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Chapter Five

Bribery and corruption in the seat of arbitration in Australia during the COT Cases arbitrations cut deep into the rule of law.

Part 1

Ex parte  “Ex parte” is a Latin phrase meaning “on one side only; by or for one party”. An ex parte communication occurs when a party to a case, or involved with a party, talks or writes to or otherwise communicates directly with the judge about issues in the case without the other parties’ knowledge. Under the Judicial Code of Conduct, judges may not permit or consider “ex parte communications” in deciding a case unless expressly allowed by law. This ban helps judges decide cases fairly since their decisions are based only on the evidence and arguments presented to the court and the applicable law. It also preserves trust in the legal and court system.

Both the TIO and his appointed arbitration resource unit withheld vital arbitration evidence from being investigated during the COT arbitrations. 

The 22 March 1994 transcripts of a clandestine gathering, where the COT cases were not represented (see Open letter File No 54-A), shows Telstra’s Mr Chalmers, the author of the minutes, has left out points 4 and 5. Point 6 follows point 3. Where are points 4 and 5?

This is further proof that Dr Gordon Hughes should have never allowed this secret meeting to take place without the COT cases being represented. Most, if not all, Western democracies would expect the defendants and their lawyers to be present in the judge’s chambers. In this case in secret with the arbitrator, the defendants and the TIO and his special counsel. The missing discussion material or questions raised at points 4 and 5 may well be why the parties present agreed to Telstra lawyers drafting the agreement, instead of the independent arbitration agreement the government and claimants were assured would be used. It could also be where Telstra and the arbitrator, Dr Hughes, agreed Telstra would allow the arbitration resource unit first access to all arbitration procedural material (AS-CAV Exhibits 589 to 647 - See AS-CAV 590, Chapter Seven). This allowed the arbitration resource unit to decide which documents Dr Hughes and the claimants would be allowed to see, and which would be discarded.

We will never know what was concealed from the COT cases during this clandestine gathering. Although the arbitration resource unit admitted, in writing 18 months after the first arbitration was finalised (see Open letter File No/45-H), to Dr Hughes that they concealed at least four relevant billing claim documents from the arbitration process.

The missing questions raised at points 4 and 5 in the minutes of this clandestine meeting may be linked to the arbitrator and his arbitration resource unit allowing for the more adverse findings against Telstra to be covertly addressed outside the legal arena of the COT arbitration process. If the addressing of non-addressed arbitration issues had nothing to do with points 4 and 5, then what could have been so detrimental to the arbitration process that these points were excluded from these minutes?

Open letter File No 54-A shows those who attended this clandestine meeting were Telstra’s arbitration liaison officer, Steve Black, Telstra’s general counsel, David Krasnostein, Telstra’s lawyer from Freehill Hollingdale & Page, Simon Chalmers, TIO special counsel, Peter Bartlett, arbitrator, Gordon Hughes, TIO Warwick Smith and his secretary Jenny Henright. Except Jenny Henright, all were lawyers and therefore all knew this was an illegal gathering. What was so important about this meeting that only the arbitrator and defence attended it?

Why weren’t the COT Cases and or their lawyers advised of this meeting?

Upon reading this segment Open letter File No 54-A) and the following Prologue page, you will come to the same conclusion many others have: arbitrator Dr Gordon Hughes should not have secretly met with Telstra (the defendants) prior to arbitration to discuss what rules in the arbitration agreement would be removed and which would remain. This clandestine meeting (without the claimants being represented) also covered how to protect – to exonerate – the arbitrator’s consultants from incurring any liability for negligence and to exempt the unit from being sued. Of course, this was to the detriment of the COT cases and our legal right to have recourse over the arbitration consultants if the resource unit was negligent in their duties. It will be apparent, after reading Open letter File No 54-A) and the Prologue page, the arbitration resource unit was negligent during my arbitration process. I could not hold them to account for those actions due to those negligent clauses being removed from my arbitration agreement.

This is a very serious issue and should have been addressed in 1995, when this was discovered. An investigation, 20 years ago, would have uncovered that Dr Hughes and Warwick Smith (TIO) used Telstra’s proposed arbitration agreement as the base document for the COT arbitration agreement, rather than using an agreement drafted totally independently of Telstra, as the government (who endorsed the first four arbitrations) and the COT cases’ lawyers were promised. An investigation in 1995 (see Prologue Chapter Four) would have also uncovered Dr Hughes’ 12 May 1995 letter to Warwick Smith, which condemned the Telstra-based agreement as not a credible document to use in the arbitrations, although he used it in my arbitration.

Before COT Cases were forced into arbitration without the necessary documents, we needed to support our claims the arbitration agreement was altered after the final copy had been signed by the first claimant Maureen Gillan, and after it had been faxed to our lawyers as the final agreement. 

Part 2

Absent Justice - Deception Continues

Hiding behind a tainted confidentiality agreement - section two

Please note:

Before reading Chapter 2 here, it is essential to remind the reader that by viewing Chapter 1 - The collusion continues and Chapter 2 - Inaccurate and Incomplete, they will observe that in my case, had I been allowed to challenge both arbitration resource units, namely Ferrier Hodgson Corporate Advisory (the financial arbitration advisors) and DMR & Lane the technical arbitration consultants I would have had a reasonable chance of some success.

However, when the arbitrator allowed the removal of clauses 25 and 26 from my arbitration agreement after it had been sent to our lawyers as the final agreement, he effectively stopped me from appealing his award using the misconduct of FHCA and DMR & Lane clauses to sue for wrongdoing. 

On the day we signed the arbitration agreement (see Open letter File No 54-B), clause 10.2.2 and the $250,000.00 liability caps in clauses 25 and 26 had been removed, and clause 24 had been modified. We were told there would be NO arbitration if we did not accept these late changes. 

I have always maintained our lawyers thought we were signing the arbitration agreement, the first of the four COT Cases Maureen Gillan had signed two weeks before. I only agreed to clause 10.2.2. being removed. With our banks declaring they were ready to take over our assets if we could not show settlements were imminent, I buckled to the removal of only that clause.

No one in their right mind no matter how must pressure was applied to them would have accepted a compromise of such a magnitude. Modifying clause 24 and removing clauses 25 and 26 meant we could not sue the TIO- appointed arbitration consultants (there were several) for acts of negligence. The legal counsel to the arbitration and the professional consultants were bulletproof. They could freely do whatever they liked when they liked, and there was nothing anyone could do. This website absentjustice.com shows this is exactly what happened.

 

The Secret meeting tells it all the way it was

Telstra's minutes [transcripts] from this clandstine meeting show no COT claimant or their representative were present at this important meeting show at point six that:

“Mr Bartlett [TIO Special Counsel] stated that he was unhappy that Telecom did not appear prepared to allow his firm an exclusion from liability. …

“Mr Smith [TIO Warwick Smith] stated that he thought it was reasonable for the advisers to incur some liability, and that the only matter left to be negotiated on this issue was the quantum of the liability caps.

“Mr Black [Telstra] said that he thought the liability caps proposed by Telecom in the amended rules were already reasonable.” (See Open letter File No 54-A)

 

Points 4 and 5

The fact that Open letter File No 54-A shows the author of these minutes has left out points 4 and 5 i,e; point 6 follows point 3 is of great concern. Where are points 4 and 5? 

What information was originally exposed in those two points that prompted Telstra’s lawyers to remove them from the minutes that the arbitrator would have surely received or composed his own? (see Open letter File No 54-A

The TIO (administrator to the arbitrations) Telstra and the arbitrator have refused to provide those removed clauses even though the Commonwealth Ombudsman sought that information on my behalf between October 1995 and October 1997.

I reiterate, that Telstra, the TIO and the arbitrator are stating the confidentiality clauses in the arbitration allow them not to disclose to the claimants and the public anything about the conduct of our arbitrations. 

This is further proof that for Dr Gordon Hughes should have never allowed this secret meeting to take place without the COT cases being represented. Most, if not all, Western democracies would condone allowing the defendants and their lawyers to be present in the judge’s chambers (arbitrator’s office). The missing discussion material or questions raised at points 4 and 5 may well be why the parties present agreed to Telstra lawyers drafting the agreement, instead of the independent arbitration agreement the government and claimants were assured would be used. It could also be where Telstra and the arbitrator, Dr Hughes, agreed and accepted that Telstra would allow the arbitration resource unit first access to all arbitration procedural material (AS-CAV Exhibits 589 to 647 - See AS-CAV 590, Chapter Nine). This allowed them to decide which documents Dr Hughes would see and which would be discarded (see also page 4 here which shows Telstra’s Steve Black wrote to Warwick Smith on 24 July acknowledging the resource unit would be allowed to vet which documents Dr Hughes would see and which he would not.

We will never know that was concealed from the COT cases during this clandestine gathering. Although, Ferrier Hodgson Corporate Advisory admitted, in writing, to Dr Hughes that they concealed at least four relevant billing claim documents from the arbitration process.

The TIO has, to date, declined to explain what circumstances occurred to change this. Who pressured the TIO to allow the advisors to be exonerated from all liability in relation to our arbitrations? Why would the TIO special counsel be:

“unhappy that Telecom did not appear prepared to allow his firm and exclusion from liability”?

Why it did not occur to either the TIO or the arbitrator that, once the directions regarding liability were removed, this would allow complacency to creep /the arbitration process? This is exactly what our  absentjustice.com pages show happened.

Had COT cases been represented at this hearing (as we were legally supposed to be), we would have been fully aware prior to 21 April 1994, the day we signed this document, that our rights to fair arbitrations were going to be violated.

Ann Garms, Graham Schorer and I only found out after our arbitrations had been concluded that these exonerated consultants had been given a secret charter by Warwick Smith with the approval of Telstra's arbitration defence officer Steve Black to vet all of the arbitration material going to the arbitrator Dr Gordon Hughes and that they were allowed to decide on what was viewed by the arbitrator and then passed onto us three claimants. 

Absent Justice - Deception Continues

Hiding behind a tainted confidentiality agreement - Part three

Although the 19th April, 1994 Arbitration Agreement issue has been addressed elswhere on absentjustice.com, it is important to link it here to the issue when the arbitrators secretary, faxed a copy of the FTAP Agreement to lawyers, Mr Goldberg and William Hunt. Mr Hunt was seeking a legal opinion on the agreement before Graham Schorer and I were to sign it on 21st April 1994.  The following three clauses are included on page 12 of the version of the agreement faxed by the arbitrators secretary:-

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.

This letter in June 1994, from Telstra’s Arbitration Liaison Officer to the TIO Special Counsel, who had been exonerated from all liability for his part in the first four COT arbitrations, included the new version of the arbitration agreement that would be used for the next 12 COT claimants. Point 11.2 of this new agreement states that

“The liability of any independent expert resource unit used by the arbitrator, for any act or omission on their part in connection with the Arbitration, shall be limited to $250,000.00″.

Thus, a few months after the $250,000 liability caps had been removed from my arbitration agreement, they were reinstated into the agreement for the remaining 12 COT claimants. Why were the claimants NOT advised of the reinstatement of the liability clauses? Why were we not offered the opportunity to go back to the original agreement that the arbitrator’s secretary had faxed to Alan Goldberg and William Hunt (our lawyers) as the approved final agreement? Why were the three claimants (including me) forced to continue with an arbitration agreement that allowed the Resource Unit to be safely exonerated from all liability, YET in the agreement used by 12 other COT claimants; they were mandated to conduct those arbitrations within the law? Three COT claimants, Graham Schorer, Ann Garms and I, were discriminated against, without question. Exhibit Hacking-Julian Assange File No/42 is from the TIO’s Standard Arbitration Rules used for other COT-type claims against the Telstra Corporation. Liability is covered in Rule 31, which states:

“The liability of any independent expert used by the Arbitrator is limited to $250,000 for any act or omission on their part in connection with the Arbitration”.

This means that any Australian citizen who enters into a TIO-administered arbitration could sue any independent expert used by the arbitrator, to the limit of $250,000 “for any act or omission on their part in connection with the Arbitration”. Graham Schorer and I were not afforded these same entitlements. This was, in fact, illegal as well as discriminatory. That the defendants (Telstra) in an arbitration were able to discuss with the official administrator of the process (in this case the TIO) whether certain discovery documents or pieces of evidence should be released to the arbitrator, and even whether they should be released at all, shows just how much control the defendants (Telstra) had over the administrator.

If this forced removal of the $250.000.00 liability caps for one section of the COT group and not all of the COT cases is not criminal discrimination by Australia's Establishment of the worse possible kind, then what is.  

Maureen Gillan was the first of the four COT Cases to sign her arbitration agreement with 10.2.2, 24, 25 and 26 firmly in place. COT Cases Ann Garms, Graham Schorer, and I advised our legal advisers that Maureen Gillan had signed her agreement. Our lawyers asked the arbitrator's office to fax a copy of that agreement that Maureen had signed. Our lawyers compared the faxed arbitration agreement with Maureens signed agreement advising us to do the same.

I accepted the removal of 10.2.2 as compromise after considing it was not worth fighting over. 

The minutes of this secret meeting with Steve Black (Telstra's arbitration officer), Telstra's Mr Krasnostine (legal directorate), Dr Hughes (the arbitrator), Peter Bartlett (TIO Counsel) show this meeting discussed alterations to the arbitration without the claimants being represented. Telstra's transcript of this meeting notes at point six that:

Mr Bartlett [TIO Special Counsel] stated that he was unhappy that Telecom did not appear prepared to allow his firm an exclusion from liability. …

“Mr Smith [TIO Warwick Smith] stated that he thought it was reasonable for the advisers to incur some liability, and that the only matter left to be negotiated on this issue was the quantum of the liability caps.

“Mr Black [Telstra] said that he thought the liability caps proposed by Telecom in the amended rules were already reasonable.” (See Open letter File No 54-A)

The fact that Warwick Smith stated: "he thought it was reasonable for the advisers to incur some liability, and that the only matter left to be negotiated on this issue was the quantum of the liability caps shows the liability caps were always supposed to have been in our arbitration agreement the same agreement that Maureen Gillan signed. 

 Since the conclusion of my arbitration all parties, icluding Telstra, the arbitrator, Peter Bartlett and TIO Warwick Smith are using the confidentlity agreement (attached was attached to the altered agreement) as the reason they will not discuss the secret alterations to clauses, 24,25 and 26 and the other unlawful conduct that festered all the arbitrations. 

In Open letter File No 54-B is a letter dated 12 April 1994 from Dr Hughes to a member of the TIO counsel. This letter discusses overcoming the issue that one of the four COT cases (Maureen Gillan) had already signed the arbitration agreement on 8 April 1994. This version was the agreement Senators Richard Alston and Boswell, all four COT cases and their lawyers agreed to. But now, John Rundell’s arbitration resource unit wanted to be exonerated from all liability for any act or omission concerning the remaining three arbitrations. They were removing the $250,000 liability caps from the original agreed-to agreement drawing any incentive for the resource unit to act responsibly towards the three remaining claimants. And as our Open letter File No/45-A to 45-I and File No/46-F to 46-J show, this is what happened: i.e., the arbitration resource unit withheld some of the essential relevant documents from my arbitration process – aware they could not be sued for that unacceptable conduct.

Part 3

Being forced to sign an arbitration agreement without the necessary document needed to prove your claim is one terrible situation to be in, but being forced to sign it after it had been altered to protect only the TIO Legal Counsel and the arbitrators arbitration resource unit shows how much disregard the arbitrator and administrator had for the COT Cases. 

Absent Justice - My Story Senator Alan Eggleston

They [Telstra] have defied the Senate working party. 

On 23 March 1999, after most of the COT arbitrations had been finalized and business lives ruined due to the hundreds of thousands of dollars in legal fees to fight Telstra and a very crooked arbitrator, the Australian Financial. Review reported on the conclusion of the Senate estimates committee hearing into why Telstra withheld so many documents from the COT cases: 

“A Senate working party delivered a damning report into the COT dispute. The report focused on the difficulties encountered by COT members as they sought to obtain documents from Telstra. The report found Telstra had deliberately withheld important network documents and/or provided them too late and forced members to proceed with arbitration without the necessary information,” Senator Eggleston said. “They [Telstra] have defied the Senate working party. Their conduct is to act as a law unto themselves.”  

The following six senators all formally record how those six senators believed that Telstra had ‘acted as a law unto themselves’ throughout all of the COT arbitrations, is incredible. The LNP government knew that not only should the litmus-test cases receive their requested documents but so should the other 16 Australian citizens who had been in the same government-endorsed arbitration process (Refer to An Injustice to the remaining 16 Australian citizens).

 

Eggleston, Sen Alan – Bishop, Sen Mark – Boswell, Sen Ronald – Carr, Sen Kim – Schacht, Sen Chris, Alston and Sen Richard

Being forced to sign an arbitration agreement without the necessary document needed to prove your claim is one terrible situation to be in, but being forced to sign it after it had been altered to protect only the TIO Legal Counsel and the arbitrator's arbitration resource unit shows how much disregard the arbitrator and administrator had for the COT Cases.

My many letter's to John Pinnock between June 1995 and August 1998, which discusses the failure of the COT arbitrations I had not been aware of the covert 22 March 1994 meeting which discusses the removal of the $250,000 liability caps and exonerating Peter Bartlett (see Part 1 above) which was orchestrated a month before the period we COT Cases were forced to sign our arbitration agreements. 

This changing of the arbitration agreement to suit the TIO legal counsel and the arbitration resource unit was not agreed to on in writing at any by the COT Cases and/or their legal advisors on the day we signed that agreement. No official ammendmant was made in writing as an attachment to the 21 April 1994 signed Arbitration Agreement and then added to the agreement so that it became part of the agreement.

The alterations had already been removed with us three COT Cases being told any further delay in signing our arbitrations Telstra had made it clear they would walk away from the process altogether. 

Part 3 continues - A Secret Deal

Three months after we COT Cases had literally been forced to sign our altered arbitration agreement Telstra’s Arbitration Liaison Officer wrote to Warwick Smith (TIO) on 11 July 1994 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 Telstra’s letter “if the resource unit forms the view that this information should be provided to the arbitrator confirms that both the TIO and Telstra were aware that the TIO-appointed resource unit had been assigned to vet most, if not all, the arbitration procedural documents en route to the arbitrator. If the resource unit decided a particular document was not relevant to the arbitration process, it would not be passed on to the arbitrator or other parties. This particular secret deal may be linked to the removal of points 4 and 5 in the minutes of the clandestine pre-arbitration meeting discussed in Chapter 1 above.

Warwick Smith had no legal durisdiction (authority) even as the administrator of the process to change any part of the process untill all parties had agreed in writing. This was a very serious issue.

As shown throughout absentjustice.com, the TIO did NOT have the authority to introduce a separate deal into a process being conducted according to a written legal agreement. On page 5 of the Commercial Arbitration Act 1984, under Part II – Appointment of Arbitrators and Umpires, (see Open Letter File No/21

6. 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.

The fast-track arbitration procedure agreement I signed, mentions only one arbitrator. There is no written agreement in existence, seen by me, that allows a second arbitrator to determine what information the first arbitrator will see. It is interesting to collate a number of covert situations set up by key players in the COT arbitrations and mischievously concealed under the arbitration agreement confidentiality clauses, even though those events took place before the confidentiality agreement was signed. In their 2 August 1996 communication to the arbitrator (copied to the TIO), the resource unit admitted to concealing relevant documents pertaining to my billing issues from the arbitrator during the course of my arbitration. This serious matter has never been addressed by the TIO or arbitration.

So not only were the COT Cases forced into arbitration without the necessary documents needed by them to fully prove their claims, they were pressured/forced to accept the covert alterations to the COT arbitration agreement where clauses 25 and 26 were removed and clause 24 altered (to the COT Cases detriment) before they signed it, threatened that if they did not sign it both Dr Hughes (the arbitrator) and Warwick Smith (the administrator) would not continue with the already signed Fast Track Settlement Proposal (FTSP). Then, just three months later, after the COTs had been forced to abandon the FTSP, a further change to this already altered arbitration agreement was made (to the detriment of the COT Cases), where relevant arbitration-related documents were to first be released to the arbitration consultants for their assessment and if they thought these documents were of value to the arbitration, then that information would be forwarded to the arbitrator.

Why have the COT Cases been made to live with such a disaster for twenty-eight years?

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My name is Alan Smith. This is the story of my battle with a telecommunications giant and the Australian Government. This battle has twisted and turned since 1992 through elected governments, government departments, regulatory bodies, the judiciary, and the Australian telecommunications giant, Telstra, or Telecom, as it was known when this story started. The quest for justice continues to this day. Nine publishers from all around the globe have published Absent Justice, which is now available for free in several languages.

Read about 'Mr Bates vs the Post Office' who took on the British government-owned Post Office, http://rb.gy/8399e3i.e., who found similar irregular activities by public servants who tried to hide the truth surrounding the valid claims registered by Mr Bates and his Post Office friends who dared tackle the British owned Post Office. 

 

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“…your persistence to bring about improvements to Telecom’s country services. I regret that it was at such a high personal cost.”

The Hon David Hawker MP

“I am writing in reference to your article in last Friday’s Herald-Sun (2nd April 1993) about phone difficulties experienced by businesses.

I wish to confirm that I have had problems trying to contact Cape Bridgewater Holiday Camp over the past 2 years.

I also experienced problems while trying to organise our family camp for September this year. On numerous occasions I have rung from both this business number 053 424 675 and also my home number and received no response – a dead line.

I rang around the end of February (1993) and twice was subjected to a piercing noise similar to a fax. I reported this incident to Telstra who got the same noise when testing.”

Cathy Lindsey

“I am writing in reference to your article in last Friday’s Herald-Sun (2nd April 1993) about phone difficulties experienced by businesses.

I wish to confirm that I have had problems trying to contact Cape Bridgewater Holiday Camp over the past 2 years.

I also experienced problems while trying to organise our family camp for September this year. On numerous occasions I have rung from both this business number 053 424 675 and also my home number and received no response – a dead line.

I rang around the end of February (1993) and twice was subjected to a piercing noise similar to a fax. I reported this incident to Telstra who got the same noise when testing.”

Cathy Lindsey

“A number of people seem to be experiencing some or all of the problems which you have outlined to me. …

“I trust that your meeting tomorrow with Senators Alston and Boswell is a profitable one.”

Hon David Hawker MP

“Only I know from personal experience that your story is true, otherwise I would find it difficult to believe. I was amazed and impressed with the thorough, detailed work you have done in your efforts to find justice”

Sister Burke

“…the very large number of persons that had been forced into an arbitration process and have been obliged to settle as a result of the sheer weight that Telstra has brought to bear on them as a consequence where they have faced financial ruin if they did not settle…”

Senator Carr

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