Select Committee on Home Affairs Minutes of Evidence


Examination of Witnesses (Questions 40 - 59)

TUESDAY 30 JUNE 1998

COUNCILLOR STEPHEN MURPHY AND MR DAVID WILMOT

  40. So the confidentiality clause was a waste of time?
  (Councillor Murphy) We did not tell them.

  41. The confidentiality clause was a waste of time?
  (Councillor Murphy) There was another issue about the confidentiality clause as well because at the same time that we were actually in discussion the insurers were looking at two further cases and one of the comments that was being made at the time was that they did not want to have publication of the settlement because that may damage the cases that they were looking at and any settlements that they may have to make in the other cases.

Mr Corbett

  42. But the police proposed the confidentiality, not the insurers?
  (Councillor Murphy) It was a mutuality and that is the difficulty we have got.

  43. Who proposed it?
  (Councillor Murphy) It is easy for the insurers to say that they did not play a part in this. At the end of the day there was a wide discussion going on at the time.

Mr Winnick

  44. Councillor Murphy, would it not be right to say that every member of the policy authority in Greater Manchester is aware of the settlement?
  (Councillor Murphy) No, I would not say that every member is aware of the financial settlement.

  45. You are aware, are you not?
  (Councillor Murphy) No, I am not aware of the final settlement. I have not seen anything on paper.

  46. You are telling us that you have no idea what the final settlement is?
  (Councillor Murphy) Yes, I do.

  47. You are answering to a Select Committee of the House of Commons.
  (Councillor Murphy) I do have an idea of what the financial settlement was. The same as the Chief Constable, if I am pressed and questioned to give an answer then I would not refuse to give that answer; I cannot refuse to give that answer.

  48. That indicates that you do know but we are not pressing you to do anything, like we are not pressing the Chief Constable to give answers which could be held to be in contempt of court. Clearly you are indicating that you know the answer as to what the settlement was. Therefore, would it not be true to say that although perhaps not all members of the police authority, most of the leading members, if not all of the leading members, are aware of the figure?
  (Councillor Murphy) Certainly the people who sat in that room with me on those final days were aware of the discussions taking place and the figures that were being talked about.

  49. During the course of the court case and the rest of it did the Chief Constable keep you aware of what was happening?
  (Councillor Murphy) Did the Chief Constable?

  50. Yes. Did he have consultations with you as the Chairman of the Police Authority?
  (Councillor Murphy) I think apart from one of those meetings, the Chief Constable was probably in attendance at most of these discussions we had. At one of those meetings he was on holiday, I think.

  51. But as you say in the papers which have been circulated, Councillor Murphy, the Police Authority were not a party to the agreement; presumably you knew what was going to be done over the case? Were you consulted by the Chief Constable?
  (Councillor Murphy) We were consulted by the Chief Constable. We were consulted by the insurers. We were consulted by the barristers. We were consulted by our own legal people. We were consulted by our own financial people.

  52. So you were kept informed all the time?
  (Councillor Murphy) We had to be because at the end of the day, if this case was going all the way through and we were not covered for the figures we thought we were covered for, then as a police authority we would have had to have found the money to fund the case.

  Mr Winnick: Okay.

Ms Hughes

  53. Could I ask you, Mr Wilmot, just to clarify where we are with this status of the agreement. You clearly seem to be under the impression that it is an order of the court because you are clearly under the impression that were you to reveal it today, the figure, you would be in contempt. Other information sent to us by the insurers and others have used different terminology. For example, they say that the settlement was submitted to and approved by the court. This is the question we were trying to clarify earlier: as to whether this is an order, in which case you are in contempt; or whether it is simply an agreement that the judge signed and endorsed, in which case you would not be in contempt. I do not know whether you have any legal advice with you today, but can you help the Committee with this? It seems to me to be quite a crucial question.
  (Mr Wilmot) The front sheet of the document of the agreement, which has a number on it, (which I presume is the court number for the document), starts off: "Before the Honourable Mr Justice Owen sitting at Court 1 on 26 June 1995. Upon hearing leading counsel for the plaintiff and legal counsel for the defendant, and the plaintiff and defendant having agreed to the terms set forth in the schedule hereto, it is ordered that..." My impression, although I am not a lawyer, is that this is a court order.

  54. Okay. That is helpful. It may be helpful if you can clarify that later on. But thank you. That is helpful.
  (Mr Wilmot) I repeat, if I am asked a direct question by this Committee I will answer it.

  55. That is why I am trying to seek clarification. We would not want to put you in contempt of court, Mr Wilmot, but there seems to still be some slight lack of clarity, although what you have read out may be helpful. Could I ask Mr Murphy. You have just implied that the insurers themselves have their own reasons for wanting the confidentiality clause. You were talking about other cases that they had in the pipeline, and that they would not want the figure necessarily to be public. Could I tell you that in a letter to the Committee on 6 May the insurers said, in talking generally about these matters and how far confidentiality clauses were the norm, they said that "... no insurance policy issued by this Company to any police authority, or indeed any other public body, has contained any provision or condition involving the imposition of confidentiality clauses in the terms of claim settlements." The whole drift, as well as that statement from the insurers, is that as all parties in the end agreed, this was not something that either they asked for or was common practice in terms of their own commercial interests.
  (Councillor Murphy) I do not think I would dispute what you are saying in so far as it is not involving the insurance policy. The actual comments that I made were in line with the discussions that we did have on numerous occasions, in private, in the Police Authority offices. It was the lead-up to whatever took place at the end of the day. The case was initially leading towards going to court. Then the case was actually in court up to a certain element of evidence being given. We were having a number of discussions with various people. The insurers were part of that discussion. The legal people representing the insurers were there and part of that discussion. When we were having that discussion it was made quite clear when all the discussion went on to confidentiality clauses, that they were in some difficulty if there was not a confidentiality clause in there because there were still a number of cases surrounding these issues which needed to be settled. They were dealing with those because they were our insurers on those cases as well. They did not want to have any figures disclosed which set a precedent for those further cases. That discussion took place.

  56. That is not consistent with certainly the letter and the tone of all the correspondence we have had from the insurers who make it clear that the initiative came from Greater Manchester Police; and whilst they agreed it in the spirit of trying to reach an agreement, it was neither normal practice nor was necessarily required in this particular case by the insurers.
  (Councillor Murphy) I do not dispute where the initiative came from. I actually made the comment that it was in the general discussion that took place: that comments were coming from the people representing the insurers, who were saying it would be in their interests not to disclose these figures because of the other cases that they were having to look at.

  57. That is not a view which has been put to us.
  (Mr Wilmot) To support what Councillor Murphy is saying, on 21 December 1994 the plaintiff, Derek Britton, settled out of court with the insurers. A similar clause was inserted in that settlement. That was part of this. There were four plaintiffs actually.

  58. That was after— 1994 did you say?
  (Mr Wilmot) That was before the Taylor Inquiry but it was part of this whole series of civil actions against Greater Manchester Police.
  (Councillor Murphy) There were two further later.
  (Mr Wilmot) My understanding then was exactly the same as Councillor Murphy's. That clause was inserted in order to prevent a public disclosure before the other cases were submitted.
  (Councillor Murphy) The company we are talking about is the MMI. At the time this was going through, the MMI was basically a frozen company. They were not getting any business in. All that they were doing was settling out the final claims that they had as a company. One of the difficulties that they had, and they expressed it quite openly, was that they needed to make sure that they were settling their claims as economically as they possibly could.

  59. Just finally, notwithstanding some of those issues about how and where and why this clause came into being included in the settlement; Councillor Murphy, what justification can you give, as the Chairman of the Police Authority, for the inclusion of the confidentiality clause and for the practice of not publishing in your annual report, as other police authorities do, the total damages paid by Greater Manchester Police in any one financial year?
  (Councillor Murphy) I think the only comment that I can make on that is that wherever you agree to pay out damages at any stage, any organisation, if they need to pay out damages, needs to make sure that they can keep those damages as low as they possibly can. That is common sense for any organisation. For an organisation like ours, if we were to be seen to be paying out large amounts of money in compensation through our insurers or whoever, you then feel you may become a soft touch. We have to make sure that we are protecting the public interest. The more compensation that is paid in cases like this, the higher the premiums are that we have to pay at the end of the day. So whatever you are doing, you have got to try and make sure you are keeping your costs down; you are keeping your premiums down. By having confidentiality clauses in agreements like this, it helps you to do that. So that is a justification we would have to make. But, as we said, at the end of the day on this one we were not a party to that confidentiality agreement. We wanted to make sure that this case went to the end. The one reason why it did not was simply because of the Legal Aid system; the way it works; and because the insurers at the end of the day could not get any recompense if they had won this case.


 
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