Chapter Six - Julian Assange - Hacking -3
The COT stories are real-life crime dramas conducted by unscrupulous and evil government bureaucrats whose sole aim is to destroy the credibility of any claimant who entered the government endorsed arbitrations. Heinous, scandalous vile and mischievous crimes were committed by those who controlled the arbitrations
3rd December, 1997: Graham writes two identical, but separate, letters to David Hoare, Chair of the Telstra Board and Michael Montalto, Telstra’s Corporate Secretary:-
“With reason, C.o.T. members believe many of Telstra’s recent answers provided to The Senate are neither true nor fair answers to specific questions asked of it by individual Senators.
“The attached Appendix, with supporting documents, sets out the reason for the C.o.T. members’ belief.” (GS-CAV Exhibit 324 to 367 - See GS CAV 325-A and GS CAV 325-B)
Had David Hoare and Michael Montalto correctly addressed some of the important issues raised in the appendix, most, if not all, of the problems continuing to plague the COT claimants could have been solved then. For example, appendices one and two show Graham proved to the Telstra Board that the Alan Smith Bell Canada Addendum tests were impracticable, yet Telstra still used the results of those tests to support their defence of Alan’s arbitration claim. Alan’s chronology shows DMR and Lane never investigated any of the faults Alan claimed continued to occur after the Bell Canada tests were completed.
Had the Telstra Board correctly investigated Graham’s evidence, they would have agreed with Brian Hodges MBE (Technical Consultant), in his report of 27th July, 2007, when he concluded BCI could not have conducted the tests at Cape Bridgewater and thus all Cape Bridgewater BCI tests were fundamentally flawed (see Alan Smith’s Relevant Information file).
Exhibit Telstra's Falsified BCI Report shows Alan Smith provided John Pinnock and Dr Hughes with the same evidence that was provided to Telstra after Alan's arbitration. Dr Hughes wrote to Mr Pinnock (and copied to Telstra) regarding Alan’s BCI evidence.
Did Mr Hoare and Mr Montalto receive Alan’s letter of 20th June, 1995 regarding the BCI evidence, and Dr Hughes’ letter to Telstra on 21st June? Perhaps the Telstra Board deliberately allowed Telstra to use the flawed BCI Defence Material in the COT arbitration process – and then allowed Telstra’s misleading and deceptive answers to the Senate, on 26th September 1997 to go unanswered, because it wanted to avoid a major inquiry into Telstra’s use of false evidence in a process conducted under the auspices of the Commercial Arbitration Act, Victorian Supreme Court.
5th December, 1997: Graham Schorer writes:-
“CoT members believe many of Telstra’s recent answers provided to The Senate are neither true nor fair answers to specific questions asked of it by individual Senators.” (GS-CAV Exhibit 324 to 367 - See GS CAV 324)
Although this letter is only a draft of the 5th December, 1997 letter (GS-CAV Exhibit 324 to 367 - See GS CAV 336) and it is referred to in Part 1 of the Chronology, it is included for reference.
Graham Schorer writes to John Wynack:-
“Enclosed with this facsimile is the interim List describing the types and classes of documents Telstra need to discover in order to identify their existence in its list of documents to enable it to comply with the Senate Committee Terms of Reference. Equally, these are some of the same documents the Claimant, GOLDEN, needs to establish reasonable causal link between telephone service difficulties, problems and faults it experienced and call losses.”
8th December, 1997: William Hunt’s file note shows just how concerned he was for Graham to end this dreadful Telstra saga:-
“I have recommended to Schorer that he settle for almost anything that would be of use to get on with his business. He says he can quantify his call losses without any doubt (I would need to be shown this to believe it. What he cannot determine is the cause of the call losses being the fault of Telstra and rate. This is always spoken about as being showing evidence of the cause or link between Telstra and the losses. It is not a question of quantifying causes or links it is a question of identifying in simple language that calls were lost because Telstra did not provide a service that enabled the calls to be received when made. …”
“It should be noted that there is something in incongruous and unfair in Telstra being the case directly or indirectly of Schorer’s losses being able to set up ‘its prepared rules of arbitration’ to dispose of the fast track settlement procedures…” (GS-CAV Exhibit 324 to 367 - See GS CAV 327-A)
IMPORTANT
Part 1 of this Chronology does not reveal how ill Graham became as he watched his business struggle to survive. Not because of his business decisions, but because, like the other COT claimants, he had no control over the communications system linking him to his existing and prospective new customers. As the COT spokesperson, Graham learned, early in the claims process, Telstra had to hide, at all costs, the network problems resulting from their incompetence in not reading the signs regarding business and residential telecommunications growth as a result of population/immigration growth – millions more than the Telstra Board expected. All the extra telecommunications traffic, created by population growth in the cities and in numerous rural hamlets, which became major tourist attractions, put a severe strain on Telstra’s old and obsolete copper wire: it was lasting only 20 years instead of the expected 40! The combination of population growth and corroded copper wire caused communications congestion because Telstra’s Board didn’t do their calculations properly, and ordinary Australian business people (like Graham and Alan), suffered as a result.
After more than 10 years of attempting to run a telephone-dependent courier business, Graham attended his first counselling session on 18th November, 1996 in an attempt to control his anger in relation to the situation he found himself in due to the ongoing Telstra saga. By 7th June, 1999 Graham had attended 107 counselling sessions.
When William Hunt noted he “recommended to Schorer that he settle for almost anything that would be of use to get on with his business”, Mr Hunt did not realise that, like Alan Smith’s business, Graham’s business was still experiencing telephone problems. Bell Canada should have tested the lines properly at both Alan and Graham’s telephone exchanges: the faults would have been uncovered if the tests had been carried out correctly. Proper initial testing would also have shown Telstra hid the problems during the COT arbitrations, under Legal Professional Privilege or Telstra in-confidence, or simply by stating the problems did not exist.
How could anyone, particularly the Government of the country, reasonably expect a small-business person like Graham, to enter into a process as complex as a Senate Working Party at the same time as they were in an arbitration process and trying to run a business?
Graham’s letter of 29th September, 1997 to Ms Pauline Moore, secretary to the Environment, Recreation, Communications and the Arts Senate Committee, discusses Senate Hansard records of 26th September, 1997. On page 2, at point 2 under the heading “Quantum of Claim”, Graham notes:-
“The claimant’s Interim Claim for loss, as at 30 September 1996, is a minimum $4.3 million to a maximum of $12.6 million.” (GS-CAV Exhibit 324 to 367 - See GS CAV 328)
Even though Graham provided the Senate Committee Secretary with his interim loss figures to September 1996, Telstra later pressured Graham into taking a May 1999 offer of $3.8 million without any forensic valuation of the costs involved in trying to get Telstra to simply provide the telecommunications service the Government assured all Australians they had a right to!
An accurate valuation was never provided regarding the consequential future losses resulting from prospective customers not being able to contact Graham’s business, or from the effects of bad advertising, spread by word-of-mouth among customers and prospective customers of Golden Messenger, as a direct result of the seriously faulty telephone service provided by Telstra.
There was never any investigation into Graham’s claim the Government Regulator started with a review of past and present problems and then, with the assistance of the TIO, converted the review into the commercial Fast Track Settlement Proposal (FTSP) and then the Fast Track Arbitration Process (FTAP), putting Telstra in control of the procedure. In the end, even John Pinnock, the TIO, had to admit the arbitrator had no control over the arbitration process!
Back in September/October 1993, Graham convinced Ian Campbell, then Group General Manager of Telstra’s Commercial and Consumer Division, it would be cheaper and more successful, all round, if Telstra would just negotiate with the claimants, without any admission of liability, and appoint an assessor to take a case by case approach, so no precedent would be set and there would be no problems with quantum or call-loss calculations.
Because of these discussions with Graham, Mr Campbell and AUSTEL’s Robin Davey arranged the FTSP. The process disintegrated, however, when legal gurus, within and outside Telstra, saw a way to make a fortune out of litigation instead of a simple commercial loss assessment, such as that commonly used by insurance loss assessors around the world.
By 1998, Graham was in a highly legalistic nightmare, having been forced out of the FTSP and almost to his knees in desperation. Telstra’s legal parties saw Graham was becoming more frantic and denied the existence of any relevant FOI documents to support his claim, knowing that when they then offered him what would seem like a lifeline, he was almost guaranteed to accept any amount. The following information shows just how far Telstra, and those allegedly employed as independent umpires, were prepared to go – to cover their tracks!
Had John Pinnock told the Senate Working Party, at the beginning of that process, that Warwick Smith (Mr Pinnock’s predecessor), Peter Bartlett and Dr Hughes were warned by FHCA’s John Rundell, on 18th April, 1995 the arbitration process was being derailed by “forces at work” beyond the control of the TIO-appointed arbitration resource units, then the Senate Working Party would have had to investigate this and the FOI matters.
Had Mr Pinnock told the Senate Working Party Dr Hughes also warned Mr Pinnock’s predecessor that, if the arbitration agreement was to remain credible, it had to be revised – but Warwick Smith ignored this advice and continued with the process: it would be reasonable to conclude the Senate Working Party would have taken this matter seriously and included it in their further investigations.
Exhibit (GS-CAV Exhibit 324 to 367 - See GS CAV 329) is a Telstra facsimile dated 7th November, 1997 to the Senate Legislation Committee providing answers to the Senate concerning how many COT-type complaints were in existence during the previous financial year. On page 3, is written:-
“During the last financial year the total costs of providing advice for legal matters including costs of the Telstra Legal Directorate and litigation and arbitration costs resulting from disputes and claims was approximately $52 million. Of this amount approximately $40 million was spent with external service providers including legal firms and patent attorneys.”
Telstra’s answer to the 1997-8 Estimates Hearing, question 112 shows Telstra were prepared to spend three times the total of the actual original claims, on lawyers and legal advisors. This very damning issue is highlighted in our conclusion.
QUESTION:
- Why did Telstra force Graham and Alan out of the already signed FTSP commercial agreement that Telstra’s Group General Manager Commercial Business, Ian Campbell, thought was the best way to go for all concerned?
- Did the highly paid lawyers suggest Telstra should go legal instead of settling the claims commercially
It is clear from the answer given by Telstra, to the 1997-98 Estimates Hearing, the lawyers won and the COT cases’ lost.
12th December, 1997: Graham writes to John Wynack, Commonwealth Ombudsman’s Office:-
“Enclosed is copy of the correspondence sent to all Senators and a copy of correspondence sent to all Telstra Board Members, including Appendix and index of support documents, plus all support documents. …”
“[D]ocuments now in the possession of C.o.T. confirm there was an agreement reached between Telstra and the then TIO, Mr Warwick Smith, on or before 12 January 1994, for a legalistic arbitration process to be used with the C.O.T. Four who signed the FTSP…”
“This is one of many examples of how Telstra used misleading, deceptive and unconscionable conduct against C.o.T. members to gain an unfair advantage in the dispute resolution process. Telstra’s unfair advantages gained by unethical tactics and unlawful conduct is resulting in C.o.T. members being financially disadvantaged.”
“This conduct must be investigated and exposed for what it is in order to make Telstra accountable and be restrained in the future from engaging in like conduct.” (GS-CAV Exhibit 324 to 367 - See GS CAV 330-A)
The Bell Canada tests, carried out on 1st & 10th November, 1993 and the Cape Bridgewater addendum tests that Graham labelled as fundamentally flawed in this letter, were also discussed on pages 107 and 108 of the Hansard records of the Senate Meeting on 26th September, 1997 attended by the TIO, John Pinnock (GS-CAV Exhibit 324 to 367 - See GS CAV 330-B).
GS-CAV Exhibit 324 to 367 - See GS CAV 331-A is a Statutory Declaration, dated 6th November, 1995 which was sworn by Mr John Main, a COT claimant.
“I spoke to Ms Pia Di Mattina from the Telecommunications Ombudsman’s Office at approximately midday today.”
“She advised me that the Bell Canada International Inc Report to Telecom Australia dated 1 November 1993 and the addendum dated 10 November 1993 were flawed documents.”
QUESTION:
When Mr Pinnock addressed the Senate on 26th September ,1997, why didn’t he report one of his officers, Ms Di Mattina, told John Main the BCI reports were flawed in November 1995?
In Graham’s letter to Jenny Fox, Senator Schacht’s secretary, on 19th November, 1997, Graham notes:-
“Telstra’s and John Pinnock’s recent answers to The Senate in response to Questions on Notice do not give a true and fair representation of events. In a number of instances, answers are misleading and/or contained statements that contradict fact.”
“During Telstra’s and John Pinnock’s recent appearances before The Senate, they both provided The Senate with explanations/account of the Telstra arbitrations, which was not a true and fair representation of events. …”
“C.o.T members were invited to appear before The Senate on 24 June 1997. They were told The Senate would give C.o.T. members an opportunity to give the Senators their version of events that did or did not take place, plus be available to answer questions.” (GS-CAV Exhibit 324 to 367 - See GS CAV 331-B)
Relying on this promise, Graham and Alan paid their own travel and accommodation expenses, believing they would finally be able to expose the Telstra/TIO arbitration fiasco, once they arrived in Canberra, but as Graham further notes:
“Unfortunately, no C.o.T. member was given an opportunity to provide The Senate with the C.o.T. version of events that have or have not taken place or address the misleading and inaccurate statements made to The Senate by Telstra and Mr Pinnock in their opening statements or response to questions.
Had the Senate allowed access to the sort of information included in Graham Schorer and Alan Smith’s individual Chronologies, surely it would have had no alternative but to call for an official Senate Enquiry into why the TIO-administered arbitration process, initially facilitated by the Government Regulator, was administered and conducted by the arbitrator outside the auspices of Australia’s accepted and democratic process of law. The Senate did investigate the five litmus COT cases FOI issues, but nothing else. Was the Senate pressured not to further investigate why the process was not conducted according to the agreed process?
15th December, 1997: Graham writes to John Wynack:-
“I wish to include other items on the Agenda under the following:-
- Bell Canada International
Is there any reason why Telstra:-
- has not provided the C.o.T.s with, and
- will not provide the C.o.T.s with
the working papers, testing data and other relevant information created before, during and after the testing of the Telstra network relating to the Telstra test calls performed in accordance with the Bell Canada International (BCI) requirements before BCI completed its November 1993 Report and its attached Appendix, or for the Working Party to consider if the information is relevant?” (GS-CAV Exhibit 324 to 367 - See GS CAV 332)
19th December 1997: John Wynack writes to Graham:-
“Attached is the letter I sent to the Senate ERCA Committee re the Working Party’s activities.”
“I decided not to send the appendix which you sent to me late yesterday as I do not think it relevant to the purpose of the letter and I think that those issues should be the subject of debate in the Working Party in the first instance.” (GS-CAV Exhibit 324 to 367 - See GS CAV 333)
The attached letter Mr Wynack refers to is to Senator John Tierney.
29th December, 1997: Dr Hughes writes to William Hunt on the letterhead of Blake Dawson Waldron.
“[D]ue to a perceived conflict of interest arising from my commencement at Blake Dawson Waldron, I shall forthwith cease to act as arbitrator…”
“I noted the following reservations and qualifications expressed by the parties
Mr Schorer has reservations as to whether the arbitration should continue;
Mr Benjamin has some reservations as to whether a mediation should be commenced;
Mr Schorer’s objects to the involvement of Mr Howell as technical expert (although this is an issue which has previously been addressed by me).”
(GS-CAV Exhibit 324 to 367 - See GS CAV 324)
7th January, 1998: John Wynack writes to Graham:-
“Attached is a copy of a letter Telstra sent to me on 5 January 1998, in which they suggest that I write to Bell Canada International asking that BCI provide to the Working Party certain documents relating to its reports which were published in 1993.”
“I should be grateful for your comments on Telstra’s suggestion. Should you decide to request me to write to BCI, please provide details of the documents you think BCI might hold which are covered by the Working Party’s Terms of Reference.” (GS-CAV Exhibit 324 to 367 - See GS CAV 335)
9th January, 1998: Graham responds to Mr Wynack:-
“Ann Garms and Graham Schorer have discussed this matter and are both in agreement that it would be improper and would not be appropriate for the Chairman of the Working Party to write directly to Bell Canada International to request information.” (GS-CAV Exhibit 324 to 367 - See GS CAV 336)
MOST IMPORTANT
Of the five COT claimants selected for the Senate Working Party litmus-test process, Graham was the only one still running his business. It was unreasonable to expect him to be the major player and spokesperson for the whole group, while preparing his own arbitration claim and operating his business. It is clear from the numerous letters and other documents that Graham prepared, between 1997 and 1999, his arbitration and his business both suffered as he attended to Senate Working Party business.
Because scores of letters, exchanged between Graham, John Wynack, Telstra, individual Senators and the Senate Working Party, discuss all five of the COTs involved in the Senate Working Party process, it has been impossible to separate out references to Graham alone. This correspondence is collated into a separate file, in date order, and is available for perusal.
Telstra’s Ms Chisholm and Mr Carless
14th January, 1998: Telstra’s Lyn Chisholm and Peter Carless arrive at Alan’s residence (not the camp) and discuss the continuing fax lock-up problems and billing faults associated with the line remaining connected after sending a fax. Alan provides fax journal printouts that do not match Telstra’s accounting for those calls. They also discuss the just-disconnected 1800 billing service and the problems experienced during and after Alan’s arbitration. Alan provides examples showing the Commonwealth Ombudsman’s Office officially provided Telstra with a document confirming the Ombudsman’s Office made 43 calls to Alan’s 1800 line, until February 1997, yet Telstra charged him for 96 calls from the office.
When AUSTEL’s Darren Kearney visited the camp, on 19th December 1995 he commented to Cathy that he had never seen such well-documented evidence. “It’s unbelievable!” he said. He subsequently took some of the arbitration billing claim documents that were not addressed during the arbitration back to Melbourne. Alan believes Lyn Chisholm and Phil Carless had the same thought and he later followed Ms Chisholm’s suggestion and provided some of this evidence, via the TIO’s office, to Telstra. Alan’s records confirm he continued to provide evidence of fax and phone problems, occurring throughout 1998 and 1999, to the TIO’s office and Mr Pinnock advised him these billing issues were still being investigated. Other letters confirm Mr Pinnock was advising both Mr Hawker and the Minister’s office that these matters were still under consideration as late as February 1999.
Alan was never told, however, Telstra provided both the Minister for Communication’s Office and the TIO with copies of Lyn Chisholm’s file notes, confirming her opinion the billing faults he raised in his arbitration continued after his arbitration. This would have given Alan good grounds to appeal the Arbitrator’s Award.
22nd January 1998: Ms Toni Ahkin, Communication Minister’s Office, writes to Mr Pinnock:-
“Further to our recent phone conversation I am forwarding Telstra’s transcript of its meeting with Alan Smith, held on 14 January 1998 concerning his claim of overcharing on his 1800 number [sic].” (AS-CAV Exhibit 234 to 281 - See AS-CAV 239)
23rd January 1998: Ms Toni Ahkin again writes to Mr Pinnock:-
“I am forwarding copies of our proposed replies (that will be sent to the Minister’s office today) to David Hawker and Alan Smith in response to recent Min Rep’s concerning the arbitration process and overcharging on Mr Smith’s 1800 number.”
This fax suggests John Pinnock received a draft copy of the information regarding Alan’s arbitration and billing problems, for his comment, before the Minister or David Hawker received it. (AS-CAV Exhibit 234 to 281 - See AS-CAV 240)
4th February 1998: Ted Benjamin writes to Mr Pinnock noting:-
“Telstra has examined the information forwarded by your office with regard to Mr Smith’s 1800 telephone service and is currently conducting an investigation into Mr Smith’s complaints.”
Attached to this letter is a three-page file note from Telstra’s Lyn Chisholm. This attached file note raises a number of questions:-
- Why were these file notes only provided to Ms Ahkin (and possibly the minister and Mr Pinnock), but not provided to Alan until December 2001? (and only then because of the then-new Privacy Policy Act)?
- Why wasn’t Alan told that Lyn Chisholm noted the billing faults he raised in his claim appeared to continue after his arbitration, when the Minister’s office and Mr Pinnock WERE told? This documented proof was what Alan needed to appeal his Award.
- When Lyn Chisholm alerted the Minister’s office and Mr Pinnock about the ongoing billing problems, why didn’t they initiate an enquiry?
- Ms Ahkin’s fax of 23rd January confirmed Mr Pinnock would see the Minister’s response to Alan’s complaints before David Hawker. Consider a Telstra FOI document, I00265, dated 16th October, 2002 and noting, regarding Darren Lewis, the new owner of Alan’s business:-
“Hopefully, the TIO will become involved and that will take the Minister and Member [David Hawker MP] out of the equation.”(AS-CAV Exhibit 234 to 281 - See AS-CAV 242)
This document suggests Mr Pinnock has a lot to answer regarding to the problems that continued in Cape Bridgewater for so long.
COMMENTARY – Most important (1):
Regarding checking AUSTEL on dates: Mr Benjamin’s statement, “Telstra responded to investigations undertaken by Austel on 16 October 1995,” relates to correspondence from AUSTEL on 4th October, 1st December 1994 and 3rd October 1995. It is a misleading and deceptive comment.
Please note: The 16th October 1995 response Ted Benjamin is referring to, is when Telstra addressed Alan’s arbitration 1800 billing issues outside the legal arbitration arena. (AS 213)
The letter of 4th October is exhibit AS-CAV Exhibit 92 to 127 - See AS-CAV 126. Mr Benjamin wrote to Bruce Mathews of AUSTEL, on 11th November 1994 noting:-
“Each of the questions put by you in your letter 4 October, 1994 will be answered as part of Telecom’s defence to Mr Smith’s claims lodged under the Fast Track Arbitration Procedure.” (AS-CAV Exhibit 92 to 127 - See AS-CAV 127)
When he wrote his letter of 4th February 1998 Mr Benjamin knew Telstra waited until five months after Alan’s arbitration before addressing the same billing faults he previously told AUSTEL would be addressed under arbitration.
COMMENTARY – Most important (2):
There are far-reaching ramifications from AUSTEL allowing Telstra to address arbitration matters without allowing Alan his legal privilege of responding to this document, as he would have been able to if Telstra submitted this document in their arbitration defence. Imagine the outcome if Alan was able to challenge the information contained in this 16th October 1995 document had it been submitted in the arbitration.
Page one, second paragraph letter dated 4th February, from Mr Benjamin to Mr Pinnock, notes:-
“Telstra will not be investigating complaints relating to the period before the Arbitration award that was handed down on 11th May, 1995 as Telstra considers that this matter was included in the arbitration and is finalised.”
How can Mr Benjamin make such statement when, on the next page he admits Telstra addressed the 4th October and 1st December 1994 matters on 16th October, 1995 – five months after 11th May, 1995 (the end of the arbitration)?
26th February 1998: Wally Rothwell, Deputy TIO, writes to Alan advising his office has received Alan’s letters, of 17th & 18th February, regarding billing information withheld from Alan during his arbitration. Mr Rothwell notes:-
“the Ombudsman has asked me to seek the opinion of the Special Counsel to the TIO under the FTAP, as to whether the aspect raised in those letters are matters which were or should have been decided by the Arbitrator in the Award he made”. (AS-CAV Exhibit 234 to 281 - See AS-CAV 243)
In her letter of 2nd August 1996 to Mr Deeble of the TIO’s office, Sue Hodgkinson admitted, to Dr Hughes and the TIO’s office, billing documents WERE withheld from Dr Hughes and Alan, during his arbitration (AS 220). Therefore, Dr Hughes could not address billing issues nor include them in his award.
Mr Pinnock’s statement is confusing, as he told Mr Hawker on 28th March 1996 the faults were addressed in Alan’s arbitration. Again, Mr Pinnock concealed his knowledge of FHCA admitting, on 15th November 1995, DMR and Lane did not address the 008 billing problems nor diagnose the causes of the faults, but left the problems “open” (see the Technical Report).
27th February 1998: John Pinnock writes to Graham and Ted Benjamin:-
“On 22 December 1997, Dr Hughes held a Directions Hearing in this matter.
Subsequently, Dr Hughes advised the parties, the Administrator, the Special Counsel and the Resource Unit that:
- due to a perceived conflict of interest he had ceased to act as Arbitrator;
- the arbitration should continue with the appointment of a new Arbitrator by the Administrator;
- the Resource Unit should suspend further work pending directions from a new Arbitrator.
The parties then held discussions about the possibility of a mediated settlement. However, to date nothing concrete has emerged from these discussions.
Advice from the Special Counsel confirms
- the Arbitration remain on foot;
- as Administrator, I should appoint a new Arbitrator;
- the Arbitrator must give directions about the release of the Preliminary Technical Evaluation Report prepared by Mr Paul Howell at the direction of Dr Hughes and now held by the Resource Unit.” (GS-CAV Exhibit 324 to 367 - See GS CAV 337)
Note: Graham never received a copy of the Preliminary Technical Evaluation Report by Paul Howell.
Paul Howell’s Preliminary Report could only have been compiled from Telstra’s technical information because Graham was unable to submit his technical claim, as he had still not received ALL his relevant requested FOI information. In Alan’s case, Paul Howell only assessed 23 claim documents from the 200 plus Alan submitted (see his report of 30th April 1995 page 37). Perhaps Paul Howell was contemplating doing the same in Graham’s arbitration?
6th March 1998: William Hunt’s file note contains his recollection of a discussion with Graham, concerning Graham’s belief he was forced under duress to sign the Arbitration Agreement. Mr Hunt noted Graham as saying:-
“I rang Hughes and said ‘this is nonsense, you’re considering a proposition when it shouldn’t even be considered. We’re a commercial assessment process not arbitration’. He said ‘well that’s the way I’m playing it’ (or words to that effect).” (GS-CAV Exhibit 324 to 367 - See GS CAV 338)
Mr Anthony Hodgson, Chair of Ferrier Hodgson misleads Mr Alan Cameron, Chair of the Australian Securities Commission
17th March 1998: Even though Ferrier Hodgson’s John Rundell wrote to Mr Pinnock on 15th November 1995 advising him DMR and Lane had NOT addressed Alan Smith’s billing claim documents (AS 104), Mr Hodgson told Mr Cameron, “DMR and Lanes did address all of the claim documents submitted to the Arbitrator.” (AS-CAV Exhibit 234 to 281 - See AS-CAV 249)
18th March 1998: These file notes were prepared by parties other than William Hunt and Graham, confirming the author was present during this Direction Hearing administered to appoint a new arbitrator to assess Graham’s claims. (GS-CAV Exhibit 324 to 367 - See GS CAV 339)
25th March 1998: John Pinnock writes to Graham:-
I refer to the meeting at the TIO on Tuesday, 17 March 1998.
At the conclusion of this meeting I gave various directions in relation to the future conduct of your arbitration. I note that two of the dates by which certain actions were to be taken by the parties fall on a weekend. To prevent any misunderstanding, I now summarise my directions, providing revised dates where required:
By Friday, 15 May, 1998 the parties are to have provided one another and the TIO with detailed curriculum vitaes for nominations for the appointment of a new Arbitrator.(GS-CAV Exhibit 324 to 367 - See GS CAV 340)
On 26th March 1988 Peter Bartlett writes to John Pinnock:-
“1. Appointment of new Arbitrator
1.1 Clause 1 of the Fast Track Arbitration Procedure (‘FTAP’) states that:
‘This procedure provides arbitration pursuant to the Commercial Arbitration Act 1994 Victoria), as amended (“the Act”).
1.2 Clause 3 of the FTAP states that the Arbitration:
‘will be administered independently by the TIO…(“the Administrator”) and conducted by Dr Gordon Hughes…(“the Arbitrator”.)’. …
2. Arbitration remains on foot
2.1 We advise that the Schorer and Telstra Arbitration remains on foot despite Dr Hughes ceasing to hold office. The Act provides that when an arbitrator ceases to act, either the court or person with the requisite power shall appoint a new arbitrator. Neither the Act nor the FTAP provide that the Arbitration shall cease if an Arbitrator ceases to hold office.” (GS-CAV Exhibit 324 to 367 - See GS CAV 341)
Since Mr Bartlett was the legal advisor to the arbitration and John Pinnock was the administrator of the process, why didn’t they apply to the Supreme Court of Victoria and ask for an enquiry into Telstra’s conduct during Graham’s arbitration? The legal architects of the Victorian Commercial Arbitration Act in 1984 would not have envisaged a situation, like that surrounding the COT arbitrations, where the arbitrator and administrator allow:-
- the defendants to use documents they knew were flawed to support their defence;
- the official Arbitration Resource Unit to submit a half-completed report for the claimant’s response.
Surely the legal architects of the Arbitration Act would not have envisaged an arbitrator and administrator would allow the Australian Federal Police to run their own investigation into the same arbitration issues at the same time? How could both investigations take place at the same time when the documents were supposed to be held under strict confidentiality by the arbitration process?
Graham’s 12 counselling sessions during January and March 1998 (GS-CAV Exhibit 324 to 367 - See GS CAV 327-B) had little effect in mitigating the damage done by the TIO, the TIO’s Legal Counsel and the arbitrator, as they allowed Telstra’s conduct to continue throughout most, if not all, of Graham’s arbitration. In fact, the damage done to Graham is immeasurable.
21st April, 1998: William Hunt’s file note discusses the following:-
“On the Thursday before Good Friday (9th April) I had made special arrangements with Mr Schorer to be available to go through the material that he had been working on for purposes of the ‘working party’ for the Senate representations he was wanting to make. …”
“On Friday morning 17th April in the middle of the morning he rang me and asked for urgent help to provide copies of documents that he had prepared for the submissions to the arbitrator Hughes.” (GS-CAV Exhibit 324 to 367 - See GS CAV 342)
In regards to Mr Hunt’s file note, concerning Graham’s representations to the Senate Working Party, Graham submitted the following submissions to the working party while he was still corresponding to the other parties in the arbitration process:-
3rd December 1997 to 11th January 1998, 5 letters and 82 attachments;
12th January 1998 to 10th February 1998, 8 letters and 210 attachments;
- 11th February 1998 to 16th March 1998, 6 letters and 98 attachments;
- 17th March 1998 to 5th April 1998, 3 letters and 28 attachments;
- 6th April 1998, to 22nd April 1998, 8 letters and 199 attachments.
22nd April, 1998: John Pinnock writes to Dr Hughes:-
“The TIO proposes to appoint a new arbitrator as soon as possible. Until such an appointment is made, I consider that it would be appropriate for the TIO, as administrator, to hold for safe keeping all the documents and correspondence submitted to you, as well as your own files, in relation to this Arbitration.” (GS-CAV Exhibit 324 to 367 - See GS CAV 343)
4th May, 1998: William Hunt faxes Graham a list of seven legal experts he considers a possible replacement for Dr Hughes. The relevance of this letter is discussed below. (GS-CAV Exhibit 324 to 367 - See GS CAV 344)
15th May, 1998: Lyn Chisholm, writes to Mr Pinnock noting:-
“I refer to your correspondence of 25 March, 1998 regarding the appointment of a new Arbitrator and Technical Resource Unit.”
“I attach for you copies of curriculum vitaes for Mr Geoff Nettle QC, Mr Julian Burnside QC and Mr Jonathan Mott for consideration.” (GS-CAV Exhibit 324 to 367 - See GS CAV 345)
18th May, 1998: John Pinnock writes to Graham:
“I confirm that by Friday 15 May 1998, the parties were to have provided one another and the TIO with curriculum vitae for nominations for the appointment of a new Arbitrator. I have to date received no such documentation.”
“I request that you immediately provide me with your nominations for the appointment of a new Arbitrator.” (GS-CAV Exhibit 324 to 367 - See GS CAV 346)
IMPORTANT
Between the dates of 3rd December, 1997 to 6th April, 1998, Graham corresponded with the Senate Working Party at least 29 times and provided 617 attachments to his correspondence. Over approximately the same period Graham received the following correspondence from the Working Party:-
1st December, 1997 to 31st December, 1997: 3 letters and attachments;
2nd January, 1998 to 30th January, 1998: 12 letters and attachments;
2nd March, 1998 to 25th March, 1998: 29 letters and attachments;
4th February, 1998 to 28th February, 1998: 20 letters and attachments;
2nd April, 1998 to 30th April, 1998: 25 letters and attachments;
5th May, 1998 to 13th May, 1998: 7 letters and attachments.
During this time Graham attended four Working Party Oral Hearings, and here was John Pinnock on 18th May, 1998 stating:-
“I have to date received no such documentation.”
Graham did send this documentation. Where is it?
The TIO and his Legal Counsel failed to grasp that they had a duty of care to see the process was conducted transparently and ethically. The arbitrator, Dr Hughes, failed to understand that once he realised that the Arbitration Agreement he condemned as not credible, as it didn’t allow claimants their proper entitlements to access documents from Telstra or allow reasonable time for the preparation of technical reports, he should have refused to carry on as arbitrator.
Had Dr Hughes’ letter of 12th May, 1995 to Warwick Smith reached the TIO Board and Council, 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”
The Board and Counsel would have immediately aborted the process until a new agreement was drafted.
It is a national disgrace and a mark against the Australian legal system: Dr Hughes, Warwick Smith and John Pinnock did not act legally, via the Supreme Court of Victoria, in compelling Telstra to abide by the original agreement reached between the parties before the COT cases signed for arbitration (that they would get the relevant documents they needed through the FOI process). The Senate became involved but, due to their own work load, it could only partially assist some of the COT cases.
It is a sad indictment that even Senator Richard Alston, wouldn’t apply force on Telstra to supply the relevant documents needed by the Working Party, so Graham could complete his claim for a negotiated settlement and have his claim of between $4 – $12 million professionally valued.
19th May, 1998: In William Hunt’s file note he writes:-
“On today’s date I had conversation with Schorer and with Lyn Chisholm and Harry Thorpe [Graham’s accountant] on the telephone at Golden’s office. The upshot was that Benjamin is still holding back on agreeing to the proposition for stage one of Chisholm’s proposals because of fear that the arbitration would be blamed and he would be criticized in Parliament.” (GS-CAV Exhibit 324 to 367 - See GS CAV 347-A)
21st May, 1998: John Pinnock writes to David Hawker, Federal Member for Wannon noting:-
“As you may be aware, Mr Smith has written to this office on numerous occasions concerning aspects of his Arbitration which was completed in May 1995.”
“The vast majority of Mr Smith’s complaints seek, in effect, to review the conduct of the Arbitrator, or the Resource Unit or both, as well as the Arbitrator’s Award.…
“Recently, Mr Smith has raised a question as to whether the Arbitrator’s Award dealt with his complaint that he had been overcharged on his 008 (now 1800) freecall service. As this is a matter which I can properly consider, I have made preliminary enquiries of Telstra and have also sought advice from Mr Peter Bartlett, Special Counsel, Minter Ellison.” (AS-CAV Exhibit 234 to 281 - See AS-CAV 245)
IMPORTANT
Graham’s business losses were supposed to be assessed by an arbitration process, conducted transparently, ethically and according to the Commercial Arbitration Act (Victoria). Yet, it is quite clear that the defendants in the arbitration – Telstra – controlled the arbitration process, not the arbitrator (Dr Hughes) or the administrator (the TIO’s office).
On 26th September, 1997, just nine months earlier, Mr Pinnock explicitly told the Senate:-
“the arbitrator had no control over that process because it was a process conducted entirely outside the ambit of the arbitration procedures”.
On 25th May, 1998 Ted Benjamin blatantly refutes the value of Graham’s claim. The same Ted Benjamin who was previously condemned by the Senate for his conflict of interest: as Telstra’s Arbitration Liaison Officer (as well as a sitting member of the TIO Council), while the TIO’s office administered the COT arbitrations.
On top of relevant information being altered and blanked out in legally requested FOI documents and the drip-feeding of FOI documents (usually not those specifically requested), in order to withhold vital FOI documents from the claimants, Telstra – not the arbitrator – was running the arbitration and deciding what it would pay the claimants.
25th May, 1998: This facsimile document from William Hunt’s office to Graham’s office was intercepted via Telstra’s fax-screening process. This will be discussed shortly (GS-CAV Exhibit 324 to 367 - See GS CAV 348-B)
GS-CAV Exhibit 324 to 367 - See GS CAV 349, entitled Graham Schorer & Alan Smith Fax Interception Exhibit 3, prepared for Allen Bowles, January 2007, is a four-page document describing information showing legal documents between William Hunt, Graham and Alan’s offices were intercepted via Telstra’s fax-screening process during 1998, without their written authorisation.
Graham’s May/June 1998 settlement offer is similar to Alan’s 11th December, 1992 settlement offer, with Telstra dictating what the claimant should receive during settlement and appearing to know the minimum a claimant will accept, in order to stay financially afloat.
Exhibit GS-CAV Exhibit 324 to 367 - See GS CAV 350 contains pages from Alan’s arbitration reply, dated 18th January, 1995 to Telstra’s arbitration defence. On page 3, Alan states to Dr Hughes:-
“I feel it is an appropriate time to indicate to you my interpretation of events of 11 December 1992, my date of settlement. I recall that I arrived at 10.00 am and left for lunch at 12.10 pm I arrived back at 1.00 pm and finished at approximately 2.15 to 2.30 pm. I would make mention that I had no legal representation and was completely on my own. I recall using the telephone twice. The affair, the bizarre type of negotiations, started at bargain basement style: $20,000.00 was offered, then $40,000.00 and then Ms Pittard [Telstra’s commercial general manager] left the room. On her return, she showed me two letters of guarantee that my phone was now up to network standard.”
Towards the end of page 3, Alan notes:-
“I recall that Ms Pittard deliberately stated that Telecom had time on their side which in my opinion Ms Pittard was attempting to say that Telecom would stretch me financially in respect to getting to Court.”
On page 4 of Alan states:-
“Mr Arbitrator you would find that Telecom has been negligent in their dealings with my phone service and the actions of Ms Pittard in refusing me historical fault information prior to the settlement was not only negligent, misleading and deceptive, it was also unconscionable conduct. Mr Arbitrator you would also have to wonder about Ms Pittard’s statementthat I had unlimited use of a telephone and that she was aware that in her absence I made several telephone calls during the negotiation period. Was Ms Pittard that concerned about me that she had this telephone monitored?” (GS-CAV Exhibit 324 to 367 - See GS CAV 351)
26th May, 1998: Graham writes to Telstra’s Graeme Ward, Group Director Regulatory and External Affairs, unaware Mr Ward was also a sitting member of the TIO Board during part of the early period of Graham’s arbitration. Graham notes:-
“GOLDEN believe [sic] its immediate compensation, without incurring further time and costs, for matters referred to and covered by the arbitration process originally agreed to as a Fast Track Settlement Procedure in November 1993 should not be less than $7.183 million.”
“Notwithstanding the $4 million limit imposed late as set out above, and on the basis that Ms Chisholm was genuine in her discussions with me on 13th May last and was acting with the knowledge and authority of some of her superiors in Telstra and that in consequence Telstra was in good faith indicating its readiness to make substantial concessions if GOLDEN could likewise respond then GOLDEN is prepared to accept $3.8746 million in full settlement of all the matters referred to in the arbitration proceedings or covered by or arising there out up to the present time.” (GS-CAV Exhibit 324 to 367 - See GS CAV 352)
As shown in exhibit GS-CAV Exhibit 324 to 367 - See GS CAV 349, Telstra intercepted faxes of Graham’s legal advisor William Hunt during the time Telstra and Graham were under confidential negotiation to settle all outstanding issues the arbitration process failed to settle. While Graham states:-
“Ms Chisholm was genuine… and acting with the knowledge and authority of… superiors in Telstra and… Telstra was in good faith indicating its readiness to make substantial concessions”,
It is blatantly clear Telstra was NOT acting in good faith at all, otherwise they would not have intercepted legal correspondence between client and lawyer.
28th May, 1998: Graham writes to Ted Benjamin noting:-
“Telstra’s advise [sic] that the 1st of June 1998 is the earliest it can arrange for the inspection of GOLDEN’s accounts, documents, and discuss GOLDEN’s methodology used to calculate its claim, is acceptable to GOLDEN.” (GS-CAV Exhibit 324 to 367 - See GS CAV 353)
Ted Benjamin writes to Graham in response to his letter to Mr Ward of 26th May:
“In respect to the conditions you have placed at point 2), Telstra will need to seek advice from its professional legal and accounting advisors and therefore reserves its rights to disclose contents of documents to the above mentioned parties solely for the purpose of assessing Goldens [sic] claim.” (GS-CAV Exhibit 324 to 367 - See GS CAV 354)
The fax imprint at the top of Ted Benjamin’s letter shows the letter was faxed back to Graham at 16:28, after Mr Hunt read the document. Exhibit GS CAV 355 (a previous faxed document from Mr Hunt’s office, dated 4th May, 1998) shows William Hunt’s usual fax identification display: May 04 ’98 61 11:55AM 61 3 96706598 – yet Ted Benjamin’s letter see (GS-CAV Exhibit 324 to 367 - See GS CAV 354) shows a very different fax identification font and style.
A more detailed explanation of these faxes issues are explained in more detail in GS-CAV Exhibit 324 to 367 - See GS CAV 349.
29th May, 1998: Senator Alston writes David Hawker MP, noting:-
“I understand that Mr Smith gave Telstra an undertaking in January 1998 that he would provide Telstra with any documentation he had in his possession supporting his claims. The Telecommunications Industry Ombudsman has also advised that the matter is still under consideration.” (AS 246)
2nd June 1998: Lucy McCullagh, Minter Ellison, on behalf of Mr Pinnock writes to Graham:-
“We refer to the above meeting and regrettably advise that the tape recording made of this meeting is inaudible due to radio interference.”
“Fortunately, Lucy McCullagh took notes throughout the meeting. As a formal transcript is not available, we request that you peruse the enclosed draft minutes and provide us with your comments and amendments in order for us to prepare a final set of agreed minutes.” (GS-CAV Exhibit 324 to 367 - See GS CAV 356)
9th June, 1998: Wally Rothwell, Deputy TIO, writes to Alan:-
“The purpose of my intended meeting with Mr Hughes is to clarify whether he did consider the 1800 issues during the arbitration. …
“The Ombudsman’s advice to me though, is that he is only prepared to discuss or investigate the 1800 matter of overcharging and the Gold Phone issue if that appears to be necessary, after I have looked into it initially.” (AS-CAV Exhibit 234 to 281 - See AS-CAV 247)
Question:
How could Dr Hughes have considered the technical issues when:
- DMR and Lane state, at point 2.23 in their technical report, “the level of disruption to overall Cape Bridgewater Holiday Camp (CBHC)” was not clear and the “fault causes” remained undiagnosed and, therefore, they expected “these faults would remain ‘open’”.
- There was no provision in Dr Hughes’s award for future damages that might arise out of the faults DMR and Lane admitted were not investigated; and
- DMR and Lane admitted, in their official Arbitration Report, they only assessed approximately 11 per cent of the faults Alan registered.
10th June, 1998: Graham writes to Neil Mounsher, Manager Telstra’s Customer Response Unit:-
“Point 1
“It is my understanding that Mr Crofts [Telstra’s accountant] considers the GOLDEN claim is worth between $.6M to $1.2Million. …
“In my opinion, the amounts being considered by Mr Peter Crofts are less than what was alleged to be on offer in 1996.
“Point 2
“GOLDEN’s basic losses – $8, 333,000.00
“When these losses are discounted by 53.85% = $3.846 Million.
“Point 3
“Loss of jobs (see Schedule) $5,003,000.00 ‘Loss of Goodwill (see Schedule $1,198,000.00 “Interest Foregoing (see Schedule) $2,132,000.00 “Total GOLDEN $8,333,000.00 “Total – Integrated Transport Service $2,777,000.00 “TOTAL $11,110,000.00 “Legal costs (not being FOI) $60,000.00 “FOI $431,000.00 “Court costs ($200,000.00 taxed) $80,000.00 “G Schorer – injury, loss of health, etc $1,000,000.00 plus “GRAND TOTAL $12,681,000.00” (GS-CAV Exhibit 324 to 367 - See GS CAV 357)
17th June, 1998: Graham’s five page letter to Mr Pinnock, does not agree with the Arbitration Meeting Draft Minutes dated 22nd May, 1998 prepared by Minter Ellison.
“The GOLDEN response has been made in consultation with Mr William Hunt in order to address all of the deficiencies within the Minter Ellison Draft.” (GS 358)
Wally Rothwell, Deputy TIO, again writes to Alan:-
“I understand that you are going through a hard time at the moment and, while I cannot guarantee a successful outcome of your 1800 complaint, hope that you can bear with this delay.” (AS-CAV Exhibit 234 to 281 - See AS-CAV 248)
18th June, 1998: Ted Benjamin writes to John Pinnock:-
“I have received a letter dated 17 June 1998 from Mr Schorer attaching his proposed amendments to the minutes of the above meeting.”
“Telstra does not agree with Mr Schorer’s suggested amendments to paragraphs 20 and 21. It believes that the minutes should remain as is, because they more accurately reflect the meeting proceedings than do Mr Schorer’s proposed amendments.” (GS-CAV Exhibit 324 to 367 - See GS CAV 359)
18th June, 1998: Telstra’s Neil Mounsher responds to Graham’s letter of 10th June 1998, noting:-
“Notwithstanding the above, Telstra is not prepared to let the arbitration process be unduly delayed and I have been instructed to seek the appointment of a new arbitrator. I enclose a copy of Telstra’s letter to the TIO on this matter.” (GS-CAV Exhibit 324 to 367 - See GS CAV 361)
19th June, 1998: Graham writes to John Pinnock:
“At 11:44 am Friday, 19 June 1998, my office received a Telstra facsimile dated 18 June 1998, addressed to the TIO, containing comments on my response to the errors within and omissions from the Draft Minutes of 22nd May 1998 meeting. …”
“It is unfortunate for all present at the meeting that the Draft of the brief notes taken by Lucy McCullagh do not record all of the key words used and key statements made by each party at the meeting. Telstra’s assertion the Draft should remain as is cannot take place because it does not mirror the meeting’s procedures and content.”
“The only action the TIO is entitled to take is to produce a set of Minutes that includes reference to my correction of the errors and the omissions of the key words/key statements made by individual parties, plus record Telstra’s belief the Minutes should remain as is, on their stated grounds they believe the Draft ‘more accurately reflect the meeting proceedings than do Mr Schorer’s proposed amendments’.
Please advise what action the TIO intends to take.” (GS-CAV Exhibit 324 to 367 - See GS CAV 362)
Had Mr Pinnock admitted to himself and the ACA (formerly AUSTEL), both he and Dr Hughes failed the claimants, and had Mr Pinnock handed Graham’s claim back to the ACA where the whole process began, the ACA would have had to declare all four arbitrations and settlement processes null and void.
The ACA would have had the power to do this because AUSTEL originally appointed Mr Pinnock’s predecessor to administer the original, signed, commercial-settlement agreement and AUSTEL endorsed that agreement. Had Mr Pinnock handed Graham’s arbitration claim back to the ACA, his claim would have been properly valued, on the merits of the evidence, but instead Graham was told to accept Telstra’s offer, regardless of whether or not it came anywhere near Graham’s claim amount.
Was Graham still in the Fast Track Arbitration Procedure under the control of the TIO or did the appointment of the Senate Working Party mean his claim was now under the control of the working party? It certainly seems that, at least up to this point, Telstra was in control – not the TIO or the Senate Working Party. By June 1998, Mr Pinnock already knew the arbitrator had no control over the arbitration.
Graham again writes to John Pinnock:-
“I agree with your previous statements made in words to the effect, the TIO does not have the power to appoint a new Arbitrator under circumstances where the parties do not agree on who should be appointed, again repeated at the 22 May 1998 meeting.”
“After re-reading the previous correspondence between AUSTEL, TIO and myself, and my other notes on the same matter, it is quite clear the TIO’s only option is to refer this matter back to the ACA (formerly AUSTEL).” (GS-CAV Exhibit 324 to 367 - See GS CAV 363)
Please note: Because of Graham’s ill health during May and June 1998, much of the Senate Working Party correspondence was administered by other COT members, although Graham did receive 14 letters in May and June 1998, while he was trying to find a suitable arbitrator that was acceptable to all parties.
Ted Benjamin also writes to John Pinnock:-
“I note that, despite recent efforts, the parties have been unable to agree to date upon an Arbitrator to replace Dr Gordon Hughes.”
“The Arbitration has now been in limbo for some months as a result, a situation which clearly cannot be allowed to continue indefinitely.” (GS-CAV Exhibit 324 to 367 - See GS CAV 364)
IMPORTANT COMMENTARY
Graham was still seeing a counsellor four times a month, to help him cope with this TIO and Telstra fiasco. Did John Pinnock, the TIO Board and the TIO Council, expect anyone to believe they were looking after Graham’s welfare as a claimant in an arbitration supposedly being conducted under the Commercial Arbitration Act (Victoria)?
It was not revealed, in the Alan Smith CAV Chronology or the Graham Schorer Chronology part 1, that, during Graham’s arbitration, on a number of occasions, friends found Graham on his office floor crawled up into a foetal position and shaking. Is it any wonder Graham is a shell of the man he used to be before he took part in the alleged TIO-administered transparent arbitration process?
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