation to these documents as it was considered by Telecom more important you receive copies of the documents now.” (AS-CAV 183)

Twelve months after Alan originally asked for these documents, Telstra finally considers it important that he gets them – too late!  And the arbitrator had gone to Greece.

Among the papers in this FOI release, Alan found two particularly relevant documents, numbered N00005/6 and N00037 (AS-CAV 135 and AS-CAV 136).  Document N00005/6 is a letter dated 6th September, 1994 from Telstra to Gerald Kealey of Bell Canada International in Ottawa, which confirms that the BCI tests conducted at Cape Bridgewater on 5th November 1993 were impracticable.

N00037 is an internal Telstra memo dated 23rd August, 1994 which also acknowledges the BCI tests conducted at Cape Bridgewater on 5th November 1993 were impracticable.  Even though documents N00005/6 and N00037 note the BCI tests conducted at Cape Bridgewater on 5th November, 1993 were impracticable, none of the BCI tests conducted from 5 to 9 November could have been conducted, because the CCS7 equipment could not be operated at Cape Bridgewater or the Portland Exchanges.

These two documents support Alan’s claim:  Telstra should not have used the BCI Report as defence material or as library material for the arbitration process, as it was flawed.  Telstra knew the report was impracticable as far back as August 1994, yet they used it to support their assertion that the telephone network into Cape Bridgewater was operating well.  This was more than just unethical.

Brian Hodge, B Tech; MBA (B C Telecommunication) declared in his 27th July, 2007 Technical Report, NONE of the five-day tests BCI allege were generated through the CCS7 trapping data could have terminated at the unmanned Cape Bridgewater RCM.

Letters received in 2001/2

Among the material Alan received in 2001/2, under the TIO Privacy Policy Act, were a number of documents confirming TIO Mr Pinnock allowed numerous episodes of Telstra’s unethical conduct, during Alan’s arbitration, to remain un-addressed.  One of these was a letter dated 7th September, 1995 from Telstra to Mr Pinnock (AS 116), which suggests the BCI test results they used to support their defence, were impracticable. Why did Telstra withhold this knowledge until after Dr Hughes had brought down his findings?  In the Arbitrator’s Award, he clearly notes he accepted the BCI report into evidence; therefore, he read the report and believed it was a true and correct document.

Another alarming document was a fax coversheet from the TIO to Peter Bartlett of Minter Ellison, regarding some of Alan’s letters to Dr Hughes and his consequent letter to Mr Pinnock on 21st June, 1995.  This sheet asks, in reference to Alan’s arbitration, “what the approach should be re parties seeking to revisit issues post [Arbitration].  His position is not to open the can of worms…” (AS-CAV 184)  This document suggests Alan’s arbitration process was certainly not administered as transparently or as lawfully as it should have been.

1st June, 1995:  The file note created by William Hunt, Graham Schorer’s solicitor, states:-

“In relation to the Bell Canada reports, the situation is apparently is [sic] that Bell Canada were engaged to give an appraisal by Telecom. Bell Canada asked Telecom to run certain tests for them and Telecom did that. …”

“It is claimed by Steven Black that that material does not belong to Telecom and it was handed back to Bell Canada and Telecom are not in a position to get it from Bell Canada and they don’t have copies of it.” (GS-CAV 221)

Exhibit GS 203A confirms, on 25th August, 1994, Telstra had copies of the Bell Canada information.  Why did Mr Black state otherwise?

5th June, 1995:  William Hunt’s file note states:-

“Re Schorer & Cot Cases. Pursue Schorer & Thorpe to get authority to write to the Commonwealth Ombudsman about the inability or refusal to provide us with the tests that were conducted for purposes of both Schorer and for Smith. In particular I am to concern myself that the material has not been made available for inspection and it should be because it belongs to Telecom not to Bell Canada.” (GS-CAV 220)

19th June, 1995:  William Hunt’s file note states:-

“On 17th May attending Mr Harry Thorpe [Golden Messenger’s accountant] who phoned and I dictated to him an answer to Gordon Hughes letter of 12th May which didn’t arrive until 16th. We discussed that Alan Smith had got a very poor settlement, namely a $400,000.00 less 80 of which $135[,000] was then taken out in cost to people who assisted him.”

“I said we should consider whether we may be better off scrapping without letting this arbitration be scrapped and going public in litigation and complaints about the FOI lack of documentation received.” (GS-CAV 222)

19th June, 1995:  William Hunt’s file note states:-

“Schorer rang me on Friday 16th June saying that he was not going back to Warburton but he would be still under the clinical psychologist and would be coming in to see me next Thursday.” (GS-CAV 223)

Both Alan and Graham, at various times, have received professional counselling associated with trying to come to terms with the way Telstra, the TIO, and those appointed by the TIO to assist them in the TIO-administered arbitration, treated them.

21st June, 1995:  Dr Hughes writes to TIO John Pinnock and copies the same to Telstra.  Dr Hughes attaches three letters from Alan Smith, written during his arbitration, requesting Dr Hughes seek, on Alan’s behalf (under the discovery process), all the BCI information supporting their alleged successful tests at Cape Bridgewater.  Alan does not receive a copy of this correspondence, from Dr Hughes to Mr Pinnock and Telstra, during his arbitration even though the defendants (Telstra) received it.

27th June, 1995:  John Pinnock writes to William Hunt, stating:-

“As you may be aware, this arbitration has in effect been in abeyance for some months.  This has apparently been due to the Claimant’s outstanding request for documentation, and Mr Schorer’s ill health.”

“We have not heard from Mr Schorer for some time, and would be grateful if you could advise us as to how he intends to proceed.” (GS-CAV 224)

Likewise, there is no reference in this letter regarding, It is Dr Hughes’ view that if the process is to remain credible, it is necessary to contemplate a time frame for completion which is longer than presently contained in the Arbitration Agreement.

29th June, 1995:  On behalf of Alan, Taits Solicitors in Warrnambool writes to AUSTEL, asking for information associated with the BCI and NEAT testing process conducted at the Cape Bridgewater RCM in November 1993. (AS-CAV 185)

On 12th July, 1995 Cliff Mathieson, of AUSTEL, replied:-

“The tests to which you refer were neither arranged nor carried out by AUSTEL. Questions relating to the conduct of the test should be referred to those who carried them out or claim to have carried them out. (AS-CAV 186)

But, Cliff Mathieson wrote to Telstra on 9th December 1993, before Telstra used the BCI report as Defence Material, advising Telstra must provide the “assessor(s)” of the COT processes with a copy of his letter regarding the BCI tests, which he declared did not go far enough.  This letter was NOT provided to Dr Hughes, as AUSTEL had directed, which makes Telstra’s use of the BCI Report even more unconscionable conduct.

4th July, 1995:  Telstra writes to Ms Philippa Smith, Commonwealth Ombudsman.  Ms Joy Geary, of Telstra Corporate Legal Directorate, reluctantly acknowledges Telstra were indeed defective in supplying FOI documents during Alan’s arbitration. This letter can be found at the back of the Ted Benjamin Exhibit 4, entitled Examples of Telstra’s abuse of Legal Professional Privilege (LPP).

Ms Geary’s 4th July, 1994 letter is related to the 29th June, 1995 letter discussed above, because had Telstra abided by the FOI Act, Taits would never have had to write that letter.

3rd August, 1995:  Dr Hughes writes to Ted Benjamin, copied to Mr Schorer, Mr Pinnock, Mr Bartlett and Mr Rundell noting:-

“Mr Schorer advised me that due to a combination of factors, including the current state of his health, the commercial pressures imposed by his business and an impending FOI claim, he is unable to submit a claim at present.
(GS-CAV 225)

Again, there is no reference in this letter alerting these parties, that, as arbitrator, Dr Hughes believes “if the process is to remain credible, it is necessary to contemplate a time frame for completion which is longer than presently contained in the Arbitration Agreement”.

7th August, 1995:  John Pinnock writes to Alan Smith regarding the impracticable BCI tests. He states:-

“You have also claimed that on 26 May 1995 you received further FOI documents from Telstra which, you state, would have assisted your claim significantly. …”

“As Administrator of the FTAP, I have a duty to ensure the integrity of the procedure. Your complaints go to this issue, and accordingly, I would be pleased if you would provide me with:

  • all documents supplied to you by Telstra on or after 26 May 1995 together with covering letters, schedules or annexures which may identify those documents.
  • a concise explanation of the significance of the further FOI documents released by Telstra; in particular, specific instances which support your contentions in (a) and (e) above.
  • Any other evidence which supports the above contentions.” (GS-CAV 226)

In the CAV Alan Smith – John Pinnock Conspiracy to pervert the course of justice LGE file and the TIO – Target file, it is shown Alan Smith provided Mr Pinnock with a comprehensive list and the required documents to Mr Pinnock.  Alan is still waiting for him to carry out his “duty” as the administrator of Alan’s arbitration and to correctly respond to Alan’s reply.

8th August, 1995:  Alan writes to Ted Benjamin concerning Telstra knowingly using the flawed BCI tests in their defence as well as withholding FOI documents until after Dr Hughes deliberated on his claim. (AS-CAV 196)

9th August, 1995:  Alan submits yet another FOI request to Ted Benjamin, re the T200 report.  As neither Telstra nor Dr Hughes accessed, on Alan’s behalf, the working notes regarding Telstra’s ‘beer-in-the-phone’ TF200 report, Alan makes a fresh FOI request, with the appropriate $30 application fee, for these documents.  This letter was also copied to Mr Pinnock, who plays a continuing roll in this TF200 saga. (AS-CAV 188)

21st August, 1995:  Mr Pinnock is provided with a copy of a letter allegedly sent by Gerald Kealey of BCI Canada to Steve Black of Telstra on 11th August, 1995 (AS-CAV 189 and AS-CAV 190-A).  A number of Telstra Executives would have known this letter contains false and misleading information.  Yet this letter was provided to the Senate in an attempt to stop its investigation into Alan’s claims that Telstra knowingly used impracticable test results to support their arbitration defence (AS-CAV 191).  Was the Gerald Kealey letter a manufactured document?  This letter does not have any BCI identification on the letter at all.

Attached as exhibit AS-CAV 190-B, is a copy letter from Bell Canada International (BCI) to Telstra’s Alan Humrich, dated 14 December, 1993 on a BCI letterhead.  Why did Gerald Kealey type his letter on a blank piece of paper?

In Mr Black’s letter to Mr Pinnock he states:-

“I refer Dr Hughes’ letter to you dated 21 June, 1995 which enclosed a copy of a facsimile from Mr Smith to Dr Hughes dated 20 June 1995. Dr Hughes copied his letter to Telstra.”

Attached to Alan’s 20th June, 1995 letter to Dr Hughes (AS-CAV 192) were three other BCI-related documents showing Alan had reason to raise the flawed BCI tests during his arbitration (AS-CAV 193, AS-CAV 194, and AS-CAV 195).

Did Dr Hughes copy this BCI information to Telstra because he believed Alan’s claims were valid?  After all, he was now supplying correspondence that he didn’t address during Alan’s arbitration onto Telstra.

24th August, 1995: Ted Benjamin responds to Alan’s letter 8th August, 1995 noting:- I refer in particular to the last paragraph of your letter in which you state that Telstra had ‘…internal knowledge that the Bell Canada International Addendum report was not a true and correct document’. Telstra rejects outright your claim…” (AS-CAV 197)

4th September, 1995:  Dr Hughes writes to Graham Schorer, copied to Mr Benjamin, Mr Pinnock, Mr Bartlett and Mr Rundell.  He notes:-

“I refer to our telephone discussion on 3 August last and would be pleased to know if you are yet in a position to indicate whether, and if so when, you intend proceeding with the submission of your claim documentation.” (GS-CAV 227)

At no time, during Graham’s arbitration, was he advised Dr Hughes believed a new Arbitration Agreement should be drafted.

20th September, 1995:  The Senate Hansard shows under Matters of Public Interest – Telstra:-

Senator BOSWELL (Queensland –Leader of the National Party of Australia) states:-

“At the moment there are customers of Telstra who, for many years, have also been casualties of Telstra. For years they have experienced problems with dead lines, lines dropping out, busy signals when it was not busy and many more. …”

“One Commonwealth Ombudsman’s report on delays in FOI information condemns Telecom’s denial of documents in the following words:

It was unreasonable for Telecom to require the participants to make further assurances while Telecom was considering the arbitration agreement and thereby denying participants the opportunity to consider the rules that Telecom wished to have included in the agreement.
(GS 228)

3rd October ,1995:  AUSTEL writes to Telstra’s Steve Black, re 008/1800 faults.

“I write concerning charging discrepancies raised in 1994 by Mr Alan Smith of Cape Bridgewater Holiday Camp regarding his 008 service, and the wider issues these discrepancies raise for Telstra’s 008/1800 customers. …”

“To date, AUSTEL has not received a response from Telstra which allays AUSTEL’s concerns about this issue.” (AS-CAV 201)

This letter was copied to John Pinnock.

From August 1995 to October 1995, Mr Pinnock wrote a number of letters to Telstra’s Ted Benjamin, asking why Alan had not received the BCI information during his arbitration. It appears (see CAV LGE Target files) that even though Mr Pinnock was concerned Alan wasn’t receiving the relevant information after his arbitration, he stopped his enquiries into the BCI matters.

28th November 1995: Mr Pinnock informs Alan:-

“You have sent approximately 25 letters to the TIO in the last month. …”

“If you continue to write to me seeking that I take action which you know I cannot and will not take, you will only be frustrated and disappointed by my lack of response. …”

“The Resource Unit have provided clarification of the reasons for the deletion of references to a potential addendum on possible discrepancies in your Telecom bills from the final Technical Report as follows:

  • ‘At a late stage of the Arbitration process, at the time of the Technical Evaluation Report, there was discussion about billing issues which had been raised by Mr Smith.  A draft of the Technical Evaluation Report therefore included references to the billing matters, which it was thought might require further work beyond the time of issue of the Report.’ (This letter is available in J Pinnock File No/11-E)

23rd October, 1995:  Portland solicitors Bassett & Sharkey, write to John Pinnock, stating Alan believes Telstra used BCI test results known to be impracticable to support their arbitration defence and he requires answers. (AS-CAV 198)

26th October, 1995:  Minter Ellison, for the TIO, drafted a letter to reply to Bassett & Sharkey.  This letter included the statement:-

“Although the Arbitrator had a copy of the Bell Canada Report, it does not appear to have ever formally been put into evidence.”

This was false and misleading because both Minter Ellison and the TIO’s office also had a copy of Telstra’s arbitration defence and a copy of the arbitrator’s award where he states the BCI was placed into evidence. (AS-CAV 199)

6th November, 1995:  Five months after Dr Hughes wrote to Warwick Smith, on 12th May 1995, noting that:-

“if the arbitration agreement was to remain credible, it is necessary to contemplate a time frame for completion which is longer than presently contained in the Arbitration Agreement”,

Dr Hughes wrote to Graham Schorer, asking Graham to advise him:-

“within 7 days when you expect to complete the submission of your claim.”

“If you anticipate a delay of considerable or indeterminate length, I will give consideration to the question of whether this arbitration should be abandoned.” 

Regardless of Senator Richard Alston being advised of the flaws in the arbitration agreement, the regulator AUSTEL and TIO continue with the arbitrations.

9th November, 1995:  Mr Pinnock responds to Bassett & Sharkey.

“If Mr Smith feels the process was flawed or the Award tainted, he has legal avenues available to him.” (AS-CAV 202)

In his letter to Mr Pinnock, on 15th November, 1995 Mr Rundell states:-

“A second matter involved 008 calls. Again, this matter was current at a late stage (April 1995) of the Arbitration process.” …

“As no further progress was likely to be made on these matters, the formal version of the Technical Evaluation Report did not leave the billing issues open.” (AS-CAV 104)

Although the billing issues were certainly still ongoing in April 1995, this letter implies they were not referred to before.  This is inaccurate: the billing issues were included in Alan’s letter of claim that he lodged on 15th June, 1994.  Furthermore, the transcript of the Arbitration Oral Hearing, on 11th October, 1994 also shows both FHCA and the arbitrator were given huge amounts of evidence regarding wrongly calculated accounts charged to Alan’s phone services over many years. (AS-CAV 105)

As for the “Technical Evaluation Report” not leaving “the billing issues open”, both the draft Technical Evaluation Report and the formal version clearly left this issue wide open, as can be seen from the following point, which appears in both versions of the report:

“2.23 Continued reports of 008 faults up to the present. As the level of disruption to overall CBHC service is not clear, and fault causes have not been diagnosed, a reasonable expectation is that these faults would remain ‘open’.”

10th November, 1995:  AUSTEL’s Cliff Mathieson writes to the Hon Michael Lee, Minister for Communications, attaching AUSTEL’s fifth quarterly COT Case Report, which states, on page 3:-

“The TIO has observed that the progress of arbitration for both the original four complainants and the other group involved in the Special Arbitration Procedure has been significantly hampered. The TIO attributes this to –

  • delays in the provision of documentation and information by Telstra to the various customers under Freedom of Information entitlements;
  • delays on the part of the claimants in advancing their claims; and
  • the legalistic approach adopted by Telstra in its defence against these claims.” (GS-CAV 230)

24th November 1995: This letter from William Hunt, Graham Schorer’s solicitor, to Dr Hughes, states:-

“The arbitration proceedings were entered into on a clearly accepted basis that Telstra would supply required documentation under FOI provisions. Our client cannot proceed without the relevant information being made available. …”

“Our client is aware of the disastrous state of affairs as to the supply of FOI documents in the recent Smith arbitration wherein documentation was supplied shortly before and after you made your decision; it does not want to be similarly disadvantaged in its own proceedings. (GS-CAV 231)

20th December, 1995:  TIO John Pinnock writes to Derek Ryan. He notes:-

“In that letter you state, among other things, that “I have since been advised by a staff member of FHCA that a large amount of information was excluded in their final report at the request of the arbitrator.”

I have been informed by Ferrier Hodgson Corporate Advisory that it is not in fact the case that a large amount of information, or indeed any information, was excluded from the Resource Unit’s report at the request of the Arbitrator.” (AS-CAV 177-B)

22nd December, 1995:  Derek Ryan responds to Mr Pinnock’s letter, noting:-

“On May 8th 1995 I telephoned FHCA and spoke to John Rundell and requested a meeting to discuss how the FHCA loss figures were determined. He was reluctant to talk to me at that time however we set a tentative date of 17 May 1995 for us to discuss this matter again. …”

“My response to the FHCA report was lodged on 9th May 1995.

“On 17th May, I telephoned John Rundell and he stated that he was unable to discuss anything with me until the appeal period had expired. During that telephone conversation I told him I was unable to recalculate the FHCA figures and that I felt the report was deficient in that regard. He then stated that he understood my problems and that FHCA had excluded a large amount of information from their final report at the request of the arbitrator.”
(AS-CAV 178-B)

That John Rundell told Mr Pinnock, “I did advise Mr Ryan that the final report did not cover all material and working notes, (AS-CAV 179) suggests Derek Ryan’s two letters (AS-CAV 177 and AS-CAV 178) are closer to the truth that anything Mr Rundell will admit.  See also Derek’s letter to Ms Caitlin English, Consumer Law Centre Victoria (AS-CAV 176).

Why did John Rundell respond like this?

In the letter from John Rundell of FHCA to Mr Pinnock, dated 13th February, 1996 admitting Mr Rundell’s Financial Report was incomplete, Mr Rundell all but accuses Alan of causing criminal damage to his personal property and notes the Brighton CIB were intending to interview Alan.  When Alan found this comment, he contacted the Brighton CIB and was told that they never intended to interview him regarding this matter and, in fact, they had no record of Alan on their files at all.  This further supports Alan’s assertions:  John Rundell is not a credible witness and should therefore never have been in charge of the distribution and assessment of Alan and Graham’s arbitration claim documents. (AS-CAV 179)

IMPORTANT POINTS TO CONSIDER:

  • Derek Ryan’s report was dated 9th May, 1995.
  • Dr Hughes and FHCA would have needed all of the following day, 10th May, 1995 to digest and discuss Derek’s reply to the final FHCA Report. This is the same final FHCA Report that John Rundell advised Mr Pinnock, on 13th February, 1996 that he did advise Mr Ryan that the final report did not cover all material and working notes”.
  • Dr Hughes submitted his award on 11th May, 1995.

Derek Ryan never received a response from Dr Hughes to confirm he received Derek Ryan’s official response. Did FHCA receive Derek’s Ryan’s report first, due to their vetting arrangement, and decide it was irrelevant?

22nd November, 1995:  Ted Benjamin again refutes Alan’s BCI claims.  Mr Benjamin states:-

“I note that you raised issues in relation to the Bell Canada International testing results in the arbitration process.  As you are aware, the arbitration process dealt with the complaints by you in relation to your telephone service. … Telstra does not propose to comment further or enter into debate with you on these matters.” (AS-CAV 200)

28th November, 1995:  Alan makes a telephone call to Dr Hughes’ residence to inform him that his latest FOI application, dated 9th August, 1995 which he asked Ted Benjamin to process (AS-CAV 188), yielded amazing results.  Alan’s FOI application sought all working notes showing how Telstra laboratory staff concluded “sticky” beer was the cause of his EXICOM TF200 phone lock-up problems.  The TF200 information Alan now received was a completely different set of testing results than the ones Telstra used in their arbitration defence (see Ted Benjamin Appendix 32).  Dr Hughes wasn’t home and Mrs Hughes informed Alan that he was away on business.  Alan was immediately concerned Dr Hughes would have told his wife about Alan’s continued frustration with his arbitration and so, when she asked who was calling, Alan worried she would become upset if he gave his real name.  He quickly decided to use the first name he could think of that was unlikely to upset her, but who he was sure Dr Hughes knew – John Rundell.  The result of this telephone call is discussed in more detail below.

10th January, 1996:  Mr Pinnock writes concerning Alan’s requests for documents that might enable him to appeal the Arbitrator’s Award.

“The arbitration of your claim was completed when an award was made in your favour more than eighteen months ago and my role as Administrator is over.”

“I do not propose to provide you with copies of any documents held by this office.” (AS-CAV 203)

18th January, 1996:  Alan writes to Mr James, President of the Institute of Arbitrators, condemning the way Dr Hughes conducted his arbitration. (AS-CAV 204)

19th January, 1996:  Telstra’s letter to Dr Hughes states:-

“I should note, however, that in the circumstances Telstra faces great difficulty in attempting to place practical limits on the scope of its searches. This is due both to the vague nature of Golden Messenger’s claim and the wide scope of your direction, which is broadly analogous to a direction for Telstra to give discovery of documents, a situation which was not envisaged when the parties entered into the Fast Track Arbitration Procedure.” (GS-CAV 232)

On the next page of this letter, Telstra lists some 26 different locations from where approximately 66,000 documents and computer disks were sourced to accommodate Graham’s arbitration requests.  Telstra doesn’t explain, however, that these 66,000 documents included multiple copies of the same documents from these 26 different locations.  Even the intervention of the Senate Working Party from 1997 to 1999 did not result in Graham receiving the real exchange material he needed, i.e. the CENTOC – TRAXE congestion-monitoring data for the outer exchanges servicing the North Melbourne exchange that Graham’s business was connected to.  How could any of the COT claimants be expected to accurately calculate the extent of lost calls if they were not given these important monitoring data documents?  Rather than 66,000 documents, many duplicated, Graham needed a single 52-page weekly congestion chart for each year of his 10-year claim – a total of some 520 pages or more would have sufficed.  Why did none of the COT claimants ever receive these CENTOC – TRAXE charts through their numerous FOI requests?

It is shown below, for the date of 14th March, 1997 Telstra knowingly withheld CENTOC – TRAXE data (half-hourly recordings) during Alan Smith’s arbitration under Legal Professional Privilege.

A Telstra Arbitration Defence Document, provided to Graham Scherer, entitled Briefing Document B003 Report and dated 26th November, 1996 notes:-

  1. “From October 1995 customers whose services were directly connected to LONU exchange would incorrectly receive a RVA when calling (03) 9287 70xx (8 digit dialling). Customers connected to North Melbourne System-12 exchange (NMEE) would incorrectly receive the RVA on 50% of call attempts to (03) 9287 79xx as calls from NMEE to NMEX were trunked on 50/50 basis via LONU and North Melbourne. …
  2. “Traffic Observation data available for the codes (03) 286 & 287 xxxx and (03) 9286 & 9287 xxxx shows that the percentage of callers dialling new 8 digit codes was less than 20% in October 1995 and less than 50% in December 1995. (GS-CAV 233-A)

In regards to this same Lonsdale fault, Telstra notes on page 15:-

“On 19January 1996 the Claimants’ complained that at 4:30pm they attempted to ring their own (03) 9287 7000 number following a clients [sic] complaint of receiving RVA intermittently. The fault was traced to incorrect data at LONU exchange on 10 October 1995.” {Ref: J05771 to J05774}

“A detailed analysis of this fault is provided in ‘Investigations, Analysis and Supportive Data’. The estimation of the impact attempting to the Claimants’ ISDN services is:

  • for 10 October to 12 December 1995, approximately 0.12% call loss from the Melbourne (03) network attempting to call the Claimant’s ISDN services; and
  • for 13 December 1995 to 23 January 1996, 0.23% call loss from the Melbourne (03) network attempting to call the Claimants’ ISDN services.

Therefore the data error in Lonsdale had negligible effect on call delivery to the Claimants’ ISDN services and no effect to their PSTN services. The Claimants’ outgoing calls were not affected.” (GS-CAV 233-B)

COMMENTARY 1

It is important to compare the Graham Schorer Lonsdale exchange RVA call-loss problems with the Alan Smith Lonsdale exchange RVA call-loss problems that were discussed during Alan’s arbitration in Telstra’s B004 Briefing document.  It is unknown if Telstra misled the arbitrator regarding the Lonsdale exchange RVA software problem Graham experienced.  However, it knowingly misled the same arbitrator regarding the Lonsdale exchange MELU RVA problem regarding Alan’s claims when Telstra noted:-

“Telecom investigated these complaints and located data entry error at its MELU Windsor Trunk Exchange (‘MELU’).”

“The error was made on 4 March 1992 and was located by test calls that were made by staff at Telecom’s Lonsdale exchange. … Whilst it was initially thought that the problem may have existed for a 6 week period, subsequent investigations confirmed its existence for a total of 16 days (refer witness statement of Hew MacIntosh and David Stockdale.” (GS-CAV 233-C)

At Exhibit 9 in the Alan Smith – Ted Benjamin Target file, Alan uses Telstra’s own file notes, together with correspondence he received from various people, to show this Lonsdale exchange RVA software error problem had existed for eight months (not 16 days), with a call loss of 50% (not the 33% Telstra claimed).

On 21st November, 2007, Alan received a 74-page draft report prepared by AUSTEL on 3rd March, 1994 from the Australian Communication Media Authority (ACMA), regarding Alan’s claims against Telstra.  At point 103, this report is most critical of Telstra for misleading and deceptive statements in relation to the MELU Lonsdale exchange RVA problem, noting:-

“It is apparent from Telecom’s documentation that no investigation of the duration of the MELU data error problem would have been initiated without the persistence of Mr Smith’s complaints on the matter.” And, the next point states, “The assessment provided to Mr Smith that up to 50% of STD calls from Melbourne to the Cape Bridgewater Holiday Camp would have been affected by the MELU RVA problem appears to be accurate.” (GS-CAV 233-E)

COMMENTARY 2

As mentioned above, in Telstra’s Briefing Document B003 report, point 8, page 18, Telstra stated:-

“Traffic Observation data available for the codes … shows that the percentage of callers dialling new 8 digit codes was less than 20% in October and less than 50% in December 1995.”

Where did Telstra’s Arbitration Defence Unit obtain this data code percentage information?  No such data code percentage information was ever supplied to Graham under FOI or discovery.

Exhibit GS-CAV 233-f states:-

“It is important to note that material that is not produced for this request cannot be used in Telecom’s defence.”

Regardless of Telstra’s knowledge that it could not rely on information in their defence that was not supplied to the claimant, it still did.

23rd January, 1996:  Dr Hughes writes to John Pinnock, re Laurie James, and notes:-

“I enclose copy letters dated 18 and 19 January 1996 from the Institute of Arbitrators Australia.   I would like to discuss a number of matters which arise from these letters, including:

  • the cost of responding to the allegations;
  • the implications to the arbitration procedure if I make a full and frank disclosure of the facts to Mr James. (AS-CAV 205)

Why wasn’t Dr Hughes fully frank with Laurie James?  Why didn’t Dr Hughes inform Laurie James, he had already advised Mr Pinnock’s predecessor Warwick Smith, that the arbitration agreement was flawed and needed revising?

25th January, 1996:  Ted Benjamin writes to Graham, stating:-

“At paragraph 17 the Claimants state that their business was connected to the Telstra Australia ISDN Network in December 1993 by Telecom Australia, but the service difficulties, problems and faults previously experienced still continued.

Telstra understands that the PABX generates reports at the premises at which it is located and also generates reports which are sent to or generated at the premises of the company responsible for servicing that PABX. Those reports are relevant to the Arbitration to enable Telstra to distinguish between the telephone service difficulties, problems and faults attributed to the CPE, CAN and Network and misoperations by the Claimants.”(GS-CAV 234)

Telstra wanted documents from Graham, but would not release the CENTOC – TRAXE congestion traffic data for the exchanges servicing the North Melbourne exchange that serviced Golden Messenger.

In the AUSTEL COT Case Report at point 8.56, 8.58 and 8.59 AUSTEL notes:-

“As Coopers & Lybrand concluded – Telecom placed an unreasonable burden on DNF cases to provide evidence to substantiate claims for situations where all telephone fault information that could reasonably assist to determine loss should have been held by Telecom. To determine settlement of a dispute Telecom is considered to be entitled to obtain information on business performance from customers. In relation to information on the nature of complaints and their incidences, it is Telecom’s responsibility to collect the information and we believe Telecom unreasonably used its inability to adequately document faults and tests for causes as a defence against claims.”

At point 8.58, AUSTEL states:-

“If a customer objects to a Telecom offer, it is not uncommon for the customer-Telecom negotiation process to be terminated and the customer to be told to deal only with Telecom’s lawyers. For example, on 27th September 1993 Mr Schorer, one of the original COT Cases, received from Telecom’s solicitors a facsimile in the following terms –

‘I confirm that we act for Telecom Australia. As discussed we have been instructed by our client to request that you address any concerns of a legal nature involving our client and your business, direct to this office marked to my attention.’ ”

At point 8.59, AUSTEL further states:-

“Mr Schorer subsequently wrote to AUSTEL expressing considerable frustration with the arrangement proposed in Freehill Hollingdale and Page’s facsimile.”

AUSTEL then noted under the heading, Letter dated 28 September 1993, AUSTEL to Telecom:-

Point 8.60

“Coopers & Lybrand also share AUSTEL’s concerns about Telecom’s propensity to insist that its customers deal with its lawyers rather than with the relevant officials within Telecom. It said – ‘Telecom’s use of legal advisers to handle DNF customers was inappropriate.’ ”

Yet, on 26th January, 1996, three years after AUSTEL wrote this letter, Graham was still having to deal with Freehill Hollingdale & Page, this time as Telstra’s Arbitration Defence Counsel.

2nd February, 1996:  William Hunt’s file notes confirm he spoke with Mr Bongiorno’s office (an expert on discovery), leaving a message associated with Graham’s arbitration discovery issues.  On 1st February, Mr Bongiorno returned Mr Hunt’s call citing a precedent set in “the case Conlan v Landsworth re. Copsey’s Carlton Inn Hotel reported 1970 Law Reports on page 293. There was a decision on the question of discovery apart from the case itself as a whole. The ruling on discovery was apparently made on the 17th or 18th June, 1969. Copy judgements can be found in the Supreme Court library.” (GS-CAV 235-A)

Attached to this file note are three separate similar cases to that of Graham Schorer, where discovery should have been provided on request. (GS-CAV 235-B)

The Australian Digest – Discovery And Inspection Of Documents states:-

  1. “Government communications to obtain legal advice – Improper use of regulation-making power alleged.} – Held, that where there was prima facie evidence that a government’s communications with its legal advisors came into being as part of a plan to defeat the interests of a class by deliberately using regulation-making power for a purpose outside the enabling Act, sufficient colour existed to displace the usual privilege attaching to the professional legal advice.

{(1984) 3 FCR 534; 55 ALR 545 affd.}

A-G (NT) v Kearney (1985) 158 CLR 500; 59 ALJR 749; 61 ALR 55 (HC) (GS-CAV 235-C)

5th February, 1996:  The transcript from the Direction Hearing confirms William Hunt asked Dr Hughes:-

“Would you be kind enough to have identified for the record who is here?”

Dr Hughes-

“We have Telstra Mr Benjamin and Peter Gamble; from the resource unit, Sue Hodgkinson and Lauren Zohar from Ferrier Hodgson Corporate Advisory, and Andrew Crouch from Lane Telecommunications. We have from the telecommunications industry ombudsman’s office Mr Pinnock, for the ombudsman, and Ms Di Mattina, assisting Mr Pinnock.” (See Graham Schorer CAV – Relevant Information file exhibit 4)

On page 3 of this transcript Dr Hughes notes:-

“Recapping what brings us here, we had a directions hearing last on 14 December 1995 and at that directions hearing, I directed that Telstra provide or make available such relevant documentation in its possession that had otherwise been available pursuant to FOI and that this documentation be made available on or 16 January 1996. Subsequently, I received advice from Telstra on 16 January 1996 that it had been carrying out extensive document searches and that those searches were continuing but in the time available it had not been possible to finalise the production of documentation.”

Also on page 61 and 62 of this transcript Dr Hughes states:-

“Telstra has put us on notice that if they believe that the claim is stalled at any stage due to unreasonableness on the part of the claimant, they will be making the appropriate application and it’s a matter we deal with when and if it arises.”

Summary of issues arising from meeting on 5th February, 1996

Exhibits 1 to 8 in the Alan Smith – John Pinnock Conspiracy to Pervert the Course of Justice LGE 5 – CAV file confirm Dr Hughes, Mr Pinnock, Ms Mattina and Ted Benjamin (all present at the Directions Hearing on 5th February) knew Telstra knowingly used this flawed BCI material and evidence of this knowledge was hidden from Dr Hughes until after he handed down his award on Alan’s arbitration.  Why, with all the information regarding the flaws in the BCI report before them, did Dr Hughes and Mr Pinnock allow Telstra to decide what they would and would not provide regarding the BCI information under discovery?

In numerous letters sent by Telstra’s Ted Benjamin to Dr Hughes, Mr Benjamin states he believes Telstra supplied all the relevant information Graham Schorer asked for.  Yet, the letter of 11th July, 1994 confirms Telstra’s Steve Black and TIO Warwick Smith agreed between them Telstra would provide all documents pertaining to the arbitration to the resource unit for vetting purposes, and the decision on whether that material should be passed to the arbitrator depended on whether or not the resource unit believed the information was relevant.  By allowing the resource unit this final power over the exchange of evidence, this hidden agreement between Telstra, the TIO and the resource unit, allowed the resource unit to become the de-facto arbitrator.  None of the COT claimants were told of this before they signed the Arbitration Agreement.  How many documents Graham asked for under FOI were scrutinised and rejected by FHCA? (therefore never reaching Graham or the arbitrator).

It is now proven FHCA secretly vetted and discarded numerous documents during Alan’s arbitration because, in FHCA’s opinion, they were not relevant to the arbitration (see 2nd August, 1996 below).  Perhaps the documents Graham expected to receive, under his many FOI requests lodged between 1993 and 1996, were also secretly vetted and discarded by FHCA?  In Alan’s case, some of the material FHCA vetted in his arbitration, and discarded as irrelevant, was again inspected on 14th January, 1998 by Telstra’s Lyn Chisholm (see Alan Smith – John Pinnock Target file) and her minutes of that meeting show this discarded material was in fact most relevant to Alan’s claim.

15th February, 1996:  Dr Hughes writes to Mr Pinnock regarding a draft of a letter he proposes to send to the Institute of Arbitrators in response to one of Alan’s complaints. He states:-

“I would appreciate your confirmation that there is nothing in the proposed letter which would embarrass your office or jeopardise the current arbitrations.”

“You may consider it appropriate for you to provide an independent letter of support. This is of course a matter for your discretion.” AS-CAV 206

Why would Dr Hughes need a letter of support if he had nothing to hide?

Dr Hughes spins a tall story to Laurie James

16th February, 1996:  There are many inaccuracies in this letter, but the most important is at point 1 on page two, where Dr Hughes states:-

“contrary to Mr Smith’s assertion on page 3, his 24,000 (sic) documents were all viewed by me, Ferrier Hodgson Corporate Advisory, DMR Group Inc (Canada) and Lane Telecommunications…”

This statement, however, is wrong and highlights just how far Dr Hughes was prepared to go to cover up the unconscionable way Alan’s arbitration was conducted. AS-CAV 157)

For the record:

The 24,000 FOI documents, referred to by Dr Hughes in his letter to Mr James, relates to Alan’s original letter to Senator Evans (also copied to Laurie James).  On page 4 of this letter, Alan alerts Senator Evans to the 24,000 documents, stating:-

“As a result of viewing the previously referred to 24,000 late FOI documents and sorting them into bound volumes it became apparent that there were still many areas I could not include in my written submission since I did not have enough technical knowledge.” (AS-CAV 208)

On page 3, Alan states:-

“Telstra presented their defence on 12th December 1994. At this time I was still waiting for FOI documents to be supplied. Eleven days after Telstra presented their Defence I was finally supplied with 24,000 plus documents. The first notification I had of these documents arriving was a phone call from Kendall Airways on 23rd December 1994, announcing that 72-74 Kilograms of documents, addressed to me, had arrived at the Portland Airport.”

It is obvious from Dr Hughes’ letter to Laurie James that he was concerned about the content in Alan’s letter to the senator, and the ramifications if the truth was revealed.

16th February, 1996:  Graham Schorer’s solicitor, William Hunt, receives a phone call from Amanda Davis, who had been AUSTEL’s General Manager of Consumer Affairs, but now had Power of Attorney for Maureen Gillan’s claim.  Maureen was one of the four COT claimants.  William Hunt’s file note says:-

“Amanda Davis, who rang on the suggestion of Schorer. She told me she had complained in effect to Bartlett of the legal support team to Hughes that the administrator (the Telecom Ombudsman’s department) had been pressuring Hughes to produce results and get on with the matter generally. She was putting it to Bartlett that any pressure on Hughes should be related to getting Telecom to produce results and not just to wind the matter up.”

“The impression I go [sic] was that Bartlett’s view was that the administrator had to keep out of the rights and wrongs of the disputation between the parties to the arbitration.” (GS-CAV 236)

Alan Smith has attached to his CAV – Warwick Smith Arbitration LGE file, at point 12, two letters that relate to this pressure being applied to Dr Hughes to produce results quickly, rather than pressure being applied to Telstra to produce the FOI information they were duty bound to provide to the claimants.  These letters are dated 28th April, 1995 and both relate to Alan’s Fast Track Arbitration.

Letter 1, from Peter Bartlett to Warwick Smith:-

“Further to our recent discussion, it seems to me that we should put to Gordon Hughes that we expect his Award to be made prior to his departure on 12 May 1995.”

“Attached is a draft letter to Gordon. It is in reasonably harsh terms.”

“Could you please consider whether a letter in this form, or an amended form, should go to Gordon.” (GS-CAV 236-B)

Letter 2, draft letter attached to Letter 1:

“I am becoming increasingly concerned at the delays in the finalisation of this matter. …”

“I understand you are to present a paper in Greece in mid May.”

“I would expect the Award would be delivered prior to your departure.”

“It would be unacceptable to contemplate the delivery of the Award being delayed until after your return.” (GS-CAV 236-C)

Even though the TIO-appointed Technical Resource Unit, DMR and Lane, clearly stated their draft report of 30th April 1995 was incomplete, this reference was removed from the draft and the doctored report was then provided to Alan and his technical advisors as the final and complete version of the report.  Either Dr Hughes conformed to Peter Bartlett’s request of 28th April, 1995 or he made his own decision to bring down an award prematurely on an incomplete report before he went to Greece: either way, Alan’s claim suffered.

While this despicable act in relation to Alan Smith’s claim is of grave concern, Dr Hughes was also Graham Schorer’s arbitrator and the issue here, is that pressure was still being exerted on Dr Hughes to complete Maureen Gillan’s claim.  The most important section of Mr Hunt’s file notes is his record of Amanda Davis saying that:-

“The impression I go [sic] was that Bartlett’s view was that the administrator had to keep out of the rights and wrongs of the disputation between the parties to the arbitration.”

Although Ms Davis does not appear to be critical of Mr Bartlett, it does seem somewhat alarming that Mr Bartlett seems to be laying some of the blame (for delays and interference in the process) on the administrator, when previously it was Mr Bartlett himself who was directly interfering in Alan Smith’s arbitration (see 28th April, 1995)

CHAPTER FIVE

Who benefited from exonerating FHCA, DMR and Special Counsel?

Although the 19th April, 1994 Arbitration Agreement issue was addressed previously, it is important to link it to the issues raised by Amanda Davis, when Caroline Friend, secretary to Dr Hughes, faxed a copy of the FTAP Agreement to lawyers, Mr Goldberg and William Hunt (see Graham Schorer CAV Relevant Information file, exhibit 2), Mr Hunt was seeking a legal opinion on the agreement before Graham Schorer and Alan Smith were to sign it on 21st April, 1994.  The following three clauses are included on page 12 of this version of the agreement received via Caroline Friend:-

Clause 24: Neither the Administrator nor the Arbitrator shall be liable to any party for any act or omission in connection with any arbitration conducted under these Rules save that the Arbitrator (but not the Administrator) shall be liable for any conscious or deliberate wrongdoing on the Arbitrator’s own part.

Clause 25: The liability of Ferrier Hodgson and the partners and employees of Ferrier Hodgson for any act or omission in connection with any arbitration conducted under these rules (other than in relation to a breach of their confidentiality obligations) shall be limited to $250,000 jointly.

Clause 26: The liability of DMR Group Australia Pty Ltd and the directors and employees of DMR Group Australia Pty Ltd for any act or omission in connection with any arbitration conducted under these rules, other than in relation to a breach of their confidentiality obligations) shall be limited to $250,000 jointly.

In the agreement presented to the COT claimants for signing two days later, on 21st April, 1994, clauses 25 and 26 were removed and only some of the wording was added to clause 24

The final version of Clause 24 reads: Neither the Administrator, the Arbitrator, the Special Counsel, a partner or employee of the legal firm of which the Special Counsel is a partner, a member of the Resources Unit, Ferrier Hodgson or a partner or employee of Ferrier Hodgson, DMR Group Australia Pty Ltd shall be liable to any party…”

Clause 24 now had a different meaning to that presented by the original three separate clauses and it freed Peter Bartlett and Minter Ellison from any risk of being sued for misconduct in their role as Legal Advisors to the process and thereby provided no incentive for them to ensure the COT claimants were involved in a fair and just process.

The altered clause 24 also has the original $250,000 liability cap against FHCA and DMR removed from the Arbitration Agreement faxed to Mr Goldberg and William Hunt on 19th April, 1994.

It is important to consider:

  • Graham Schorer sought a legal opinion from Mr Goldberg, through Mr Hunt, regarding what the COT claimants were led to believe was the final version of the Arbitration Agreement. Changes were later made to that agreement: i.e., the removal of clauses 25 and 26 and alterations to clause 24.  This meant the legal opinion given to Graham and Alan was provided on a document that was later secretly altered, apparently by the Legal Counsel who would most benefit from the alterations.
  • On 19th April 1994, when Mr Goldberg and Mr Hunt were assessing the not-yet-altered version of the agreement, they could not have known alterations would be made AFTER they had completed their assessment, neither did they know that another clause, 10.2.2, had already been changed by the removal of the words “each of the Claimants’ claims”. Neither Graham Schorer nor Alan Smith knew of this change either.
  • On 21st April, 1994, the day Graham Schorer and Alan Smith signed the FTAP in the Special Counsel’s office, no reference was made to the alterations by Mr Bartlett or anyone else. The claimants were told they had to sign the agreement before close of business that day because Mr Bartlett’s instructions were that the TIO would not administer the already-signed Fast Track Settlement Proposal – the earlier commercial agreement.

Questions:

  • Would Mr Hunt have advised Graham and Alan to sign the altered agreement, had he received that document instead of the one faxed by Caroline Friend?
  • Would Dr Hughes have advised Graham and Alan to sign the altered agreement, had he been aware it was not the agreement he and Caroline Friend, believed he was to arbitrate under?

20th February, 1996:  Telstra provides Dr Hughes, with a list of the names of the 48 telephone exchanges that routed through the North Melbourne exchange, which serviced Golden Messenger. (GS-CAV 237)

11th March, 1996:  At point 11, on page 15 of Telstra’s Briefing Document B003 report (Appendix E) is noted:-

“On 11 March 1996 the Claimants’ complained of receiving 3 different recorded voice announcements (RVA’s) when calling mobile 019 925xxx and 041xxxxx. The Claimants’ advised of the exchange code heard at the end of the RVA’s. The exchange code given appeared to be a Mobile Network exchange. Clear codes indicate that the fault existed in privately maintained equipment. {Ref: J05314 to J05315 & J05137 to J05141}” (GS-CAV 238)  

18th March, 1996:  Oren Zohar, from FHCA (the TIO-appointed arbitration resource unit), sends a fax to Dr Hughes stating:-

“Telstra has proposed that the meetings be held on Monday, Wednesday and Friday week commencing 25 March 1996. Graham Schorer has yet to confirm whether these dates are acceptable and he has advised that he will contact me once he has spoken with George Close and his solicitor, Bill Hunt.” (GS-CAV 239)

21st March, 1996:  Dr Hughes responds to Oren Zohar’s fax, stating:

I am prepared to be present at the proposed informal meeting

I do not consider the meeting should be transcribed. (GS-CAV 239)

  • Why was Dr Hughes concerned about a simple directions hearing being transcribed?
  • Was Dr Hughes worried because Alan Smith was raising the arbitration issues with Laurie James, the President of the Institute of Arbitrators Australia?

On 18th and 19th January, 1996 Alan Smith raised a number of complaints with Laurie James concerning the unethical way in which his arbitration was conducted (see Dr Hughes Target file for this date).

In the Alan Smith CAV – Dr Hughes Target file for the date of 16th February, 1996 it is shown that Dr Hughes’ letter of 16th February, 1996 misled Laurie James concerning Alan’s arbitration.  There is also no reference in this letter from Dr Hughes admitting he had advised the TIO, on 12th May, 1995 the Arbitration Agreement was not credible (see also GS-CAV 239-D).

The fact that Dr Hughes was seeking advice from Mr Pinnock, on what he should or should not disclose to Laurie James, (about the conduct of the COT arbitrations) during the time he was arbitrating on Graham arbitration raises more questions about Hughes’ independence.

19th March, 1996:  William Hunt’s file note states:-

“At or about the same time Bell Canada had Telstra doing reports on its service in relation to Golden’s receipt of same.  At or about the same time similar tests were being done on the Telstra equipment  relating to Smith and the results of thoses [sic] cover the demonstration that they could not have been done. …”

“As to the second Bell Canada test Schorer has on disk the [sic] Telstra abandoned certain tests as to part from certain exchanges. One can only assume that the reports were unsatisfactory to Telstra or supportive of Schorer.”(GS-CAV 240)

25th March, 1996:  George Close, Graham’s Technical Advisor informs Graham:-

“You are aware, I have been assisting a number of CoT members in preparing their technical submission that demonstrates reasonable causal link between telephone service difficulty and faults experienced to call losses to be used in support of their claims being processed under arbitration. …”

“Telstra’s Use Of Final Testing Results As Evidence:

Telstra has only employed successful final test call run results as a defence in response to all CoT claim submissions made under Arbitration.

These final tests comprise over 50% of the Telstra defence evidence to establish the Integrity of Telstra equipment, bearers, network performance and the degree of congestion. …”

(b)Prior to performing final testing, a series of pre-dial test are carried out and subject to the resulting grade of service experienced, a decision is made to either run the final tests, fix the fault(s) or block out the offending service (for future fixing).”

“Thus by Telstra using only final test runs as defence evidence attesting to be proof of service levels provided in response to a complaint made without including the pre-dialled test results places Telstra in a classic win-win situation as the final test runs by design are meant to produce a successful result once the complaint has been fixed. …”

“In essence, the use of Telstra’s final test results should be totally disregarded as evidence unless pre-dial information, tests and faxes accompany the final test results attested under statutory declaration.” (GS-CAV 241)

It’s interesting to note that in the AUSTEL COT Case Report, at point 5.48, is stated:-

“Telecom’s approach to the required testing regime was also less than positive. AUSTEL had required the testing to occur in business hours. Telecom maintained that it interpreted this requirement according to the nature of the business and, had it done so in good fault, it would have been acceptable. That was not, however, the outcome. In one case (Mr Schorer of Golden Messenger) only 15% of the test calls related to the complainant’s business hours, an approach scarcely consistent with Telecom’s advice that it wanted to establish the ‘fundamental integrity’ of the approach and that it wanted the results to be ‘beyond’ reproach.”

27th March, 1996:  Mr Pinnock assists Dr Hughes in his letter to Laurie James, President of the Institute of Arbitrator (Australia).  Mr Pinnock also attacks Alan’s credibility by knowingly misinforming Mr James regarding Alan ringing Dr Hughes’ wife one morning, noting:-

“Mr Smith has admitted to me in writing that last year he rang Dr Hughes’ home phone number (apparently in the middle of the night, at approximately 2.00am) and spoke to Dr Hughes’ wife, impersonating a member of the Resource Unit.(AS-CAV 209)

Who advised Mr Pinnock that Alan telephoned at approximately 2.00am?  The telephone account for the evening in question confirms Alan called at 8:02pm (AS-CAV 210).

Questions:

  • Why did Mr Pinnock not send Laurie James a copy of the alleged letter from Alan to him admitting Alan telephoned the arbitrator’s wife at 2.00am in the morning?
  • Did Mr Pinnock deceive Mr James (because this letter never existed) because he and Dr Hughes did not want any investigation by the Institute of Arbitrators into issues that should have been addressed (but were not) during Alan’s arbitration?

28th March, 1996:  Mr Pinnock writes to David Hawker MP in response to Alan’s allegations to Mr Hawker, that the incorrect billing issues he raised in his claim were not investigated, addressed or fixed during his arbitration. Mr Pinnock states:-

“It is incorrect for Mr Smith to assert that the TIO has avoided dealing with over-charging practices. My office refers questions of general charging practices to AUSTEL and deals with particular problems itself. Mr Smith’s allegations of over-charging for his service formed part of the claim submitted to the Arbitrator. Consequently, this matter was dealt with in his arbitration.” (AS-CAV 211)

Of course, the matter was not dealt with in Alan’s arbitration and AUSTEL advised Mr Pinnock so, on 3rd October, 1995 by giving the TIO a copy of AUSTEL’s letter to Telstra, which stated the billing faults Alan raised in his claim were NOT addressed (AS-CAV 201).  Mr Rundell of FHCA also admitted, in writing, to John Pinnock that he asked DMR and Lanes, (the Technical Resource Unit), NOT to investigate or address the billing documents Alan Smith submitted in his claim (AS 104).  Mr Pinnock has not behaved independently or impartially in Alan’s matters.  Knowingly lying to David Hawker MP, Alan’s local Federal Member of Parliament, is beyond contempt.

Telstra disconnected Alan’s Gold Phone in December 1995, even though they knew that he was refusing to pay only the refuted faulty part of this account that originated in the exchange at Cape Bridgewater.  Alan arranged for Telstra to disconnect his 008/1800 number in December 1997, because of the endless billing and short duration calls generated on that line which apparently could not be fixed.

Brief Billing Summary

Alan jumps 18 months in this particular billing summary to show it took from Mr Pinnock’s letter to Mr Hawker of 28th March, 1996 until October 1997 to convince Mr Hawker to investigate the continuing billing problems, which were twofold.

  • The lines often locked-up for periods unnoticed. It was quite common for Cathy and Alan, after terminating a call, to lift the receiver only to find the line still open.
  • This billing fault also disallowed intended calls to receive an engaged signal.

27th May, 1996:  Mr Pinnock writes to Alan noting:-

If you have complaints about the conduct of your arbitration procedure, I suggest you seek legal advice on the availability of review or an appeal. …”

“In your letter of 3 May 1996, you request that I ask Telstra why they chose not to defend allegations raised in your claim regarding your 008 service. As this matter was raised in your claim, it would have been considered by the Arbitrator, regardless of Telstra’s failure to respond. …”

“I advise that any further request by you for a review or investigation of (or comment on) the substantive issues in your completed arbitration will not be answered. (AS-CAV 215)

As with AS-CAV 213, Telstra waited until five months after Dr Hughes deliberated on Alan’s claim before attempting to address the 008 billing arbitration issues.

25th June, 1996:  Alan writes to Mr Pinnock noting:-

Your statement to Mr Laurie James, President of the Institute of Arbitrators, regarding a telephone call to Dr Hughes. ..”.

“To date I have had no response from you, personally, as to why you chose to tell Mr James that I phoned Dr Hughes’ residence at 2.00am on 29th November 1995 and that, in making this alleged call, I behaved unethically. (AS-CAV 216)

When Alan later received a copy of this letter back from the TIO’s office, a handwritten note had been added, stating:-

John, we are still waiting on a response from Gordon [Hughes] on this.”

Although, Mr Pinnock apologised, in a roundabout way, for writing to Laurie James in this manner, Alan has never received any reason as to why Mr Pinnock was intent in blackening Alan’s name as he did.

It would be reasonable to conclude that the Institute of Arbitrators, would believe an Ombudsman, (the TIO) over Alan, who was making a number of allegations against the conduct of his arbitration.

Why isn’t anyone listening to Graham and Alan?

26th June, 1996:  Alan pens another letter to Mr Pinnock, in disgust:-

“I find it very sad to be in possession of so many FOI documents which support my allegations that many, many copies of internal correspondence I forwarded to Dr Hughes during the FTAP was never seen by the Resource Unit or Telstra.”

“It is equally sad that copies of Telstra letters, which were also part of the FTAP, were not forwarded to me.” (AS-CAV 217)

When this letter was later returned from the TIO, it also had a handwritten note stating:

“These are quite serious allegations. We need to respond to specific letters Smith says weren’t forwarded or received and provide answers on each.”

Exhibit AS 64 is a letter dated 25th March, 1994 from Philippa Smith to Mr Blount.  This is important because, in the third paragraph on page three, Ms Smith confirms Mr Bartlett and Warwick Smith knew Telstra were holding up the settlement/arbitration process at that stage.  Even after Graham and Alan had signed the settlement (FTSP) agreement, when Alan approached Warwick Smith regarding FOI documents Telstra was not providing, he advised Alan that, as long as he submitted the documents into arbitration, this would help facilitate the process and assist the arbitrator.

It is now obvious many of the documents that Dr Hughes, Graham and Alan should have seen, may well have been vetted and discarded by FHCA.

11th July, 1996:  Sue Harlow from AUSTEL writes to Senator Richard Alston, Minister for Communications. She notes:-

“I am pleased to provide AUSTEL’s sixth status report on Telstra’s progress in implementing the recommendations of AUSTEL’s April 1994 The COT Cases Report. …”

Also included in AUSTEL’s report is a report by the Telecommunication Industry Ombudsman (TIO) on the Status and Progress of the Fast Track, Special and Standard Arbitration Procedures. “The TIO is critical of Telstra’s behaviour and attitude in relation to these arbitrations.”

Sue Harlow, Deputy TIO (during Alan’s arbitration), left a note for Warwick Smith on 16th May, 1994 saying:-

“Attached is a fax received from Alan Smith regarding access to FOI documents at Telecom.”

“Smith is alleging that documents are not in chronological order and blanking done for earlier FOI inspections has made the collection of appropriate documentation uncertain and diminished the opportunity for him to satisfactorily present his case.”

“Mr Smith has demanded a TIO member be present at today’s examination of papers by him at Telecom. …”

“He left an example of this with us…” (AS 77)

No one came from the TIO’s office the next day to assist me in inspecting the documents.

On page 12 of AUSTEL’s report, under the heading Conduct of the Arbitrations, is:

“The TIO believes some comment on the behaviour and attitude of Telstra in the conduct of these Arbitrations is warranted. …”

“The TIO believes that Telstra has, in all claims, responded in an overly legalistic manner. It has shown a tendency to deny liability under every potential clause of action on the basis of perceived statutory and contractual immunities. It has provided large and detailed defences, often out of proportion to the size or complexities of claims. It has lodged lengthy and detailed request for further and better particulars in most arbitrations. In short, while the arbitration procedure has sought to relax the legal burdens, Telstra’s conduct has certainly not. …”

“There have also been considerable delays in the provision of claim and defence materials and further information from both claimants and Telstra. Telstra has taken excessive time in the provision of material requested under FOI.” (GS-CAV 242)

22nd Jul, 1996:  Dr Hughes writes to William Hunt, noting:-

“I have considered the submission of the parties in relation to the request by the claimant for an adjournment of this arbitration until January 1997.”

“The essence of the claimant’s request is that: …

  • Telstra has not been co-operative to date in responding to FOI requests but (as I understand how the argument is put) further information might be usefully produced it Telstra is granted an adequate period of time to produce it.”

“Telstra has responded by asserting:

  • the arbitration agreement provides for the completion of steps within agreed time frames;
  • the history of this arbitration demonstrates that Telstra has taken all reasonable steps to provide the claimant with relevant information; …”

“After considering the matters raised by both parties, I have come to the following conclusion: …

  • it is not, however, essential that all relevant information be available to the claimant at the time the Statement of Claim is submitted; …
  • I do not believe the claimant would be prejudiced by submitting a claim based on information presently available to him;” (GS-CAV 243)

Please note: the FTAP agreement, at clause 10.2.2, states:-

“The Arbitrator will make a finding on reasonable grounds as to the causal link between the alleged service difficulties, problems and faults in the provision to the Claimant’s telecommunication services and the losses claimed.”

As mentioned previously, on 20th February, 1996, Telstra provided Dr Hughes with a comprehensive list of the 48 separate exchanges that were routed through to the North Melbourne telephone exchange servicing Golden Messenger

If Telstra wouldn’t provide Graham Schorer with the CENTOC-TRAXE congestion data for those 48 exchange routes, how could Dr Hughes expect Graham to be able to prove call losses associated with those 48 exchanges? For example, if 15 of the 48 exchanges suffered 14 per cent congestion during peak hours (en-route to the North Melbourne exchange) and 18 of the remaining 33 exchanges suffered eight per cent congestion in peak hours, how could Graham differentiate between a reasonable causal link for the lost calls without the CENTOC-TRAXE data for all 48 exchanges?

30th July, 1996:  Mr Pinnock drafts a letter intended for Alan (AS-CAV 219).  Alan did not see a copy of this letter until 2001/2.  The handwritten list in the top right corner of this letter included dates that coincided with a number of arbitration letters that were withheld from both Dr Hughes and Alan during his arbitration AS 129).

COMMENTARY:

  1. The letters referred to are attached at Exhibit AS 127 to Exhibit AS 129.
  2. The handwriting exhibit (AS-CAV 219) looks to be the same as Ms Di Mattina’s handwritten note referring to “opening a can of worms”, on the TIO document (AS-CAV 184).
  3. Alan only received these letters under the TIO Privacy Policy Act, late in 2001 and early in 2002.

Ms Sussan Hodgkinson’s Memorandum to Dr Hughes

2nd August, 1996:  In this memo, Ms Hodgkinson knowingly misinforms Dr Hughes when she states:-

“I refer to your letter dated 31 July 1996 (received 1 August 1996) concerning Mr Smith’s letter dated 25 June 1996. I have not received a copy of Mr Smiths [sic] letter however I have reviewed Matt Deeble’s summary and provide the following information concerning Mr Smith’s allegations: …”

“At the time of the letter from Austel, Mr Smith’s telephone problems were being addressed in the Arbitration. Due to a number of factors including confidentiality, it was felt not appropriate to answer Austel’s comments in detail, in particular the issue was under consideration in the Arbitration. As agreed the Resource Unit did not response to the AUSTEL letter.” (AS-CAV 220)

One of the documents, dated 16th December, 1994 in this memorandum was addressed to Dr Hughes and had three AUSTEL and Telstra billing documents attached (also see AS-CAV 129).

The Arbitration Agreement’s clause 6 is clear regarding the supply of documents to the defence and claimants.  “A copy of all documents and correspondence forwarded by a party to the Arbitrator shall be forwarded by the Arbitrator to the Special Counsel and the other party.” (AS-CAV 130)

Mr Deeble, who Ms Hodgkinson refers to, was a lawyer seconded from Minter Ellison to the TIO’s office.  Why didn’t Mr Deeble provide Ms Hodgkinson with a copy of Alan Smith’s letter to Mr Pinnock on 25th June 1996?  Also, when Mr Deeble received a copy of Ms Hodgkinson’s letter of 2nd August, 1996 why didn’t he immediately advise the TIO and Dr Hughes that Ms Hodgkinson was incorrect when she wrote only one AUSTEL letter was withheld from Dr Hughes?  Alan Smith provided examples of numerous letters sent by Telstra to Dr Hughes that were withheld during Alan’s arbitration.  The evidence included handwritten notes by John Pinnock regarding how serious this withholding of documents from Graham and William Hunt was, during Graham’s arbitration.  This evidence was not released until 2001, when Mr Pinnock provided documented proof to Alan confirming how seriously the TIO saw these issues.

16th August, 1996:  Mr Pinnock writes to Alan re his concerns that Mr Paul Howell, author of the DMR and Lane Technical Report, didn’t sign off on the report.

“I note that the Arbitrator was not obliged to forward a copy of this covering letter to you, as it did not, strictly speaking, form part of the Technical Evaluation Report.” (AS-CAV 221)

Alan does not believe Paul Howell signed this letter on 30th April, 1995.

Exhibit (AS-CAV 222), is a copy of a Statutory Declaration Alan provided Senator Helen Coonan’s office 23rd February, 2006.  Alan states:-

“I collapsed with a suspected heart attack and was rushed to hospital by ambulance. On my return, five days later, Mr Paul Howell of DMR Canada telephoned me at home. I had not spoken to Mr Howell before, but he told me he had heard that I had been in hospital and was phoning to wish me well. Mr Howell then went on to tell me that my arbitration was the worse process he had ever been associated with and that, had it been conducted in North America, it would never have been allowed to continue under such an atrocious administration. I told him I appreciated his concern, but was disappointed with his technical report and asked him why he had not signed it off. He relied in words to the effect that he hadn’t signed the report.”

Question:

If Paul Howell was telling Alan the truth – that he did not sign off his report – then who wrote the 30th April, 1995 letter and forged Mr Howell’s signature?  The 30th April, 1995 letter was attached to the 16th August, 1996 letter provided to Alan by Mr Pinnock (AS-CAV 223).

15th October, 1996:  Dr Hughes writes to William Hunt, noting:-

“I agree with Telstra that it is important for this arbitration to be brought to a conclusion. Whilst I express no view as to the adequacy of otherwise of the claim documentation, Telstra is accurate in its assertion that any lack of particularity in the claim documentation may be to the disadvantage of the claimant. …

“On the question of the production of further particulars by the claimant as requested by Telstra, and the production of further documentation by Telstra as foreshadowed by the claimant, I find it unnecessary to express any view at this stage. It should be emphasised that the Arbitration Agreement does not provide for discovery but I do have the power under 7.6 to require either party to produce further documentary information.” (GS-CAV 245)

Telstra’s Minutes of 17th February, 1994 Arbitration Hearing confirm after Mr Schorer stated, “that he needed documents from Telecom to prepare his case and without this material, he could not go into arbitration”, Dr Hughes advised Mr Schorer (in front of Peter Bartlett, TIO legal counsel) that:-

  • the procedure is put on hold until all the documents are exchanged in accordance with the FOI procedure;
  • the arbitration procedure commences and then the arbitrator gives appropriate directions for the production of documents.

These Minutes then go onto state:

“Mr Hughes indicated that one party can ask for documents once the arbitration has commenced. Mr Hughes advocated this course of action as more effective and that as arbitrator he would not make a determination on incomplete information.”

It is most relevant that we compare Dr Hughes’ statement to William Hunt:-

“I should emphasise that the Arbitration Agreement does not provide for discovery,” (GS-CAV 245)

with his previous statement made to Warwick Smith on 12th May, 1995:-

“we did not allow sufficient time in the Arbitration Agreement for inevitable delays associated with the production of documents, obtaining further particulars – request for further particulars are, I think, unavoidable – although the emphasis in the arbitration process is upon a quick resolution of the dispute,” – and – “It is my view that if the process is to remain credible, it is necessary to contemplate a time frame for completion which is longer than presently contained in the Arbitration Agreement.”  

Surely, by now, Dr Hughes would have realised that he should have refused to continue with an Arbitration Agreement that was not credible, because it did not allow enough time for discovery.

28th October, 1996:  William Hunt responds to Hughes’ letters of 15th October and 22nd July, 1996, noting:-

“In your letter of 22nd July 1996 you stated:–

‘It is not however essential that all relevant information be available to the claimant at the time the statement of claim is submitted. …”

“‘I do not believe the claimant would be prejudiced by submitting a claim based on information presently available to him.’ …”

“As you are aware, the claimant has been making, for a considerable time, requests to Telstra pursuant to the Freedom of Information Act to supply information about its various service faults and difficulties upon which his claim is based.”

“According to our instructions those requests for information have either not been complied with, or inadequately complied with.”

“We note further that in your letter dated 15th October 1996 you state that you find it unnecessary to express a view on the question of the production of further documentation by Telstra at this stage. …”

“The claimant has ascertained that Telstra holds on four discs an index of all information held by it relating to service difficulties and faults and technical matters. He has made a request for the discs pursuant to the Freedom of Information Act but they have not been forthcoming. The information indexed on the discs would, the claimant believes, cover the matters which form the technical basis of his claim. …”

“According to our instructions it is believed the four discs would have been easily located within the Telstra organization, and there is no valid reason why they should not be made available promptly.” (GS-CAV 246)

1st November, 1996:  Dr Hughes writes to William Hunt, noting:-

As indicated previously, I may well exercise my discretion under rule 7.6 to require the production of further documentation from Telstra. I am most reluctant to do so, however, until I have at least received Telstra’s defence. This will enable me to assess the parameters of the claim and form my own view (perhaps after receiving submissions from the parties) as to what further documentation, if any, should be provided.” (GS-CAV 247)

Please note: the phrase used by Dr Hughes:-

“This will enable me to assess the parameters of the claim and form my own view”,

should be compared with the phrase he used in his letter to Warwick Smith, 12th May, 1995 when he states:

“In summary, it is my view that is the process is to remain credible, it is necessary to contemplate an time frame for completion which is longer than presently contained in the Arbitration Agreement.”

Dr Hughes should have disclosed his view regarding the inadequate timeframes in the Arbitration Agreement to all parties associated with the arbitration.  This is the very reason Graham was still unable to submit a complete claim.

1st November, 1996:  John Pinnock puts William Hunt on notice, stating:-

“I understand that you have responded to the Arbitrator in relation to his directions of 15 October 1996. I understand that a copy of this correspondence was provided to Telstra but not to this office or to Mr Peter Bartlett, the Special Counsel to the Administrator.”

“I advise that clause 6 of the Fast Track Arbitration Rules provides that a ‘copy of all documents are correspondence forwarded…by a party to the Arbitrator shall be forwarded to the Special Counsel’. The common practice in other arbitrations has been for a copy of documentation and correspondence to also be provided to the TIO as Administrator of the procedure.

“In future, would you please provide copies of your formal correspondence in this matter to the Arbitrator, Telstra, the TIO and the Special Counsel.” (GS-CAV 248)

27th November 1996:  John Pinnock writes to William Hunt, stating:-

“I enclose two copies of Telstra’s Defence in the above matter consisting of six sealed boxes. These documents were received by my office on 26 November 1996.

“I also enclose a copy of Telstra’s covering letter setting out the volumes contained in these boxes. Would you please advise me if you have not received all the documents set out in that letter.”

“Please note that Telstra is still to provide certain documents. They will be forwarded to you as soon as they arrive at the TIO.” (GS-CAV 249)

Please note: clause 6 of the Arbitration Agreement only states:-

“A copy of all documents and correspondence forwarded by the Arbitrator to a party or by a party to the Arbitrator shall be forwarded to the Special Counsel. A copy of all documents and correspondence forwarded by a party to the Arbitrator shall be forwarded by the Arbitrator to the Special Counsel and the other party.”

28th November, 1996:  William Hunt’s file note records:-

“I rang Mr Pinnock to ask why he is writing me letters, why matters are coming to me through him. I rang about 4.15 pm and was told by the receptionist that he wasn’t available. …”

“I later spoke to Mr Pinnock who rang me back and told me that it was part and parcel of the requirements under the arbitration procedure whereby Telecom had to send up things through him and he wouldn’t be reading it all unless he was required to for some person. Ditto with Ferrier Hodgson.” (GS-CAV 250)

Why was it so important for the TIO to receive the claim and defence documents before Dr Hughes?  In Alan Smith’s arbitration, numerous claim and arbitration procedural documents disappeared en route to Dr Hughes office, before he was able to assess this material.  Were similar documents about to disappear in Graham Schorer’s arbitration as well?

In his letter of 11th July, 1994 to Warwick Smith, Steve Black wrote:-

“If the resource unit forms the view that this information should be provide to the arbitrator, then Telecom would accede to the request.”

Telstra and the Resource Unit were working together and the Resource Unit had access to Telstra information before it was actually released into the arbitration process.  The Resource Unit made decisions about the relevance of the material before they directed Telstra to provide the information to the arbitrator.

Exhibit 13, in Graham Schorer’s CAV Relevant Information file, contains 14 letters between Steve Black, Warwick Smith, AUSTEL and the Commonwealth Ombudsman’s office, showing Graham had good reason to question the TIO’s office.

10th January, 1997:  John Pinnock writes to Alan Smith:-

“I refer to your letter 31 December 1996 in which you seek to access to [sic] various correspondence held by the TIO concerning the fast Track Arbitration Procedure.

The arbitration of your claim was completed when an award was made in your favour more than eighteen months ago and my role as Administrator is over.

I do not propose to provide you with copies of any documents held by this office.” GS-CAV 251)

15th January, 1997:  Graham submits his reply to Telstra’s defence, stating:-

“Because of the format of the Telstra defence as it is in narrative style, it is difficult to distinguish between that which is argument or proposition (as distinct from factual evidence) and that which is a formal statement of defence. In consequence the Claimants in this reply refer only to Telstra’s ‘Principal Submissions’ and to its ‘Legal Submissions’.” (Graham Schorer – CAV Relevant Information file exhibit 12)

24th January, 1997:  Graham Schorer writes four startling letters (see GS-CAV 252) to the three people mentioned here.

“I enclose my correspondence to

  • Mr Ted Benjamin (our Ref. 3060) re Bell Canada documents not discovered identified and supplied.
  • Mr John Pinnock (our Ref. 3057 and Ref. 3059) re Arbitration costs and other related matters.
  • Ms Melanie Bleazby (our Ref. 3058) re FOI requests. …”

“Based upon Telstra’s current response to my recent FOI application (already requested under Arbitration and covered within the scope of my 21 April 1994 FOI application), it would appear Telstra had introduced another new face to add to the confusion while their conduct goes from bad to worse.” (GS-CAV 252)

Dr Hughes knew some of the information Telstra did not supply to Graham related to the Bell Canada International test results, in relation to the North Melbourne telephone exchange.

Dr Hughes’ letter of 2nd May, 1994 shows Telstra gave the BCI Report to Dr Hughes and he supplied it to the Resource Unit to assess as part of the arbitration procedural information.  In his award concerning Alan’s matter, Dr Hughes refers to accepting both reports into evidence during Alan Smith’s arbitration

As mentioned previously, Dr Hughes, Mr Pinnock, Mr Benjamin and Ms Di Mattina were all provided with evidence proving that, when Telstra used the BCI Cape Bridgewater Addendum Report as defence material, they already knew that the tests were fundamentally flawed.  Although the information concerning the flaws in the BCI Cape Bridgewater Report was received after Alan’s arbitration, Dr Hughes should have immediately instructed Telstra and the TIO Legal Counsel to withdraw all the BCI information from all of the arbitration procedures.

4th February, 1997:  Dr Hughes writes to William Hunt, stating:-

“I have now had an opportunity to peruse the claim, defence and reply documentation.”

“A number of outstanding matters must now be addressed in order that this arbitration can proceed. Each party had foreshadowed in previous correspondence that it requires information from the other; in addition, I pointed out in my letter of 15 October 1996 that, upon receipt of the initial submissions of the respective parties, I would be in a position to make my own assessment as to whether further documentation (if any) should be produced by either party. …”

“I accordingly invite each party to advise me within seven (7) days as to whether it still requires the production of information or other material from the other party and, if so, I require a full description of that information or other material.” (GS-CAV 253)

Who’s kidding who?

4th February, 1997:  John Pinnock writes to Alan Smith, stating:-

“I reject completely your assertion that Dr Hughes and David Read ‘conspired to breach the rules of the Arbitration’”.

“Similarly, I reject your assertion that there was or ever has been a conflict of interest between Mr Benjamin’s membership of the TIO Council and any role he may have had in relation to the supply of FOI documents.” (GS-CAV 254-A)

Exhibit GS-CAV 254-B shows Dr Hughes did breach the arbitration rules by corresponding with Telstra during the COT arbitrations without copying that correspondence onto the claimants.

Although Mr Pinnock rejected Mr Benjamin’s membership of the TIO Council created a conflict of interest, this is not the way Senator Schacht saw the situation (see Senate Hansard records of 26th September, 1997 discussed shortly).  This conflict of interest was also evident when Mr Benjamin, on 30th November, 1993 during the COT Fast Track Settlement Proposal, chose to relay various COT issues, discussed during a TIO Council Meeting he attended, back to his colleagues at Telstra’s Head Office.

12th February, 1997:  Exhibit GS-CAV 255 is a 12-page letter from Telstra to Dr Hughes mirroring a similar request for the production of documents and further better particulars in Alan Smith’s arbitration.  It was the same production of documents, obtaining further particular issues, that concerned Dr Hughes when he wrote to Warwick Smith 12th May, 1995 stating:-

  • “the time frames set in the original Arbitration Agreement were, with the benefit of hindsight, optimistic;
  • In particular, we did not allow sufficient time in the Arbitration Agreement for inevitable delays associated with the production of documents, obtaining further particulars and the preparation of technical reports;

“In summary, it is my view that if the process is to remain credible, it is necessary to contemplate a time frame for completion which is longer than presently contained in the Arbitration Agreement.”

And here he was, still troubled about the production of documents and obtaining further particulars using the same Arbitration Agreement he condemned 15 months prior.

14th February, 1997:  William Hunt responds to Dr Hughes’ letter:-

“We refer to your letter of 4th February, 1997 herein. Prior thereto on 24th January last, Mr Schorer on behalf of the Claimants herein, had sought an immediate meeting with the Administrator (Mr Pinnock) to discuss, inter alia, matters affecting the FTSP and the FTAP which prevent the Claimants from obtaining essential information from Telstra through FOI procedures. …”

“Alternatively and preferably it is requested a Directions Hearing be scheduled for that day (or later as may suit you or Telstra’s convenience) to discuss and make submissions to you on the problems created for the Claimants by the continuing lack of material being made available to the Claimants under FOI procedures.” (GS-CAV 256)

14th February, 1997:  Graham Schorer’s letter to Telstra’s John Armstrong, copied to John Pinnock, Dr Hughes, Peter Bartlett, Ferrier Hodgson, Lane Telecommunications, John Wynack and William Hunt, states:-

“Further to our correspondence dated 24 January 1997 Ref.3060, it is drawn to Telstra’s attention that after 23 November 1993, Mr Ian Campbell, on behalf of Telstra, undertook to Graham Schorer to arrange the immediate supply of the documents, working papers, work orders, instructions, memos etc created by Telstra employees who were involved in supporting and/or performing the tasks devised by Bell Canada to test specific parts of the Telstra network that formed the basis of the first of the Bell Canada Reports.” (GS-CAV 257)

This letter would have made it quite clear to all those who received it that the TIO should never have allowed Telstra to submit this report to the arbitrator.  Dr Hughes and John Pinnock, who were among those receiving this letter, also received a letter dated 20th June 1995, from Alan Smith, confirming Telstra also used the BCI Cape Bridgewater Addendum Report as defence material despite knowing it was fundamentally flawed.  It remained in the COT process and then, on 14th February, 1997, 44 months after Dr Hughes and John Pinnock were alerted to the flaws in the report, it is again being challenged by another COT claimant.

Once Alan Smith’s letter of 20th June, 1995 reached Mr Pinnock and Dr Hughes, they should have immediately told Telstra it was illegal to use material known to be flawed and to withdraw all the Bell Canada reports relating to the remaining COT claimants, until an independent audit of the BCI reports could be conducted.  Had Mr Pinnock and Dr Hughes directed Telstra to withdraw the BCI reports, then they would have reduced some of the problems associated with the poor timeframe issues related to Graham’s discovery matters. Since neither Mr Pinnock nor Dr Hughes ordered the withdrawal of the flawed BCI reports, they both contributed to the problems with Graham’s discovery process.

18th February, 1997:  Dr Hughes responds to William Hunt’s letter of 14th February, 1996 noting-:

“In its response of 12 February, Telstra submitted that it had no case to answer; in the alternative, it requested the production of further specified information from your client.

In the absence of a submission by your client relating to the production of further information from Telstra, I propose to proceed with a ruling as to what documentation, if any, must now be produced by each party.”

“My determination could be along any of the following lines:

  • one or both parties are to produce additional material, as specified by me. In relation to your client, this may or may not be the documentation requested by Telstra in its letter of 12 February 1997. In the case of Telstra, I would take into account past submissions by your client; or
  • neither party need produce further documentation, and the Resource Unit to now proceed with its own assessment of the financial and technical issues; or
  • neither party need produce further documentation, no Resource Unit involvement is required and the matter will proceed to a final award forthwith; or
  • in accordance with Telstra’s submission, there is no case to answer and the claim is dismissed.” (GS-CAV 258)

24th February, 1997:  Mr Pinnock writes to Alan, noting:-

“Since the Arbitrator delivered his award, you have written many letters to me asserting, variously, that the Arbitrator, and/or the Resource Unit, erred in their duties under the Arbitration agreement.” (AS-CAV 225)

25th February, 1997:  William Hunt responds to Dr Hughes’ letter of 18th February 1997, stating:

“The FTSP arose from an acceptance by Austel that the Claimants had cause for complaint against Telstra, that reasonable proof of the nature and extent of the complaint could come only from within Telstra, and that it was reasonable in Telstra’s interest for the sorting out of the dispute and the amount of compensation payable (if any) to be kept confidential. …”

“In your letter of 4th February to the parties in dispute, and to others you wrote thus:

‘I am prepared to make a ruling on this matter but would prefer the parties to reach agreement. In any event, I require submissions from each party as to what documents or other material should now be produced.’”

“Based on long running and fruitless experience in dealing with Telstra about the provision of necessary information under FOI procedures the Claimants feel it would be impossible to reach any even faintly useful agreement with Telstra about ‘what further documentation (if any) should be produced’…”

“Because of the continual lack of information being provided by Telstra (whether or not under FOI procedures or as indicated by you) the Claimants simply cannot at present usefully supply you with a list of all the documentation it requires or provide you with ‘a full description of that information or other material’.”

“The Claimants again respectfully request you re-consider your rulings contained in your letters of 4th and 18th February, and schedule a Directions Hearing for 11th March or later as you may consider appropriate to enable submissions to be made to you on the problems created for the Claimants by the continuing failure of Telstra to supply information in breach of the basis on which the FTSP and FTAP were entered into.” (GS-CAV 259 to 323)

Continued on Consumer Affairs Victoria (CAV) Part 3

Please note: the following exhibits (which we might have missed into the text of the chronology of events above) can be accessed by placing the cursor over the relevant number range in order to access that exhibit.

AS – CAV 1 to 47 – AS-CAV 48-A to 91 – AS-CAV 92 to 127 – AS-CAV 128 to 180 – AS-CAV 181 to 233 – AS-CAV 234 to 281 – AS-CAV 282 to 323 – AS-CAV 324-A to 420 AS-CAV 421 to 469 – AS-CAV 470 to 486 –AS-CAV 495 to 541 –AS-CAV 542 to 588 – AS-CAV 589 to 647 – AS-CAV 648 to 700 –  AS-CAV 765-A to 789 – AS-CAV 790 to 818 – AS-CAV 819 to 843 – AS-CAV-923 to 946  – GS-CAV 1 to 88GS-CAV 89 to 154-A – GS-CAV 155 to 215 – GS-CAV 216 to 257  – GS-CAV 258 to 323 – GS-CAV 410-A to 447 – GS-CAV 448 to 458 – GS-CAV 459 to 489 – GS-CAV 490 to 521 – GS-CAV 522 to 580 – GS-CAV 581 to 609