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Chapter Six

To be continued in a manuscript we are currently preparing titled 'The Briefcase.'



Anyone who uses a telephone has sometimes reached a recorded voice announcing, “The number you are calling is disconnected,” or something similar. Within the telecommunications industry, these messages are referred to as RVAs or recorded voice announcements (refer to glossary). Among the FOI documents I received in 1994 was a copy of a Telstra internal e-mail dated 26/9/93, which refers to the need to “have a fundamental review of all our RVA messages and how they are applied.”  This e-mail says, “... I am sure when we start to scratch around, we will find a host of network circumstances where inappropriate RVAs are going to the line.”  Telstra was aware of RVA problems long before I experienced them.





Since I was no longer one half of a working husband and wife team, I continually had to dig deep into my almost non-existent financial reserves to cover labour costs or risk losing everything. With Faye gone, I was suffering what is commonly known in the world of finance as a ‘consequential resultant loss’; now I also had to begin to pay Faye a yearly dividend on her financial investment in the business, even though she was no longer contributing her unpaid labour, plus I had to find the dollars from somewhere to pay staff.

As we headed further into 1990, the future looked grim. The phone faults were no better; who knows how many prospective customers were lost because they couldn’t reach me by phone? Because the camp was pretty remote, phones were the only means of access for the people in the city.

By now, the legal vultures were circling.   I couldn’t abide by the original financial agreement with Faye; her solicitor demeaned me for his form. My first payment to her came due, and I couldn’t raise the funds to refinance. I had trouble meeting my legal costs, let alone finding extra for Faye. My son’s $3000 school fees were overdue, and I had nowhere to turn. I couldn’t think beyond today. The outlook could never get any bleaker, I thought. How wrong I was!

To pay some of the mounting debts, I sold the 22-seater school bus I had initially been used to ferry customers around and purchased a small utility in its place.

I met Karen through mutual friends, a divorcee from Warrnambool, some 100 kilometres away. At least the little ute meant I could see Karen several times a week, and the relationship developed into something quite profound. When Karen heard that Faye’s solicitor was about to wind up my business, forcing me to sell because I couldn’t raise the funds to make any more payments to Faye, Karen put her house up as security for a loan, giving me two years of breathing space.

At about the same time, I again contacted Telstra’s fault centre in Hamilton to find out what, if anything, Telstra was doing about the continuing phone problems at Cape Bridgewater. As usual, I got the run-around but was finally informed that a new exchange, about to be installed at Cape Bridgewater, would alleviate all the problems I had suffered. Some four years later, due to an FOI request, I acquired a copy of a three-page, hand-written file note dated 15/8/91, which covers my discussions with Telstra regarding these faults. The date doesn’t correlate with my records because I knew early in 1991 that Telstra was installing a new exchange, and I had told Karen early in 1991 that this improvement would solve the phone problems and assure us of a bright future. This file note stated, however:

“Alan Smith rang 15/8/91 regarding service 267 267. Incoming callers are receiving an engaged signal when it’s not engaged—two calls from Collingwood PM 14/8/91.

This has been a continuing problem, and he needs to gain more business.

The fault history shows that the problem may be in the exchange and that the following RCM exchange, 21/8, would solve these problems, but I would check this out with the techs. (refer to the Glossary for the definition of RCM)

I also said we would look at the service now to try to get it working correctly until cutover.”

This note later says: “I rang Alan Smith on 15/8/91 and explained that we believed the problems were caused by specific exchange faults due to the age, which the cutover would solve to Portland AXE.

At least someone in Telstra had given us something to hang on to. We are excited to install the new exchange in July 1991. However, between 16 March 1990 and the cutover day, which turned out to be 18 August 1991, not July as we had originally been told, I continued to log 46 other faults and customer complaints.



My relationship with Karen continued well as we worked together to attempt to pull the business out of the doldrums.  Karen finally sold her house, raising a bit over $80,000, $65,000 of which went directly to pay my legal fees and to pay Faye most of what I owed her.  It took me another 12 months to finally pay her out.  Karen’s name was now officially on the title to my business.

Still very few new bookings were coming in and the camp was now badly in need of some maintenance work.  This created a flow-on effect:  the business looked sad and bedraggled without the necessary painting and upgrading and so people who passed by were not interested in staying.  Because they were not coming to stay there was no money to effect the repairs and no ‘word of mouth’ recommendations being passed on.

On those rare occasions when a school or club did manage to get through and book in, we had no cash flow and so we couldn’t get credit to buy even the necessary food to feed the clients when they arrived.  The operational side of the business began to look even grimmer.

Karen and I began to argue just as Faye and I had earlier argued.  Karen could see her investment fast going down the drain and she began to ask why I had not told her the truth.  “It’s now twelve months since I moved here and nothing has changed — the phone faults are no better!”

During all this time I continued to sponsor under-privileged groups to stay at the camp.  I arranged sponsored food purchases through the generosity of a number of commercial food outlets and these groups then just used the camp facilities — it didn’t actually cost me anything other than a small amount of electricity and gas.  At one point around this time, May 1992, I had organised a charity week for kids from Ballarat and the South West, including Warrnambool, Hamilton and Portland.  This group was organised by Sister Maureen Burke, IBVM, Principal of Loreto College in Ballarat and I am sure she would not be offended to know that I think of her as the ‘mother’ of the project.

Much of the organisation for this week, including arrangements regarding food, organising a bus to collect the children, decisions about where to collect the children and discussions about any special needs the children might have, had to be handled over the phone since Ballarat was a 3½ hour drive from Cape Bridgewater.  Of course, Sister Burke had enormous problems trying to contact me because of the phone problems.

Finally, after trying all through one whole week, Monday through to Friday, Sister Burke decided to drive the 3½ hours to make the final arrangements.

At this same time Karen and I had also been attempting to organise a series of ‘get-away’ type holidays for ‘over-40s’ singles clubs.  These plans were not going very successfully:  the response to our ads had been very poor (or was it just that no-one could get through on the phone?).

On the Saturday that Sister Burke decided to drive to us, just as she finally arrived at the Camp, Karen took a phone call from a very irate man who wanted some information about the singles week-ends.  This caller was very angry and quite abusive and Karen took the full brunt of his fury.  He couldn’t understand why we were advertising a business but never answered the phone.

Karen burst into tears:  this was just the final straw as far as she was concerned.  I tried to make a joke of it to relieve the tension by saying something about the problems we have dealing with the public.  Now, Karen was then, and still is, a fine ‘horse lady’.  She rode in cross country races and played polo amongst other things; she’s not someone you cross unthinkingly.  And she can sure pack a punch!  I know, because she almost flattened me that day.  Not only did my legs fold under me, but my ego went the same way.  And Karen continued to sob.  Right at that moment Sister Burke appeared in the office. 

I decided that absence was the better part of valour and removed myself, leaving these two fine ladies together.  Finally, quite some time later, Sister Burke advised me that she thought Karen should leave Cape Bridgewater.  It would be in the best interest of both of us, Sister Burke believed, and she would arrange counselling for Karen back in Warrnambool — here we go again, I thought.

The charity camp went ahead in April 1992; 35 children for five nights.  It was a great success all round.  While she was at the camp I asked Sister Burke to describe the phone faults she experienced in that dreadful week before Karen left.  She referred to calls either ringing out or simply getting a dead line — no sound at all.  And this happened for an entire week.  Later I sent Sister Burke a very early draft copy of this book;  after reading it she wrote back, saying “Only I know from personal experience that your story is true, I would find it difficult to believe.”

It is interesting to note here that, twelve months later, in March of 1993, Sister Karen Donnellon, also from Loreto College, also tried to make contact to arrange an annual camp.   Sister Donnellon later wrote:

“During a one week period in March of this year I attempted to contact Mr Alan Smith at Bridgewater Camp.  In that time I tried many times to phone through.

Each time I dialled I was met with a line that was blank.  Even after several re-dials there was no response.  I then began to vary the times of calling but it made no difference.”

Twelve months had passed and still there was no improvement to the phone system, even with a new exchange installed in Cape Bridgewater.

Back in May of 1992 however, we could not know, of course, that the stress created by the faulty phone system would continue for so long.

Karen was hospitalised as a result of this stress added to the worry that she would lose her investment in my business.  She had come to believe that I had lied to her when I reassured her that the phone problems were over.  I later learned not to believe anything I was told by Telstra.

After she left the hospital, Karen settled in a rented house in Portland.  Without her assistance at the camp, which had, in the past, given me space to travel around, my promotional tours to schools dropped to almost nil.  Still I continued to complain to Telstra about the phone faults which seemed to me to be getting worse, not better, since the old exchange had been demolished and replaced.  From August 1991 through to May of 1992 more and more complaints of recorded voice announcements came in.

Again I began to question my decisions.  Why had this move to Cape Bridgewater been so disastrous?  Everyone takes a working phone as a given, but a faulty phone system had now ruined three lives; mine, Faye’s and Karen’s and, indirectly, my two children’s as well.


In July of 1992 I spoke to the proprietor of O’Meara Bus Company regarding proposed arrangements for his buses to bring elderly groups to my camp on a regular basis.  Mr O’Meara had, of course, suffered severe difficulties trying to reach me by phone and he was concerned that this would become an insurmountable problem.  As he saw it, each of the groups would need to ring me direct to confirm their bookings.  What if they couldn’t get through either? he asked.  And so, without mentioning the name of the bus company, I wrote to Telstra to ask them to provide me with a written guarantee, stating that my phone service was up to network standard.  Naturally I intended to pass this guarantee on to Mr O’Meara.

At about the same time, Karen mentioned a friend who had heard of someone in Melbourne who was complaining about the same phone problems that were crippling my business.  Karen said her friend believed this was the proprietor of “The Society” restaurant in Bourke Street, in the centre of the city.

Of course, making phone contact with the restaurant was enormously difficult, but eventually I got through to Sheila Hawkins, who ran the restaurant.  We arranged to meet and I travelled to Melbourne.

Sheila was also very interested in gathering a group together to tackle Telstra head-on.  She already knew of an Ann Garms in Brisbane who ran the Tivoli Theatre Restaurant there and who was also having serious phone problems.

Armed with this knowledge I rang Ann and, as it happened, Ann was coming to Melbourne the following week.  It was arranged that, while she was here, Ann would meet with the General Manager of Consumer Affairs for Austel, the Australian Telecommunications Regulator, and with Sheila.

Sheila, Ann and I had an enthusiastic meeting and Ann mentioned that she knew of at least one other Brisbane business that was in similar trouble with phones — a Japanese car spare-parts company run by Maureen Gillen.  Like Ann’s business, Maureen’s business was also trunked off the Fortitude Valley Exchange.

By this time Sheila had contacted Graham Schorer who ran the Golden Courier Service out of North Melbourne.  Like the rest of us, Graham had a very bad phone service.  Finally our little group gathered together at the Society Restaurant in Bourke St, except for Maureen who couldn’t make the journey from Brisbane.

During the following week I spoke to Sheila a couple of times on her mobile, ringing while she was on her way in to her office.  It was Sheila who suggested we call ourselves C.O.T.  —  the Casualties of Telstra.  We were on our way down the path to justice, or so we thought.  Unfortunately our battle had only just begun.

I still don’t know how I managed to drag myself through the last few months of 1992, but I did.  And now the lies and corporate cover-up perpetrated by Telstra began to be exposed.

In October of 1992, at the Ibis Hotel in Melbourne, the COT group had our first official meeting with Telstra, presenting a united front of small-business telephone users.

Austel was now involved, concerned at some of the facts that the COT group were unearthing in relation to Telstra.  We were seen, not just as a group of hot-heads, out to make trouble, but as a concerned group of small-business people who had been continually squashed and ignored by Telstra.  Finally we felt that our claims were being taken seriously and were being seen as valid.

Also at this time, July/August 1992, I lodged the first of many FOI requests for documents to be supplied by Telstra.  A letter dated 2nd July 1992, from a Mr Taylor (part of Telstra’s management team based at the Warrnambool exchange) stated however that Telstra had ‘no past fault records prior to June 27, 1991’.  It later became quite apparent that documented fault records DID exist in Telstra’s archives, dating back as far as 1987 and continuing for many years after that.  What else could be lurking in these archives, I wonder?

On 1st September 1992 the first Telstra ‘guarantee’ arrived, stating that my phone service was indeed ‘up to network standard’.  Sixteen days later another ‘guarantee’ arrived, this one dated 18 September 1992.  The ‘guarantee’ of the 1st stated:

“Whilst our recent tests indicate that your service is now performing to normal network standards, I am initiating a further detailed study of all the elements of your service and the tests which have been conducted.”

The ‘guarantee’ of the 18th stated:

“We believe that the quality of your service can be guaranteed and although it would be impossible to suggest that there would never be a service problem we could see no reason why this should be a factor in your business endeavours.”

Because of the delay between my initial request and the provision of these belated ‘guarantees’, I had already missed out on securing the charter business with O’Meara’s Bus Lines.  Later however, these documents became more important as we uncovered the extent of the skulduggery at management level within Telstra. 

While visiting the camp, a local Telstra technician casually remarked that it was well known that congestion was a problem in my area.  His attitude seemed to be that this was something country people just had to learn to cope with.  I thought it seemed to be a very strange way of looking at the problem, particularly since my business was ‘going down the tubes’ fast.  Why should I have to put up with a faulty phone service simply because I ran a country business?

During an FOI release in mid-1994 I came across four interesting documents which all related to this congestion problem.  The ‘minute’ document titled “Subject PORTLAND - CAPE BRIDGEWATER PCM HBER”  and the document marked as FOI no. A40558 are of particular interest. The second paragraph of the first document contains the statement:

“ When the ‘A’ direction of system 2 was initially tested, 11,000 errors per hour were measured.  In the ‘B’ direction, approximately 216 errors per hour were measured, 72 errors per hour is the specified number allowable.” 

In other words, back in July of 1991, Telstra were uncovering 11,000 errors per hour in one direction and 216 per hour in the other direction when the acceptable level in the telecommunications industry is 72 errors per hour.  Furthermore,  document A40558 states, in part:

“i)        LTS Melbourne were aware of the problem in early 1990 as optocouple measurements were documented on file dated 13/02/90 (ref P 34)

iii)        Tong advises me that to his knowledge LTS Melbourne did not circulate any information on the problem until the work specification was finalised in October 1990.

iv)        The Cape Bridgewater loop MUX was up graded between July and December 1991 after it was removed from the Cape Bridgewater link.

v)         The Cape Bridgewater customer had documented complaints of call dropouts from 12/1989 to 12/1992 the later date some 7 months xx after xx the A735 loop MUX had been replaced by the RCM.

The question remains - why did it take one year for the Cape Bridgewater Loop Mux to be upgraded from the issue of the Work Spec.  Tong says the OIC of Portland believes that the equipment was not touched prior to the upgrade.”

Obviously the technicians were uncovering faults and problems with the Cape Bridgewater phone system as far back as at least 1990, probably as a result of my continual badgering of them, but I was being told one thing while Telstra knew another.  Here I was, with a business ‘bleeding to death’ and without any treatment available to stop the ‘bleeding’.  If the business wasn’t bleeding, it certainly felt as if I was.

The third of these four interesting documents was titled “Portland — Cape Bridgewater — RCM System” and it stated, in part:

“Initial reports were of a vocal customer at Cape Bridgewater complaining of VF - cutoffs in one direction.  The customer had been transferred off system 1 onto system 2 and 3 on the 24th February ‘93 and had experienced no further problems.”

I must admit that my sense of humour did manage to fight to the surface for a moment when I read this — ‘vocal customer’ indeed!  Maybe this is why my voice has lost its customary strength.  The interesting point is, of course, the reference to switching the ‘vocal customer’ from system 1 to systems 2 and 3.  Since Telstra were aware of this problem when I complained, first in 1988 and again in 1990/91, of 11,000 errors per hour in one direction and 216 per hour in the other direction, why didn’t this changeover take place then?

As if this all wasn’t disturbing enough, in a letter dated 12th July 1993, the following information refers to 2 March 1993, 19 months after Telstra discovered the massive fault rates recorded above.

 “Initial error counter readings

            Portland to Cape Bridgewater direction:-


System 1

System 2

System 3













At this stage we had no idea over what period of time these errors had accumulated.

Attempts to test the inground repeaters using the “TRIOS” system where unsuccessful as the strapping records could not be located.”

The two FOI documents on the following pages show that thousands of errors continued to plague my service.  It seemed nothing had changed - just more excuses from Telstra’s Corporate Management.

  It is interesting to note the reference “we had no idea over what period of time these errors had accumulated”  because the second page of this document states:

“The alarm system on all three RCM systems had not been programmed.  This would have prevented any local alarms being extended back to Portland.”

In other words, they didn’t know how long these errors had been accumulating because, from 18 August 1991, when the new exchange (RCM) was installed at Cape Bridgewater, the fault alarm system had not been connected up.  Since this was an un-manned exchange, this meant that no-one would know when a fault or faults occurred.  Except, of course, the poor, defenceless customers.

This ‘not connected’ alarm was not discovered until March 1993 but, in September / October of 1992, Telstra senior management had written to me stating that they believed that the quality of my telephone service could be guaranteed as up to network standard when, just 5 kms down the road from my business, the exchange continued to accumulate errors with no alarms going off at the ‘manned’ Portland exchange.  What a farce!

No wonder my ‘could-have-been-thriving’ business was sinking so fast.  It seems like most of the local telephone technicians were oblivious to the continuing resultant call loss due to this ‘not connected’ alarm system in the exchange.

Here I was, scratching the bottom of the financial barrel, selling off anything I had left that was saleable to keep going and buy food for the next group that had managed to get through to make a booking because many schools and other groups do not pay up-front when they make their booking.

Meanwhile, until a group actually paid their bill, I had no money to pay my catering costs or wages.  I was now borrowing from friends just to keep the camp running on a day to day basis.  Karen,  with three children to think about, was devastated by her financial losses and had lost all faith in my judgement.  I had lost faith in my own judgement by this time too; I had now let down two different partners who had trusted me.  Through all of this, of course, the phone faults continued and the useless ‘guarantees’ supplied by Telstra sat on my desk, a continual reminder that they had arrived too late:  I had lost the charter with the bus line.

The COT group continued to negotiate with Austel and Telstra and this pressure finally produced results:  Telstra approached me with a proposal for a compensation payout which was to include a confidentiality agreement to the effect that I would not disclose the value of any settlement which might be forthcoming as a result of this.  I signed this agreement on 11th December 1992 and I have honoured this agreement not to disclose the amount of the payout without prior approval by Telstra.

That same day, Telstra’s area general manager and I were involved in a long discussion regarding what Telstra believed I had lost, financially, over the preceding 4½ years since I first complained about the phones.  This manager and I were the only people involved in this discussion.  I provided her with copies of numerous letters I had received from clients and trades-people, describing their experiences with my phones.  I clearly explained how much I had calculated my losses to be.   On a number of occasions the manager left me alone to examine documents she had given me.  As she left on the first occasion, she explained that she would close the door so I could read in private and she added that, if I needed to discuss anything with my advisors I was free to use the telephone; there was a direct outside line available at all times so I wouldn’t need to speak to an operator within the building.  I made use of the phone a couple of times to ring Karen and talk over the offer and we calculated how much she needed to buy herself a relocatable house to set up as her home, thereby at least partly restoring her to a financial position similar to her position before she met me.

The documents provided by the manager were mostly hand-written and included copies of the so-called ‘guarantees’ that I had received.  One of the hand-written documents stated that there had only been a single fault, lasting for 3 weeks, and causing the RVA message to be heard by incoming callers (this was the message stating that my number was not connected).  This document also stated that the RVA message probably caused me to lose about 50% of all incoming calls over this 3 week period.  Other documents referred to one minor fault in the phone exchange at Heywood plus some other minor faults which may have contributed to some call loss.  Telstra agreed to accept responsibility for these ‘minor’ faults, without admitting to anything in writing, if I agreed to their offer.

Naturally I protested.  Again I went over the continuing and constant complaints I was getting from customers and I asked how a few ‘minor’ problems could possibly cause so many difficulties.  I had nothing to bargain with however and the manager simply took a ‘take it or leave it’ position, commenting that this was Telstra’s last offer and advising me that the only other avenue I could follow would be court proceedings.  Her final comment was along the lines of ‘Telstra has more time than you have money to fund court proceedings.’  These wonderful customer relations, I believed, left with me no other option and so, finally, and with some regret, I accepted their ‘final offer’.

Later, during 1994, I was provided with a copy of a document which shows that, while out of the meeting room, this same area general manager had made notes regarding our discussions, including a reference to the fact that I had rung my advisors on a number of occasions while she was out of the room.  If the phone line I was using was a direct line to the outside, how did she know whether I used it or not?  And how could she know who I rang if I did use the phone?  I have since, unsuccessfully, asked Telstra to explain this on a number of occasions.  This issue has also been raised with the Senate and with the Telecommunications Industry Ombudsman (TIO - refer Glossary).  So far there has been no satisfactory answer.  The questions remains:  were my private phone discussions that day listened to by someone and is this how the manager knew exactly how much to offer me, because she had heard the discussions I had with Karen regarding the cost of buying her a relocatable house? 

Pages 111 and 112 show that Telstra officials later provided the Australian Federal Police with documents which confirmed that Telstra had listened to my private and business phone conversations (called ‘voice monitoring’) for some time.  Was this one of those occasions when Telstra people were listening in?


These ‘secret’ Telstra documents relate to the so-called ‘guarantees’ that I had received from Telstra.  The last item included in point 4 of the document numbered C04006 refers to “RVA on congestion”  This RVA was, as previously mentioned, the message indicating that my phone had been disconnected.  Also, during 1993, Austel confirmed that Telstra’s ‘congestion’ tone was very similar to an engaged tone and, unless you were aware of the difference (and most people certainly wouldn’t be aware of the difference) callers would believe they were hearing an engaged signal when they were actually hearing a ‘congested’ signal.  Because the local Cape Bridgewater exchange was such old technology with so few lines, of course it was congested — it was probably nearly always congested!  This meant that it was quite likely that many prospective customers gave up trying to reach me because they believed I had ceased trading.  No wonder I didn’t have many new bookings.

At point 16, on the page numbered C04007, there is a reference to “... — Mr Smith’s service problems were network related and spanned a period of 3 - 4 years.” and then, on the page numbered C04008 another reference “Overall, Mr Smith’s telephone service had suffered from poor grade of network performance over a period of several years; with some difficulty to detect exchange problems in the last 8 months.”  According to the hand-written, note at the bottom of C04008, signed by the area general manager I had dealt with before,  “These are preparational notes recorded at the time of settlement.  Alan Smith was not prepared to provide better substantiation of his claim.”  This seems to me to indicate that the writer was quite clear, in her own mind, about the severity of the faults I had suffered and, since she obviously already knew of the “poor grade of network performance” spanning “a period of 3 - 4 years”, how could she possibly have provided the two guarantees that I received three months before this?  This is even more astounding because document C04008 also states “with some difficulty to detect exchange problems in the last 8 months” .  This means that the ‘difficulty to detect’ the problems dated back at least to April of 1992.  As a responsible corporate senior manager, how did this person ever allow the two ‘guarantees’ to leave her office?


The information in this document is interesting, bearing in mind the two ‘guarantees’ of September 1992, and the fact that Telstra knew that at least one fault had been occurring for 8 months. 

Although I had the ‘guarantees’, I continued to complain about the faulty phone service, particularly call-drop-outs when, part-way through a conversation, the line would simply go dead, and about short duration rings when the phone would ring once or twice and then stop — with no-one there if we picked up the receiver.  Finally, in October of 1992, the area general manager arranged for two testing machines (called ‘Elmi’ machines - refer Glossary) to be installed;  one at the local un-manned exchange at Cape Bridgewater and another at my office.  These two machines were set up to work in conjunction with each other. 

On 13th October I complained of four calls that had dropped out, at 1.20, 1.40, 2.00 and 3.00 and a single time when I had answered the phone to find a dead line.  The Telstra technicians found, as they had in many instances before, no faults that they could detect.

I continued to work at getting my business running successfully and, at the same time, kept trying to sort out the continuing phone problems.

Two years later, in 1994, as part of a bundle of documents sent to me in response to one of my FOI requests, I discovered two documents relating to the problems I had encountered on 13 October 1992.  The first was a hand-written file note stating “We had the Elmi disconnected at the RCM (exchange) and were installing it at Mr Smith’s house and the CCAS showed no evidence of above (not receiving ring) 1.20, 1.40, 2.00 and 3.00.” (refer Glossary for definition of CCAS)

The next step was to ask Telstra, through FOI, to supply any ‘Elmi’ print-outs they had from September/October 1992.  Some weeks after this request was lodged a number of documents arrived which I found quite alarming, including the tapes reproduced on the previous page, which show that the call drop outs and dead lines that I had experienced appeared on Telstra’s monitoring equipment records as answered calls at 13.29.25 (approximately 1.30pm) and 15.01.11 (approximately 3pm).

The issues surrounding the ‘Elmi’ incident become even more alarming and one question that has never been satisfactorily answered is:  Why would a local technician state that the ‘Elmi’ equipment was disconnected at the exchange and was to be installed at my house when it is clear from these two ‘Elmi’ print-outs that it was actually installed and operating correctly at both locations?

All this obviously brings Telstra’s fault centre into question.  How accurate are their records and how often are complaints like mine ignored by Telstra?

By this stage of the battle, with two partners lost and my health deteriorating, my business began to suffer even more.  Why would no-one listen to what the members of COT had to say?  Why would no-one look at all the information we had collected between us?

The members of COT continued to draw strength from each other.  We had many group discussions as we tried to find a satisfactory way to deal with the deception of Telstra management but we were, after all, simply five small-business people struggling against the might of a huge corporation.  Not very good odds!

As we struggled from the end of 1992 to the New Year of 1993 I began to wonder if ‘settling’ with Telstra (via the area general manager) had been such a good idea after all.  Nothing had changed.  Phone faults continued to run rampant with my attempts to keep the business going.  How could this be still continuing?  The new telephone exchange was supposed to have rectified all the problems I was suffering.

During January 1993 I registered eight more faults with Telstra.  Those customers who had managed to get through to place their bookings were also experiencing phone faults when they arrived at the camp.  The coin-operated gold phone unit in the main hall, installed for customer’s use, became the butt of continual jokes.  “Why bother to go to NSW to play the pokies?” the customers joked, “We can just come here and get the same result with the gold phone:  it takes our money, gives either no service at all or very little value for money, and leaves us as frustrated as if we had gambled away our cash.”  Calls continually drop out, they complained, as soon as they said “Hello”.

According to my records, two of the eight complaints lodged in January 1993 were related to the gold phone.

By this stage my mortgage payments were causing a huge headache.  I had been forced to re-finance through the Commonwealth Development Bank, incurring more set-up fees, and because I couldn’t afford to maintain the camp buildings properly the place was beginning to look abandoned.  I felt as if I had been abandoned too.  Both the buildings and I were tired, run-down and in need of a face lift!

Ann Garms and Graham Schorer had, by now, become ‘comrades in arms’ in this war we were fighting.  We wondered if we could ever be in a position to expose Telstra’s unethical corporate strategies and their continued and apparently deliberate mis-handling of our complaints.  Ann had  also begun to suspect that, on the rare occasions that our phones actually worked properly, the lines were being bugged.

The first experience I had of the possibility that my phone was bugged came after the COT group had been on “A Current Affair”, a news show on Channel 9, a national TV channel.  This was our first experience of an interview situation and we soon discovered that we were novices at this process.  We had a lot of technical information to back our legitimate complaints about phone faults and to support our attempt to organise a Senate hearing into our cases but, because of our inexperience at putting our case, this is not quite how it came across on the show.  Because our information was so highly technical it was a bit like trying to prove that a patient has cancer without actually having a biopsy or an x-ray.

Because we were so disappointed at how our case came across on Channel 9, I rang the Australian Broadcasting Corporation (ABC) in Melbourne to speak to the co-ordinator of their “Four Corners” show, in an attempt to get another chance to tell our story to the Australian public.  I was told that the person I needed to speak to was based in their Sydney office (I believe his name was Knight) and that my call would be transferred to him.  I was quickly connected and proceeded to describe what had happened with ”A Current Affair” and to explain that I thought a more in-depth investigation of our situation by a program like “Four Corners” would expose Telstra’s incorrect charging as well as the problems with their fault reporting system, thereby alerting the rest of Telstra’s customers.

After I had babbled on for quite a while, I referred to the co-ordinator by name, only to be told the person I was speaking to was not “Mr Knight”, but John Stanton.  Furthermore, Mr Stanton was not with the ABC “Four Corners” show either.  He was not even with the ABC at all.  He was, in fact, a senior executive with Telstra, based in Telstra House in Sydney.

“How can this be?” I asked, “The ABC in Melbourne switched me directly through to their Sydney office.”

Mr Stanton paused for about 20 seconds and then confirmed that he had indeed patched into my phone line even though I was connected elsewhere.  He then suggested that he would set up a meeting with the members of COT, if we so wished.

So, with Ann already worrying about her phones being bugged from some time in 1992, I now had been through the same experience


It is interesting to note the date of 19/08/92 on the first of these two documents relating to Ann Garms’s business, The Tivoli Theatre Restaurant:  this is about the same time as the COT group was first formed.

In the comment at point 19, “Description:  Line 1 NDT NRR suspect sabotage ?????”  the ‘NRR’ refers to ‘not receiving ring’ and, at the bottom of the document, at points 1, 2 and 3, the comments are even more interesting and will be covered more fully in Chapter 18.

The second document, with the number B00474 in the lower right corner (see following page), also relates to Ann’s business and raises a number of other questions.  Who are these people discussing in this letter?  Does the reference to “Compass Security” refer to Compass Airlines who were linked to the same exchange as Ann, in Fortitude Valley?  Compass Airlines was a small airline company which tried to break into the system in Australia and finally went bankrupt.  The owner of the airline stated that one of the reasons for the company never ‘getting off the ground’ was continual problems with phones and it was widely speculated in the media at the time that some form of sabotage had been involved.  This document certainly doesn’t do anything to dispel that rumour.

Another question that this document raises is why a ‘bug scanning device’ was requested by AA (whoever that is) of protective services?

After reading these two documents it is easy to understand how Ann and I felt every time we used the telephone.  Who was listening to us and why?

Graham Schorer was elected as spokesperson for COT and, early in 1993, he met with the then chairman of Austel, Mr Robin Davey.  By February / March of that same year, following that meeting, a number of politicians had become interested in our situation.  The question remained, would these politicians actually take any action on behalf of small-business people, or would they protect the ‘milking cow’ of the Telstra corporation?

So the COT group began their push to get the Australian Senate to pay attention to our plight, providing the finance from our already depleted own pockets for travel to and from Canberra, where the seat of power is located.

At this stage I was still suffering from major problems with the phone system although, through some fancy footwork with the banks I had at least managed to stave off a repossession order.

As a result of all the pressure, Karen had become a born-again Christian.  Would her prayers be answered though?  I knew she was asking for help for us all in our ongoing fight for justice but would Telstra’s true colours ever be exposed?  Their power over the Senate was becoming more and more apparent to us and we were afraid they would have enough control to put a lid on the whole saga.

By now I had accumulated more than seventy separate letters of complaint from customers who had been unable to reach me by phone.  One of these, dated 5/2/93, came from a Mrs Elsie Teer of the Werribee Outreach Centre in Victoria, writing to say that they would have to cancel their booking because of ‘poor membership response’.  Mrs Teer also noted that she had tried to ring me over the last five days but that ‘it appears that you don’t answer your phone’.

I later received a letter dated 17/5/93 from Ray Morris, a senior Telstra technical engineer.  Mr Morris wrote regarding his own experience of trying to ring me, stating:

“On the 24/2/93 I received a phone call from a technician at Portland who stated he had been given a fault from (1100 fault dept.) indicating a customer in Ballarat had trouble calling your business 055 267 267 - I then attempted to ring 055 267 267 myself, the ring was tripped after several bursts ie: “answered” and I received a loud noise similar to a  radio carrier noise and a very faint ‘Hello’.

At least someone inside Telstra acknowledged that I had a problem with the phone service!

The really significant point to Mr Morris’s letter (see next page) however is not just his recognition of the problems I had.  On 12/12/94 Mr Morris made a Witness Statement, in the form of a Statutory Declaration witnessed by a lawyer.  This Witness Statement was used by Telstra as part of their defence of my arbitration (refer Glossary).  There is no mention of Mr Morris’s own experience with my phone anywhere in this Witness Statement.

Mr Morris appeared to be more than just a little concerned about my complaints during the time he was involved in these investigations.  Perhaps he was pressured to stay quiet during my arbitration — who knows?  What is apparent from a number of FOI documents is that not all Telstra engineers or technicians treated our complaints as genuine, as the following example shows.

The official spokesperson for COT is Graham Schorer and, on one occasion I phoned Telstra’s 1100 number to report difficulty in getting through to him on the phone even though he has thirty-seven lines in to his courier business.  I spoke to a Mr Richards at Telstra; he advised that he would immediately have Mr Schorer’s lines tested.  Some months later I came across FOI document K00045.  In this document, Mr Richards has made a hand-written note to the effect that, once it ‘clicked’ that this was a COT member, the service was not tested.

In a second, similar incident, I have an un-numbered FOI document regarding a complaint I lodged about my own phone service, this time to a Mr Watson.  Mr Watson’s hand-written notes state:

“Probably caused by ‘RCM’.  No need to investigate, spoke with Bruce, he said not to investigate also.”

Either Telstra had decided that the members of COT were fools or their fault center knew that the faults we were reporting were common faults which could not easily be rectified and so they had decided to ignore our complaints rather than attempt to fix the problem.


In the first five months of 1993 I received another eleven written complaints, including letters from the Children’s Hospital and the Prahran Secondary College in Melbourne.  The faults had now plagued my business, unabated, from April 1988 to mid 1993.

Coming into June of 1993 things began to warm up for COT:  the then Shadow Minister for Communications, the Hon. Senator Richard Alston, was showing an interest in our claims and Senator Ron Boswell of the National Party, who obviously had no political gain in mind, became involved also.  Even though Senator Boswell is based in Queensland and most of the remaining members of COT are in Victoria, at the other end of the country, he has continued to offer his support.

David Hawker MP, my local parliamentary member was another who saw his ‘duty of care’ to his constituents and so answered our call for help.  Mr Hawker has continued to go into battle on our behalf for ten years now.

During political campaigning through June of 1993 both Senator Alston and Senator Boswell pushed for a Senate Inquiry into our claims and, I have recently been told by an ex-Telstra employee, they were so close to pulling it off that it was not funny.  If this Senate Inquiry had got off the ground, heads in Telstra would have rolled but, since this didn’t happen, those same ‘heads’ continue to control Telstra to this day.

While the politicians and Telstra conducted their deals behind closed doors, I continued to lobby Austel for assistance and, between February and June of 1993, I provided Austel with more and more evidence of incorrect charging on my 1800 free call service and all the other lines servicing my business.  Finally John MacMahon, General Manager, Consumer Affairs at Austel asked me to record all the short duration calls and RVA’s that were still being charged to my 1800 account and which were also showing up on the ‘Elmi’ testing machine which had been installed at the local exchange.

You will see as you get further into this story that there is clear proof of already existing technology  which allows faxes to be diverted, printed off and redirected without the sender’s knowledge or permission.  If faxes can be diverted in this way then it is not a huge jump to assume that phone calls can also be secretly diverted, although phone calls would have to terminate at the phone they were diverted to, of course.  Were all these short duration calls that I was continually receiving actually calls which began to ring at my business and were then caught and diverted to another number?   In the early days, it didn’t even occur to me that this could be the explanation.  Now that this saga is so much further ‘down the track’ however, it seems to be a very likely scenario. If I am right, what are the ramifications for other telephone subscribers?  (This diversion of calls is discussed in more detail on page 177.)

Not only were Austel involved in the saga by this time, but we were also dealing with the Commonwealth Ombudsman’s Office as well, so both these organisations were aware that I continued to ask Telstra, under the rules of FOI, to provide me with copies of the ‘Elmi’ data from the RCM that the camp was connected to, for the period of May to July 1993.  It is now 5 years since my first request for this data and all I have so far received is information covering a single 6-day period during May of 1993, which I came by accidentall


As a result of my constant complaints to Austel regarding the many phone faults I had suffered with, including the incorrect charging, Telstra’s ‘Network Investigations’ department were finally involved and, for the very first time in this saga, Telstra investigators were sent to Cape Bridgewater.  At last, or so I thought, I would be able to speak directly to people who knew what they were talking about.  At last, or so I thought, I was getting somewhere.


Dave Stockdale and Hugh Macintosh of Telstra's National Network Investigation Division arrived at my office on 3 June 1993, with what later transpired to be a briefcase full of magic tricks.  We spent some considerable time ‘dancing around’ my summary of the phone problems I had been complaining about, with little input from Stockdale and Macintosh and with more and more anger and frustration on my part.  Finally they prepared to leave and head back to town.  My own transport was, by this time, long gone:  sold to pay some of my mounting debts, and so Stockdale and Macintosh offered me a lift.  Along the way they stopped briefly at the local exchange at Cape Bridgewater where Stockdale took a tape from what I later learned was one of Telstra’s ‘Elmi’ machines.  Then he replaced it with a new tape which he threaded into place.

After spending some time in Portland I got a lift back to Cape Bridgewater with a neighbour.  In my office I found that, lo and behold, Aladdin had left behind his treasures:  The Briefcase Saga was about to unfold.

When I found that the briefcase was not locked, I opened it to find out who it belonged to and discovered that it belonged to Mr Macintosh.  There was no phone number in the case that I could contact Mr Macintosh on directly so I was forced to wait until the next morning when I could ring my local exchange.

Imagine how I felt when the first thing I actually saw in the briefcase was a file titled “SMITH, CAPE BRIDGEWATER”.  After five gruelling years fighting with Telstra and being told various lies along the way, here was possibly the truth, as seen from Telstra’s perspective.  Some of the documents in this file were much too technical for me to understand or interpret.  Some of those that I could decipher however dated back to the ex-gratia compensation payment I received on 11 December 1992.  Then I froze.  I had turned the page to be confronted with the words “Problem 1”.

This document referred to Telstra being aware that the alleged three week RVA fault in March of 1992 had actually lasted for ‘8 months’, not the three weeks that I had been told on the day that I accepted the compensation pay-out.  By hiding this information from me Telstra deliberately misled me — this type of deception, under these conditions, is illegal.

Dated 24/7/92, and with my phone number in the top right corner, this document refers to my complaint that people ringing me get an RVA “service disconnected” message with the “latest report” being dated 22/7/92 from Station Pier in Melbourne and a “similar fault reported” on 17/03/92.  The final sentence reads: “Network investigation should have been brought in as fault has gone on for 8 months.”

The second document is a Telstra minute dated 2/7/92.  This document shows that the local Telstra technicians believed my complaints were correct regarding the ‘service disconnected’ RVA on my line.  Further, they also believed that the problem “is occurring in increasing numbers as more and more customers are connected.....”.

In November 1992, after I had received Telstra’s written guarantees stating that my service was up to network standard and just before the settlement arranged by Telstra’s area general manager, Don Lucas of Telstra also wrote to me confirming that the RVA fault had only lasted for three weeks and adding that it caused an average loss of 50% of calls during that time.

Now, on one hand we have Telstra reports that the RVA fault had only occurred for a single period of three weeks and we have other Telstra documents, including the report I found in this briefcase, reporting that the RVA fault had been in existence for 8 months and that the technicians believed I was correct.  Which are we to believe?

Other pieces of alarming information uncovered in the briefcase were printout tapes from the ‘Elmi’ machine.  These showed 29 short duration incoming calls to my service in May of 1993 alone.  These lost calls could very well have been 29 different customers who couldn’t get through.  Even worse, four of these calls, which never got through, were charged to my 1800 account!  Later I was to provide this information to Austel.

As the weeks passed Austel became increasingly interested in what I had seen in this briefcase.  A letter dated 3 August 1993, from Austel’s General Manager, Consumer Affairs to Telstra’s Group Manager - Regulator, Dennis Hambleton, is reproduced below.  This letter indicates that Austel have requested an immediate copy of all the documents which were in this briefcase, and which have not already been forwarded to Austel

I sent off a number of Statutory Declarations explaining what I had seen in the briefcase.  Later Austel was told that they had all the information which was originally in the briefcase that was left at my office that day, however that was not correct.  Late in 1994, among a late release of FOI documents, I learned that Austel had not been provided with some very sensitive material that had been in the briefcase.

After finding this document I sent a copy to the TIO’s (Telecommunication Industry Ombudsman - see Glossary) office with a covering letter explaining how important it was that Telstra had misled Austel into believing they had been given everything that had been in the briefcase.

Another letter also refers to documents in this briefcase.  This letter, dated 27 August 1993, was written by Telstra’s Corporate Secretary, Jim Holmes, to me.  In this letter Mr Holmes states:

“Although there is nothing in these documents to cause Telstra any concern in respect of your case, the documents remain Telstra’s property and therefore are confidential to us. 

I would appreciate it if you could return any documents from the briefcase still in your possession as soon as possible.”

Mr Holmes carefully omitted any reference to vital evidence which was withheld from me during their negotiations with me regarding compensation.  The information in this briefcase proved that senior Telstra management had deceived and misled me during these negotiations and, at the same time, provided letters stating that the phone system to my business was up to network standard when the information in the briefcase clearly proved that it was certainly nowhere near ‘up to standard’.

On June 17 1993 the General Manager of Telstra Commercial, Victoria/Tasmania, wrote the following confidential internal memo to the Manager of Network Investigations.

Quite clearly this indicates that not only was Telstra’s area general manager fully aware, at the time of my settlement on 11 December 1992, that she was providing me with incorrect information, but the General Manager, Commercial Victoria/Tasmania was also aware of this deception — a deception which seriously influenced my judgement of the situation.

Misleading and deceptive conduct such as this, in a commercial settlement such as mine, is a direct contravention of the Australian Trade Practices Act but this issue is yet another which has not yet been addressed by Telstra.  Even more alarming, the arbitrator handed down his award on 11 May 1995 without questioning Telstra’s unethical behaviour even though I raised this issue in my claim documents, pointing out that Telstra had knowingly deceived me at this settlement meeting, thereby placing me at a commercial disadvantage.

In another letter dated 8 June 1993, Austel’s John MacMahon explains to Telstra that I had complained of continuing phone faults, even after the ‘settlement’.  Mr MacMahon goes on to say:

“Further he claims that the Telecom documents contain network investigation findings which are distinctly different from the advice which Telecom has given to the customers concerned.

In summary, these allegations, if true, would suggest that in the context of the settlement Mr Smith was provided with a misleading description of the situation as the basis for making his decision.  They would also suggest that the other complainants identified in the folders have knowingly been provided with inaccurate information.

I ask for your urgent comment on these allegations.  You are asked to immediately provide AUSTEL with a copy of all the documentation which was apparently inadvertently left at Mr Smith’s premises for its inspection.  This, together with your comment, will enable me to arrive at an appropriate recommendation for AUSTEL’s consideration of any action it should take.

As to Mr Smith’s claimed continuing service difficulties, please provide a statement as to whether Telecom believes that Mr Smith has been provided with a telephone service of normal network standard since the settlement.  If not, you are asked to detail the problems which Telecom knows to exist, indicate how far beyond network standards they are and identify the cause/causes of these problems.

In light of Mr Smith’s claims of continuing service difficulties, I will be seeking to determine with you a mechanism which will allow an objective measurement of any such difficulties to be made.”

It seems that Austel’s concern regarding the sensitive information I had originally found in this briefcase was warranted!


Back in April of 1993 I had become so concerned about what was going on in the Telstra Corporation and what sort of devastating effect this corporate thuggery could well be having on other small businesses around the country, that I had phoned Malcolm Fraser, ex-Prime Minister of Australia.  I told Mr Fraser about the information I was uncovering and how I was finding not only phone faults but also misleading and deceptive commercial conduct which appeared to contravene the Trade Practices Act.

By this time a number of articles had appeared in my local newspaper and interstate gossip about the COT group was beginning to grow.  As a result of this Julian Cress from the Channel Nine ‘Sixty Minutes’ program attempted to contact me.  This fax speaks for itself. 

Also by this time, June of 1993, the public were becoming interested in what they were hearing about our battle.

At Camp Bridgewater, we acquired a logo specially for the over-40s singles club which we were calling “The Country Get-A-Ways” and I hit the road with a vengeance, marketing a range of different week-end holidays.  We had organised an outdoor canoe weekend, a walking and river cruise along the Glenelg River and a Saturday Dress-up Dinner Dance with a disco as well as a trip to the Coonawarra Wineries in South Australia and a Saturday morning shopping tour to Mt Gambier, also in South Australia.  This meant we were able to market the holidays in both Victoria and South Australia.

A special feature in the Melbourne Age Newspaper gave the project a great write-up and I began to feel things were finally looking up for the camp.  My spirits rose, at least temporarily.  Then another plummet into despair:  on 26 October a fax arrived from Cathine, a relative of the journalist who had written the Age feature:

“Alan, I have been trying to call you since midday.  I have rung seven times to get an engaged signal.  It is now 2.45 pm.”

Cathine had been ringing on my 1800 free-call line.  My spirits sank right back down again.

Later in this saga I checked this fax against Telstra’s own CCAS data for that day.  Telstra’s records show one call at 12:01, lasting for 6 minutes and another call at 12:18.14, lasting for 8 minutes.  There were no incoming calls at all between 12.30 and 2.44 that day.  Where had Cathine’s calls been going?  I was devastated but I decided not to let the bastards get me down.  Their continuing lies and assertions that they had found no faults on my service line must be exposed.

So, I stepped up the marketing of the camp and the singles-club week-ends, calling on numerous recognised social clubs around the Melbourne metropolitan area and talking personally to the people in charge.  Over the next few weeks I spoke to the Phoenix Social Club in Camberwell, the Australian Social Centre in Hartwell, Frenze-In-Deed in Mont Albert and Capers in Knox City.  I also visited other singles organisations in Ballarat and Warrnambool, large country centres in Victoria.

Further newspaper advertising followed with ads placed with the Leader Newspaper group in Melbourne.  This local newspaper group covers 23 different metropolitan areas around Melbourne.  Ads also went into the local newspapers for a number of large regional centres around Victoria and South Australia, including the Geelong Advertiser, the Warrnambool Standard, the Ballarat Courier News, the Horsham Wimmera Times, the Colac Local News, the Mt Gambier-Border Watch etc. 

Complaints about the phones continued.  People had so much trouble getting through to the camp and although some obviously persevered, God knows how many simply gave up trying. 

The two letters in appendix 6 show the less-than-enthusiastic response from Telstra when the Deputy TIO attempted to extract from them an explanation of entries missing from the White Pages telephone directory in 1993.  These entries were specifically for my Country Get-a-way Singles Club holidays and I went ahead with an extensive advertising campaign, unaware that the entries were not in the telephone books.  I now wonder if there is more to these missing entries than meets the eye because, if there was a simple, above-board reason for my advertisements being left out of 18 major phone directories then why has Telstra never offered an explanation?  As the Deputy TIO says in his letter of 29/3/96, he believed his office would simply “be flogging a dead horse trying to extract more” from Telstra on this matter.

One Saturday evening a couple of Scotches left me in tears of complete frustration.  I knew I was easily capable of running the camp as I pictured it but I was trapped, like a rabbit in car headlights, with no way to turn.  It was a vicious merry-go-round.  Without customers I would go broke quickly and the customers couldn’t reach me because the phones didn’t work.  Right then Graham Schorer, the COT spokesperson, rang.  He kept urging me to hang in there, convinced that we would win out in the end.  Later, even Ann Garms, who is usually so strong and determined, broke down over the phone, crying that it was impossible to go on.  This time it was my turn to be strong; “Hang in there, Ann.”  I told her, “We’ll beat the bastards yet, you’ll see.”

The process became even more of a roller-coaster ride.  My spirits rose once I had hosted a few successful Country-Get-Aways in the following few months but it was only a few, not nearly as many as I knew should have been responding to my advertising and marketing and, inevitably, my spirits sank again as bookings dwindled.

Finally, in desperation, I remembered a clinical psychologist the COT members had contacted back in 1992, when we were first formalising the group — Dr Don Burnard.  At the time Dr Burnard had written a report regarding his opinion of our individual conditions, noting the breakdown in our psychological defences and referring to the excessive and prolonged pressures we were being forced to endure.  In this report Dr Burnard went on to say:

“All of these clients have been subjected to persistent environmental stress as a result of constant pressure in their business and erratic patterns of change in the functioning of their telephones which were essential to the success of their businesses.”

Now it was May 1993 and nothing had changed.  I rang Dr Burnard’s office,  looking for support.  My conversation with his office was interrupted three times by phone faults.  Later I received a letter from Dr Burnard’s office, saying:

“I am writing to you to confirm details of telephone conversation difficulties experienced between this office and our residence mid-morning this day, 5 May 1993.  At approximately 11.30 am today Mr Alan Smith telephoned this office requesting to speak with Don Burnard.  Mr Burnard was not available to take his call.  During this time the telephone cut out three times.  Each time Mr Smith telephoned back to continue the call.”

Between May and October of 1993 I received many letters from schools, clubs and singles clubs, each writing of the difficulties they had experienced trying to contact the camp by phone.  The executive officer of the Camping Association of Victoria, Mr Don MacDowall, wrote on 6 May 1993 to say that 10,000 copies of their ‘Resource Guide’, in which I had advertised, had been direct mailed to schools and given away.  Most of the other advertisers with ads similar to mine, he went on to say, had experienced an increase in inquiries and bookings after the distribution of these books and so it was clear to him that the ‘malfunction of your phone system effectively deprived you of similar gains in business.’  He also noted that he had himself received complaints from people who had been unable to phone my camp.  They were asking him why I was not answering my phone. All in all, during this period, I received 36 letters from different individuals as well more than 40 other complaints from people who had tried, unsuccessfully, to respond to my advertisements.  The Hadden & District Community House wrote in April 1993:

“Problems with contacting you by phone.  Several times I have dialled 055 267 267 number and received no response  — dead line.  I have also experienced similar problems on your 008 number.

Our youth worker, Gladys Crittenden, experienced similar problems while organising our last year’s family camp, over a six month period during 1991/1992.”

In August of 1993 Rita Espinoza from the Chilean Social Club wrote:

“I tried to ring you in order to confirm our stay at your camp site.  I found it impossible to get through.  I tried to ring later but encountered the same signal on the 10th of August around 7 - 8.30 pm.  I believe you have a problem with the exchange and strongly advise you contact Telstra.

Do you remember the same problem happened in April and May of this year?

I apologise but I have made arrangements with another camp.”

As more and more letters like this arrived in my office I became convinced that Telstra senior executives were hiding the true facts of the problems at the Cape Bridgewater exchange.  Surely they must have been aware by now that I was not inventing the problems I was complaining about?

Austel’s General Manager of Consumer Affairs, John MacMahon, was becoming more concerned at the evidence COT members were producing; evidence of continuing complaints like these, as well as evidence of incorrect charging.  These two problems — people not being able to get through and calls being charged incorrectly, come together in a note from a Mrs Haddok from Croydon.  Mrs Haddok wrote regarding her problems getting through on 22 May 1993 and how she continually reached a recorded voice announcement saying that my phone had been disconnected.  She commented that she thought this message was ‘quite strange’.  My Telstra 008 account for that day (see below) showed a number of very short calls.  Apparently I was being charged for RVA messages!

I also mentioned to John MacMahon my suspicions that:

Mr MacMahon did not agree with these suspicions and yet, in an in-confidence, internal Telstra memo dated 25/11/93, on the subject of short duration calls on my phone lines, Telstra stated:

“Mr Smith is obviously well aware that customer premises equipment (CPE) is a significant source/cause of charging and billing disputes, particularly those involving short calls which the customer believes were unsuccessful and should not be charged.  Telephone answering machines, facsimiles and call diverters typically are at the centre of these disputes.”

Information on page 72 in the next chapter (13) shows that neither my answering machine or my fax machine could have answered many of these short duration calls.  This leaves call diverters as the only ‘culprit’ possible and, since I had not authorised any call diversion on any of my lines, this raises the question:  Who then had authorised the diversion of at least some of my incoming calls?


Later in 1993 a Mrs Cullen from Daylesford Community House contacted me to let me know that she had tried unsuccessfully to phone me on 17 August 1993; first at 5.17 pm and again at 5.18, 5.19 and 5.20.  Each time she phoned she reached a dead line.  After the fourth unsuccessful attempt Mrs Cullen had reported the fault to Telstra’s Fault Centre in Bendigo on 1100.  She spoke to an operator who identified herself as Tina.  Tina then rang my 008 number and she couldn’t get through either.

Telstra’s hand-written memo, dated 17/8/93, reports Tina’s attempt to contact me and refers to Mrs Cullen’s complaint to 1100, recording the times that Mrs Cullen had tried to get through to my phone.
Document R11519 is a copy of my itemised 008 account, including 17/8/93.  It is quite clear that I was charged for all four of these calls, even though Mrs Cullen never reached me.  All this information was duly passed to John MacMahon of Austel.

After Mrs Cullen had reported her experience to the fault centre, Telstra began to take a pro-active approach and arranged for tests on my line to be carried out from a number of different locations around Victoria and New South Wales.  Telstra then notified Austel that some 100 test calls would take place on 18/8/98 to my 008 free-call service.

That morning I answered two calls from Telstra commercial, one lasting six minutes and another lasting eleven minutes — these two occurred first thing in the morning as they set up ready for the following test calls throughout the day.  Over the rest of that day however, I only remember answering about eight or nine calls in all.  Certainly I was stressed by then, possibly I wasn’t thinking entirely clearly, but even so I am sure I would remember if I had answered 100 calls, or even twenty or thirty for that matter.  Certainly I didn’t answer 100 calls.

Some days later my 008 phone account arrived and, lo and behold, something like 60 short duration calls have been charged to my service!  I queried this with Telstra commercial, asking how I could be charged for so many calls which did not connect and which I certainly did not answer.  Telstra wrote to John MacMahon of Austel on 8 November 1993, noting that I had queried the accuracy of the data regarding 67 calls made in a 54 minute period.  They went on to say that I had acknowledged answering a ‘large number of calls’ but that I also did not believe I had answered all the calls I was charged for.  Finally they reported that all the evidence indicates that ‘someone at the premises answered the calls’.  Although Austel has asked for the name of the Telstra employee who made these so-called successful calls to my business, and I have also asked for this information, so far Telstra have refused to supply the name.

The phone faults had started a snowball rolling down the mountain.  The lack of customers of course meant a lack of income, my financial situation became worse and worse and, with my marriage over as well, my health suffered more and more.  Friends began to notice the change in my personality and those few clients who did manage to make contact and book in were also commenting on my apparent ill-health.

Mrs Cullen’s group from the Daylesford Neighbourhood House finally arrived for their holiday in January 1994.  Later, two letters arrived from members of this group, complaining that my customer, coin-operated gold phone service was most unsatisfactory.  They wrote that the phone was taking money ‘under false pretences’ and not connecting long enough for the caller to properly complete their calls.  Both wrote that the line kept ‘going dead’ and they both supplied their names and addresses.

Late in 1994 I was supplied with some documents in response to one of my FOI requests.  This batch included two documents which are of particular interest in relation to the Telstra test calls of 18/8/93.  These documents, numbered K03433 and K03434, showed 44 test calls, numbered from 8 to 63, to the Cape Bridgewater exchange, with some numbers missing.  It is interesting to note, since I believe I only answered eight or nine of the test calls, that nine of the calls recorded on these two documents had tick or arrow marks beside them.

Since receiving these two papers I have continually asked Telstra what the marked calls represent but I have not received any response to my questions.

Document K03434 includes a note stating:

“Test calls unsuccessful.  Did not hear STD pips on any calls to test no.  The TCTDI would not work correctly on the CWBEX (Cape Bridgewater Exchange).  I gave up tests.”

It seems obvious that this remark refers to the test calls that were to have been made to my phone on that day.

Another FOI document received in this batch, numbered A03254, was a copy of a Telstra e-mail dated September 28, 1993.  This e-mail referred, in part to a recognition of the “...  duress that the COT members are suffering” and goes on to say:

“... perhaps I am getting too legalistic and defensive but we can’t afford to let anything get away.  However, our best option is still to force these cases down a legal structured path.”

Also interesting is FOI document C04094.  This also indicates that Telstra’s management team was trying to force the COT members into a court situation even though they were fully aware that their highly paid lawyers would eat us alive.  The aim seemed to be to ‘hang us out to dry’ as an example to other’s who might complain about Telstra services in the future.

On 21 April 1993, a document headed “COT cases latest” was forwarded to someone called Don.  This document confirms the COT members’ growing belief that Telstra were planning to use our claims and possible court case to stop any further claims against Telstra, ever.  The author of this document stated:

“Don, thank you for your swift and eloquent reply.  I disagree with raising the issue of the courts.  That carries an implied threat not only to COT cases but to all customers that they’ll end up as lawyer fodder.  Certainly that can be a message to give face to face with customers and to hold in reserve if the complainants remain vexatious.....”

Clearly, Telstra management intended to decide when claimants were becoming ‘vexatious’ and that this would be the time they would threaten the claimants with legal action.  And this decision comes from a corporation which is continually held up to be a benevolent organisation, acting for the good of the Australian public while, behind closed doors, Telstra management intended to turn legitimate claimants into ‘lawyer fodder’ if they persisted with their claims. 

This last Telstra document dated April 1993 had a particularly devastating effect on me.  Some time during September or October of 1993 I had advised Austel’s General Manager for Consumer Affairs, John MacMahon, that Telstra’s General Manager (Commercial) had instructed me to direct all my future phone complaints through their outside solicitors.  These complaints were all to be made in writing, addressed to a Ms Denise McBurnie, Level 43, 101 Collins St, Melbourne (see Telecom Memo dated 15/11/93 - next page).

Much, much later I was told that this strategy was intended to wear me out or force me to hire my own legal practitioner to deal with Telstra’s solicitors.  Sometimes I waited up to two weeks for a response from Ms McBurnie and the time and effort involved in documenting all the on-going faults, while still trying to run a failing business, certainly worked in Telstra’s favour.  Somehow I struggled to keep focussed on what the COT group were pushing for:  a Senate inquiry into Telstra’s unethical treatment of our small group of legitimate claimants.

A letter of support from a worker at D Madden & Co of Warrnambool (Lawyers), dated 10/11/93, helped me feel less alone and confirmed my decision to fight on.  Telstra had to respond regarding their treatment of customers complaints:  they must be stopped from continuing their bullying tactics.  This letter from Madden’s says, in part:

“I am writing in reference to the proposed Senate Committee Investigation into Telstra.

As you are aware, I am employed as a telephonist with a large legal firm in Warrnambool.  In the course of my employment, and particularly during the months of July and August this year, numerous service faults have been brought to my attention.  These problems include:

1.         Calls being disconnected during conversation.

2.         Recorded messages informing Melbourne clients and callers that the number has been disconnected when the correct number was dialled.

3.         An engaged signal received by callers despite a number of lines being available.

4.         Complaints from callers that the line has rung out when no ringing tone has been received at the number dialled.

Our firm duly contacted Telstra on a number of occasions in an effort to have these fault rectified.  However, Telstra technicians were constantly unable to identify the numerous problems and subsequently remedy our complaints.”

The letter goes on to confirm support for the call for a Senate Inquiry into problems within Telstra’s network and to advise that my name and address had been passed to Madden’s by Mr David Hawker, the local Member of Parliament, with regard to a public meeting we were then organising. 

Like previous documents relating to phone problems in the area, I passed this on to Telstra’s solicitors, together with more information showing incorrect charging on phone accounts.  I then wrote to Ms McBurnie, dated 12/11/93:

“On trying to fax you the information you received this morning I had quite some difficulty in getting all the pages through at a given time.  Note the page errors which I have enclosed.”

By this stage Austel was becoming more than a little concerned at Telstra’s approach to our complaints, particularly their continual use of outside solicitors.  In fact, during October 1993, while Austel was negotiating with Telstra for a commercial settlement proposal to be put in place for the COT members, Robin Davey, Austel’s chairman, made it clear to Ian Campbell of Telstra’s Commercial division that  Austel would not be happy if Telstra’s solicitors were to be used in future COT matters.  Mr Davey’s request fell on deaf ears however and, through to 28 January 1994, Telstra continued to insist that I register my complaints through Ms McBurnie.

Later, when Telstra submitted their defence of my arbitration, I learned that Telstra’s solicitors also acted as Telstra’s defence counsel.  By this time I was able to provide the arbitrator with clear proof that Telstra had provided incorrect written statements to Austel and to me, regarding incidents that occurred between January and August of 1993.

On 28 January 1994, during my arbitration, I received a letter from Telstra’s solicitors in response to a letter I had written, challenging their client, Telstra, for incorrectly charging me for non-connected short duration calls. Telstra’s solicitors wrote, in response to one part of my letter:

In the next paragraph they refer to the malicious call trace equipment which Telstra placed on my service, without my knowledge, and which caused a lock-up on my line after each successful call was answered.  This lock-up occurred after I had hung up the phone and meant that no further call could come in to my phone for the following ninety seconds.

On pages 66 and 67, at the beginning of this chapter, I relate an incident with the Daylesford Community House where Mrs Cullen described how the line was continually dead when she rang my 008 number four times on 17/8/93.  Even so, I was charged for these four calls, all in the space of a single 28 second period.  Since the malicious call tracing equipment was not removed from my phone line until 19/8/93, how could Mrs Cullen have been connected four times in such a short period of time?  It is clear from other FOI documents, and has been supported by Telstra technical consultants, that no call could have connected under these circumstances at any time between 26 May and 19 August 1993, while the call tracing equipment was still connected.  So, where were these calls diverted to?

Another incident, described on page 68, raises more, similar questions.  How could sixty-seven test calls all be answered in a fifty-four minute period when my 008 account shows that some of these test calls connected within a single thirty second period?  In fact, some calls came through at the rate of as many as three in a single sixty second period.  Again, where were these calls diverted to?

And, finally, who would benefit from accessing my incoming calls?


The following letter from David Hawker MP, Liberal Coalition, congratulates me for my “persistence to bring about improvements to Telecom’s country services”.  Mr Hawker goes on to say that he regretted “that it was at such a high personal cost.”

In the third paragraph of another letter, this time from the Hon. David Beddall MP, then the Minister for Communications in the Labor Government, Mr Beddall states:

“Let me say that the Government is most concerned at allegations that Telecom has not been maintaining telecommunications service quality at appropriate levels. I accept that in a number of cases, including Mr Smith’s there has been great personal and financial distress.  This is of great concern to me and a full investigation of the facts is clearly warranted.”

Negotiations continued as we lobbied for a commercial assessment (refer Glossary) for the members of COT, an assessment that we hoped would look at the financial losses we had all suffered because of the faulty phone systems that we had to put up with.  At the same time it seemed that there was a strong possibility that a Senate Inquiry would be set up.  Our hopes began to rise again.

Two Senators in particular were pushing hard for a Senate Inquiry at this time, the then Shadow Minister for Communications, Senator Richard Alston (who, at the time of writing, is the Minister for Communications) and Senator Ron Boswell.  Senate Hansard (refer Glossary) records show that these Senators were assured by Telstra that the four main COT members would have their claims assessed commercially, in a specially designed, non-legalistic settlement proposal, to be called the Fast Track Settlement Proposal (FTSP - refer Glossary). 

The decision for this FTSP was reached because all four main members of COT, Maureen Gillen, Ann Garms, Graham Schorer and I had suffered considerable consequential and resultant losses because of our ongoing attempts to bring the matters to the attention of the Government for many years and because of our ongoing attempts and constant work aimed at finding natural justice through Telstra, on top of the losses caused directly by faulty phones.

With the sanction of the then Labor Government, Austel arranged for an international expert to be brought to Australia to have a look at our claims.  Bell Canada International Inc (BCI), technical telecommunications specialists from Ottawa, Canada, arrived to run tests on a number of the phones connected to the businesses belonging to various COT members.

These tests were allegedly carried out on my phone service between 4th and 9th November 1993, a period when my phone faults were particularly troublesome, as Austel were well aware.

At the conclusion of these tests BCI produced a report.  Unfortunately this report was not acceptable to Austel since the BCI technicians had not tested the actual line between my business and the nearest connection to the local exchange (called the Customer Access Network or CAN).  FOI document numbered A00404 to A00407 shows that Telstra’s Ian Campbell, Commercial General Manager for Australia, responded by letter to Robin Davey, Chairman of Austel, on 15 December 1993, saying:

“The conclusion to be reasonably made from these events is that Austel publicly judges the BCI report “Fails to live up to the expectations raised by the terms of reference.”

Reasonable inferences might be drawn about deficiencies in the competence, professional standing and integrity of BCI, and the competence and integrity of Telstra and myself in the conduct of the study and representation of the findings.”

In this letter, Mr Campbell goes on to discuss the COT Settlement Proposal (FTSP), saying:

“Considering the above circumstances, Telstra cannot agree to attach a copy of Austel’s letter of 9 December to the BCI report if the latter is made available to the assessor’s nominated for the COT cases.”

A hand-written note at the bottom of the last page of this letter states:  “There is a multitude of inaccuracies” .  This note is linked by an arrow to a reference to a letter dated 9 December 1993, from Austel’s Cliff Matherson to Telstra’s Ian Campbell.  Some time later I received a copy of this 9 December letter, under FOI (numbered K47052 to K47054).  Cliff Matherson’s summary, at the end of this letter, stated:

“Having regard to the above, I am of the opinion that the BCI report should not be made available to the Assessor(s) nominated for the COT cases without a copy of this letter being attached to it.”

It is quite clear however, from information I received in response to my FOI request of 18 October 1995, that Telstra did not supply a copy of Cliff Matherson’s letter to my arbitrator.  This issue has not been investigated either by the Hon Richard Alston, Minister for Communication or by the TIO, even though they are both fully aware that Telstra used the BCI report to support their defence of my claims and even though the arbitrator acknowledged in his 11 May 1995 award that he had accepted the BCI report into my arbitration.

One week after Ian Campbell wrote this letter to Robin Davey, a Telstra e-mail (FOI document A00354), discusses a new tariff filing that was to be lodged on the 20 December 1993.  This new tariff was to include new performance parameters, one of which committed Telstra to a 98% call completion at the individual customer level.  This e-mail also referred to experiences with customer disputes and the Bell Canada International Study, commenting that:

 ... this is a cause for concern - Telstra will not meet this 98% figure in many exchanges around Australia, particularly in country areas

Apparently Telstra were quite aware that their rural subscribers were not being properly looked after.  This was born out in discussions I had with David Hawker and Austel.  My complaints were obviously quite valid.

FOI document A09392 raises even more concerns regarding problems with rural exchanges.  The writer of this document states:

“Parameters for Cape Bridgewater RCM have been obtained but I don’t believe them —  I am attempting to check them — some of the people supplying this information live in “old Telecom”. 

Clearly the parameters for Cape Bridgewater exchange posed some sort of problem for Telstra: could this have been the reason for Telstra not supplying this information in response to my FOI requests?

It is difficult to describe the anguish suffered by the four COT complainants as we continued to do battle with Telstra.  This was a corporation entirely government owned at the time, an organisation that Australians were being exhorted to trust with radio and television advertisements bombarding us night and day.  How could we have been treated so badly?

At about this same time Telstra commissioned the international audit company of Coopers and Lybrand to report on Telstra’s fault handling procedures, particularly when they were called on to deal with complaints like the issues raised by the COT members.  Coopers & Lybrand’s report indicates that they were shocked, to say the least, at the evidence supplied by the COT cases.  Telstra’s unethical management of our complaints over the years caused some serious concern to Coopers.  What followed Telstra’s first reading of the Coopers report was indicative of Telstra management’s attitude to their subscribers.

On 9/11/93, Doug Campbell, Group Managing Director of Telstra wrote to Ian Campbell (no relation), also of Telstra.  In this letter Doug Campbell said:

“I believe that it should be pointed out to Coopers and Lybrand that unless this report is withdrawn and revised, that their future in relation to Telstra may be irreparably damaged.”

These are strong words from the most senior manager below the CEO of the largest telecommunications corporation in the country; a corporation which, at that time, had a monopoly hold on the industry in Australia.  This was not an empty threat but it seemed not to have the desired effect because Coopers tabled their report in the Senate and released it into the public domain with, as far as I can tell, no significant changes.

The following points have been taken directly from Coopers report.

“2.20   Some customers were put under a degree of pressure to agree to sign settlements which, in our view, goes beyond normal accepted fair commercial practices.

2.22     Telstra placed an unreasonable burden on difficult network fault cases to provide evidence to substantiate claims where all telephone fault information that could reasonably determine loss should have been held by Telstra.

(2)        Fault handling procedures were deficient in terms of escalation criteria and procedures, and there is evidence that in some cases at least, this delayed resolution of these cases.

3.5       We could find no evidence that faults discovered by Telstra staff which could affect customers are communicated to the staff at business service centres who have responsibility for responding to customers’ fault reports.”

With Bell Canada International and Coopers & Lybrand busy producing their individual reports on the COT allegations we four at last felt vindicated; we were not paranoid after all.  Telstra really did have a case to answer.

As a result of their own investigation, Austel had come to the conclusion that there were problems in the Telstra Network and that the COT four had, for all the right reasons, been diligent in bringing these issues into the public domain.  It looked like four Australian citizens, without any financial backing (and now all close to being totally broke) had won a significant battle.  Sometimes, we thought, David wins over Goliath, even in the twentieth century.

Because we were in such a difficult financial position however, because our phone services were still not up to network standard and because I had certainly proved that my phones were not working properly, Austel’s chairman, Robin Davey, pressured Telstra into appointing a commercial loss assessor to arrive at a value for our claims.  This was to be the non-legal Fast Track Settlement Process and it was to be set up so that the COT four would have prompt and speedy access to any discovery documents we might need to enable us to complete our claims as quickly as possible.

Telstra agreed to rectify any on-going phone faults before the assessor handed down any decision regarding payouts.  After all, what good would a commercial settlement be if the phone faults continued?  Again our spirits rose and we began to feel that we were getting somewhere at last.  We had discussions with Robin Davey and he verbally assured us that any preparational costs we might incur would be considered as part of our losses, so long as we proved our claims.

Mr Davey would not confirm this assurance in writing because, he explained, it could set a precedent.  Telstra’s Corporate Secretary had written to Mr Davey on 18 November 1993 (FOI document number R10799), pointing out that:

“ .... only the COT four are to be commercially assessed by an assessor. 

For the sake of convenience I have enclosed an amended copy of the Fast Track Proposal which includes all amendments.

To facilitate its acceptance by all or any of the COT members I have signed it on behalf of the company.  Please note that the offer of settlement by this means is open for acceptance until 5 pm Tuesday 23 November 1993 at which time it will lapse and be replaced by the arbitration process we expect to apply to all carriers following Austel recommendations flowing from this and other reviews.”

This caused us all some concern and so we turned for advice to Senator Richard Alston, then still the Shadow Minister for Communications.

We contacted Senator Alston on 22 November and this is confirmed by an internal memo from Senator Alston’s secretary, Fiona, headed “Re: Fast Track Proposal”.  In this memo Fiona writes to Senator Alston:

“Garms and Schorer want losses in Clause 2(c) to include its definition, ‘consequential loss arising from faults or problems’ although Davey verbally claims that consequential losses is implied in the word ‘losses’ of which he has given a verbal guarantee he will not commit this guarantee to writing.

COT members are sceptical of Davey’s guarantee given that he will not commit it to writing.  On top of this COT alleges that Telstra, in the past, has not honoured its verbal guarantees and so does not completely trust Davey.

COT want your advice whether or not COT should demand that clause 2(c) include a broader definition of losses to include consequential losses.

COT was hoping for your advice by tomorrow.”

Amazing as it now seems -- we never did get this advice from Senator Alston, even though we had informed his office that various members of COT were now receiving many phone calls from other unhappy Telstra customers around Australia.  The faults reported by these callers seemed to indicate that problems within the Telstra network were more wide-spread than Telstra would have the Government know.  Some of the callers spoke about their fears of having their phone calls bugged;  others were more concerned with over-charging; some talked of suspicions of ‘organised crime’ within the ranks of the Telstra corporation and still others raised issues of the misleading conduct of some of Telstra’s senior managers.  All this information was passed to Austel and to Senator Alston.


Graham, Ann, Maureen and I signed the FTSP the following day, 23/11/93, trusting in Robin Davey’s verbal assurances that consequential losses would be included.  The agreement was forwarded to Telstra’s corporate secretary.  I included a letter with the agreement, clearly putting my expectations of the process:

“In signing and returning this proposal to you I am relying on the assurances of Robin Davey, Chairman of Austel, and John MacMahon, General Manager of Consumer Affairs, Austel, that this is a fair document.  I was disappointed that Mr Davey was unwilling to put his assurances in writing, but am nevertheless prepared to accept what he said.

I would not sign this agreement if I thought it prevented me from continuing my efforts to have a satisfactory service for my business.  It is a clear understanding that nothing in this agreement prevents me from continuing to seek a satisfactory telephone service.”

The four COT members felt some sense of achievement although Maureen’s health was beginning to fail.  The rest of us tried to ring her as often as we could because she was not getting much support from her business partner who often seemed a bit put out when we rang Maureen to ask how she was.

The pressure on all four of us had been immense with TV and newspaper interviews as well as our continuing canvassing of the Senate.  The stress was telling by now but I continued to hammer for a change in rural telephone services, at least in Victoria. 

A number of other small businesses in rural Australia had begun to write to me regarding their experiences of a poor standard of service from Telstra.  Other ordinary subscribers were also writing of problems they had had with their phones, including a number of different billing issues.  I contacted Telstra management myself on a number of occasions, putting on record my requests for these matters to be resolved.  I believed then, and I still believe, that this was a responsible reaction to the letters I was receiving.  Telstra didn’t even offer a ‘thank you’ however, leaving me with only one option: to continue to canvas the media for publicity about our fight.

Other rural subscribers wrote to various TV stations and newspapers supporting my allegations that, with regard to telephone services, rural small-business people, as well as the general public, were not being supplied with a level playing field when compared to our city cousins.  One of these letters is particularly interesting.  It came from David M Thomson & Associates Pty Ltd, Insurance Loss Adjusters in Ballarat, a rural city in Victoria, and was sent to the producer of “Real Life”, a TV current affairs program then being broadcast on Channel 7.  They wrote:

 “Re Problems with Telstra”

I have watched with interest the shorts leading up to tonight’s program as I have similar problems to the man at Cape Bridgewater.

Our office is located in Ballarat and due to Telstra structure the majority of our local calls are STD-fee based. (refer Glossary)

On many occasions we have been unable to get through to numbers we have dialled, often receiving the message “This number is not connected” or similar messages which we know to be untrue.

Clients report that they often receive the engaged signal when calling us and a review of the office reveals that at least one of our lines was free at the relevant time.

We have just received our latest Telstra bill which in total is up about 25-30% on the last bill.  This is odd because our work load in the billing period was down by about 25% and we have one staff member less than the previous billing period.”

Another letter sent in April 1993 to the Editor of the Herald-Sun Newspaper in Victoria, read in part:

“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 have 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 also 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 also got the same noise when testing.”

Because of a number of reports regarding this ‘piercing noise’, Ray Morris from Telstra’s Country Division arranged to have my service switched to another system.  Unfortunately this did not seem to help.

The TV stations reported that their phones had run hot whenever they aired stories about phone faults.  People rang from all over the country with complaints about Telstra’s service.  This support from the media and from the general public boosted our morale and gave us a bit more energy to keep going as a group.  We continued to push to have all these matters addressed in the Senate.

FOI documents show that, at about this same time, a number of Labor Party Senators were becoming more and more concerned at what COT members were uncovering.  Other FOI documents show that Telstra were not correctly reporting the true facts as they were at the end of 1993.  It is also clear from still more FOI documents that it is highly likely that some newspaper journalists were approached by Telstra and asked to ‘kill’ a story about our problems with phone faults.

FOI document number C04054, entitled “Cot Wrap-Up”, states, in part:

“I think it should be acknowledged these customers are not going to become delighted.  We are dealing with the long-term aggrieved and they will not lie down.

Further, I propose that we consider immediately targeting key reporters in the major papers and turn them on to some sexy “Look at superbly built and maintained network” stories.

I advise that Clinton be targeted for some decent Telstra exclusive stories to get his mind out of the gutter.”

We are left to wonder just who ‘Clinton’ was and why his mind was considered to be ‘in the gutter’!

A TV news program was clearly also a target in this attempt to muzzle the media.  FOI document A04646 reports:

“Good news re Channel (Australian TV station ID omitted) News.  Haven’t checked all outlets but as it didn’t run on the main bulletin last night, we can be pretty certain that the story died the death.  I wish I could figure which phrase it was that convinced (reporter’s name omitted) not to proceed.  Might have been one of ‘Jim Holmes’ pearls.”

The ‘Jim Holmes’ referred to in this e-mail was then Telstra’s Corporate Secretary; the reporter worked for the TV station referred to at the beginning of the e-mail.  The identity of the TV station and reporter, clearly shown in the original e-mail, have deliberately been omitted from this book.

Again we can only wonder what it was that could convince a respected journalist to drop a story.  Furthermore, if Telstra had met with the members of COT at the very beginning, listened to our complaints and then done something about them, there may never have been a need to interfere with media stories because there never would have been a Casualties of Telstra group in the first place.  After all, we were only asking that Telstra rectify our phones so we could each get on with the running of our businesses in the same way that other small businesses operated.

The following document is another example of censored FOI material.  This Telstra memo has some names blacked out but other documents show that Telstra’s area general manager is clearly referred to as one of the Telstra people appointed to ‘deal with the media/politicians’ regarding COT issues.  Previously, on page 58, I have recounted one of the stories related to this same area general manager.  As I explained then, it seems quite clear that this manager had deliberately misinformed me during a settlement process in 1992/93.  Now we discover that she was to be one of only two people who were appointed to speak to the media about the COTs.  Would she have misinformed the media the way she misinformed me, I wonder?  And, just as worrying, why was the author of this memo so worried about ‘tripping up’


On the 17th January 1994, Warrick Smith, then the TIO, distributed a media release.  An ‘assessor’, Dr Gordon Hughes, had been commissioned to process the four COT Fast Track Settlement Proposals.  What the TIO did not say was that Telstra were not abiding by the original FTSP agreement:  they were not supplying us with the discovery documents (refer Glossary) we were requesting under FOI.

By this stage we had lost any chance we might have had for a Senate Inquiry into what the COT members believed was the unethical way Telstra was continuing to treat us.  By late January 1994, it appeared that not only was Telstra treating us with sheer contempt but they were doing this in full view of the Senate.  The COT members were beginning to believe that no single person, and no organisation, anywhere in Australia, had the courage to instigate a Judicial Inquiry into the way Telstra continued to thumb their noses at the Government.

I remember feeling lost and confused, wondering who I could turn to for help; just wanting to find a way to trust someone, just one more time.  Austel’s chairman, Robin Davey, was expressing anger about the delays we were suffering as we tried to gather the necessary discovery documents.  By February of 1994, Senator Ron Boswell was also asking questions of Telstra in the Senate.  Still the members of COT struggled to run their failing businesses and, at the same time, attempted to do battle with the colossus of Telstra and their legal advisors.

Imagine having to write to Telstra’s solicitors, to lodge my phone complaints!  Was this Telstra’s way of breaking my morale?  Imagine having to report a telephone fault, in writing, to a solicitor!

We learnt from the TIO that the  commercial ‘assessor’, Dr Hughes, had drawn up a set of rules within which to work on our cases.  Then, to add insult to injury yet again, we learned that Telstra had badgered Dr Hughes into converting the commercial assessment into an ‘arbitration’ procedure (refer Glossary).  COT members registered our disagreement with this through the TIO who had been appointed as an independent administrator of the Fast Track Settlement Process.  We made it very clear to Warrick Smith that the four of us were already involved in a signed and agreed commercial process and we saw no clear reason for changing that situation.  We believed an arbitration process would certainly never be ‘fast-tracked’.  It was bound to become legalistic and drawn out and we knew none of us had the finances to go up against Telstra’s high-powered legal team in such a process.  We believed the whole idea of an arbitration had been raised simply to suit Telstra’s agenda.

Somewhere around the 6th to the 8th of February that same year, Graham Schorer had a telephone conversation with Warrick Smith.  Graham wanted to discuss the reasons the COT four were rejecting the arbitration process.  Our reasons were immediately dismissed.  Warrick Smith used words to the effect that his prime role was as Telecommunications Ombudsman and that he had been spending much too much time focussing on his secondary role as administrator of our FTSP.  He was concerned that his office had already incurred considerable expense because of this administrator role and he made it clear to Graham that Telstra had refused to reimburse those expenses.  He also indicated that his office had no intention of continuing to incur expenses on our behalf.  Further, he told Graham that if the COT four did not abandon their commercial agreement with Telstra then Telstra would pull out all stops with the aim of forcing us into a position where we would have to take Telstra to court to resolve our commercial losses.  Telstra, the new arbitrator and the TIO were all aware that none of us had the financial resources to enter into a court case.

As if all this wasn’t shattering enough, the TIO went on to say that, if we did decide to take legal action in an attempt to compel Telstra to honour their original commercial assessment agreement then he (the TIO) would resign as administrator to the procedure.  This action would have forced the conclusion to the FTSP and left us with no other alternative but to each take conventional legal action to resolve our claims.

Simply put, it seemed that the TIO had sold us out.  The new assessor also seemed to be selling us out before he even got properly started.  We asked to see Telstra’s preferred rules of arbitration, which had already been supplied to the TIO’s office but the TIO refused our request.  We had been reassured that these rules had been drawn up independently of Telstra, by Dr Hughes and Minter Ellison, the legal counsel to the TIO’s office.  We were also told that a Mr Sheldon, one of the partners in Minter Ellison, had consulted with Dr Hughes over these rules.

Whenever we asked to see a copy of these rules we were told that we should trust Dr Hughes.  And so we did.  In retrospect we were fools to accept such a compromise but, after struggling through the nightmare of the years leading up to this point, we were all exhausted, stressed and clutching at straws.  Singly and as a group we were vulnerable to the trickery of Telstra’s corporate power.

Even so we continued to implore the TIO to reconsider and let us continue with the original FTSP agreement.  On 16 April 1994 we faxed him once again, stressing our request.  Again this fell on deaf ears.  By the following Thursday, 21 April 1994, we had given up and abandoned the FTSP without seeing Telstra’s preferred rules of arbitration.  Later we discovered that the copy of these rules which had been supplied to the TIO’s office was actually headed “Telstra’s preferred rules of arbitration.”  We simply wanted to make sure that the rules we were signing for were different to Telstra’s ‘preferred rules’:  why should Telstra be allowed to dictate to us?  Our concerns were of no interest to the TIO however and so, like lambs to the slaughter, we signed on the dotted line on 21 April 1994.

When I arrived back at Cape Bridgewater after signing for the new arbitration procedure I found that, while I had been away, my staff had logged two more faults on my fax line, at 2 pm and again at 2.15 pm.  Nothing, it seemed, had changed.

Not only was I still suffering from all these phone faults but, along with the other members of COT, I still couldn’t access the FOI documents I needed to support my claims against Telstra because Telstra would not abide by the FOI Act.  Questions about this lack of supply of FOI documents were raised in the Senate on a number of occasions over the following years, by various Senators.  The persistence of these Senators paid off for some members of COT but, unfortunately, I was not so lucky.  The persistence of the Senators somehow failed to force Telstra to supply the documents I needed.


On 26 April my son attempted to phone me from his mother’s (where he was living at the time) about his Austudy payments.  According to my diary records he first tried at 12.56 but only reached an engaged signal.  Document K37932 is Telstra’s fault report for that day.

This makes it quite clear that Telstra acknowledged that there were other call attempts on that day, all from 03 568 xxxx, which is my ex-wife’s phone, to my phone number, 055 267 267, which translated to my 1800 freecall number.

FOI document A19115 is a copy of my wife’s telephone account. 

FOI document A19113 is a copy of my 1800 phone account. 

When these two documents are compared it is easy to see that, again, Telstra charged me for calls which I did not receive and, furthermore, they charged my ex-wife for two of the calls which did not get through because my phone was registering as engaged.  This is confirmed when these two documents are compared to Telstra’s own CCAS data.  These documents are taken from many, many documents which I have accumulated over the years and which all prove conclusively that Telstra people were aware of the many problems my phone line suffered, over a number of years.   For instance, in August 1993 I complained to Telstra that customers and friends alike were commenting on the peculiar behaviour of my direct out-going line, 055 267 230.  This was also a fax line.  People often had remarked that, after I had hung up they could still hear me moving around the office.  Because of all the other problems I was dealing with at the time I didn’t pay much attention to this small fault until 26 April 1994, the same day that my son had tried to reach me by phone.

This day I phoned Cliff Matherson, one of Austel’s senior engineers, to talk about this ‘hang up’ fault.  Mr Matherson suggested that he and I carry out a series of tests on my 267 230 line.  His plan was that I would hang up and count out loud, say from one to ten, while he listened at his end.  This first test proved that he could hear me right through to the number ten and so he suggested we try it again, but count even further this time.  Still the same situation:  he could hear me right through the range as I counted.  Mr Matherson then suggested that I take the phone off that line and switch it with the phone which was connected to my 267 267 line (they were both exactly the same Telstra phones, model T200).  I did this and then we repeated the ‘counting’ test, with exactly the same results.  According to Mr Matherson (and it was also apparent to me) this proved that the fault was not in the phone itself, but somewhere in the Telstra network.  Mr Matherson’s next suggestion was that I ring Telstra, which I duly did.

This time I spoke to Peter Gamble.  I explained carefully what was happening, adding that I had experimented and found that I could count for quite a long time, up to 15 or more, and the person at the other end could still hear quite clearly.  I didn’t mention that I had tested two different phones because I was well aware that Telstra had a strong inclination to blame the customer’s equipment first.  I was interested to see what they would come up with this time.

So, again, I performed the same tests for Mr Gamble who advised that he would send a technician to collect the phone the very next day.  Documents K00940 and K00941 (on the next two pages) show that Mr Gamble was fully aware, before the phone was even tested, that heat in the Cape Bridgewater exchange was causing the fault.

The documents on the next two pages should be read in sequence, before continuing, as both prove that Telstra were aware that phone faults in the exchange were still apparent, even while I was preparing my claim for arbitration.  It should also be noted that I asked both the arbitrator and the TIO how I could access discovery documents to support the CONTINUING phone faults, when Telstra was still actually testing for these faults, even on that very day.

Communication experts have since acknowledged that these phone faults continued even after Telstra had submitted their defence of my claim.  And what about the phone faults which continued after Telstra had defended their network?  They have still not been addressed by the TIO, the arbitrator or Telstra.

 When my Telstra account is compared with Telstra’s own data for this period it can be seen that these 15-second call hang-ups and incorrect charging were occurring from at least August 1993 right up until this phone was taken away on 27th April 1994.  The phone itself was from the ‘Exicom’ series, manufactured in April 1993; the same as the phones referred to in FOI document D01026.  This phone later proved to be a major player in one of the many sub-plots of this Telstra saga; it was used as part of Telstra’s defence of my claims and it was used mainly in an effort to damage my credibility.  But that story comes much later.

Meanwhile, on 27th April, when Telstra phoned, at around 9 am, to arrange pick-up of the faulty phone, I had just arrived back in my office after spending the previous 12 hours on our local CFA (Country Fire Authority) fire truck fighting a large bush fire (as our local CFA records will show).  I explained to the Telstra caller that I had been out from 7pm the night before and had only just arrived back, and I asked if the pick-up could be arranged for some time after 1pm so I could get some sleep.  Later, in an FOI document, I found that the most important part of this conversation had been omitted from Telstra’s records:  they simply stated that ‘Mr Smith was tired, and wanted to go to bed’ and went on to say that I had asked that they not disturb me until after lunch.  The omission of any reference to why I was tired is just another example of how some Telstra personnel twist words to suit their own perspective.

By now I was trying to assess my situation and collate my own claim to submit to arbitration, using much of Austel’s ‘COT report’ which had just been released (in April of 1994).  Even this report had needed to be revised by Robin Davey because Telstra threatened to enforce an injunction thereby tying the report up for years in a legalistic manoeuvre.  Mr Davey had agreed to the amendments required by Telstra just so that the COT four could at least have access to some of the information in the report.

Austel had found a number of my claims to be proven however they were basing their conclusions on information supplied only by Telstra and it later turned out that Telstra had not given Austel the true facts regarding the age of the first exchange at Cape Bridgewater.  I had hired as technical advisor, George Close, a telecommunications expert who was based in Queensland and he based his findings on Austel’s report.  This meant, of course, that he also based his findings on incorrect information.  According to Austel’s report, the first exchange in Cape Bridgewater was called an ARK exchange.  What transpired later was that it was, in fact, an RAX exchange.  The RAX was designed in the late 1940s or early 1950s, specifically for low-call-rate areas.  The ARK was newer technology and was designed some 20 years later.

The first part of my claim covered the first three and a half years after I took over the camp at Cape Bridgewater (the whole claim covered a period of six and a half years in all).  I later discovered that this ancient exchange had been in operation for years but George Close and I both believed, as did Austel, according to their report, that the newer ARK was in place through those years.  So George assessed my situation, unknowingly working from a false base.  This incorrect information downplayed the true fault loss suffered by my business.  Was this incorrect information, given to Austel by Telstra, just another deceptive move aimed at hiding the true extent of my continuing phone faults?

This was beginning to look like a repeat of the Tobacco companies and their deceptive conduct over the last 20 years, hiding their true knowledge about the addictive effects of nicotine and then hiding their knowledge about the smoker’s health risks as well.  Telstra was (and still is) no different really.  They were fully aware that a number of their exchanges around Australia were outdated and were therefore causing enormous difficulties for their subscribers, small-business people and the general public alike.  Still they hid these facts.  Still it appeared that they did nothing to improve the system.  For ten years Telstra have continued to charge me for calls which never connected, for RVA calls and for short duration (and therefore useless) calls.  Why hasn’t the TIO’s office investigated my irrefutable evidence?  After all, this evidence is supported by Telstra’s own data.

Some nine months earlier, in August of 1993, having been to Melbourne for a COT meeting, I arrived back home to be confronted by a Sheriff from the Justice Department.  He had a warrant requiring payment or seizure of goods in lieu of payment.  I asked if he would wait fifteen minutes while I tried to talk to the people I owed money to but he would not.   A fight ensued and I threw him out of my office.  Later I was charged, in the Magistrate’s Court, with assault:  I appealed the court action, defended the charge successfully and saved the day (there was no conviction).  The newspaper article, numbered as FOI document K01407, tells the story.

It would appear that Telstra’s FOI Unit was also interested in this situation since this copy of the newspaper article came from Telstra’s records.  What this had to do with my phone problems is anyone’s guess although I have since learned that Telstra were accumulating a lot of personal information about me in a file containing details of who rang me, when they rang and from where as well as when my staff left my business.  Apparently they were not only interested in my complaints about phone faults.

And so I battled on.  A law student to assist would have been a God send.  The mountain of documents continued to grow and threatened to engulf me entirely while Telstra’s multiplying legal team stood by, waiting to pounce on the slightest crack they could manufacture in the claim documents I submitted.  The knowledge that every document I sent would be poured over by highly qualified legal experts didn’t exactly help to keep my confidence up.  Finally I sought out the TIO and his legal counsel, explaining my lack of confidence and re-iterating Robin Davey’s reason for first asking for a non-legalistic hearing for us.  Mr Davey had always believed this would be the best and fairest way for us to present our cases.

The TIO could only console me by telling me to ‘do the best you can’.  The TIO’s legal counsel re-assured me that the new process was fair and advised me to ‘give it a go’.  And so I had no choice but to seek help from professionals in the field.  I began by approaching a local firm of loss assessors in nearby Mt Gambier, just over the border in South Australia, about 110 kms away. This firm was headed by Mr Phil McDonough, an agent for NZ Insurance.  When I first phoned I spoke to Mr McDonough and explained who I was, gave my location and what I hoped to have help with.  There was quite a long pause before Mr McDonough asked me if I had suffered some storm damage at the camp about four or five years earlier.  I remembered that I had.  It turned out that Mr McDonough had acted as loss assessor back then and remembered that he had had a lot of trouble contacting me by phone and had finally resorted to writing to me to let me know they were coming to assess the storm damage.

After discussing my current position in more detail Mr McDonough decided that my problems were outside their area of expertise.  Imagine, Telstra and the TIO expected me to prepare my claim alone and a professional loss assessor believed the case was too complicated for him to take on.  Here I was, a marine cook, a chef, and the TIO and his legal counsel could only tell me to ‘do the best you can’!

I continued my search for assistance in the Melbourne metropolitan area, approaching four different companies specialising in communications.  Three didn’t even respond in writing and the fourth simply wished me luck in finding someone who would be brave enough to go up against Telstra.

It was at this stage that I approached George Close in Queensland.  George was already working on Ann Garms’s case and she had suggested I talk to him.  It was just a shame that he was so far away from me geographically as this, of course, complicated everything just that bit more.  When Telstra discovered that we had secured George’s help, they approached him, offering work.  It would seem that they were still trying to close off all avenues for the COTs.  George, however, at 70 years of age, was having none of that.  He made it quite clear that, if he took up Telstra’s offer, it would create a definite conflict of interest and severely disadvantage the COT members and so, bless his beautiful heart, he declined their offer.  It would seem that at least one Australian was prepared to put himself on the line and face up to Telstra’s bottomless financial public purse.

Finally, after more searching, I located a Loss Assessor company, Freemans, also 1,200 kilometres away on the Sunshine Coast in Queensland and then I spoke with an ex-National Crime Authority detective, Garry Ellicott.  Garry agreed to help me on the understanding that he would only be paid if and when I won my claim.  The only payment he expected along the way would be for re-imbursement of out-of-pocket travel expenses so he could come to Cape Bridgewater.

Once all these professionals were in place I then had to work out how to raise the finances to bring Garry Ellicott to the camp.  With my business still in tatters I was caught like a butterfly in a web:  the consequential losses resulting from the poor phone service meant that my finances were getting worse and worse but I badly needed money to keep up the fight.  The only alternative was bankruptcy and I was determined not to lose the camp because of Telstra’s skulduggery.

Government ministers, Coopers & Lybrand and Austel were all agreeing that the COT cases were right and Telstra was wrong.  Even Telstra themselves, in a letter to the Minister for Communication, admitted that my assumptions were correct, but we still had our backs against the wall.  We were still not getting any financial assistance from anywhere and were left to scratch around to raise the funds to organise our claims, claims that most loss assessors would not even attempt to touch.

I raised $280.00 by selling two of the camp’s canoes and, with nothing saleable left, borrowed another $1,000 from Peter Turner of the Australian Singles Club who took an advance on his credit card because all his money was tied up in New Zealand.

At about this time 900 to 1,000 discovery documents arrived from Telstra, in response to one of my FOI requests.  “Wonderful,” I thought, “now we are getting somewhere.”  But, of course, I was wrong.  Telstra may well have supplied the documents but, according to the FOI act, they were required to supply them in some sort of order, preferably chronological and definitely with some sort of numbering system in place.  Not only were all these documents supplied without any numbering system, they were also not even supplied in chronological order of any sort.  Further, there was no explanation of what the documents actually represented.  Many were unreadable with so much information blanked out that they were totally worthless.  This would have driven even the most hardened lawyer to the wall with frustration.  Below is one of many examples of these heavily censored documents from my first FOI release.  How could I support my claim with material like this?

If I had known, back on 21st April 1994, when I was forced, under duress, to abandon the commercial assessment process and sign for arbitration, that Garry Ellicott’s fees would mount to over $50,000; that George Close’s fees would come to more than $25,000; that Derek Ryan, my forensic accountant; would amass fees of more than $50,000; that typing would cost me more than $25,000 and that I would also have to bear another $40,000 in miscellaneous fees, I would never have agreed to the arbitration, even if Warrick Smith had held two guns to my head.  But I couldn’t know this in advance and I did not have any legal representation on the day so there was no-one who could warn me of what was to come.  As a lay person I did not know that, if I later wanted to challenge the decision made by the arbitrator, I would have to take the matter to the Supreme Court, even if I could prove that the arbitrator had acted in concert with another.  What chance did I have?

Even the TIO’s suggestion that we would have nowhere to go if we didn’t sign for arbitration, except for massively expensive court cases, would not have made Ann, Graham and me agree to sign even if we had know what was to come.  Not only have we had to bear enormous financial burdens, but we have also all had to suffer through failing health.  I know blackmail is a strong word to use when talking about an ombudsman but that is certainly how it felt to the members of COT.  The TIO’s comments sounded quite clearly like a ‘take it or leave it’ threat because the his office is funded by the telecommunications companies, Telstra included, unlike the office of the other ombudsman, which is funded by the Government.

The following two paragraphs are taken from FOI document R00037 (a fax from Telstra’s Corporate Secretary).  Clearly the members of COT were not intended to have to bear the burden of the costs of assessment.


Anyway, I managed to raise enough cash to bring Garry Ellicott to the camp for a couple of days to observe what was going on with the phones.  During his stay he noted short duration calls, dead lines and problems trying to send faxes to George Close.  In fact it was Garry who commented that he believed I was being watched.  His background as bodyguard for the United States President, Jimmy Carter, during his visit to Australia, gave him some experience in this area.  He was sure I was being kept undersome sort of surveillance and FOI documents (see document K01006) show that Telstra were aware of my movements, and the movements of my staff.

Document K01006 is dated Thursday 7 April 1994, at 2.05 pm and signed by Bruce Pendlebury of Telstra.  This document raises two issues.  Firstly this date falls during the time I was involved in the Austel designed commercial agreement with Telstra and secret observations would surely seem to be inappropriate, at the very least.  Secondly, this document refers to a time when I would be away from my business.  Mr Pendlebury states (note that NRR in this memo refers to ‘Not Receiving Rings’):

“David, Mr Alan Smith is absent from his premises from 5/8/94 - 8/8/94.  On other occasions when he has been absent there have been documented complaints received (usually months later) involving NRR etc.  I called the premises at approx 4:55 pm 6/4/94.  The answer time was 41 secs.

I intend on this occasion to document his absence and file all data I can collect for the period.  That way we should be prepared for anything that follows.”

Now, it is clear that Mr Pendlebury knew, in April of 1994, that I planned to be away later that year, in August. In other words he knew of my movements, 4 months in advance.  Telstra have never been able to explain how he came by this information.  Further, Mr Pendlebury has also stated that he knew that I had spoken to the former Australian Prime Minister, Mr Malcolm Fraser, on the phone.  He also knew when that conversation took place.  Mr Pendlebury insists that I told him about this conversation but this is not true.  I told him no such thing.  Again, Telstra have never been able to find a convincing explanation for Mr Pendlebury having this information.  Obviously Telstra were still listening to my private calls, even though I was then involved in litigation with them and their lawyers.  The following FOI document, not numbered, clearly shows that the writer knew where this caller usually rang from even though, on this occasion, the caller was phoning from a different number, “somewhere near Adelaide”.  How could the writer have this information, if someone hadn’t listened to this call to find out who the caller was?

Senator Richard Alston, Minister for Communications; the TIO and the Federal Police were all supplied with this document, along with a number of other documents indicating that my private calls were being ‘bugged’.  I have had no response from any of them, and I have now been waiting for four years.

Listening to private calls is appalling enough but the following information is even more damning.  Page A133 of the official Senate Hansard records dated 25/2/94 states that Senator Alston, then Shadow Minister for Communications, questioned Mr Robin Davey, Austel’s Chairman.  Senator Alston asked:

“Mr Davey, Why did not Austel immediately refer COT’s allegations of voice recording to the Federal Police instead of waiting for the Minister to refer the matter to the Attorney General and then on to the Federal Police?”

FOI document K00701, dated 14 January 1994, headed “Voice Monitoring of Priority, Investigation Services”  states:

“Described below are the details of any voice monitoring which has been carried out on the 3 Priority Case Investigation services in Country Vic/Tas”.

This document goes on to say that calls to the Cape Bridgewater Holiday Camp had been voice monitored at the Portland exchange where an alarm bell rang when calls came through for the Camp.  Further proof that Telstra personnel listened to my calls over a long period.

FOI document A10148, a copy of a letter dated 10/2/94 from Austel’s General Manager of Customer Affairs to Telstra’s Group General Manager in charge of the COT arbitrations, confirms the visit by the Federal Police.  In this letter Austel notes:

“Yesterday we were called upon by officers of the Australian Federal Police in relation to the taping of the telephone services of COT cases

Another interesting letter which I received under FOI was dated 28 January 1994 (within the COT litigation period) and was from none other than the Chairman of the Board of Telstra, Mr David Hoare.  Mr Hoare wrote to the Hon. Michael Lee, then the Minister for Communications, acknowledging that the Board were aware that Telstra technicians had listened to customers’ conversations.  Mr Hoare wrote:

“Thank you for your letter of 20 January 1994 requesting a report on allegations regarding voice monitoring.

I have attached for your consideration a full report on Telstra’s inquiries into this matter and the actions proposed to prevent its recurrence.”

Other documents received by various members of COT also confirm this ‘voice monitoring’.  These documents include one titled “Corporate & Govt. Major Customer Group 19/8/92”.  This document is included on the first page of Chapter 9.  It includes information showing that the document relates to the Tivoli Theatre Restaurant (which was owned and run by Ann Garms in Brisbane) and, in relation to ‘voice monitoring’, it is interesting to again note the information at point 19:


On the last few lines of this same document are the comments (at points 1, 2 and 3):

“10/03/92 ....... Tests looped .... SK ... maybe the bug has slipped off.  Looks like a job for super sleuth Sherlock Kelly????????”

I found myself wondering; was this an internal memo from Australia’s largest telecommunications company I was reading, or was it a page torn from a spy novel?

FOI document B00474 is a copy of a Telstra minute which also refers to Ann Garms and the Tivoli Restaurant.  In relation to the Federal Police’s investigation it is interesting to note the following points and questions raised in this document:

“John Brereton (Fed Police) initially stated a particular person was paying money for 3 people + others in Telstra to manipulate some services......... Why was Federal police stopped from investigating the Tivoli Case ...........  Why did John Brereton start to deny everything and then volunteer for service in New Guinea for 2 years. 

Why was AA of Protective Services investigated  ?   and investigation stopped short of his bank account.

Why did AA of Protective Services initially accede to my request to borrow a Bug scanning device for the 12th Night and Tivoli, then suddenly change heart ............”



Telstra have acknowledged that during May of 1994, I continued to report what is commonly referred to in communication circles as R00 faults, ie. the phone only rings once or twice, then nothing.  Telstra officials tried to play down these faults as me not understanding the operation of my new fax machine (in other words, they continued to blame the customer’s equipment, referred to as CPE or customer premises equipment), even after Coopers & Lybrand’s report of November 1993 had advised that this practice was not acceptable.

Austel also found that the R00 faults were continuing.  In their COT report, under the heading “Telstra’s fault reporting/recording & monitoring/testing system & procedures”  they said:

“Network investigations had been working on the problem for an extended period of time with little success.  This involvement has been escalated in the past three months — this fault was in connection to cut-offs which had also happened in the past.”

At point 6.87 in this same Austel report is the comment:

“It may be concluded from the above extracts from internal Telstra documents that Telstra knew for quite some time of general problems in its network which were affecting customers and was unable to identify the cause of those problems.

Again, at point 7.39 (page 167), Austel reported:

“AXE network fault — this is Portland’s main telephone exchange (AXE).

In the period February to April 1993 Telstra staff responding to complaints lodged by Mr Smith of the Cape Bridgewater Holiday Camp recorded in their notes that there was a fault known to exist in AXE (digital) Switching equipment which could give rise to a single burst of ring, followed by a busy tone to a caller and dial tone to the called party — for example:

ie. “I spoke to Alan Smith ..... he received one burst of ring at 1.15 pm and 5.05 pm yesterday.  When he picked up the receiver he heard dial tone.  This problem occurs intermittently through-out the network and although it is recognised as a problem there appears to be no one person or group involved in resolving it.”

And again, on page 168, Chapter 7, titled “Customer Complaint Form 25 March 1993”:

“Visited Mr Smith 6/04 to do end to end test calls.  The first call in prior to me starting testing gave two bursts of ring and when the phone was lifted there was only dial tone.  The receptionist said it was the 2nd call that morning with the same result.  She also stated several people had commented they receive busy tone when they rang the previous evening when she knew the phone was free.”

These statements are even more alarming when you realise that they were collected from Telstra’s own archives and records, by Austel officials, paid by the Australian Government, and yet still some Telstra officials were prepared to later sign Statutory Declarations covering information they knew to be untrue.  This corporate culture at the management level of Telstra was what put the members of COT in the positions they found themselves in:  fighting an unfair arbitration simply because we challenged the misleading and deceptive conduct of Telstra managers.  Simply because we were seeking the truth.  Simply because we were prepared to stand up for our rights as Australian citizens; our rights to a telephone system which was comparable to that of our competitors.

During May 1994 Garry Ellicott and I spent five nights toiling over the pile of Telstra discovery documents in an attempt to decipher what they all meant.  By this time Garry was also experiencing phone problems similar to those problems I had been suffering from for all these years.  I found some comfort in having someone of Garry’s standing staying with me, even if it was for only a short time.  His background in the police force and the NCA was quietly reassuring.  When he left to return to his office in Queensland he took some of the FOI documents with him for further examination.

While Garry was visiting, I discovered I could not locate a number of important camp documents.  Missing were exercise books in which I kept official booking records, books which I needed to support those few bookings that were still managing to get through; a number of bank statements and my bank pay-in books for 1992/93.  Also missing were two diaries which were keepsakes because they were in my ex-wife’s handwriting (from the two years she spent at Cape Bridgewater before our marriage broke up).  These diaries covered the period of 1988 to 1989 and they have never been seen since.  I was left with my rough diaries, and wall planners which I used to register bookings as they came in and before they were registered in the official exercise books.  This information is covered in more detail in the description of an oral arbitration hearing which occurred later, on 11th October 1994.

Because all these records went missing, I was hard pressed to produce full and correct financial statements for my financial advisor, Derek Ryan.  In fact, I had to resort almost to guesswork, based on information from my wall planner and diary which was compared to those bank statements I still had.  Where these missing records really went is anybody’s guess.

Graham Schorer found himself in a similar position.  A concrete pillar at the side of his office was smashed so thieves could gain access to his business.  Interestingly, the only things stolen were documents.

My stress levels rose enormously over this period.  Trying to produce a claim in some readable form when the story was so very complex, and without much actual technical knowledge was extremely difficult.  My phone and fax lines became life-lines to Garry Ellicott, my technical advisor in Queensland.  By this time I was not only relying on the phone lines, I was also, unfortunately, relying more and more on the Scotch bottle, consuming up to 3 or 4 scotches a night in a vain attempt to calm my nerves.  My private life was a mess with my partner in Ballarat and I turned, for a time, to another fine lady for comfort.  It is interesting to note that soon after she befriended me she also began to experience problems with her business phones and her customers started complaining that her phone was continually engaged.  FOI documents indicate that Telstra investigated this.

Often I was aware of a particular car sitting on the road above my house.  Were they admiring the picturesque view of Cape Bridgewater Bay, I wondered, or were they watching me?  Even though I was aware that my mind may well have been playing tricks on me, this was certainly a worry. 

Finally, in the early hours of one morning, in July or August of 1992, I confronted an intruder sitting in a car among trees on my property.  I was rather agitated, as anyone would be at finding a stranger on their property, and I was also rather loud, but the intruder actually offered what seemed, at the time, a plausible excuse so I let him go.  I lodged a call with the Portland police and, the next morning, the local sergeant of police, Frank Zeigler, who later became Mayor of Portland, visited my office with a constable, to take some notes about the incident.  During this interview I mentioned in passing the phone call I had which was ‘accidentally’ switched through to Telstra’s John Stanton instead of the ‘Four Corners’ Sydney office, and raised with Frank my belief that my phones were being bugged, as well as my property being watched.

Some days later Frank came again with information about the ‘intruder’ and his apparently sensible reason for being on my property.  Frank had made inquiries in both Victoria and over the South Australian border, in Mt Gambier but the information he had acquired did not support the reason I had been given in any way.

While he was carrying out this inquiry Frank also looked into my suggestion that my phones were being bugged but he could not clarify how or why my call had been transferred to the wrong office in Sydney.  Much later, when I began to sort through the confusion of documents which were sent to me from Telstra under FOI, and began to discover Telstra e-mails and other records which showed that they knew, on a daily basis, who I had telephoned and when; when my staff left my business and when I was away, I could only shudder.  What on earth had I done to deserve such treatment?

Even the local Telstra technicians seemed to be involved in this process:  in one FOI document (K03273), an internal Telstra memo, the unidentified writer offers to supply a list of phone numbers which I had rung (I believe this was around the time of the ‘briefcase saga’ incident which is described in Chapter 11).  Why were Telstra employees happy to distribute this private information so freely?

Attached to this document was another which indicated that I was the ‘customer’ referred to.  All this seems to indicate that phone calls I had made to a number of clients and friends were being circulated to various people, courtesy of my local telephone exchange.  I had previously learned that the writer of this fax was listening in to my private conversations and, when I confronted him with this information, he insisted that he was not the only technician in Portland listening in.

Other FOI documents show that other Telstra officials were checking up on who I rang, and were keeping records including the names of other organisations, clients and friends.  Even my ex-wife did not escape — her name was listed also.  As I uncovered more and more of this ‘spying’ I became more and more agitated.  By May/June of 1994, as I battled on with the preparation of my claim, I was sinking deeper and deeper into depression.

Much of this information was forwarded to the TIO, who was, after all, supposed to be the independent administration of the arbitration.  Not once did I receive a reply from the TIO’s office regarding this particular matter.  And still the phone and fax problems continued.  Since the problems were still occurring I was in somewhat of a bind.  Legally, Telstra had 30 days to respond to any FOI request I lodged so how could I provide evidence to the arbitration regarding faults that only happened the day before?  The whole process was getting out of hand and, although I raised this issue with both the TIO and the arbitrator, I didn’t get much help.  The TIO would only reiterate that I should lodge my claim to the best of my ability.

Garry Ellicott attempted to ring me on 27 May 1994, using my 1800 freecall service (this can be confirmed from Telstra’s own records).  Finally he got through at 7.59 pm.  I was at screaming point when I discovered he had tried at 7.51 pm and again at 7.55 pm, reaching a recorded voice announcement both times.  On both occasions he was told that my number was not connected.  When Garry rang Telstra fault centre to complain about these voice messages the operator told him that she could not register the fault because the complaint had to come from the customer.  Garry’s response was understandably rather rude.  “How” he asked, “can the customer complain if he doesn’t even know that I’m trying to reach him?  How can he complain if he is not aware that his incoming callers believe he’s no longer trading?”

When my telephone account for this period arrived I was again stunned to see that I had been charged for both calls.  The 7.51 pm call was charged at 76 cents and the 7.55 pm call was charged at 30 cents. 

The Austel COT report talks about Telstra’s fault reporting, recording and monitoring system and procedures regarding these recorded voice announcements on page 125 at point 6.53:

“Monitoring equipment at the exchange will not identify this condition as the call will either not be received at the terminating exchange or it will be seen as a call existing from the exchange.  Complementary equipment at the customer’s premises will not record a call being received in either of the above circumstances.”

This is a report compiled by an official, government funded body and yet Telstra continued to tell the public that these faults did not exist, even though many of these non-connected calls were being charged out to customers.

By this stage I had been fighting for 6½ years to have these matters addressed and still I was caught in a game of ‘catch up tennis’.  As each new fault appeared I had to lodge an FOI request and each request would take 30 days to bring results.  No sooner had I faxed information to the arbitrator detailing yesterday’s faults than more occurred and I had to wait, again, for another 30 days to get copies of Telstra’s records.  Many times I sobbed in frustration.  No-one would listen or, if they did hear me, they apparently didn’t care.  Or was Telstra playing some sort of cat and mouse game with me?

On a number of occasions during 1994 I was interviewed by the Australian Federal Police in relation to my problems with Telstra and my arbitration.  On the following page is a copy of the first page of the transcript of one of these interviews together with a copy of part of page 7 of this same interview.  This was the third interview and I answered, in all, more than ninety-six different questions.  It was clear that the Federal Police were very concerned at the documentation I had provided for them.  In particular they were alarmed by the document shown on page 103 (Chapter 18).  The police were asking:  How could a caller, who usually called from this number, be identified if he called from another number, apparently somewhere in Adelaide?

During this third interview, Constable Dahlstrom of the Federal Police stated (question 81):

“But it does identify the fact that you were live monitored for a period of time.  So we’re quite satisfied that, that there are other references to it.”

Clearly Telstra had provided the Federal Police with evidence supporting this ‘live monitoring’.  In other words, Telstra had admitted to listening to my private and business telephone conversations “for a period of time”.

If the Federal Police, Telstra or the Government had provided me with answers to these mounting questions as they arose, I would not still be searching for those answers today.


During one of my more severe bouts of depression I re-read Austel’s COT report and stumbled on information I had missed before.  This information related to the Bell Canada International testing and Telstra NEAT testing which had been carried out in November of 1993.  In particular it related to Bell Canada’s testing procedures.  Page 157 of the Austel report shows that the NEAT testing was carried out by Telstra between 8 am and 10 pm (0800 hours and 2200 hours) between 28th October and 8th November of 1993, to the exchange test number at Cape Bridgewater (055 267 211).  The BCI test report, dated 10 November 1993, shows that their testing took place on the same dates and at the same times, except for 9 November when there was apparently no NEAT testing, but when BCI stated that they carried out some of their tests.

Now, each NEAT test takes up to 100 seconds and, while it is occurring, no other test of any kind can take place.  Obviously the BCI testing could not and did not take place between 28 October and 8 November, as it appears in the BCI Addendum Report on Cape Bridgewater however, just for fun, let us assume that somehow all these tests could have been performed at the same time.  The BCI tests needed 15 seconds between each call to reset the system, otherwise the second call would get a false engaged signal and, at the same time the NEAT tests took up to 100 seconds each.  When I examined the test reports from both Telstra and BCI, it was glaringly apparent that there wasn’t enough time between 8 am and 10 pm to fit in anywhere near all the calls that were listed.

Below is a copy of two sections from the BCI report showing calls made to phone number 055-267-211, the same number in the table on the previous page.  These two tables indicate that a total of 1675 + 328 calls were made from two separate locations (Richmond from 428-8974 and South Yarra from 03-867-1234), over approximately the same time period without clashing.  This, of course is impossible

Telstra later used parts of the BCI report to prove that their network was operating up to expected standards.  The BCI report was even released to the media, as well as being given to Parliament.  But it was obviously falsified because the test calls simply couldn’t possibly have been made in the time frame recorded.

Around June 1994 I challenged Telstra to prove that I was wrong in my allegations about the inaccuracies of the BCI report.  I had found a copy of a Telstra e-mail (FOI document number A05254), from a Greg Newbold to a number of different Telstra officials including a Ted Benjamin whose name often popped up in documents that I was finding.  This e-mail was very significant in relation to the BCI report debacle.  Mr Newbold’s e-mail said:

“Peter Sekuless and I have prepared a draft news release; a one-page media aide for Ian Campbell plus the pre-emptive media strategy itself.

Am now raising with Sekuless the merits/demerits of holding back the BCI info for a “cleansing” program immediately after the mess of Coopers.  My thinking is that it would draw the focus from the Coopers stuff and on to our network that works.


Then I came across another interesting document.  This was an un-dated Telstra minute entitled “Grade of Service Complaint: Mr Alan Smith - 055 267 267.  File HA. Ac4/1/18”.  In the 6th paragraph of this document is the statement:

“Congestion between Cape Bridgewater and Portland had been prevalent as only five junctions available.  This situation was to be upgraded with the cutover of Cape Bridgewater RAX to an RCM parented back to Portland RAX 104.”  

RAX and RCM refer to different types of Telstra exchanges (refer Glossary).

Once I had these two documents in front of me I reached for the Austel COT report and there, on page 165, at point 7.33, I found:

“Telstra’s more recent assessment of the effect of the Cape Bridgewater RCM fault on Mr Smith’s service not only conflicts with the contemporaneous report quoted in paragraph 7.31 above, but also does not accord with Telstra’s contemporaneous GAPS record for September 1992 which shows a significantly higher complaint rate of ‘call drop out’ and ‘no ring received’ for customers who were reliant on the defective plant than those dependent on the remainder of the Cape Bridgewater RCM.”

It was no wonder that I was confused.  Even the experts were obviously confused.  Was FOI document A05254 from Greg Newbold to Ted Benjamin proof of an attempt to ‘cleanse’ an international test report?  I struggled to understand.  And still my fax line gave trouble.  And still the phones played up.  I sat and wrote and hoped some of the information I was sending to my advisors and to the arbitrator was actually getting through.  The following quotes from two separate government documents demonstrate the problems the fax line was creating:

The first document, dated February 26, 1994, was from Fay Hoithuysen of the Telecommunication Policy Division of the office of the Hon. Michael Lee, MP.  This letter said, in part:

“Attached are copies of correspondence received by the Hon. Michael Lee MP, from Alan Smith, outlining FURTHER (my emphasis) difficulties he is having with his telephone and facsimile service.” 

The other document, dated 10 June 1994, was from Austel to Telstra’s Group Manager.  This document said, in part:

“Mr Smith at Cape Bridgewater continues to express concern about his ability to receive and send facsimiles.”

Austel continued to be concerned because I was regularly contacting their John MacMahon and Bruce Mathews with ongoing evidence of incorrect charging to my 1800 account.  When I compared my 1800 accounts to Telstra CCAS and ELMI data (refer Glossary), it was easy to see that I was being incorrectly charged for calls which never connected.  I was also forwarding to Austel evidence of numerous pages of my faxes which came out at the receiver’s end as blank pages.  And, of course, Telstra charged me for these as if the recipient had received all the information that was NOT on the pages.

As one example of these problems it is interesting to look at what happened the day after I had agreed to abandon the original commercial agreement and sign for arbitration.  By this stage in the process I had already discovered this ‘blank fax page’ problem and I had also become aware that these blank pages often had a strange small symbol at the top of each page; sometimes on the left, sometimes on the right.  Each of these pages appeared on my Telstra account as taking minutes to transmit so I decided to time the sending of a blank page.  When I finally got the fax to work properly, a blank page took only 10 to 15 seconds to go through.  What was even more alarming was that these ‘lost’ faxes were being sent either to my legal advisors or my accountant, or to someone else involved in my commercial assessment process.  What did this strange little symbols mean, I wondered?

On 22 April 1994 I sent three separate faxes to Austel.  These were copies of my billing records for the 1800 service, showing comparisons with customers’ statements regarding the calls they had made to my number and proving that the account was incorrect.  Now, I had run my own tests with sending a complex document like a Telstra account and I knew that each page would take about 1.45  to 2.40 minutes to go through.

Although I have asked again and again, in writing and through various legal processes, I have never received an answer to my questions regarding why these pages should arrive at the other end as blank pages, except for the unexplained symbol?  In one instance I sent similar documents to my accountant.  When his fax journal print-out was checked against my Telstra accounts they both showed the same amount of excessive time to send and receive the documents, even though they arrived blank.

I told my arbitrator I believed that I was losing faxes in the system somewhere and that he was therefore not receiving everything I was sending to him.  In particular I raised one instance, on 23 May 1994.  In this case Telstra told the arbitrator that the problem had occurred because his fax was busy when my fax was attempting to get through and so my fax simply didn’t go.  Whatever happened to my fax hearing a busy signal and trying again?  And if my fax reached a busy signal more than once and so gave up trying to send, why was I charged for the call?  In fact, even though my phone account showed that, on this day, I was charged for seven non-connected calls to the arbitrator’s office, and even though Telstra has since acknowledged this (in camera), still the arbitrator was not interested enough to investigate.

By this stage I began to believe that the whole arbitration had been orchestrated by Telstra simply to thwart an investigation into their questionable corporate conduct.  Those discovery documents that did reach me were coming in bits and pieces, small numbers at a time.  I was being drip-fed information in a further attempt to disadvantage the preparation of my claim.

Among the material that was being drip-fed to me I found FOI document K01489 (appendix 5).  This Telecom fax indicates quite clearly that Telstra were well aware of the ‘blank fax’ problem and records (last paragraph) their experience with unexplained oddities when testing, particularly the receipt of blank pages which did not even have the sending identification stamp across the top.  How many of these unidentified pages did the arbitrator’s office receive when I was attempting to send important claim documents to the arbitrator?  And, what would the arbitrator’s office have done with blank sheets?  They would have had no way of knowing where the fax had originated so there would have been no way they could let the sender (whoever that might be) know of the problem.  Over the space of three years I had three different fax machines which all suffered from this same fault.  It seems quite clear that the fault must have been in Telstra’s network and yet still the TIO will not investigate.

Because of the need to be in constant contact with Garry Ellicott and George Close, my claim advisors in Queensland, my Telstra account for this period reached more than $16,000 by 11 May 1995.  My home account was another $2,000.  What a way for an Australian citizen to have to work in an attempt to prepare a claim against a corporation armed with lawyers and staff at their finger tips.  In fact, by now, Telstra had set up a special office in their solicitor’s building, just to deal with the COT arbitrations, while the claimants struggled to run the day to day affairs of their respective businesses at the same time that they struggled to prepare their claims, mostly without legal support.

In 1996 Telstra actually admitted that the COT arbitrations had, up to then, cost Telstra something in the vicinity of at least $18 million.  All this just to fight a small group of small-business people who were only looking for Australian justice!

Back in June of 1994 however, I asked the arbitrator for extra time to prepare my claim.  He allowed only one extra week and yet, as the records show, Telstra were allowed an extra 72 days on top of the original extra 6 months time already given to them by the arbitrator.  Did Telstra deliberately delay supply of discovery documents to give themselves more time to prepare their defence?  Or did they delay supply to give their defence unit more time to go over the discovery documents before my advisors saw them?  By this time, why hadn’t the TIO contacted the Minister for Communications and had Telstra pulled into line?  How, in the name of justice, were the members of COT ever going to be able to support the claims they were making if Telstra would not provide the discovery documents the COTs were asking for under FOI?

A Telstra representative was in the arbitrator’s office when Graham Schorer, COT spokesperson, and I presented the arbitrator with my interim claim documents on 15 June 1994.  This interim claim material was taken away by Telstra’s defence counsel, Paul Rumble.  Even though the arbitration rules were clear that Telstra was allowed only one month to prepare their defence of my claim, they did not present that defence until 12 December 1994, six months later.  Why did the arbitrator allow Telstra’s defence unit to have access to my interim claim documents when he was well aware that I was still waiting for more discovery documents to come from Telstra, so I could complete my whole submission?

At the same time Graham Schorer contacted the Commonwealth Ombudsman’s Office in Canberra to ask if they would investigate why Telstra would not supply the COT members with their discovery documents.  These delays were severely disadvantaging all the COT members:  the longer we were kept waiting, the longer our advisors and researchers were kept waiting and the more it cost us to participate in this so-called ‘fast tracked’ procedure.  Personally, I began to wonder if Telstra weren’t working to a plan — a plan to simply send me broke before the arbitration was ever settled.


Just by chance, the American movie “Class Action” was released on video while I was preparing my claim.  This was a story about a pharmaceutical company that knew about side-effects caused by one of its drugs, but continued to sell the drug anyway.  A report had been commissioned by the company and the chemist preparing the report found a flaw in the production of the drug.  Now, if my memory serves me right, the parent company chose to ‘lose’ the report rather than spend the money to correct the flaw.  What attracted me to this story at the time was the long and drawn out process undertaken by the pharmaceutical company when they released discovery documents to the lawyer representing a group of suffering patients.  In the end, the company swamped the lawyer with thousands and thousands of documents at the very last minute so that the lawyer had only a short time to find the missing report.  According to the movie, this process of burying important documents amongst numerous irrelevant papers is called ‘dumping’.  Shades of Telstra versus COT here!

In my case, another COT member located, among her FOI documents, one of the reports I needed to support my claims regarding rural phone faults:  this report had not been forwarded to me by Telstra during my preparation time, when it would have been very useful.  This was a report titled “Can We Fix The CAN” .  ‘CAN’ stands for ‘Customer Access Network’ which is the line from the exchange to the customer’s premises.  This report highlighted numerous alarming facts that had to come to Telstra’s attention during their testing of the CAN.  This is the last contact point where a call can be lost but calls can be lost at this point without any faults registering at the exchange end.  Even so, when Bell Canada International carried out their original tests in my case they didn’t test the CAN at all.  If I had received this report when I first began to prepare my claim, or even towards the end of the preparation of my claim, I could have raised with the arbitrator many more issues which were never addressed — including instances where a number of other rural Telstra customers were severely disadvantaged due to the ‘poor’ CAN.

The very first page of this ‘CAN’ report seems to indicate that Telstra certainly weren’t playing fair with the members of COT in any way and, like the movie, Telstra elected to ‘dump’ approximately 22,000 discovery documents on me (yes, twenty-two thousand!), eleven days after they had submitted their defence even though they were well aware that I had only one month after the lodgment of their defence in which to reply.  This meant that I had only just over two weeks to sort through thousands and thousands of pages of information to find the ‘missing link’ which would support my case — evidence which would also prove that Bell Canada didn’t test my phone service as they stated they had in their report; a report which was then used by Telstra to support their defence of my claim.  It was Christmas Eve, the busiest period for my business and, with all these documents in front of me, I was lost to know where to even start looking.




Over Christmas, twelve months after I had originally asked for documents from Telstra, I ploughed through what I could, uncovering (too late) a number of documents which would have been most useful to my technical advisor, and to me, when we were preparing my interim claim.  Again I asked myself, did Telstra deliberately withhold this information?  The arbitrator had a charter, as the ‘judge’ in this matter, to facilitate provision of requested documents but even though I continually asked him to do this for me, none of my requests were fulfilled.  I believe he never passed on any of my requests but, at the same time, he directed me to provide some 40 extra documents and numerous pages of attachments and further particulars which Telstra had requested through the arbitrator.  These requests to me were made under the same discovery process I had used to request documents from Telstra.  I complied on every single occasion, incurring costs that ran into thousands of dollars but, in return, I received nothing from the arbitrator.  At the same time I began to feel more and more concerned that something was very wrong with this whole process.  Were Telstra and their highly paid lawyers deliberately setting out to destroy me financially before I had even finished my submission?

An oral hearing had been convened on 11 October 1994, under the rules of the arbitration.  These rules allowed me to have legal representation if Telstra had legal representation but where would I find the money to pay a lawyer, particularly a lawyer who wouldn’t buckle under the power of a corporation as huge as Telstra?  By this stage I had discovered that at least 43 of Australia’s largest legal firms were, at that time, on the payroll of Telstra in one way or another.  This meant that all 43 of those companies were not available to me or to any of the COT members because they would be caught in a conflict of interest situation if they took up our cases.  In the August before this oral hearing, already five months into the arbitration process, I had also been informed by the TIO, who was acting as administrator to the arbitration, that the arbitrator himself was a senior partner in a legal firm which was also working for Telstra at the same time.  Although I raised the issue of conflict of interest, the TIO disagreed, saying that I should just confirm, in writing, that I had been informed of this situation.  What could I do?  By this time I had run up bills with advisors and secretarial assistants to the tune of $150,000.  How could I then demand a new arbitrator be appointed, only to have to start the whole process over again?  Obviously the administrator’s approach was five months too late since I had already submitted my interim claim two months before he made his announcement about the arbitrator.  I have since been advised that, even today, the arbitrator continues to work as a partner in a legal firm which has large contracts with Telstra.

At that stage though, I felt I had no choice but to continue with the arbitration procedure and no choice but to participate in the oral hearing.  Now, the arbitration rules stated that there were to be no lawyers at oral hearings unless both parties had legal representation and the arbitrator advised me that Telstra would not have a lawyer with them so I went to the meeting believing that this would, more or less, be a meeting of equals.  I could not know in advance how wrong I was — obviously the rules can be flaunted if you have enough power.

The drive from Cape Bridgewater to Melbourne took five hours and, since the meeting was set to start at 10 am, I set out at 4 am to allow for unforseen delays along the way so, by the time the meeting actually started, I was already exhausted.  What I was not ready for was the sight of two of Telstra’s top executives on Telstra’s side of the table, both men with legal training.  And, not only did Telstra have these two legal minds on their side, they also had two representatives from Ferrier Hodgson Corporate Advisory, the independent financial advisors to the arbitration.  Again I was in the position of a David up against the Goliath of Telstra, with no-one at all to support me.

During this hearing I produced four exercise books of records which I asked to have accepted into the procedure.  These exercise books contained the names and contact information of clients who had not been able to reach my business by phone.  This was important information, proving as it did that I had not been able to set up the over-40s singles club I had advertised, because of the phone problems.  I had not submitted these books before, as part of my claim, because, as I had explained to the arbitrator, the information had been given to me in confidence.  I hoped that, by submitting them directly into the care of the arbitrator, the sensitive information contained in them would be secure.

On the day, however, Telstra insisted that the information was not relevant and should therefore not be accepted into evidence.  The arbitrator went with Telstra’s suggestion and I was not allowed to submit the four books, even though the information they contained proved conclusively that not only had I lost business calls as a direct result of a faulty phone service but I had also missed out on the opportunity to set up a singles club which would have been another business to augment my income and keep the camp going.  It was at this point that I finally admitted to myself that the arbitrator was not acting impartially.

By the time Telstra lodged their defence of my claim, on 12 December 1994, I had been fighting for justice for 6½ years.  Fighting a losing battle, not because of anything I had done, but simply because I chose to set up business in a rural hamlet which Telstra’s senior board members saw no benefit in upgrading.  In this time I had lost a wife of 20 years, who had trusted my judgement that I could create a successful business at Cape Bridgewater and my next partner had finished up in hospital after also trusting my judgement.  The oral hearing made me realise that I was truly on my own in this:  even the arbitrator couldn’t be relied on to be independent.  The other COT members had not been at the oral hearing and so I warned them of what I had discovered but they couldn’t really comprehend the gravity of the situation for us all.  As it turned out, my gut feelings were correct:  we had been conned by the TIO’s office.  The Senate had also been conned by the TIO’s office as it turned out:  the TIO’s office had also assured them that this would be a non-legalistic process.

Between 11 October 1994, the day of the oral hearing, and 12 December 1994, the day Telstra lodged their defence of my claim, I continued to search through all the claim material I now had, looking for something to help me improve my position, hoping to find the illusive discovery documents I needed.  At the same time I became even more aware of what an enormous toll this was having on my life as well as my business.  I was suffering from frequent dizzy spells and stress related pains; I couldn’t swallow comfortably and continually felt as if there was a lump in my chest.

From the very beginning Telstra denied that there was anything wrong with my phone lines.  But now, although logically I was sure I was right, I began to have moments where I doubted my own sanity.  Not only was my health suffering but so was the health of all those in the small group who continued to support me.

It was at this low point when a letter of support arrived from Fred Fairthorn, local farmer and businessman, stating that it was quite clear to him that the phone system was a disaster area.  He referred to problems he had with the system going back six years.  Fred wrote his letter in June of 1994 and six years before took me back to the time I first moved into the area.  So, Fred agreed that the phones were not always reliable and that they were certainly not up to network standard.

Another incident which spurred me to keep fighting concerns a neighbour, Mr Walter Carey senior.  Mr Carey had taken over the next door property after I moved to Cape Bridgewater and, when my claim advisor was researching the phones in the areas, Mr Carey senior wrote of his experiences with the phones. 

“I reported the faults many times to Telstra”, Mr Carey wrote, “to no avail.  I telephoned Alan Smith and obtained the Melbourne telephone number to ring.  Having rung that number I was informed that my number, 055 267 265, was not a business number.

I have questioned my telephone account on several occasions but have no option but to pay as no further account was provided.”

Also in the course of his research my advisor circulated a questionnaire to local residents, regarding their experiences with their phones.  Mr Carey’s response to this questionnaire included the following:

Engaged signal indicating phone is always busy

Answer = yes

Recorded Voice Announcements telling people your phone is not connected

Answer = yes

Dead line - caller hears nothing on dialling   

Answer = yes

Drop-out - while talking on phone                                          

Answer = yes

Have you reported your problems to Telstra?            

Answer = yes

In his letter, Mr Carey went on to say:

“Telstra service is extremely poor at time of reporting this fault to Melbourne.  Shearers were engaged and I could not inform them whether sheep were dry - nobody can run a business where phone only works intermittently or is supposedly fixed on many occasions.”

With regard to the shearing incident that Mr Carey refers to here, he was forced to drive some considerable distance from another property to speak to his son who was at the homestead, because he could not reach him on the phone.

On a number of occasions during this period I continued to question Telstra.  How, I asked, did they make their calculations for my phone account?  My bills were like a yoyo - up one month and down another.  My only tool was to refuse to pay the disputed account until they had been investigated but, when I didn’t pay Telstra disconnected my service.


Back in 1992, before Mr Carey took over the next-door property, I had been friendly with the previous owner, Kevin Turner, and often drove over for a chat.  Kevin had brought this property intending to turn the lower section, close to the Blow Holes, into a natural golf links:  even going as far as having plans drawn up by a professional golfer (I still have a copy of the plans for the golf course).  Financial backing had been discussed for the project, sign boards had been erected and brochures printed and distributed to prospective investors.  The Commonwealth Development Bank had viewed the proposal and noted that it was a good proposition.

During the time Kevin was working on this proposal I had to drive to his place on many occasions because his line was constantly engaged.  Or was it?  His phone number was 055 267 275 and mine was 055 267 267 and we often suffered from crossed lines as well.  FOI documents later showed that Telstra was well aware of this ‘crossed line’ problem, along with many other complaints from the area.  I also have a letter from a Mr Broadhurst in Violet Town, Victoria who had tried, unsuccessfully, to reach Kevin’s phone number on a regular basis throughout 1992 and who had also experienced phone problems when trying to contact me.  He wrote to ask if he could stay at my camp while he completed his business with Kevin.  In relation to problems reaching me, Mr Broadhurst wrote:

“I have tried to reach you by phone on many occasions only to get a recorded message saying that this number has been disconnected.  On other attempts I get an engaged signal that lasts for hours.  I would like to make a booking with you for the camp.  As I cannot reach you, could you phone me as soon as possible?”

Mr Broadhurst supplied his phone number for me and, when I phoned him, he told me of the similar phone problems he had trying to reach Kevin as well.  Could Telstra have been so blind?  What drove them to continue to down-play these continuing phone faults?  FOI documents would later show how I was treated as the enemy, not as a customer with a legitimate complaint.

Although I can’t say for sure that Kevin lost his business because of the phone problems, and I can’t say that my marriage was lost only because of the phone problems either, it is interesting to think about what might have happened if someone interested in investing in Kevin’s business had been able to reach him.  Maybe Cape Bridgewater would now have a golf course.  Who knows?

Although this might seem to be a story about telephones it is actually about human suffering, caused by a large corporation with too much power.  The ‘spin doctor’ approach to genuine complaints about service certainly contributed in no small way to the ruination of a quality of life for me, and probably contributed to many lost opportunities for other people in rural areas who suffered from similar phone faults.

The letters from Fred Fairthorn, Walter Carey and Mr Broadhurst, along with many similar letters, were all submitted into arbitration for assessment and yet the report produced by the so-called ‘independent’ technical unit clearly stated that “...a comprehensive log of Mr Smith’s complaints does not appear to exist” .  The fact that I had also submitted a list of 183 separate faults which had occurred between late 1989 and early 1994 seemed to be of no consequence.  Most of the entries on this list included the names and addresses of the people who had registered complaints with me.  I also submitted copies of another 42 examples of faults which had been logged by Telstra’s own three fault centres in one 8 month period alone, from January to August in 1993.  As an added bonus I included more than 70 letters which I had received from people over the years, letters describing difficulties in reaching me by phone.  Some of these letters were even written by Telstra’s own employees who had felt compelled to tell the truth about what they knew of my phone problems.  This made no difference because DMR/Lanes, the arbitration’s technical resource unit, indicated later that these documents were not given to them by the arbitrator for assessment.

The letters from Telstra employees prompted me to contact Telstra union officials and explain that my complaint was not with individual, everyday technicians but was rather with the corporate management level.  It was obviously senior people in the organisation who were creating the problems by refusing to correctly address the constant complaints from the Cape Bridgewater area.  Apparently they believed that, by ignoring these complaints, they would save money.  And these complaints weren’t only coming from Cape Bridgewater and other rural areas;  many complaints were being lodged from metropolitan exchange areas too.  Clearly, until Telstra management addressed the corporate culture of their own organisation, the list of complaints would grow.

During his time as Minister for Communications, Senator Kim Beasley of the Labor Party showed his concern with the way Telstra’s Protective Services Unit spied on their own technicians and other employees, documenting their movements while they were on sick leave, so it was not surprising that the COT members believed they also were being spied on.  The Protective Services Unit has still not provided any explanation of some of the information they appeared to pluck from thin air:  they have never explained how they knew in advance what my movements were, and they have never explained how they knew when my staff left my office.

One instance of Telstra’s apparent ability to read ‘between the lines’ relates to the O’Meara Bus Company incident mentioned previously, in Chapter 6.  As you may recall, I had written to Telstra asking for a guarantee that the phone network would work correctly, so I could assure the bus company that they would be able to reach me to place bookings.  I wrote this letter to Telstra without ever mentioning the name of the bus company I was tendering to but, in 1994, among documents sent in response to one of my FOI requests, I found a copy of my own letter with the company name “O’Meara” scrawled across the top of it.  Were Telstra intercepting my mail?  Or were they listening to my phone conversations?  Or both?  Whichever way they acquired this information, the issue is that this was spying, way back in 1992, long before the arbitration process began in April 1994.  And this is only one example of the spying that took place, others will unfold as my story continues, but the issue of spying on customers was a major factor in my decision to publish this story.  Someone has to expose Telstra’s power and alert the Australian public to the way they manipulated the legal system.  These issues of an individual’s right to privacy and a corporation’s manipulation of the system go to the very core of Australian democracy. 

Documents later acquired under FOI, and then provided to the Australian Federal Police, show that Telstra officers also made a habit of documenting private and business calls I received.  This documentation included the names of the people who called me:  my wife, my son, Austel and the TIO’s office.  Was nothing ever private during this saga?

By this stage I had begun to wonder about some of the information that was being passed to the members of COT (see page 80) by other Telstra customers around the country who had also had problems dealing with Telstra.  Was there some organised crime unit within Telstra I wondered?  Why was my private business known to a corporation only concerned with communications?  Was there more to Telstra than it seemed on the surface?  At about this time one concerned citizen wrote to me, expressing concerns she also had regarding the possibility of organised crime within Telstra.  I later  passed this letter on to the Australian Federal Police.  It has not been returned to me.


In Chapter 17 I related the story of how Mr Matherson of Austel helped me test two different model T200 phones on the one line in an effort to find out if the ‘lock-up’ fault I had been experiencing was being caused by the phone or the phone line.  These ‘lock-ups’ had meant that people on the other end of the phone could hear what was going on in my office after I had hung up.  When we had completed these tests, Mr Matherson was quite adamant that we had proved that the fault was in the line because it occurred with both phones.  Documents which I later acquired also showed that Telstra was aware that this fault often occurred in moisture prone areas like Cape Bridgewater and that they were also aware that the local exchange suffered from ‘heat problems’.  Now, when I received my copy of Telstra’s defence of my claims, I found that it included a 29 page report titled “T200”.  This document reported that, as a result of testing in Telstra’s laboratories, it was clear that the ‘lock-up’ problem with this phone had been caused by beer which had been found inside the casing of the phone.

It is interesting to note that the phone was removed from my office on 27 April 1994 but not received into Telstra’s laboratories until 10 May 1994, some 12 days later.  Still, according to photographs included in this report,  the outside of the phone was very dirty and, according to the technicians, when they opened the phone up, the inside was wet and sticky.  Analysis of the ‘wet and sticky’ substance showed that it was beer and the conclusion was that the ‘beer’ had caused the ‘hookswitch’ to lock up.  The natural inference here was, of course, that my drinking habits were the cause of all my phone problems. The technicians didn’t know of course that I had tested two different phones on that line and still found the same fault.

A number of questions were immediately raised by this report.  When the phone left my office it was quite clean — why did it arrive at the laboratories in such a filthy state?  How did the ‘beer’ get inside the phone?  Who would have a reason to pour ‘beer’ into the phone and why?  If the addition of ‘beer’ was not deliberate, how did it get inside the phone?  It certainly wasn’t even accidentally spilt there by me since I only rarely drink beer, and then only when I am out socially.  I usually only drink Scotch or wine because of a medical problem which means gassy drinks, like beer, create acute discomfort for me.

As soon as I read this ‘beer-in-the-phone’ report I put in a request to the arbitrator, asking to see a copy of all the laboratory technician’s hand-written notes so I could see how they actually arrived at their conclusion.  I had appointed my own forensic document researcher to look over the documents when I received them and he had provided me with his credentials as well as signing a confidentiality agreement, stating that he would not disclose his findings to anyone else.  Although I passed all this on to the arbitrator, the only response I received was another copy of the original report.

This lack of assistance from the arbitrator is even more shocking because, only a few weeks before, he had allowed Telstra’s forensic document researcher to have access to my personal diaries.  It seems there was one rule for Telstra and a different rule for the COT claimants.  My gut feeling after the oral hearing in October 1994 was looking more and more to be correct.  The arbitrator was definitely favouring Telstra; allowing them access to whatever information they requested but denying me the same access to information I needed.

I cannot begin to explain the anger that simmered inside me.  If only I could expose the lengths Telstra had gone to with this ‘beer-in-the-phone’ episode.  I knew they had faked the evidence but I couldn’t prove it.  What else would they do to defend their faulty phone network?  It didn’t seem to matter who I contacted about this fax line — Senators, the arbitrator himself, the arbitrator’s secretary, no-one cared about the truth.  It seemed that Telstra management would do anything in their power to prove that there was nothing wrong with the phone lines into my business.

As explained in Chapter 20, during the period when I was having the most trouble with sending and receiving faxes I actually alerted the arbitrator to the problems I was having and the arbitrator’s secretary later acknowledged that she did not receive a number of faxes from me during my arbitration.   Still I was charged by Telstra for all the faxes which left my office, hopefully heading for the arbitrator’s office even though, on a number of occasions, they never arrived there.   Telstra’s own records show, in fact, that some of these faxes never arrived at their intended destination.  Where had they vanished to?  My frustration increased when I then found that all these fax faults were supposed to have been caused by ‘beer’ which I knew, without any doubt, could not have been spilt inside the phone before the Telstra technician removed it from my office for testing.

I set about accessing Telstra’s technical analysis data covering particular times when the fax problem was at its worst.  These documents showed that the ‘lock-up’ fault had been occurring in the network system since at least August 1993.  This led me to ask the arbitrator to ask Telstra how ‘beer’ could stay wet and sticky inside my phone not only for the 12 days between when the phone left me and when the technicians opened it up, but also from August 1993 to May 1994.

Telstra had supplied a new phone to replace the ‘drunken’ one they took away and, surprise, surprise, according to their own data, the same 10 - 15 second lock-up problem was still apparent right through to June 1994, five weeks after the ‘drunken’ phone was removed and replaced.  Perhaps the phone line itself was ‘under the influence’?  What a sad episode for a company of such standing in the community.  How desperate must they have been to resort to such skulduggery when they were only defending themselves against one broken-down cook and camp operator.  Sad indeed.

In Telstra’s defence of my arbitration they also state that this telephone was received at their laboratories in a very dirty condition.  Of course, this is not the truth either.  The phone was certainly not ‘in a very dirty condition’ when it left my premises.  It is interesting to note that, before the technician took the phone away for testing, we both used a nail to scratch our names in the (clean) cradle where the receiver sits.  Much later, in a copy of Telstra’s report on this phone, I came across the photo reproduced over the page.  This is supposed to be a photo of my phone as it was when it arrived at Telstra’s laboratory.  Isn’t it interesting to note the layer of dirt OVER the inscribed signatures?  It certainly makes me wonder what lengths Telstra will go to, in order to discredit me.

Neither Telstra nor the TIO have explained how all this dirt and grease appeared OVER our signatures.  When the technician collected this phone from my business, if it was as dirty and greasy as it is in this photo, then our signatures would be indented INTO the dirt rather than covered BY the dirt.  I also have to ask, if the phone was that dirty, wouldn’t both the technician and I have automatically wiped away the dirt BEFORE we engraved our names on the phone?

These are just some of many unanswered questions I have raised with the Government over the years.  How can they continue to protect Telstra when they have this evidence of such unlawful conduct?  The Government is fully aware that tampering with evidence in a legal process is a criminal act.  First we have dirt and grease splattered on a clean telephone and then we have beer poured into the phone:  how sad this has all become.


There were many, many other misleading statements made under oath by Telstra’s defence unit and their technicians which are too numerous to bother with here but most disturbing were the signed Statutory Declarations made by some of the local technicians.  Even though they knew at the time that Telstra’s network system into the local exchange was not up to standard, they signed these legal documents, blatantly ignoring the problems and insisting that everything had been all right during the period covered by my claim, except for some minor, every-day type faults.

Some of these signed statements would almost have been laughable, if the situation hadn’t been so serious.  One local technician even went so far as to say that he knew of no other business in the Cape Bridgewater area who had experienced the type and number of phone problems that I had experienced.  This statement included the comment that the technician had a friend, a stock farm agent, who lived at Cape Bridgewater, and he had never had phone problems when he lived in Cape Bridgewater.  When I checked Telstra’s own fault data, however, lo and behold, this very friend had, in fact, complained 7 times in a matter of weeks during early 1994, including complaints about his fax line.

Further, between 1988 and 1993, I was the only tourist operator in Cape Bridgewater:  the other residents were fisherman and farmers who did not generate any tourist activity in the area and so were not so reliant on the telephone as I was, particularly for calls outside the local area.

Another set of incorrect statements was lodged by three local technicians who were in charge of my service complaints.  These men stated under oath that the original (old) exchange at Cape Bridgewater, back in 1988 when I moved to the area, had five incoming and five outgoing lines when, it was later proved, this old RAX exchange actually only had four incoming and four outgoing lines.  One of these technicians went so far as to state that any congestion caused by this ‘five in and five out’ situation would not have affected my service much during business hours.  All my calls pass through the Portland exchange before travelling on to their destination and, as we now know from Telstra’s own archival documents, Telstra secretly knew that congestion was prevalent between the Cape Bridgewater and Portland exchanges.

The saddest thing about the statements from these three technicians is that, if they truly believed that this old exchange had five lines in and five lines out then surely they were not doing their jobs properly?  Surely one of them would have noticed that there were only eight final selectors?  In real technical terms ten lines will carry 41% more traffic (in erlings) than eight lines.

By the time I received Telstra’s defence documents I was completely out of money.  How could I employ a technical ground crew to assess the technical side of Telstra’s defence?  I still owed George Close, my previous technical advisor, $25,000 — I couldn’t afford to hire another advisor.  In fact, I was so heavily in debt by then that another friend mortgaged her house to the tune of $20,000 just to keep me going and came to the camp to help out in the office with the assessment of further FOI documents now arriving.  Thankfully people I knew could clearly see how right I was and they continued to support me but, in practical terms, my team came down to one house-wife/mother and one camp operator — pitted against the power of Telstra and their vast team of highly paid legal and technical experts.

The Federal Police had shown an interest in the many issues I had raised with Austel and finally they came to Cape Bridgewater to interview me.  My friend, Cathy, operated the phones in the office for five hours while the police taped their interview with me.  During this five hour period Cathy experienced a number of incoming phone faults — with the phone alarm bell ringing (two rings, stop, one ring, stop — then a dead line).   The visiting Federal police could see for themselves what was happening.  Cathy then made her own Statutory Declaration, telling the police about a survey I had distributed some months before, back in late 1993, through the Ballarat Courier Newspaper.  I had experienced an enormous number of complaints from the Ballarat region after I advertised my singles club project and this survey was taken to prompt people to write to me with their own experiences with phone faults in their area.  I asked newspaper readers to send their complaints to me, care of the newspaper, and Cathy (who was living in the area at the time) had agreed to collect the mail for me.  The issue with this survey which Cathy thought important enough to include in her Statutory Declaration, relates to collection of this mail.  On two separate occasions Cathy phoned the paper and was told that, yes, there was mail waiting for her to collect but, when she arrived at the newspaper’s office, that mail had mysteriously vanished.  Who had collected our mail and why would the results of this survey be so interesting to someone else?  What did they intend to do with the survey results?

So, here I was, more confused, frustrated and angry than ever, with no money, $140,000 further in debt because of the resultant and consequential losses created by this arbitration farce.  That $140,000 later grew to well over $200,000 and it continues to grow while these matters are not addressed.  Remember, on 23 November 1993, both the chairman of Austel and the TIO had assured the COT four (and the Australian Government) that this would be a fast-tracked, non-legalistic process which would take only a matter of weeks.  When I received my copy of Telstra’s defence documents however they were accompanied by a bound document entitled “Telstra’s Legal Submission (1994)” (my emphasis).

How could this be when, immediately before we signed for arbitration, the TIO’s legal counsel had assured us that the whole process had been specifically designed to give the claimants natural justice?  How could this be, when the TIO himself had confirmed that the arbitration process would be based on the existing commercial agreement?  I had trusted these two people.  They represented hope after years of trying to deal with the underhanded tricks of Telstra.  They represented the legal system to me, and they represented justice.  I had believed that we were finally on the road to the end of all my worries, back then when we signed for arbitration.  And now this document shattered all those hopes, again, along with all the trust I had put in the system and in these two representatives of justice.  Would this saga never end?

On 3 December 1993 the TIO wrote to Telstra (see following page), clearly acknowledging his understanding that this was to be a Fast Track Settlement Procedure.  It is interesting to note that he also refers to appointing an assessor and makes no reference to an arbitrator.  The appointment of an assessor is appropriate for a commercial assessment, which is what the COT four had signed for.  This agreement, that we signed in good faith, was legally binding -- so what happened to change this situation?  Why did the TIO change the rules?  Even Austel has acknowledged, in letters to the COT four, that there was no mention of an arbitrator in the document we signed for the Fast Track Settlement Process.  What happened to cause the TIO to then force us into this highly legalistic and costly arbitration process?  Could it have something to do with the fact that the TIO later became a Government Minister?


When I originally signed for arbitration, the TIO had confirmed that all the rules and regulations surrounding the original commercial agreement would remain in place.  These rules had included a confidentiality agreement which stated that none of the claimants could ever disclose the value of their award, if an award was made.  Remember, the COT four signed for arbitration under severe duress, believing that we had no other alternative and because we were all running out of money to finance our fight for justice.

After reading Telstra’s defence documents I went back to the arbitration rules.  Imagine my astonishment when I discovered that the confidentiality agreement section had been changed to suit Telstra’s agreed rules of arbitration.  Now I discovered I was not allowed to disclose anything at all to do with the arbitration.  Obviously the rules I signed for at arbitration were not what I had been told they were.  The agreement which I was advised to sign by the TIO and his legal counsel prevented me from disclosing information relevant to the arbitration, including claim and defence documents.  Because I believe that Telstra acted in concert with the arbitrator so that not all of my claims would be correctly addressed, I have now broken my agreement because I believe strongly in the legal rights of all Australians.  I also believe strongly that we should all respect the law but, after everything I have suffered through over these past ten years, I no longer believe that our Australian legal system will necessarily ensure justice for all.  The COT arbitrations have been a farce and therefore the rules, drawn up ostensibly to ensure justice, are also a farce.  If this book contravenes the confidentiality agreement, so be it.  The truth must be told, and it must be told to the Australian public who have all relied on Telstra to provide the telecommunications system for the whole of the country.

Christmas 1994 slid past in a blur and I found myself into the new year of 1995 with only two weeks left in which to submit my reply to Telstra’s defence, and thousands and thousands of discovery documents to sort through.  Once again the stress was getting to me and my health was deteriorating fast.  Not only was this affecting the preparation of my response, but it was seriously damaging the running of my business.  The festive season is always the busiest for bookings of course, but I was then averaging debilitating giddiness attacks about twice a week.  Fortunately Cathy had, by this time, moved into the camp house.  Without her assistance I would never have survived through this time.

Garry Ellicot came to Cape Bridgewater for a brief stop-over and together we worked through New Year’s Eve while Cathy went with her sister and brother-in-law to see in the New Year in Portland.  Some time after 1.30 on the morning of the first of January, while Garry and I were still labouring over my reply, the troops arrived back from the celebrations, armed with a bottle of Scotch and a bottle of Port.  After all the hard work and long hours we had put in over the past two days, a couple of drinks saw Garry and me out like lights.  The following day Garry flew back home.

February saw the camp fairly heavily booked, thank goodness.  Tony Speed, year 7 co-ordinator for Hamilton High School (now Bainbridge College) brought his group along, as he had every year from 1990.  Even with major problems contacting me on many occasions, he is still a regular customer.  His support, and that of many other regular customers, has played a big part in keeping me going through the worst times.

After being here in the February, and because he had experienced problems reaching me by phone from his very first contact, back in 1990, when he returned to school Tony wrote describing his continuing concerns about not being able to contact the camp by phone.  In part of this letter he states:

“I wish to acknowledge in writing the repeated difficulty I have had contacting Alan Smith at the Cape Bridgewater convention centre by telephone.  In the week March 1st to 5th I made 5 or 6 attempted phone calls to Alan but I was unable to get through, indeed the line was ‘dead’.  This was extremely frustrating and had I not been aware of Alan’s phone problems, I would have used another camp site.”

Tony and his group had stayed for a full five days, following closely on the heels of a group from the Birchip Community Centre, who have come regularly since 1988.  My records from this month show that members of the Birchip group continually complained that my coin-operated gold phone, installed for the campers use, was ‘always on the blink’.

Tony’s group left on a Friday and Lake Bolac Secondary College were due the following Monday and now I was even closer to running out of time to send in any further supporting claim material.  I felt like everything was conspiring against me.  Of course, the main part of the problem, and the part that the TIO’s office never seemed to grasp, was that I wasn’t just ‘running’ my business, I was also working in my business, supported only by part-time staff.  How could I successfully prepare such a complicated claim and response during the busiest period of the year for my business (November to May)?

If I had only had a reliable phone service from the very beginning I would, by now, have been in a position to hire at least three full-time staff, supported by daily, part-time waitresses.  But since I was not in this position I had very little time available to even think about my claim against Telstra.  I certainly had very little time available to prepare the claim and the consequential losses continued to mount:  all because Telstra would not admit that the phone service was totally outdated and not coping with the volume of calls.  I could not believe the position the COTs now found themselves in, through no fault of their own:  a handful of small-business people pitting their wits against the legal minds of some of the largest corporations in the country.

Back on 6th January I had submitted to the arbitrator a three page list of procedural documents (refer Glossary), asking him to request these documents from Telstra under the arbitration agreement.  Come March however, two months later, and I was still waiting.  I was at a loss to know where to turn for help.

Again and again I was faced with the same tactics.  Every request I made of the arbitrator continued to bring a roar of silence — certainly no documentation appeared.  Worn out and frustrated, my irritation with the arbitrator grew worse each day.

On 23 January 1995, in response to an earlier letter dated 13 January 1995 which I had sent to the arbitrator asking for information about the Bell Canada report and how they arrived at their findings, I finally received a letter from the arbitrator in which he noted that “Telecom does not consider it has any further information of relevance in its possession.”  The arbitrator goes on to ask me to respond to this comment within 24 hours in order to “be certain that there is no confusion between the parties as to the documentation which is being sought.”  As requested, I responded the following day.  My fax account shows that this two page response left my office and took 2 minutes and 19 seconds to travel to the arbitrator’s fax.  This length of time indicates that there were indeed two pages as most faxes take about 1 minute per page to transmit successfully.

According to the rules of the arbitration, all documents sent to the arbitrator must be copied to the other party (in this case, of course, that other party is Telstra).

Twelve months after my arbitration procedure was completed, through the persistence and support of the Commonwealth Ombudsman’s Office and under FOI, I was provided with information that showed that Telstra did not receive my response of 24 January 1995, which had been faxed to the arbitrator. There were also another 42 claim documents, which had been sent via fax at other times, which, according to their records, never reached Telstra’s defence unit, even though my fax account indicates that they reached the arbitrator’s office.

In further relation to the Bell Canada report and the tests they allegedly carried out at Cape Bridgewater, another similar FOI document, N00040, which appears in Chapter 29, indicates the importance of my persistent requests for data proving that the Bell Canada tests were done on the days shown in their report. 

This document, dated 20 June 1994, clearly shows that there is an error in the tests from Richmond to the Cape Bridgewater PTARS, 055 267 211 as detailed in the BCI original report.  Unfortunately, I did not receive this document until three years after my arbitration had been completed.  It was supplied at that time by another COT member. 

Three weeks after my arbitration had been completed and my appeal time had totally expired I received three more FOI documents (N00005, N00006 and N00037).  Document N00005, dated 6 September 1994, from Telstra to Bell Canada, states, in the second paragraph:

“Specifically, the start and finish times for the test run from Richmond digital exchange (RCMX), test line 03 428 8974, to Portland exchange, Cape Bridgewater RCM (CBWR) number range, test line 055 267 211, (detailed in section 15.23 of the report) are impracticable.  The number of calls made during the test run could not have been completed within the time span shown and the test run would have clashed with other test runs performed within those times.”

and document N00037, an internal Telstra e-mail headed “Smith’s Query on BCI Tests”, states, in part:

 “Mr Smith is correct in the suggestion implied in his query that the test results recorded in the ‘Addendum - Additional Tests’ part of the BCI report to Telecom, 1 November 1993, are impracticable.”

Since Telstra had not sent me copies of these four documents before the end of the arbitration procedure 11 May 1995, how could they turn round and tell the arbitrator on 13 January 1995 that they considered they had given me everything they had which was relevant to the Bell Canada report?  The Canadian Director General of Telecommunications Policy agreed (see page 141) that I should contact BCI regarding the alleged errors in their test report but, although I wrote to BCI in Canada three times, I have never received a reply.

Further information relating to the BCI report came to hand much later, as this book was nearing completion.  A copy of a report from Hansard, detailing discussions which took place in the Senate on 26 September 1997 was forwarded to me late in August of 1999.  This report indicates quite clearly that Telstra misled the Senate in regard to the BCI report.  Two pages from Hansard are reproduced at the end of this story, with a commentary, starting on page 223.

While the group from Birchip were at the camp I was visited by people from Ferrier Hodgson Corporate Advisory (FHCA) who, along with a representative from Telstra, were coming to assess my financial losses resulting from the phone difficulties I had been suffering.  FHCA were supposed to provide a list of who they interviewed and where they went on their trip to Cape Bridgewater and I had been led to believe that they provided just such a list to Telstra, but I never actually saw any documentation myself.  Later I was to uncover some rather unsavoury information in relation to FHCA but on the day of their visit, because the Telstra representative had been delayed by poor landing conditions at the local airport, the FHCA people had time for a leisurely look around the camp and the local area in general.

Under the rules of the arbitration, neither the resource unit, the technical advisory unit or FHCA were allowed to be alone with either Telstra or with me but there was not much we could do about the two hour delay between the time FHCA arrived and the time Telstra arrived, except for FHCA’s solitary inspection of the general area.  When the Telstra representative finally arrived we first visited the once-proposed golf links at Kevin Turner’s old homestead.  It was then that I began to recognise FHCA’s true colours:  everything I said was ignored or negated.  FHCA, it seems, already had fixed ideas about this case.

Perhaps it was my early years at sea as a 15-year-old, perhaps I was just being ‘streetwise’, but whatever you like to call it, I was not going to ignore my feelings again.  FHCA’s attitude and the way they played down my business in front of the Telstra representative was a clear indication of what was to come.

Bearing in mind that FHCA and Telstra were not supposed to spend time together without including me, and being aware that I couldn’t leave the camp site because the Birchip group were in residence and besides, this being the holiday period, there was always the chance that passing tourists might want a bed for the night, I had arranged lunch at the camp.  Cathy had brought fresh bread rolls in town and I provided fresh pasta and salad with three different cold meats.  My offer of lunch was, however, declined and the others all adjourned to the Kiosk by the beach, totally in opposition to the rules of the arbitration.  And what I could I do?

They all returned later, but then stayed only another 15 minutes before leaving for Melbourne.  I tried to introduce evidence which supported my position but what I was not aware of was an arbitration procedure rule which means that late information, if not considered relevant, will usually not be accepted into evidence by the arbitrator.  In my case, much of the information I was receiving from Telstra under the discovery process (in the form of FOI documents) were arriving months after my original request.  Part of the information I attempted to introduce a this stage included copies of brochures and other information obtained from businesses similar to the business I had hoped to build here; businesses which provided a guest house set-up for week-end get-aways.  A number of professionals in the tourist industry are convinced that my situation, right by the sea, would be ideal for this kind of business but now, after all the energy I have spent just fighting for a decent phone system, I don’t have the energy and enthusiasm I once had, nor do I have the will to struggle any more, particularly when I look back at the ruined lives scattered along the road behind me.

Anyway, although the brochures and other documents that I gave to FHCA on this day were not accepted into the arbitration process, I have never set eyes on this information again, not even when some of my claim material was finally returned to me after the arbitrator had handed down his findings. 


With most of my days taken up with camp duties during this holiday period, I only had the evenings to work on my final claim material.  Before I had come anywhere near completion of the collation of the first 20,000 documents that had arrived after Telstra lodged their defence, more had been delivered.  With all this paperwork where was I to find enough space to sort them out so I could refer back and forth among them?  The Australian public purse might well have been paying Telstra’s legal bill but I wasn’t getting any support at all:  I couldn’t even afford to hire a law student to help.  And all any of us in the COT group were trying to do was achieve simple justice for ourselves and, at the same time, alert the Australian public to the cover-up being orchestrated by Telstra. Telstra just seemed to be doing anything they could to stop us.

Now, well into 1995, I was still struggling with the enormous task of attempting to collate all the FOI documents I was receiving, so late into the process, into some sort of sensible order.  Because it seemed to me, with my lack of experience in legal matters, that the arbitrator was not accepting any more material in support of my claim, I believed I could not lodge these documents as further evidence even though Telstra’s CCAS technical data sheets, when compared to my Telstra accounts, showed clearly that I was still being charged for calls which never connected.  Instead I phoned the arbitrator to ask for another oral hearing.  I wanted to ask the technical resource unit how best to lay out all this evidence;  I was concerned that, because of my lack of technical expertise, they might not understand what I was trying to show.  During this phone conversation with the arbitrator I explained that I now owed my technical advisor $25,000 and could not afford to continue to run up any more expense.

The arbitrator advised me to continue working as I had been because DMR, the technical resource unit, would be visiting Cape Bridgewater shortly and they could discuss the presentation of my material with me then.  Before that visit occurred however, DMR Australia pulled out of the process and a new technical unit was commissioned by the TIO’s office.  This new company was Lanes Telecommunications, run by a man who had previously worked for Telstra for 20 years.

Eleven months down the track and now we are told there’s a whole new ball-game, a new resource unit is to access our claims and, to add insult to injury, an ex-Telstra employee is to be the main player.   Ann, Graham and I made it quite clear to the TIO that we were not happy about this and so DMR Group Canada were brought in to the process to alleviate our fears.  DMR Australia, a company with a high reputation in the telecommunications industry, had signed the original agreement but then pulled out because Telstra offered them valuable contracts and DMR saw a conflict of interest.  This situation raises two questions:  Did Telstra deliberately set up this ‘conflict of interest’ situation? And, how could DMR pull out of a signed contract?

The TIO advised, in writing, that Lanes would only assist DMR Group Canada but, as it turned out, Lanes did most of the assessments.  This was not according to the written agreement forwarded to me by the TIO:  once more it seems that the TIO had misled me before I signed for arbitration.

All this on top of having to cope with an arbitrator who was a partner in a law firm which was doing contract work for Telstra.  It was almost too much to bear.  I felt as if the whole world was ganging up on me, as if the whole world supported Telstra and no-one cared what happened to the COT four.  Surely it couldn’t get any worse?  But it did.

As April 1995 rolled around, even more tricks of the justice trade were unearthed.  On the 6th April a Telstra official arrived at the camp and we then collected a representative from Lanes from the airport.  Together the three of us inspected the exchanges at Cape Bridgewater and Portland and had discussions with the local technician (the one with the stock farm agent friend who apparently never had problems with his phone - until I uncovered the agent’s complaint records). 

By this stage in the process I had found a number of documents pertaining to congestion at the local exchanges.  One of these FOI documents, numbered K01003 and dated 7 April 1994, twelve months earlier, stated:

“At 4.55 pm on 6/4/94 I was informed by Network Ops that the route into the Portland exchange would be increased by 30%.  The work was to be completed prior to midnight that day.  This should alleviate any problems Mr Smith or anyone else in the area has been experiencing with congestion into the area for some time.”

Another, titled “Cape Bridgewater COT”, and dated April 6 1994, stated:

“Chris:  Following previous lost call analysis of the Z route between Warrnambool node and Portland AXE - R (PORX) it was decided to increment this route from 30 to 60 CCTS.

I have reiterated to all parties concerned the importance of getting this project done ASAP.

Could you please ‘fast track’ this project due to the sensitivity of the current COT case at Cape Bridgewater (off PORX).”

The reference to an increase from “30 to 60 CCTS”  refers to an extra 30 circuits into Portland.  This was a 100% increase in the phone route (which therefore would create a decrease in congestion) into Portland exchange, not 30% as reported in Telstra’s FOI document K01003.  To the credit of the people from Lanes, when we arrived at the Portland exchange, it was clear to them that Telstra had under-estimated this decrease in congestion by 70%.  The Telstra officers on duty at the Portland exchange at the time seemed a touch embarrassed at the error uncovered by Lanes.  These technicians were not aware of a phone call that I had received the previous month, from Frank Blount, Telstra’s CEO.  It is, of course, interesting to speculate on why the top man in such a large organisation would take the time to phone a small holiday camp at the far end of the State, particularly if everything I had been saying to Austel and to the politicians was not considered to be relevant.  The fact is, he did ring me, and I took the opportunity to point out my belief that both Portland and Cape Bridgewater exchanges had been suffering from congestion for some years.  He gave me his word that he would investigate my theory.

FOI documents show that he was a man of his word.  What is more, his investigation proved that I was right.  The congestion was clearly confirmed in a Telstra internal memo dated 30/3/94 (FOI document K01007) which states:

“On 27th March Mr Smith complained that he did not receive two calls on Sunday night from Melbourne.  The customers calling Mr Smith received “busy Tone”.  During the period 20:00 to 21:00, Telecom’s traffic monitoring equipment indicated that the amount of calls being made into Portland exceeded the available junctions.  It is probable that the callers to Mr Smith in fact received tone indicating congestion in the telephone network into the Portland area.”

This memo raises another question, quite aside from the fact that it recognises problems with congestion into the Portland exchange:  would ordinary callers actually recognise the difference between a ‘busy tone’ and a ‘congested tone’ which sound very similar to the untrained ear?  It also indicates the technician’s acceptance of congestion at the Portland exchange.  In the case of my business, this situation was compounded by the fact that, after first negotiating the minefield of congestion at Portland, calls were then switched through to the RCM exchange at Cape Bridgewater where they encountered even more difficulties created by heat and other problems.  No wonder my customer’s complaints continued to mount, even while my arbitration was in progress — each call had to cross two separate hurdles before there was any chance of actually connecting to my phone!

On 6th April, while the Lanes representatives were in Cape Bridgewater, I again attempted to raise the incorrect billing issues.  According to the Lanes people, the arbitrator had instructed them not to assess any new claim material.  Naturally I was most irate.  This was a complete turn-around by the arbitrator who had assured me that, if I discovered any new information among FOI documents which I received late, that information could be presented to the technical resource unit when they came to the camp.  I had burned the midnight oil night after night to have my evidence prepared before the technical team arrived and it was clear that all this new information would have further supported my allegations.  I was so angry, in fact, that I managed to have him at least look at one document (below) while the Telstra official was still there.

How could I be charged for a 9.49 minute call on 13 January 1995 at 11.50 am, I asked, and then for a 42 second call at 11.57 am?  This is an impossibility.

This caught the attention of the Lanes people and I was able to offer further examples of incorrect charging on this 1800 account, both on 10th and on 11th January.  The account showed calls from my home number to the camp number.  According to my diary notes, both those calls registered an engaged signal, but both were charged as having connected.  And again, on 13 January, there were similar examples of more incorrect charging.  Clearly incorrect charging had been running rampant through Telstra, just as this copy of my account shows.  This document was included in my claim.

Neither the Telstra official nor the people from Lanes were prepared to comment on this evidence at the time, although I was assured that the matter would be taken up and addressed as part of the arbitration.  The Telstra and Lanes representatives left shortly after this — together.  Together, and without me, was, of course, in direct breach of the rules of the arbitration.  What private conversations took place between these two?  The answer to that question is probably only known to the participants themselves (and perhaps the arbitrator?).

Both the resource units were now preparing their reports and I had a gut feeling that the COT members had been sold more than a pup.  I felt as if I had been crucified by the very person who was supposed to be delivering justice, my arbitrator.  By this stage he had not once investigated my questions regarding why my fax and my phones continued to create problems.  I was now convinced that the arbitration was just a sham, instigated with the single aim of ‘shutting me up’ by providing some sort of minimum award payment.



Cathy was now involved in the business as a partner but I had only been able to pay her very minimum wages from early 1994.  After Lanes and Telstra left we had quite a disagreement about my next move.  I believed I had a great idea (Cathy disagreed).  The Commonwealth Ombudsman’s Office had been very supportive of my allegations concerning Telstra’s defective supply of the discovery documents I had requested under the FOI act.  Throughout this whole awful saga they had, again and again, proved themselves to be truly impartial.  What a breath of fresh, clean air!

It was perfectly clear that this was one government department that operated strictly according to the principals of natural justice.  Based on my knowledge that this office was involved in preparation of a report on Telstra’s failure to provide the COT’s discovery documents under the FOI Act, I guessed that this office would keep a copy of every document  I had faxed them, as well as all the documents they had faxed to me.  I was sure I was onto a winner here.  I asked the Commonwealth Ombudsman’s Office to use my 1800 freecall number for all future calls because I knew that they would document the number of calls they made in relation to my complaints.  I was convinced that the Commonwealth Ombudsman’s Office’s tally of those calls would not match up with my 1800 account.

Two years later, on the 28th February 1997, the Commonwealth Ombudsman’s Office presented a document to Telstra, covering all the communications between my office and theirs.  This document formed part of their report to Telstra’s Corporate Customer Affairs Office.  This report showed that they had received 315 faxes from me, with 1369 attachments and they had sent 21 faxes to me with 209 attachments.  And it also recorded 163 calls from my office to theirs with 43 from their office to my 1800 account.  Bingo!  Telstra, however, had charged me for 92 calls from the Ombudsman on my 1800 account over this same period.  I have lost another three pages of 1800 accounts for the same period but have not bothered to have them replaced until Telstra explains the difference in these figures.  Forty-three calls registered by the Commonwealth Ombudsman’s Office against 92 calls actually charged by Telstra needs some explaining.  As of December 1998 Telstra has still not provided me with a rebate for these incorrectly charged calls, nor have they made any attempt to explain such a high margin of discrepancy.  This matter has not been investigated by the TIO’s office either.

The TIO’s office, and Senator Alston, have been shown clearly that this incorrect charging, both on my 1800 line and on my fax line, continued for at least 18 months after the arbitrator handed down my ‘award’.  Since neither Telstra nor the arbitrator ever addressed this issue during my arbitration, then I have never been awarded anything in relation to this particular matter, even though the Commonwealth Ombudsman’s information helped me prove, beyond any doubt, that there were considerable problems with Telstra’s billing system as much as 20 months AFTER my ‘award’ had been handed down.  Obviously this means that the problem continued right through the arbitration itself.

How could the arbitrator hand down an ‘award’ when it was clear that incorrect charging, one of the main reasons I was in arbitration in the first place, was still occurring on a regular basis, and had occurred right through the time I was in arbitration?  Since this incorrect charging was one of the issues raised in the arbitration, and it was never addressed or included in the ‘award’, how can this procedure be complete?

I have written numerous letters to both the TIO’s office and to Telstra about this matter but still, in December 1998, neither has offered any explanation and still the incorrect charging over the Commonwealth Ombudsman’s calls has not been addressed in any way.  More on this matter later in this unbelievable story.

May 11th 1995 was D-day, the day the arbitrator was due to hand down his award.  I had previously been sent a copy of the DMR/Lanes report on the technical losses attributed to the phone faults my business had suffered over the previous 6½ years which my claim covered.  I had found, to my horror, that this report had only addressed 26 of the points I had raised in my claim leaving many very relevant claim documents un-addressed.  In fact calculations now show that DMR/Lanes assessed less than half the claim documents I submitted.  This effectively gave Telstra a major advantage since they therefore did not have to respond to the documents which were not covered in the DMR/Lanes report.  The TIO has still not investigated why both the arbitrator and DMR/Lanes allowed so much of my claim material to be ignored.  The information on pages 169 to 171 in Chapter 30 further supports this fact.

None of the incorrect charging issues had been addressed at all and neither had my questions about claim documents which had been lost between my fax and their intended destination.  Nor had the continuing phone faults been addressed.  Bile rose from my stomach.  I had no money left to employ George Close again.  What could I do?  This was clearly an attempt to ‘wipe the slate clean’ for Telstra.  Obviously the arbitrator thought he could get away with awarding me a minimum payment, without any compensation to cover all the consequential and resultant costs that had accumulated as I prepared my claim and then as I worked to bring all these matters to the attention of Austel and the Government.  Senator Alston knew all along that the COT members had been verbally assured by the chairman of Austel that all these other costs would be reimbursed if we proved our claim.  This agreement was never put in writing because of the concern that it would set a precedent, but it was clearly understood by all concerned. (see Chapter 14).

DMR/Lanes report found that a number of my claims were proven and, sure, they did find against Telstra on a few issues, but not anywhere near the extent of the problems which had been shown by my claim documents.

If anyone had investigated the short duration calls and asked why Telstra charged them to my account between May and August of 1993 (while the malicious call tracing equipment was connected to my phone service), it would have been quite clear that these calls had been illegally diverted somewhere else.

Even more alarming, if this issue had been investigated correctly, considering that the short duration calls continued at least until June of 1994, an even more sordid picture would have emerged:  the possibility that my incoming calls were still being diverted twelve months later.


The following fault assessments are taken from the DMR/Lanes technical report, specifically from a section covering the telephone exchange, referred to as RCM 1, which my coin-operated gold phone was connected to for most of the time.  The DMR/Lanes report was compiled from Telstra’s own data and records.

“2.2     There were consistent problems with the RCM system.  Mr Smith’s services were carried on RCM No 1 until February 1994.  This system had a track record of problems, and the RCM system components were the subject of several design corrections (Work Specifications).  These issues were likely to cause a range of problems (as reported) over the period August 1991 to February 1993 (a period of 18 months) when Mr Smith’s services were transferred off RCM 1 and service improved.  Specific problems caused are covered in later paragraphs (ref: 2.8, 2.9, 2.21).

            ASSESSMENT  - Service was less than reasonable.

  2.8     RCM1 failure due to lightning damage.  Lightning damage to communications equipment would be expected from time to time in this area.  Reasonable service relates to the time taken to return the service to normal.  A reasonable expectation would be repair within less than the 4 days actually taken.

            ASSESSMENT  - Service was less than reasonable.

  2.9     Evidence of problems with services on RCM 1 had been sufficient to cause Telecom to move the CBHC services away from RCM 1 to RCM 2 and 3.  Later when the RCM equipment was examined by Melbourne staff, evidence of severe error levels had accumulated on the counters in the transmission equipment (particularly RCM1).  After corrective action these severe error levels were no longer accumulating.

            ASSESSMENT  - Service was less than reasonable.

This report then goes on to summarise the situation regarding the gold phone:

“Intermittent effects on the gold phone resulted in it being removed from RCM 1 11 days after potential cause (lightening strike damage to RCM 1).  At the time of removal the actual equipment fault had not been found, although testing was continuing.  This seems to have been a reasonable action and timescale under the circumstances.

ASSESSMENT:    A reasonable level of service was provided.”

So, in their report, DMR/Lanes stated. at point 2.8 (above) that 4 days was a “less than reasonable”  time-frame for repair of a fault but, in the summing up of this section of the report, they state that 11 days was a reasonable time-frame for repair of a fault.

Also in their summing up (above) they gave the gold phone a clean bill of health, but the gold phone was connected to RCM 1 for most of its existence so how could it possibly have been working well when the exchange (the RCM 1 referred to in point 2.2 above) “had a track record of problems”?

Bearing in mind that this report was compiled seven years after my first complaint was lodged with Telstra, isn’t it just a bit of a worry that DMR/Lanes made no reference to the many diary notes and letters from customers which I lodged with the arbitration, many referring to continual problems with this gold phone?  How could they possibly prepare a secret document for the arbitrator (which I was never intended to see), giving the system a clean bill of health, with all these complaints piling up?   Mind you, it must be noted that DMR/Lanes did state that they did not assess all my claim documents when they were assessing the phone faults at Cape Bridgewater.  This, of course, raises the question of why they didn’t assess all these claim documents.  Who in Australia had the power to instruct an independent technical resource unit that they were not to address issues raised in claim documents which had been presented to a legal procedure?  Clearly, if you have enough resources and enough power to influence the judge (in my case the arbitrator), you can hijack the system whenever you want to.

The ‘lighting strike’ referred to is another interesting item.  According to FOI documents which I included in my claim, the exchange had received a lightning strike some time in November of 1992.  This lightning strike apparently damaged a ‘bearer’ at the exchange.  This document also reports that it ‘appeared that the fault was rectified by late January 1993’.  According to my calculations, even if the ‘some time in November’ was actually late in November, this is still 2 months, not 11 days as DMR/ Lanes had stated in their findings.  To have a phone out of order for two months is certainly not a reasonable level of service.

Other information that came to light while Austel was researching their COT report (see Chapter 6) shows that at one stage the Telstra technicians forgot to connect a fault alarm at the Cape Bridgewater RCM exchange.  Since Cape Bridgewater was an un-manned exchange, this alarm was vital as it was the only way the technicians at Portland would know if there was a problem or a fault at the exchange.  This alarm was not connected for 18 months — from August 1991 through to March 1993.  Why hadn’t DMR/Lanes highlighted this error in their technical report?  Obviously many of the phone faults my business experienced during these 18 months would have gone undetected by the local technicians simply because the alarm wasn’t connected.

I challenged DMR/Lane’s assessment of my gold phone and supplied both Telstra and the TIO’s office with conclusive evidence, using Telstra’s own documentation, that there had been continuing problems with the gold phone over a period of years.  These problems were supported by many letters from my customers.  In December 1995, some time after receiving the DMR/Lanes report (dated 30 April 1995), I had finally had enough, and I refused to pay the gold phone account until the gold phone faults were acknowledged by Telstra.  Telstra’s response was to cut the phone off.  This phone remains disconnected up to the present day (December 1998), with the TIO’s office stating that they are ‘looking into the matter’.  How long will it take to resolve this issue?  My customers and I have already been patiently waiting for three long years.

As if it wasn’t hard enough to respond to the technical report lodged by DMR/Lanes, the financial report, prepared by FHCA, was even more of a nightmare.  On 9 May 1995, my forensic accountant, Derek Ryan of D M Ryan Corporate, actually wrote a 39 page report to the arbitrator explaining the failings he had found in the financial report.  Some of the points he raised in that letter were:

“1.       The FHCA report does not include any detailed workings so we have endeavoured to recalculate the FHCA figures given their assumptions and the base figures which were included in our report dated 21 June 1994.

            Our recalculated figures are still higher than the FHCA figures and we are unable to determine the reason for this.

2.         We believe that the FHCA report contains many inaccuracies and in the main area of loss quantification is simply wrong.  THE MAIN CALCULATION OF LOSS HAS BEEN CONSIDERABLY UNDERSTATED BY AN ERROR OF LOGIC.

            The error of logic appears to arise from the fact that FHCA reduce the total bed capacity by the night utilisation of 48% (to give available bed capacity) and FHCA then apply the bed occupancy rates to the available bed capacity.  It is incorrect to reduce the total bed capacity by both of these factors.”

D M Ryan has never received a response from the arbitrator (and, at the time of writing this, it is now December 1998).  Two days after D M Ryan’s letter was sent, on 11th May 1995, the arbitrator handed down his award.  Compared to D M Ryan’s calculations of the losses my business had suffered because of the phone problems, this award gave only 10c in the dollar.  After I had taken into account all the expenses I accumulated just to bring the phone problems to the attention of Austel and the Senate, and all the expenses associated with submitting my claim to the arbitrator, I was left with only 4 cents in the dollar.  By this stage I had been fighting for justice for 7 years and I was left to ask — what about my failing health?

I was not aware of Derek’s disgust at the handling of the arbitration procedure and, unbeknown to me, he contacted the project manager of my claim at FHCA and asked him how he had arrived at his findings.  The project manager advised Derek that, under instructions from the arbitrator, he had been forced to exclude a large amount of information from his final report, meaning that the final report was actually incomplete.  The two following letters, written by Derek Ryan to Senator Richard Alston, Minister for Communications and Mr John Pinnock, the new TIO, clearly show Derek’s disappointment with FHCA.  He considered that their conduct was detrimental to my claim because, since their report was incomplete, he had no firm base on which to formulate his response or, indeed, to challenge the report.

If I thought I knew what stress was before this, I was certainly learning more now.  The arbitrator’s award had been delivered to me by taxi from Melbourne and the effect was shattering but I had to keep going, I had customers to think about.  Six days after receiving the report however, nature took over.  In front of a group of campers, some sixty children and staff, I collapsed, twitching on the floor.  An ambulance delivered me to hospital and, at first, it was suspected that I had suffered a heart attack.  A five day stay in hospital followed and the final diagnosis was — stress.

On the first day home after the hospital stay I received a call from the FHCA project manager.  He had rung, he said, to let me know that he was aware that things hadn’t turned out quite as I had hoped but he believed I now had to put it all behind me, get on with my life and show them what I could do.  I am still wondering who ‘them’ was.

As if it isn’t bad enough that the so-called independent arbitrator forced the so-called independent financial assessors to ‘doctor’ their report, it is even more disappointing that the project manager for the financial assessors would wait until after my appeal time had elapsed before speaking out.  And, why did he ring then anyway?  I had only ever spoken to him once through this whole process and that was back on 11 October 1994, during the oral hearing.  This phone call seemed totally out of character; or had he heard about my collapse and had an attack of conscience?

Even stranger, during this conversation, the project manager informed me that the executive manager of my case with DMR was also going to ring me; and so he did. 

The Canadian DMR manager said something like:  ‘I was sorry to hear you had been ill and I hope you get better soon.  This has been the worst process I have ever been a party to.  This sort of situation would never have happened in North America.’  I was so stunned at this statement that  ‘This sort of situation would never have happened in North America’  that I later forwarded a signed Statutory Declaration, recording my memory of this conversation, to various Government Ministers.  I also wrote and faxed DMR in Canada but, three years later, I am still waiting for a response.  I have not received any sort of explanation for the ‘would never have happened in North America’ comment.  Could it be that, in Canada, DMR Group Canada would not have been pushed so that they didn’t correctly address a legal claim?  Who knows?

What we do know however, from the letter on page 141 from the Director General of Telecommunications Policy in Canada, is that he was concerned about errors that may have been in the Bell Canada Report.


And still the plot continued to thicken .....

On the 23rd May 1995 another 700 or so FOI discovery documents arrived.  I couldn’t even begin to imagine what on earth Telstra thought they were going to achieve by this.  Why now?  Why not twelve months ago when I could have used the material to support my claim?  Why not even ten DAYS ago — because two of the documents included in this latest batch proved to be particularly interesting and, if I had only had them ten days before I could have used them to support an appeal against the arbitrator’s award.  Even better, if I had had them a month before I could have amended the claim itself.  By the time I had these documents in my possession the only way I could have used them was to take the matter to the Supreme Court of Victoria, an alternative that was entirely beyond my financial means at the time, as Telstra well knew.

The two documents in question were copies of letters exchanged between Telstra and Bell Canada International in August and September of 1994.  These letters acknowledged that the BCI tests, as reported in the addendum to their Cape Bridgewater report of 10 November 1993, were impracticable.

When, some three years later, I received yet another document (N00040) from another COT member, the deception was totally uncovered.  Document N00040, dated 20 June 1994, and under the heading  “Smith Query — BCI tests to Cape Bridgewater”, is reproduced below:

Clearly Telstra was aware that something was not right with the BCI report which they had provided to the Senate in 1993, allegedly to support their assertions that their network into the Cape Bridgewater exchange was up to world standard.  We now know, of course, that Telstra has continued to mislead the Senate for many years about the true standard of this network.

On the 6th September 1994, in Telstra’s letter to Mr Kealey of Bell Canada (the FOI document numbered N00005 and 6), Telstra specifically referred to the start and finish times for the tests run from the Richmond digital exchange (RCMX), from test line 03 428 8974 to the Portland exchange test line, 055 267 211.  These tests were detailed in section 15.23 of the BCI report and Telstra referred to these tests as being impracticable although they did not disclose that this was partly because Telstra were themselves conducting Neat testing to the same number in Cape Bridgewater, namely 055 267 211 (the PTARS test line) at the same time on the same day.

This letter to BCI is not the only document to refer to the impracticability of these tests;  a number of inter-departmental documents within Telstra also refer to this problem.

FOI document L68979 is a copy of a letter from Telstra to my arbitrator on 13 September 1994.  Telstra acknowledges in this letter that the arbitrator has not given them any directions relating to the raw data from the BCI tests which I had asked the arbitrator to request from them.  I asked to see this raw test data so I could prove to the arbitrator that my telephone service was so poor at the time that these tests could not possibly have been carried out as shown in the BCI report.  I have not yet sighted any documentation of any sort, certainly none of the raw data has been passed to me by either the arbitrator (under the discovery process), during the arbitration, or by anyone else since.  I have not received any documentation showing how BCI arrived at the figures in their report.

Even though Telstra knew that this BCI report was impracticable and flawed, they still used the BCI test results in their defence of my claims, to support their assertions that the network was working correctly.  I know that at least one copy of this report was passed on to Telstra’s defence unit because it has been acknowledged in writing by a clinical psychologist, who was commissioned by Telstra to assess my mental health, that he had read the BCI report before he met me.

Of course, any  ordinary person would believe that Telstra’s phone system was working properly if they read BCI’s report because BCI is an international, highly regarded and qualified communications company and because they clearly stated that thousands and thousands of test calls were made to the exchange that my phone was connected to, with a 99.5% positive result.  The first conclusion would then have to be that my claims were unsubstantiated and, following this, that I must be out of my mind in some way.  The fact still remains that Telstra knowingly provided a flawed document to support their defence.  This is illegal in this country and is classified as perjury in a legal process.  Why hasn’t Telstra been made accountable for their actions by the Government?

For years I have canvassed the Communications Minister and the TIO to have the BCI report withdrawn from Telstra’s defence.  My requests seem to have fallen on deaf ears.  It is clear from Telstra’s own FOI documents that, for some six months before they lodged their defence, they knew that this report was impracticable.  The TIO and the various Government Ministers who have been notified of the problems with this report have so far failed in their Duty of Care — they should have ensured that this report was withdrawn from the Public Domain when they were first alerted to the impracticability of it and the flaws it contained.  As it stood then, and still stands now (because I don’t have the finances to continue the fight), there is no way I can take my case to the Supreme Court although, in 1998, Ann Garms did just that.  At the time of writing she has lost the first round but is now waiting on an appeal being heard.  Her court costs are so far in excess of $350,000.  It seems that Australian justice can be painfully expensive.

In a letter to the Commonwealth Ombudsman, Telstra has written:

“The reference to documents relating to Mr Smith being lost or destroyed refers to a discussion I had with Mr Smith.  Apparently Telstra had previously informed Mr Smith that specific documents had been lost or destroyed.  I am not aware of the circumstances in which this occurred and will arrange for my staff to ascertain the details from Mr Smith and advise you of the circumstances.”

Telstra’s Commercial General Manager for Victoria and Tasmania has added a hand-written note to another document, asking, in relation to one of my FOI requests:

“Should we make Alan pay, even if we can’t provide everything he wants?  Please prepare the letter as suggested.”

Does this note indicate that Telstra were acting in good faith at all times?  I think not.  Imagine even contemplating taking my money for something they knew they could not possibly supply!


At this stage the daily running of the camp was almost beyond me and my partner, Cathy, was handling the work almost entirely on her own.  My self-esteem continued to sink lower and all the marketing and promotional expertise I had built up over the years was of no help:  I had no reserves of energy to call on, I couldn’t even think straight any more, let alone compose advertisements or talk to people about the camp.

Again and again I found myself stewing on my situation.  How could this happen in Australia in the 1990’s?  Wasn’t this supposed to be a democracy?  How could the Liberal Coalition Government continue to ignore me?  How could the lawyers get away with hiding the truth in order to prop Telstra up?  I couldn’t work out which way to turn next.

Finally I decided to ask for all my claim documents to be returned to me (this was covered in the rules of the arbitration).  I waited patiently for weeks before deciding to drive to Melbourne and collect them myself.  I thought I had been as angry as it was possible to be but no, by the time Cathy and I arrived in Melbourne I was ready to explode.  I controlled my anger though, as I walked into the arbitrator’s reception area and spoke to the arbitrator’s secretary, Caroline.  Looking back now I wonder why I expected to have my request met this time:  certainly none of my previous requests had been met but I suppose we can always hope.  It was not to be however.  My documents were not ready, Caroline informed me, and the arbitrator was not available.

My emotions, already on a short fuse, finally took over and I shouted at Caroline, demanding that she get my documents at once and reminding her that I had put in my request three months before and had now driven for five hours to collect them.  “I am not leaving this office without those documents.”  I told her,  “Call the police if you want to, I don’t care.  You have my property and I want it back now.”  At last a young lad appeared from the lifts wheeling a trolley loaded with boxes of documents.  He asked me to sort out which were my claim documents;  I simply took the lot.

It took Cathy some time to find a parking spot near this busy city office but finally I loaded them into the car and we headed off, unaware that, among my own documents, there were some that I had never seen before.  These proved to be documents that should have been forwarded to me under the rules of arbitration.  And they were very, very interesting, to say the least.

Of course, in any dispute which is settled by an umpire (like an arbitration) it is almost mandatory that any information supplied by one party must be automatically circulated to the other party and this was certainly so according to the rules of my arbitration.  In fact, in my case, the information had to also be supplied to the TIO’s legal counsel.  Among the documents I took with me from the arbitrator’s office this day, however, I found a brown envelope full of documents and loose papers, none of which had ever been forwarded to me.  This envelope contained copies of a number of letters from Telstra to the arbitrator, including one letter dated 16 December 1994, which indicated that it had been sent with three attachments:

1.Letter dated 4 October 1994 from Austel to Telstra

2.Letter dated 11 November 1994 from Telstra to Austel

3.Letter dated 1 December 1994 from Austel to Telstra

In the first paragraph of this 16 December  letter, Telstra stated:

“You will note from the correspondence that Austel has requested Telstra to provide information relating to charging discrepancies reported by Mr Smith for short duration calls on his 008 service.  These issues form part of the subject matter of Mr Smith’s claim under the Fast Track Arbitration Procedure.”

  Clearly, at that time anyway, Austel were most concerned regarding this incorrect charging and, on page two, Telstra go on to state:

“The simplest way forward may be for Mr Smith and Telstra and yourself to all confirm in writing that this information can be provided to Austel if this meets with your approval.”

Now, if this was the way to go, why didn’t I receive some indication of this from the arbitrator?  Certainly I did not receive any correspondence from him which referred to this arrangement but Austel apparently later wrote to the arbitrator acknowledging receipt of Telstra’s letter of 11 November 1994 and noting that Telstra had agreed to answer, in their defence of my claims, each of the questions put by Austel on 4 October 1994. 

In their earlier letter of 1 December, Austel had indicted that a number of other Telstra customers in the Portland area had also complained about incorrect charging on their 008 services and so it is not surprising to find them indicating their concern about this in their letter of 8 December:

“A major consideration in Austel’s pursuit of the issue raised by Mr Smith was the likelihood that these problems, if proved to exist, would almost certainly affect a number of other Telstra customers.”

In direct breach of the rules of the arbitration, the arbitrator did not forward these letters on to me during the arbitration.

Even more amazing, the arbitrator made no written finding in his award regarding the massive incorrect charging as shown in my claim documents.  In fact, even though Telstra had notified both the arbitrator and Austel (in their letter of 11 November 1994) that they would address these incorrect charging issues in their defence, they failed to do so, and even though the arbitrator obviously knew of this promise, the arbitrator still allowed Telstra to ignore the issue completely.  I believe that this constitutes a conspiracy between the arbitrator and Telstra in my arbitration but I was to uncover even more when I turned to the loose documents I had come by inadvertently.  These would surely convince the devil himself that there was a conspiracy afoot.  These documents relate back to the day the COT four signed for arbitration, on 21 April 1994.

As I have already explained, one of the main reasons for signing for arbitration, as opposed to the existing commercial agreement, was that Telstra’s billing system would be brought under scrutiny.  The members of COT believed this was a major issue which needed to be brought to the attention of all Telstra’s customers, in the public interest.

I had been directed, you will recall, to lodge written details of any phone complaints with Telstra’s solicitors.  In particular, in one of my letters to the solicitors I had shown them that I was being charged incorrectly for short duration calls on my 008 account.

On 18 June 1993, Austel wrote to Telstra regarding these billing issues.  Their letter, one of many written by Austel to Telstra regarding this particular issue, follows on the next page.

  On the same issue, in an internal Telstra letter dated 25 November 1993, to the Corporate Billing Directorate in Brisbane, regarding my short duration call problems, the writer states.

“Telstra does have clearly defined policies and principles for call charging and billing.

Unanswered calls include calls encountering engaged numbers (busy), various Telstra tones and recorded voice announcements as well as calls which ‘ring out’ or are terminated before or during ringing.”

When speaking with John MacMahon, the General Manager for Consumer Affairs at Telstra, I referred to this document, telling him that this was certainly not the case on my phone line.

Over the years leading up to my arbitration, I continually proved to Austel that Telstra were incorrectly charging RVA calls.  In one instance I used my claim advisor as just one example, and provided my 008 account and Telstra’s matching data records to prove my point.  Finally, because these issues were not addressed in my arbitration, Austel visited Cape Bridgewater late in 1995 to look at a further 6 bound volumes of new evidence I had accumulated to support my case.  Three of these volumes, which had been submitted into arbitration, had resulted in Telstra writing to Austel on 11/11/94 to say they would address these issues in their defence.

The Austel people looked over the six volumes I had and commented that they had never seen so much evidence, presented in such detail.  They appeared to actually be quite stunned.  Finally they left, taking the volumes of evidence with them.  Although all this evidence was returned to me some weeks later I have never had any formal recognition of my effort from Austel.

In a letter dated 6 December 1995, Austel wrote to me:

“I refer to my recent correspondence advising you that Austel had again written to Telstra regarding the issues relating to charging discrepancies concerning its 008/1800 service originally raised by you in 1994.  I write to request additional information from you to assist Austel in its investigation of charging discrepancies associated with Telstra’s 008/1800 service.

Your assistance in this matter would be appreciated.”

Among the ‘loose documents’ inadvertently provided to me by Caroline I found three technical reports which had been compiled from my claim documents.  One, dated 7 April 1995, was headed “Draft for Discussion Purposes Only” and written by Lanes Telecommunications; the other two documents were duplicate copies of a report compiled by DMR and Lanes and dated 30 April 1995.  Or were they duplicates?  They certainly looked the same; they certainly both had identical covers; they certainly both had the same date and neither of them was signed, but .... ?

Back in May of 1995, when I received my copy of this DMR/Lanes report, and needed to respond to it in writing according to the rules of the FTAP, I had asked why it had not been signed off as a complete document.  The arbitrator did not respond to my question.  When I found these ‘duplicates’ of the DMR/Lanes report, I dug out my copy and compared all three.  Lo and behold, a number of differences showed up, all in Telstra’s favour.

Some of these differences were not apparent at first glance but one was quite clear from the start:  the page numbering on one of the 40 page documents which I had not seen before sailed along sensibly up to page 27 but after that, with the exception of a page numbered 31, all the rest of the pages were also numbered 27.  What on earth did this indicate? I had no idea.  And there were other differences, the most alarming relating to a part of the report headed “Scope of Report” in the early draft version, dated 7 April 1995 (documents 1 and 2).  Part of this section states:

“The report covers incidents and events potentially affecting the telephone service provided to the Cape Bridgewater Holiday Camp during the period February 1988 to August 1994.


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

As you can see on the following pages, the documents listed in the draft version as being sourced by Lanes are also listed in the arbitrator’s copy of DMR/Lanes final report.  In my copy of the final report however, half way down the list, all the items arrowed have been added.  All these additional items were my claim documents; none of them were Telstra’s documents.  Apparently someone was trying to make me believe they had looked at every document I submitted but the body of the report clearly proves that DMR/Lanes didn’t assess all the documents I submitted.

On examination of these three versions of the same document the following differences become apparent: 

The difference in numbers of documents assessed before August 1994 indicates that not all my claim documents were passed to DMR/Lanes for evaluation.  How could they possibly have correctly assessed all the faults prior to August 1994 if they only saw half my claim? I wondered, was this a conspiracy, this apparent attempt to cover up on behalf of Telstra and defraud me of a proper assessment?

The next lot of documents have also been taken from two different copies of the final report, one of which was sent to me (dated 30 April 1995).  The other was given to me by the arbitrator’s secretary;  apparently this was the arbitrator’s copy (also dated 30 April 1995).

The first problem with these documents occurs on the page numbered as 1 in my version and titled “Resource Unit Technical Evaluation Report.  Mr Alan Smith.   CBHC.  30 April 1995.”  The second paragraph on this page consists of only one short sentence “It is complete and final as it is.”  The second paragraph on the equivalent page of the arbitrator’s report (numbered as page 2), however, goes on to say “There is, however, an addendum which we may find it necessary to add during the next few weeks on billing, i.e. possible discrepancies in Smith’s Telecom bills.”

Note that again, there is more information in the arbitrator’s version than there is in my version.  And, again, this refers to billing problems.

  Again, in the arbitrator’s copy (on the page numbered as 3), the fourth and fifth paragraphs state:

“One issue in the Cape Bridgewater case remains open, and we shall attempt to resolve it in the next few weeks, namely Mr Smith’s complaints about billing problems.

Otherwise, the Technical Report on Cape Bridgewater is complete.”

This information is simply missing from my version of the report (page numbered as 2).  Did the arbitrator and DMR/Lanes all think that I would forget about the billing issues if they didn’t remind me?

It was serious enough to discover that Telstra had not addressed the billing issues, even though they said they would;  it is even more serious to discover that letters discussing this matter had been sent by Telstra to the arbitrator and to Austel without being copied on to me.  If, as it seemed to me, the arbitrator actually had favoured Telstra so that this billing issue would never be addressed in my arbitration, then we must ask if the arbitrator was as impartial as he was supposed to be.  All this greatly disadvantaged me, as a claimant in this matter.  And then, to finally find that the technical resource team (DMR/Lanes) intended to address the billing issues but mysteriously omitted this from the final version of their report just proves my allegations that there was a conspiracy between various high-ranking people involved in this arbitration.

I returned again to the documents on pages 175 and 176, under the heading “Cape Bridgewater Documentation”, and found, in the second line on both pages, reference to more than 4,000 pages of documents which had been presented by both parties and “examined by us”.  In the arbitrator’s ‘award’, however, he states that he viewed more than 6,000 documents.  What happened to the other 2,000?

Let’s assume, generously, that there were, say, 400 pages of documents (out of the arbitrator’s 6,000) which were only related to the financial side of the dispute, and which would therefore not need to be assessed by the technical team.  This still leaves 1,600 not accounted for.  Interestingly, this is approximately the number of claim documents referred to by DMR/Lanes (in their two source information documents) as not being assessed.  Could this mean that DMR/Lanes didn’t see all my claim documents?

On the last two lines of this same paragraph I found the following amazing statement:

“A comprehensive log of Mr Smith’s complaints does not appear to exist.”

This is further proof that the technical team were not provided with my list of 183 logged faults from late 1989 to early 1994.  Apparently they were not provided with a copy of the further 43 logged faults which I submitted or the 70 or so letters of complaint which I also provided to support these two lists, totalling 226 logged calls in all.

Looking back now it seems obvious that there was some sort of conspiracy going on here, a conspiracy to cover up at least some of the issues I had raised in my claim.  I have evidence which supports my claims that Telstra ‘bugged’ my phone both before and during my arbitration and when this information is put together with what I now believe was happening with all the incorrectly charged short duration calls on my 1800 account, a conspiracy seems the only answer.  Diversion of phone calls and faxes has been explained in more detail on page 52.

Back in early 1993, as I have previously related, I was continuing to lodge complaints with Austel about the short duration and non-connected calls.  An FOI document dated 23 September 1993, from Don Pinel of Telstra to Jim Holmes, Telstra’s Corporate Secretary, discusses ‘long held’ and ‘incoming unanswered’ calls of ‘4 - 8 seconds’.  According to this document there was some suspicion that these were ‘diverted’ calls.  Pinel commented that further investigation was to take place.

The following three incidents all relate to other situations where call diversion was highly likely to be the cause of the problem:

I used my fax phone to phone Telstra.  This equipment is on a separate line to my 008/1800 free call service which was the line I was complaining about.   I asked the Telstra 1100 fault operator if she would phone my free call number and see if she had problems getting through.  Moments later, while I was still holding on the fax line, there was a faint, one ring burst on my free call line.  Both the charter operator and I heard this short ring but when I picked the receiver, the line was dead and so I didn’t bother to speak but simply hung up the phone.  The bus charter operator has since confirmed this in a letter which was presented to the arbitrator. 

A few moments after I had hung up the free call phone the Telstra operator came back to my fax phone and quite innocently announced that she had heard some-one say something about a holiday camp on the free call line.  I certainly didn’t say anything about a holiday camp, so who answered the call?  The operator’s version of events certainly doesn’t match my version, nor does it match the description given by the witness, so where was her call answered? Later I had my own version of the events professionally video taped and this five minute video clip was accepted into arbitration, along with other documentation supporting my claims of illegal call diversion by persons with access to Telstra’s network.  FOI documentation shows that all this information was passed on to Telstra by the arbitrator but, like so many of the issues I raised in my claim, the issue of illegal call diversion was never addressed by the arbitrator.

Further information relating to this illegal phone interception and to phone bugging, lost faxes and intrusion into the private lives of COT members, is detailed at the end of this book.  You will be astonished at what the Telstra Corporation has resorted to in their efforts to conceal the truth.  Withholding important discovery documents in an arbitration procedure is unlawful, if these documents exist.  Tampering with evidence in an arbitration (e.g. pouring beer into a phone) is unlawful.  Relying on defence documents which are known to be flawed, in an arbitration, is unlawful.  Phone tapping of conversations without a warrant is unlawful.  Someone within Telstra must have authorised this criminal conduct.  Does this indicate that organised crime exists within Telstra?


I wondered how much more confusion and deception I would uncover among the rest of the documents inadvertently supplied by the arbitrator’s secretary.

The unethical behaviour by the FHCA project manager, when he withdrew a large section of his financial report, was firmly fixed in my mind when I uncovered a document headed “Ferrier Hodgson Corporate Advisory Working Notes.”  As I read this document I pictured yet another spear aimed at my heart.  Had these people set out to drive me into the ground?

The following information, from page 15 of the FHCA draft report, appears to find in my favour for once.  It shows the following list of tourists visiting the Portland region between 1991 and 1994:

In 1991/92 this list shows 1,396,000 tourists, in 1992/93 this increased by 6.7% to 1,490,000 and in 1993/94 the number increased again, this time by 5%, to 1,565,000.  This was the increase which I had shown in my claim documents, supported by figures supplied by the Department of Conservation and the Environment (now called Victorian Parks) who control many tourist locations and national parks in our area.  These figures were also supported by information supplied by the Victorian Tourism Domestic Monitor.

In his award document however, when the arbitrator referred to tourism, he stated that he ‘had to take into account the decrease in tourism’ in my area as possibly one of the factors contributing to lost business at the camp. 

The figures supplied by FHCA, Parks Victoria and the domestic tourism monitor for the Great Ocean Road region are factual figures.  What made the arbitrator decide that there had been a decrease in tourism in the area?

Now, with all this information finally available to me, I set about challenging the arbitrator through the Institute of Arbitrator’s president who, because he happened to live in Western Australia, thereby caused me to spend more money on faxes and phone calls in my search for natural justice.  My impression, gained from letters from the Institute’s president, was that he was alarmed at the evidence I passed to him; evidence showing the unethical way my arbitrator had conducted himself.  At the time however, I was still suffering from sleepless nights as I stewed on the questions — how could a legal person such as the arbitrator hide so much evidence?  How could he allow Telstra to get away with ignoring so many issues?  And why?  All this deception and yet it seemed no-one with any power seemed at all concerned.

One person who was expressing concern however was my local Federal Member of Parliament, David Hawker.  As far back as 1992 Mr Hawker had supported me by writing to Telstra expressing his concern about the RVA and other phone faults I was experiencing and the business I was losing as a result of these faults.  The General Manager of Telstra’s Australian Commercial division responded to Mr Hawker on 23 August 1993, saying:

“Mr Smith has had ongoing complaints and service difficulties over some five years.  His services were initially provided from an exchange of older technology which had some faults and suffered congestion.”

My own problems with the phone service were not the only problems I spoke to Mr Hawker about;  I had also alerted him to other Telstra customers in our area who were telling me they were also having problems with the phone service, not only when trying to contact me, but with their own phones as well.

So concerned was Mr Hawker that, late in 1995, before the Liberal Government came into power, he arranged for some of the COT members to meet with the then Shadow Minister for Communications, Senator Richard Alston, in his office in Canberra.  Senator Alston seemed to be quite concerned about the way my arbitration had been conducted.

According to my record of this meeting, Senator Alston asked for further documents.  He was interested in my claims regarding the unethical conduct by various parties associated with the administration of my arbitration; he was also interested in my references to the way Telstra had ignored my claims of incorrect charging and problems with billing.  My claims that Telstra had been listening in to my private phone calls during the arbitration seemed to particularly worry Senator Alston.  It also seemed that, when we signed for arbitration, Senator Alston had been under the same illusions as the COT four — he believed that the arbitration would be a non-legalistic and fast-tracked process.  Another Senator who had supported us along the way, Senator Ron Boswell, the National Party Leader, had expressed the same beliefs.

During this period immediately following the handing down of my arbitration ‘award’, Senator Alston appeared to also be very concerned that FOI discovery documents had not only showed that Telstra knowingly used flawed and fabricated test results to support their defence of my claim, but that they had allowed the 10 November 1993 flawed BCI Addendum Report on Cape Bridgewater to remain in the Public Domain.  Telstra were, in fact, using this flawed report to publicly support their assertions regarding the high quality of their telephone network.  One example of this public use of the report was the Channel Nine program “A Current Affair”.

Following a request from Senator Alston’s office I sent them more documents showing that Telstra technicians had been listening to my private calls during the arbitration process.  Senator Alston’s office showed even more concern when they discovered, again through my FOI discovery documents, that Telstra continued to listen to my private phone calls for months after they had reassured the Australian Federal Police, and David Hoare, Chairman of the Board of Telstra, that they had ceased that practice.  As a once-practising lawyer, Senator Alston was well aware of the implications of Telstra’s behaviour;  he could clearly see what an advantage they would have when preparing their briefs and defending my claims if they had inside knowledge gained by listening to their opponent’s phone calls to his claim advisers.

How easy it is for someone with the right contacts to uncover inside information.  My movements were monitored by the very corporation I was doing legal battle with and some of my important claim documents simply vanished while being faxed.  How useful it must have been for Telstra to know where I was and when.  And how useful it could have been if they were also able to check what information I was lodging with the arbitrator and make the most damaging simply disappear before it got to him.

In December 1994 I received FOI documents R11612 to R13587 which included questions for the Senate Estimates Committee put on notice by Senator Alston, to be answered by Telstra.  Under the heading “To Telstra From Senator Alston”, document R13587 states:

“According to an ex-Telstra employee who had responsibility for security and file management in the period from 1987 until 1992, Telstra installed some computer links between its billing computers — a database system containing customer details, and computers in other organisations, ie Australia Post.”

This document then asks the following questions (among others):

“1.       Could you name each and every organisation which is linked to Telstra’s billing computer?

2.         Does ASIS (refer Appendix 8 & Glossary) have access to personal files kept by Telstra?

3.         Can each and every one of these organisations access Telstra’s files containing billing details?

5.         Could you guarantee that no Parliamentarians, who have had dealings with “COT” members, have had their phone conversations bugged or taped by Telstra?

9.         Who authorised this taping of “COT” members phone conversations and how many and which Telstra employees were involved in either the voice recordings, transcribing the recordings or analysing the tapes?

10.       On what basis is Telstra denying copies of tapes to those customers which it has admitted to taping?

11.       (A) How many customers has Telstra recorded as having had their phone conversations taped without knowledge or consent since 1990?

            (B) Of these, how may were customers who had compensation claims, including ex-Telstra employees, against Telstra?

25.       An internal Telstra minute in relation to Alan Smith of Cape Bridgewater states: “Our local technicians believe that Mr Smith is correct in raising complaints about incoming callers to his number receiving a recorded voice announcement saying the number is disconnected.  They believe that it is a problem that is occurring in increasing numbers as more and more customers are connected to the AXE.”

This document, and questions asked of Telstra in the Senate by Senator Alston, make it quite clear that Senator Alston was then, and still is, aware that Telstra taped and  listened in to private phone calls made by COT members who still fear that their calls are being listened to.  Anyone who had access to the many, many documents I have read over the years I have been battling for justice would have the same fears.

After the Coalition Government’s victory in 1996 Senator Alston became the Hon Senator Richard Alston, Minister for Communications and the Arts.  At this point his office asked me to supply them with a full report on my claims and the allegations I had made against Telstra over the years, along with any allegations I had about the conduct of the arbitration.  I set about producing the report they needed:  just to produce a chronological listing of events took 82 pages which I bound into a book, supported with a separate bound volume of attachments, each document indexed to support the information in the 82 page listing.  A copy of this 2 volume report was sent to Senator Alston and another copy was forwarded to the Commonwealth Ombudsman’s office.

This report has since been assessed by a number of Legal experts, and others;  some of the written responses follow. 

Since Senator Alston was appointed to a position which gives him the power to instigate a full inquiry into the many issues raised by the Telstra / COT situation, nothing more has happened except for a letter of acknowledgement dated 4 September 1996.  Even though I had alerted Senator’s staff to problems I had with the TIO, particularly in regard to his blatant disregard for the truth when he was addressing my concerns, this acknowledgement letter asked how the Senator might acquire a progress report from the TIO.


In Chapter 23 I related the ‘beer in the phone’ story.  This issue was raised for me again, on 28 November 1995, six months after my award had been handed down and almost 12 months after I had first asked the arbitrator to access, from Telstra’s defence unit, the actual T200 phone that Telstra had taken from my office for testing.  This was the phone that Telstra later alleged, in their defence, had been affected by ‘beer in the phone’ which caused what Telstra called a ‘lock-up fault’.  According to Telstra, this meant that the fault with my fax line was not in the network but in the phone.  As I have indicated in Chapter 23, the arbitrator would not allow my forensic document researcher to see the draft of the T200 technical report.  If this had been allowed my researcher would then have been able to ascertain how Telstra’s technical unit had conjured up this ‘phoney’ report.

So, when I received another bundle of late discovery documents from Telstra, imagine my surprise to find, included in this bundle, Telstra laboratory reports which showed that, while Telstra had my T200 fax/phone at their laboratory for testing, they also carried out tests to see how long beer would stay wet if it was inside the phone casing.  The remarks on the report of this particular test show that, when left overnight, the beer was either almost dry the next day, or completely dry the next day.  Apparently Telstra laboratory staff had satisfied themselves that beer could not have stayed wet and sticky for 12 days (the time between the phone leaving my premises and it arriving at the laboratory).  Would a corporation as large and powerful as Telstra really stoop so low as to fake the ‘beer in the phone’ set-up just to defend the quality of their network?

Of course, I didn’t see this document until 6 months after the arbitrator had handed down his award but still I was incredibly excited to be proved right.  I came across this information about 8 o’clock one evening and, in the heat of the moment I grabbed the phone and dialled the number for the arbitrator’s home.  His wife answered and told me that he was overseas and was not due home for few days.  I thought quickly.  “Probably the arbitrator would have discussed at least some aspects of my arbitration with his wife,” I thought.  “If I tell her who I am she may be afraid that I am trying to cause trouble.  I don’t want to risk upsetting her unnecessarily, so I’ll give someone else’s name.”  I quickly decided that I should use a name that would be familiar to the arbitrator; someone that he was friendly with.  The first name that popped into my mind was that of the FHCA project manager.

According to my telephone account, this call was made at 8.02 pm on 28/11/95 and it lasted a mere 28 seconds.

Later, after I had calmed down a bit, I told the TIO about my exciting find; a document that I had been looking for, for so long; a document which finally proved my innocence regarding the ‘beer in the phone’ matter.  I asked the TIO what he would do with this information, after all, he was the official administrator of the arbitration and this Telstra document showed that not only did Telstra use the flawed BCI report in their defence, but now we could prove that they also used a fabricated T200 report as well.  This of course was a very serious matter.  Tampering with evidence in a legal arbitration is a chargeable offence.

I also freely told the TIO that I had tried to contact the arbitrator to pass on this news, explaining that I had rung at 8 pm on the night of the 28th because I had only then just uncovered the laboratory documents which I was convinced proved serious unlawful behaviour:  someone must have introduced the ‘beer’ into my phone after it was taken from my office.  Surely tampering with defence material was a matter that needed to be looked into at once.  I explained to the TIO that the arbitrator had been overseas when I rang and I explained also why I gave Mrs Hughes the FHCA project manager’s name instead of my own, so as not to alarm her.

The TIO’s response was a flat statement that my arbitration had run its course and he did not intend to involve his office in any further investigation.  He added that my best option was to go to the Supreme Court of Victoria (as if I had the resources to do that!).

This incident is one which added to my concerns about the TIO because some time later I received a letter from the President of the Institute of Arbitrators (Aust), Mr Laurie James, with a copy attached of a letter Mr James had received from the TIO.  Apparently, after I had spoken to the TIO about my attempt to reach the arbitrator at his home, the TIO wrote to Mr James, relating an entirely different version of the story.  In his letter to Mr James, the TIO  stated that I had rung the arbitrator’s home at 2 o’clock in the morning (he also noted that I had used a false name, which I don’t deny).  This letter from the TIO could well have been interpreted as questioning my motives.  Although the TIO didn’t actually ask the question, it did infer that there was a question as to why would anyone make a phone call at 2 am, except in an emergency (and this wasn’t an emergency really) or if the caller was trying to be intimidating.  The TIO was well aware of how badly I had been treated by the justice system and yet still he seemed to be trying to blacken my name.  Why else would he take a perfectly innocent incident and try to turn it into something sordid?

Furthermore, what gave the TIO the right to write this letter in the first place?  The TIO is supposed to be unbiased:  how could he sit down to write this letter knowing that he is about to record a completely different story to the truth?  He must have known that his correspondence would bring my character into question.  If he was prepared to do this in my arbitration, it also raises questions about his behaviour in the arbitrations which are still going on for other members of the COT group.  Who is he actually supporting here, the Australian public or the telecommunications carriers?

Another interesting question raised by this letter to Laurie James:  the TIO forwarded a copy to the arbitrator at the time.  Surely the arbitrator would automatically check with his wife for her version of the incident?  And, if he did, I believe that his wife would agree that I rang at 8 pm and not 2 am, and I also believe she would say that I was perfectly polite. Why has the arbitrator not come forward with the true facts?

At least Mr James was giving me the opportunity to defend myself to him.  And I did, and, because  the TIO’s letter had also been copied to the arbitrator I believed that he would also confirm that I had spoken quite politely to his wife when I rang, and I also believed that he would also confirm that I rang at 8 o’clock at night, not 2 in the morning as the TIO had stated.

If we return to pages 131 and 132 in Chapter 23 you can see that I have proved, beyond all reasonable doubt, that someone within Telstra tampered with my Exicom T200 touchphone after it left my office to be examined at Telstra’s laboratories.  The TIO should have taken this into consideration before he wrote to Mr James.  It is even more alarming, as I have also explained on pages 131 and 132, to discover that Telstra was once again prepared to sign a Statutory Declaration covering the authenticity of their report regarding ‘beer’ in my phone when they knew the report was unlawfully constructed.  On pages 208 and 209, and also in Appendix 5, I show that one of Telstra’s technicians also knowingly signed a false Statutory Declaration in Telstra’s defence, in relation to my Mitsubishi fax machine.  In this Statutory Declaration the technician blames ‘customer operator error’ for the continuing faults experienced with this equipment, even though he was well aware that the faults were actually network related.

FOI Document D01026, in Appendix 9, directly relates to the Exicom T200 touchphone problem.  This document shows that not only were Telstra clearly aware of moisture problems associated with this brand of phone but they were also aware that the moisture problem created a short duration/incorrect charging fault to occur on their customer’s accounts.  These were the very same short duration/incorrect charging faults that both my arbitrator and Telstra conveniently chose not to address in my arbitration, even though Telstra advised Austel (11/11/94) that they would address both problems as part of their defence of my arbitration claims. 

Even more disturbing, from document D01026 it seems that Telstra re-deployed the phones they knew were faulty and returned them back into service to other unsuspecting customers.  It would be interesting to ask Telstra who in their employ had the meteorological expertise to decide where these moisture prone phones should be sent.  Cape Bridgewater, as one example, is a known moisture prone area and, as a result of my continual complaints, the RCM exchange at Cape Bridgewater was finally sealed so that moisture wouldn’t affect the copper components etc. inside this un-manned exchange.

If Telstra does in fact have a meteorological wizard on their staff who was deciding where these faulty phones would be best sent, I wonder if it occurred to him to contemplate that atmosphere inside the buildings where these phones were being installed.  I can imagine there would be a considerable moisture content in the air in, for instance, a fish and chip shop, a bakery, an industrial kitchen, a restaurant or a heated swimming pool etc.  The humidity in all these places would be higher than other locations in the same geographical area.  I also wonder how many of these faulty T200 phones are still being used by unsuspecting Telstra customers and how many of these customers have been continually incorrectly charged for calls they did not receive -- as I was for so long.

Another interesting point for discussion is the legality of the re-distribution of products known to be faulty.  Regardless of how the Australian Trade Practices Act looks at such a situation, according to point 1 of FOI document D01026, Telstra decided that their faulty phones would ‘still have to be deployed in areas of lower moisture risk.’  It seems that the Telstra Corporation is exempt from the Trade Practices rules covering other corporations and businesses in Australia as well as being exempt from a number of Acts of Parliament (or so it seems).

It also seems that Telstra, their agents and their employees are exempt from being charged for carrying out illegal activities in Australia and I certainly hope that no Australian business executives expect to be protected from Telstra’s thuggery by our Government:  they certainly haven’t protected me, or a number of my associates.


When the TIO and his legal counsel first began to pressure the COT four into abandoning the commercial process, the FTSP, and signing for arbitration, the FTPA, no-one bothered to tell us that the appointed arbitrator was not qualified (graded) by the Institute of Arbitrators.  This meant that, technically, he was not fully qualified to handle any arbitration, let alone one that was so complex and far-reaching as ours.  This was just another part of the comedy of errors that we had become caught up in.

In 1996 the President of the Institute wrote to me, confirming our belief that the appointment of a non-graded arbitrator was ‘always a risk’.  To add insult to the injury of this situation, I was later informed that the arbitrator, while involved with the COT cases, actually sat, and failed, his grading examination which, if he had passed, would have seen him admitted into the Institute’s register as a Graded Arbitrator.

This information was all passed to Senator Alston and the TIO as it came to light and yet, still, no-one has been able to explain why such an un-graded arbitrator was chosen to oversee such a vast process.

So, the arbitrator was not fully qualified, but at least, we thought, we always had the TIO to fall back on and the TIO was an unbiased observer in this process.  Well, once again, we discovered (too late to help me) that we were wrong.  The TIO’s office is supervised by a board and the members of the board are drawn from the leading communications companies in the country:  Vodaphone, Optus and, of course, Telstra.  In fact the very person in charge of authorising the supply of discovery documents to the members of COT under FOI, is also the Telstra representative on the council of the TIO’s office.   

This has been a highly legalistic arbitration, which has so far cost Telstra more than 18 million dollars to defend.  What chance did the COT’s have when we had to rely on Telstra documents to support our claims and the person in charge of distribution of those documents also sat on the council of the TIO?  This gave Telstra private access to the TIO himself, without the need to include COT members.  No wonder we felt so hopeless.

As more and more documents arrived I found it harder and harder to just shut the door on the saga and walk away.  I became increasingly convinced that I had been the victim of a deliberate act of sabotage, particularly in relation to the ‘beer in the phone’ episode but also in relation to other incidents.  Why, I wondered, did the arbitrator not make any finding regarding lost faxes, both before and during the arbitration process?  These lost faxes included valuable evidence but they had somehow been lost in Telstra’s network, en route to the arbitrator’s office for assessment by the resource unit and by Telstra’s defence unit.  These two episodes became the focus for me and the driving force behind my persistence in trying to uncover the truth: I still couldn’t understand why the arbitrator had apparently not seen through Telstra’s attempt to make me appear as a drunk by saying that my fax problems were caused by alcohol in the fax/phone.  Wasn’t it obvious to the arbitrator that Telstra wanted the faulty line to be hidden from the resource unit in case they stumbled on the truth; the truth that Telstra’s lines were causing the problems? 

The only way any of the members of COT could prove their cases was by using documents buried in Telstra’s archives;  how likely were we to get our hands on them?

During question time at a Senate meeting on the environment, recreation, communications and the arts, on the 24 June 1997, Telstra were asked a number of questions regarding their involvement in the supply of discovery documents to the COTs, under the FOI Act.  By this time the Commonwealth Ombudsman had completed her findings relating to Telstra’s defective administration of the supply of discovery documents to Ann Garms, Graham Schorer and myself.  Obviously the repercussions of this defective supply of documentation had severely disadvantaged me when I was preparing my claim.  Months after the arbitrator had handed down his decision in my arbitration, I was still receiving hundreds, even thousands, of discovery documents.  Among all these documents I often found particular items that would have been most useful in supporting the information in my claim.  By then, of course, they were of no use any more.

The public record of Parliamentary proceedings, ‘Hansard’, shows that, at the meeting on 27 June 1997, a Telstra whistle-blower, Mr Lindsey White, made a number of interesting statements to the Senate, including a report relating to the group he worked with while assessing the COT FOI documents.  According to Mr White, this group was originally housed in the same building as Telstra’s solicitors.  He said that, in the early days of his involvement, there were four technical specialists and about six people from Deloitte’s (Telstra’s accountants) helping the Telstra team.  The documents that were finally forwarded on to the COT members all travelled through this process first, he told the Senate.

According to the Hansard report of this question time, the following exchange then took place:

“Senator O’Chee, National Party, asked Mr White — “So Telstra had masses of documents relating to each of these cases.  Your job in this team was to interpret those documents and explain to — what lawyers — what those documents meant?”

Mr White replied — “They were committed to an Excel file.  My job was to determine what the documents were, who they were from, who they were to, what value they were.  They were put on an ‘Excel’ file and that was put on the Telstra mainframe system.  The legal people used them; Deloitte’s took what they wanted out of it, I would imagine.  What happened to them after I had deciphered them, I do not know.”

Senator O’Chee then asked — “Are you aware of any of those listings, those explanations of the FOI documents, ever being made available to the complainants?”  To which Mr White responded — “It was not part of my responsibilities.”

Certainly, in the time leading up to my arbitration, or during the arbitration itself, I never received any copies of any Excel file lists associated with my FOI claim documents.  These documents were not forwarded to me until TWO AND A HALF YEARS AFTER the arbitrator had brought down his findings.

Still the TIO and Senator Alston continue to cover up the unethical way in which the COT arbitrations were handled.

But, back to the Senate debate on 24 June 1997.  The Shadow Minister for Communications, Senator Chris Schacht, raised the question of the $18 million that Telstra had paid out in legal fees during the COT arbitrations.  In relation to the $1.74 million that the COT claimants had collectively received so far, he asked Graeme Ward, Telstra’s Group Director - Regulator of External Affairs,

“The thing that really is annoying is that the lawyers got millions, you paid them millions to go through all of this process and the claimants got $1.7 million — we know who won this case.”

Senator Schacht later added:

“Yes, but you went through a process of hanging people out to dry for a long time.”

After this statement from Senator Schacht, Senator Carr, Labor, commented to Mr Ward:

“Is it not the case in regard to the particular matters I raised regarding Alan Smith, that your own advice in documents that I have seen — they purport to be from the DMR Group Inc, Lanes Telecommunications Ltd, dated 30 April, I think it is their document, I am not altogether certain so please do not let me misrepresent the matter.  But I have a document here, headed up “TELSTRA SECRET”, which suggests that some time ago you were being advised that Mr Smith was likely to secure a substantial payment through a legal arbitration process.  Is it not the case that probably it would have been in your commercial interest to have settled long before you did?”

This question was answered by Telstra’s Ted Benjamin who had been in charge of the COT arbitrations and who, as mentioned previously, was also a member of the counsel to the TIO’s office.  Mr Benjamin replied:

“There were negotiations held with Mr Smith before the matter went into arbitration.  We could not reach a final settlement with Mr Smith before the matter went to arbitration.  It was then taken over by Austel in its investigation into what became the COT Report.”

Mr Benjamin, however, was one of the people who, back on 1 October 1993, had received a high priority e-mail, later to become FOI document A04483, from Greg Newbold, also of Telstra.  This e-mail related to an article which was due to be printed in the Melbourne Age Newspaper on the following day.  The e-mail stated, in part:

 Ben Potter is to publish a story concerning Alan Smith who’s called for a public jury to hear his complaint.  If we win — he shuts up!  If he wins, the WFB A D Hoar resign.  Potter is aware that this is just a media stunt given the extensive initiatives currently under way to resolve the COT matters.

Am currently discussing matter with J Holmes prior to responding to Ben Potter, who rang me with the news.

This will blow away or certainly diminish Mr Smith’s call for a public jury to solve his complaints.”

Mr Benjamin also received a copy of another e-mail from the same Greg Newbold (FOI A05254).  This document, dated 17 November 1993, referred to a question being raised by Canberra Liaison Group regarding the “merits/demerits of holding back the Bell Canada tests — information for a ‘cleansing’ programme after the mess of the Coopers and Lybrand Report.”

It is interesting to note that at a Legislation Committee meeting in the Senate on 27 February 1998, Mr Benjamin admitted to Senator Bill O’Chee that he was aware that Telstra had falsified defence documents during another COT arbitration.  It appears that, so far, very little has been done in response to this admission.

In my opinion, other similar documents show that Ted Benjamin, COT co-ordinator and supplier of our FOI discovery documents, was well aware of many of the different aspects and different issues surrounding our case.  This does not seem to be the impression he gave to the Senators.

Back about the middle of 1993, with phone faults continuing to plague my business, I had asked that an independent person be appointed, perhaps by Austel or the Government, to take over my office for a period of one week.  I said at the time that, if that person could survive just one week with the phones in my office without going ‘nuts’ I would be amazed but I would walk away from the whole dispute.  On the other hand, I suggested, if this independent person found that my complaints to Telstra were valid then Mr Hoare, the Chairman of the Board of Telstra, should take over responsibility for seeing my case through to the end.  My suggestion was not taken up.

Later we discovered that there had been a variety of problems at the Cape Bridgewater exchange which no-one was aware of, at the time.  The first was that Telstra technicians had not insulated the exchange and moisture was causing some of the problems I was experiencing.  The second problem was caused because the same technicians who had installed the RCM in August 1991, had also forgotten to connect the fault alarm (as discussed previously).  Because the Cape Bridgewater exchange was unmanned, the technicians at Portland relied on this alarm to let them know if there were any problems.  Obviously, if the alarm wasn’t connected, the technicians at Portland didn’t know of any of the faults that were occurring.  Finally, heat in the unmanned exchange was creating even more problems.  Much later a local technician discovered that the RCM system 1 failed when the ambient temperature reached 74ºF or 23ºC.  Once this problem was discovered, a cooling fan was installed.

Mr Benjamin’s statement that Telstra had been unable to reach a final settlement with me before going to arbitration infers that I was stubbornly refusing to negotiate and that my stubbornness created the need for arbitration.  In fact Austel’s General Manager for Consumer Affairs at the time, Mr John MacMahon, was well aware that I was actually pushing for a commercial assessment, and I had been pushing for this from the very beginning.  The last thing the COT members ever wanted was a legal process.  It is clear from many of the FOI documents I now have however, that Telstra were only interested, from the start, in forcing the COT members into a legal process, fully aware that, even if we won our cases, the cost to each of us would deliver a blow which, in the end, would mean that our group would be beaten by the enormous costs involved in mounting a legal case, while Telstra just continued to dip into the public purse.

There are still many questions waiting to be answered by Telstra.  The Commonwealth Ombudsman’s office has also been attempting to extract replies from Telstra on my behalf.  In one instance I asked the Commonwealth Ombudsman’s office to supply a copy of a letter from Telstra to my arbitrator on 25 January 1994 and copies of subsequent fax documents sent by the arbitrator to Telstra on 11 February 1994.  In response to a request from Ms Phillipa Smith, the Commonwealth Ombudsman, Telstra wrote that they had located the documents in question in a file belonging to a past senior Telstra executive.  They then forwarded the required letters on to Ms Smith.  This was a small win, but it was far outweighed by the documents which were never supplied.  For instance —

Early in the arbitration process I had asked, under FOI,  to see documents explaining just how the rules of the arbitration had been arrived at, particularly the first draft of these rules.  When Ms Smith passed this request on to Telstra she received the following reply:

“Telstra has been unable to locate Mr Black’s further general files which include copies of the correspondence received from Hunt and Hunt in relation to the development of the Fast Track Arbitration Process and I am told that these files, along with other documents, were disposed of by his personal assistant sometime after he left Telstra’s employ.”

So, it seems that everyday letters can be located but important evidence, relating to a legal process such as my arbitration, were lost forever.  This missing evidence could well have proved that the so-called ‘independent’ rules which the members of COT signed, were actually not so independent after all.

Many documents mysteriously disappeared and many organisations disassociated themselves from my arbitration over the years.  When I raised issues with the Institute of Arbitrators in a letter dated 18 January 1995, I was advised by the then President of the Institute that:

“The Institute of Arbitrators Australia has absolutely no connection with the arbitration between Telstra and yourself.”

To this day I believe that he was probably told that, but I have evidence from the TIO’s office that, in fact, at the time of the FTAP, the TIO and my arbitrator stated in writing that the then President of the Institute helped draft some of the rules of the arbitration.  This man is now a County Court Judge.

This ‘non-legalistic’ arbitration was cursed with confusion and complications from the very beginning and even now no-one seems willing to explain why so many of my claim documents disappeared during the process.  When I found out that the technical resource unit only assessed my phone and fax faults from February 1988 to August 1994 I became even more convinced of a conspiracy of immense proportions; a conspiracy not only involving the arbitrator, Telstra and those who administered the procedure, but also involving people higher up within Telstra, people who had the power to hide evidence.  Either my faxes were being intercepted en route to the arbitrator’s office, or the arbitrator’s office was not passing them to Telstra’s defence unit so they could be addressed as part of the arbitration procedure.

It has been stated by Telstra, their lawyers and a number of independent technical experts that, between 26 May and 19 August, 1993, because the malicious call tracing equipment locked my 008 line up for ninety seconds after the completion of each successful call, no incoming call could have been answered in this ninety second time.  This proves, of course, that at least some of my calls were answered somewhere other than at my business.  According to Telstra’s own CCAS data at least forty separate incoming calls were diverted during this particular period, without including Telstra’s test calls.  So, were my faxes, originally intended for the arbitrator’s eyes only, also ending up at this unknown location?

How many Australian businesses have lost out to aggressive and unexpected take-overs when they were in a vulnerable position?  How many of these businesses were surprised by the take-over bid because they believed no-one knew their situation?  How many were hijacked because someone had access to their telephone conversations?

How easy has it been to target my business, under the nose of the Government?  How many legal battles in Australia have been open and shut cases with clear evidence to support a win and, at the last moment, the case is lost because the opposition has unearthed sensitive information?  How much information, trusted to the Telstra network by Australian citizens and businesses, believed to be a private exchange of information between two people only, is actually being highacked via the telephone network?

As an example, in my case alone, Telstra have listed the documents they received as part of my claim in arbitration.  This list is forty-three documents short of the number that I forwarded to the arbitrator to be sent on to Telstra’s lawyers.  Even the most unscrupulous arbitrator in the country would not withhold this much claim material.  So -- where are these documents?

Documents lost during a legal process is not a new experience for the Telstra Corporation as the founder of the Australian Internet Web site, ‘CyberJustice’ (, also found.  John Tuczynski was originally the director of his own telephone salvage company, Liberty USA Pty Ltd.  In 1991 Liberty began purchasing used telephone equipment from Telstra.  In mid-1992 the company entered into a written agreement to purchase all Telstra’s recovered T200 telephones and, in the following years, they purchased some 400,000 of these second-hand telephones, for reconditioning and resale to overseas markets.  The company became quite successful then, suddenly, the supply of the T200 phones dried up.

John Tuczynski discovered that the Telstra officer he had been dealing with had left Telstra and set up his own company in opposition to Liberty.  The new bloke on the block, ex-Telstra, then somehow managed to secure rights to purchase almost all the popular T200 telephones himself.  So few were left for Liberty that the business was no longer viable.  Further, those few that were left were not available to Liberty at a competitive price.  Telstra sold these used phones by the tonne and, according to Federal Court documents, the new bloke purchased 472,426 tonnes at a total cost of only $75,588.16.  If Liberty had been able to purchase the same quantity, they would have had to pay in excess of $300,000.  Quite a bit more than the $75,588.16 paid by the opposition.

Bravely, Liberty USA Pty Ltd, a small family business, believing in the Australian Justice System, decided to take the matter to the Federal Court.  International observers who have since read the transcript of the court case are lost to understand what went wrong.  No-one can actually explain how Telstra won the case.  Even the trial judge commented that this ex-Telstra ‘new bloke on the block’ ‘has been involved in conduct which may be the subject of the infringement of some Commonwealth Law (and) Statutory provisions of a criminal nature which has been infringed.’

Telstra could apparently not locate the invoice, or any accounting records, which should have covered a $100,000:00 bank cheque from Liberty.  Although a hand written ledger had been kept to record the sale of used equipment, even this pre-nineteenth century record could not account for the missing $100,000:00 bank cheque.  Even the trial judge referred to the ‘surprisingly primitive accounting system for an organisation like yours.’  (ie Telstra).  Naturally John agreed!

For years Liberty has repeatedly asked for an invoice for this $100,000:00 payment but it has never materialised.

Liberty’s story continues later in this book, on page 218.

In my case, even more than lost faxes, the lost incoming phone calls add up to an awful lot of lost revenue.  Although some of my customers have been returning annually for more than ten years, I still can’t afford to loose forty calls in three months -- forty prospective new customers.  Perhaps these people are now regularly visiting another holiday camp somewhere -- who knows?  What we do know, however, is that so far the Australian Government seems powerless to tackle the ‘big brother’ of Telstra’s corporate management team.

In Chapter 34, on pages 196 and 197 you will see how much our present Government cares when a small business operator highlights the dangers of documents lost in Telstra’s network.  If I was representing the Ford Motor Company, or BHP, or one of any number of other multi-national companies in Australia, I am sure these complaints would have been investigated long ago.


My patience, already stretched past normal endurance, snapped.  Where had all the documents relating to problems after August 1994 vanished to?  After all, these problems continued right through to July 1998 — people were still writing to me describing faults they had encountered when attempting to send faxes to me or when I attempted to send faxes to them. 

Around June 1998 I received letters from five different businesses, listing the fax problems they had encountered.  These letters were all passed on to the TIO’s office.  In one of these letters, from Chrissy Hawker’s Secretarial Service in Portland, Chrissy listed the problems she had encountered, including:

Chrissy went on to say:

“As you can appreciate, being the only secretarial service in Portland, my fax machine is a valuable tool in my office and as to date I have never experienced problems with any of my other clients.”

In this letter, dated 30th July 1998, the Australian Federal Police tell me that they are unable to help in any way.

If the Federal Police can’t understand the importance of 43 faxes not reaching the arbitrator then what other avenues are left to have these matters correctly investigated?  For example, if documents are sent by courier and don’t arrive, we have recourse through the courier company.  If documents sent by fax through Telstra’s network are lost however, it would seem there is no recourse and no-one will investigate.

In the next letter, dated 18 August 1998, the Attorney General notes that he “cannot be of assistance to you in this matter.”   If the Attorney General’s office is not concerned about the loss of legal documents while in transit via a fax machine, and the Federal Police can’t help either, then who can? 

I believe that piracy of faxed documents may well be rife in Australia, not only documents relating directly to Telstra, but also documents associated with business in general.

On the 1st July 1998 I wrote again to the Deputy Telecommunications Industry Ombudsman, Mr Wally Rothwell, relating my concern that not only were some of my faxes being ‘lost’ in transit, but others were being disfigured and made unreadable.  I copied on to him a number of documents which I had received back from the arbitrator’s office when they returned some of my claim documents to me after the arbitration had been completed.  These documents were later forwarded to both the Federal Police and to the Attorney General as well as to the Minister for Justice.  These were documents which had been originally faxed to the arbitrator but which had arrived in his office as only half pages or as blank pages.  Even so, my Telstra fax account shows that I was still charged for sending these illegible documents.  The TIO’s office still refuses to address these issues.

Bank statements which I faxed to Ferrier Hodgson arrived at their office with no detail, although still clearly bank statements.  In fact, some of these mostly-blank pages have a hand written note indicating “Smith’s Bank Statements”.   I have asked the TIO to find out whose handwriting it is but, once again, I have not received a reply.

When I saw these strange faxes I asked the TIO how FHCA could possibly have assessed my financial position correctly during their assessment if some of the documents I sent them arrived minus the information they needed for their valuation.  Again — no answer from FHCA.

Back on 22 April 1994 Austel had also received blank pages from my fax when I attempted to send them copies of my Telstra accounts showing massive incorrect charging.  When I checked the accounts covering the 22 April it was clear that I was charged for many minutes of transmission time from Cape Bridgewater to Austel in Melbourne.  Even Austel’s fax journal list registered that these blank pages took minutes to arrive.  I have since tested this situation by sending blank sheets to a Melbourne address.  They took only 10 to 12 seconds to go through.

One interesting  aspect of these ‘blank pages’ which arrived over the years, was a small symbol in the top right hand corner of each page which I have pointed out to the Federal Police, the Attorney General and other people.  On 29 June 1998 my solicitor also received 2 blank pages from my office.  These two pages both had strange, square symbols, not exactly the same as the earlier ‘blank page’ symbols, but not much different either.  So whatever happened to my faxes during the arbitration process seems to still be happening.

Another fax fault which I spoke about during the arbitration related to the TIO’s legal counsel who attempted to send me a copy of the arbitration rules.  In this instance I was the one to receive pages that were blank, save for a smaller version of the mysterious ‘fax symbol’.  By that stage I had already complained that these fax problems — the pages with only the ‘fax symbol’ — had only started to occur once I signed the original commercial process, the FTSP and that my accountants, my solicitors and various other advisors had all received these strange pages.

It is interesting to note that, after this, I didn’t see a full copy of the FTAP rules until I signed them on 21 April 1994. Could it be that my copy of the rules of the arbitration had been lost because of these fax problems?  Like various Senators, I was misled by the TIO and his legal counsel.  The Senators and I believed that the rules were non-legalistic and so I signed without seeking a legal opinion.  Once again my trust in the TIO let me down.

A letter dated 21 June 1996 from Telstra, talks about providing copies of ‘all the FOI documents and correspondence’ which they received ‘from Dr Gordon Hughes from 1 January 1994 to 30 April 1994 and from 1 September 1994 to 31 May 1995’ regarding my FTSP and FTAP.  This statement indicates that they did not provide copies of any correspondence received from the arbitrator between May and August 1994.  Even though I have requested this information under FOI, Telstra insist that there are just too many documents.  It is however interesting to note Telstra’s reference to ‘all the FOI documents and correspondence’ when looking at the following listing of faxes which I sent to the arbitrator.  This list has been taken from my phone account and it shows that 43 more faxes left my office for the arbitrator’s office than those which Telstra say they received from the arbitrator.  Where are these 43 faxes?  And, why were they not addressed by Telstra in their defence of my claims?  And, why were they not assessed by the resource units attached to the arbitration?

Over the years I have written more than 800 letters to a wide variety of people including the Treasurer, the Prime Minister and many others.  Because I have not been able to secure help from any of these sources I had no other alternative but production of this book, thereby breaking the confidentiality agreement I was coerced into signing. 

I have also written to the TIO and the Minister for Communications, asking them to instruct the arbitrator’s office and the TIO’s legal counsel to supply me with a copy of all the ‘missing’ 43 claim documents, under the rules of the arbitration which Telstra and I both signed.

Some very interesting points raised in this book relate to:

1.         documents not received by the arbitrator from me during the FTAP

2.         documents not received by me from the arbitrator or the TIO’s legal counsel after the completion of my arbitration.

In relation to this, points 6 and 7.2 of the FTAP rules state:

6.           A copy of all documents and correspondence forwarded by the Arbitrator to a party or by a party to the Arbitrator shall be forwarded to the Special Counsel.  A copy of all documents and correspondence forwarded by a party to the Arbitrator shall be forwarded by the Arbitrator to the Special Counsel and the other party.

7.2         The Claimant shall within 4 weeks of receipt of written notice from the Administrator pursuant to Clause 5 that he has received completed and signed Request for Arbitration forms send to Telecom and to the Arbitrator in duplicate, its Statement of Claim and any written evidence and submissions (“the Claim Documents”) in support of that claim.

And, at point 25, the rules state:

Return of Documents after Arbitration

25.         Within 6 week of publication of the Arbitrator’s award, all documents received under this Procedure by the parties, the Administrator, the Resource Unit and/or the Arbitrator and all copies thereof, shall be returned to the party who lodged such documents.

The FTAP rules are quite clear:  all the material that I submitted to the arbitrator during the procedure was to be sent on to Telstra and then to the TIO’s legal counsel (who had been appointed as the special counsel).  This meant that they would have copies of everything I sent to the arbitrator whether I sent it through the mail or by fax.  Telstra’s list of documents which they say they actually receive from the arbitrator did not include 43 faxes however, even though I was charged by Telstra as if these faxes had arrived at the arbitrator’s office.  Telstra’s list of documents also did not include a number of bound copies of documents which I had sent through the mail.

Under the rules (point 25), I should have received back from Telstra’s defence counsel a complete copy of all my claim material (including the elusive 43 ‘missing’ faxes).  So far the TIO has not instructed Telstra or their legal counsel to supply me with these ‘missing’ documents.

The only conclusion which I can draw from this is that the TIO must be aware that the majority of my claim documents never reached Telstra’s defence unit or the legal counsel in the first place.  If this is so, then it is pointless to direct them to return these documents since they haven’t got them now and they have never had them. One can only wonder why the TIO did not follow his ‘duty of care’ when administering my arbitration.

In an effort to retrieve ALL my claim documents I have contacted:

All these people have been asked to instruct the parties involved in this process to please return my documents — ALL my documents, not just a few of them. 

The TIO had a duty to act impartially:  the members of COT agree that the evidence we have indicates quite strongly that he didn’t act impartially when dealing with COT issues.

According to a reliable source, both Warrick Smith and the Hon. Senator Richard Alston visited Atlanta in the United States during the Olympic Games, with their fares and accommodation paid for by Telstra.  Although, in my opinion, there is nothing illegal about this, it does seem to me to raise questions about impartiality.  After all, both these men were involved at a high level in a process (the COT versus Telstra issue) in which Telstra was a major player.  I can’t understand why they weren’t doing everything they could to be clearly seen as totally impartial.  If I had been in Warrick Smith’s shoes, or Richard Alston’s shoes, I would certainly not have accepted such a trip from Telstra:  my conscience would not have allowed me to accept such a gift, knowing that the COT members had been treated so badly by Telstra in their quest for justice.

Warrick Smith, when he was the TIO, had forced the four COT’s to abandon a perfectly workable commercial assessment process (the FTSP) for an arbitration procedure which the TIO and his legal
counsel had incorrectly assured us would be non-legalistic.  The administrator of the arbitration procedure (the TIO) did not carry out his duty of care to ensure that the arbitrator he commissioned was suitably qualified to preside over such a complex process as the COT arbitrations.   From the perspective of the TIO, the Minister for Communications and others involved in drawing up the procedure, this should have been seen as a disaster from the very beginning.  COT members have been advised by the current TIO that the rules of the original arbitration process were drawn up by the arbitrator in consultation with the then president of the Institute of Arbitrators Australia, who is now a County Court Judge.  The presidency of the Institute changes annually and it is alarming therefore for us to later be advised, first by Mr Laurie James, when he was president, that:

“The Institute of Arbitrators Australia has absolutely no connection with the arbitration between Telstra and yourself .... ”

and then later, in a letter dated 10/9/96 to be advised by another president, Mr J Muirhead, that the Institute was not asked to supply a graded arbitrator when the COT arbitrator was appointed.  In his letter, Mr Muirhead goes on to say that “there is always a risk” when using an arbitrator who is not correctly graded.

Since one of the two people drawing up the rules of the arbitration was, at that very time, president of the Institute of Arbitrators, didn’t he have a duty to alert the TIO to the fact that the person selected to handle the arbitration was not sufficiently qualified to do the job correctly?  Remember, the arbitrator actually sat for his exams for this qualification during the arbitration procedure, and failed!

Over the many years I have been involved in this debacle, the COT members have continually ensured that Warrick Smith, Richard Alston and Amanda Vanstone (Minister for Justice), have all been sent up-to-date information which supports our various claims.  In my case, I have provided documented proof, again and again, that my arbitration was not carried out according to the principals of natural justice.

As previously mentioned, one of the many issues which have been raised with these three people relates to the completed financial report, prepared by Ferrier Hodgson Corporate Advisory.  The project manager who produced this report had been appointed to assess what effect Telstra’s defective supply of service had on my financial losses but, on instructions from my arbitrator, this project manager withdrew a large section of the final report, including all the figures showing how FHCA arrived at their final assessment.  Both the project manager and the arbitrator must have been aware that removal of this information would seriously disadvantage my forensic accountant in the preparation of his reply:  the missing information meant that he had no way of knowing how FHCA arrived at their findings.  Not only were Warrick Smith, Richard Alston and Amanda Vanstone alerted to this situation, but the issue was also raised with the Hon. Daryl Williams, QC, the Attorney General.

All these people were also alerted to the fact that this same company, FHCA, were advising the Government and also overseeing the investigation into Christopher Skase’s financial situation (at the time, Christopher Skase was a fugitive from Australian justice and living in Spain).  If FHCA could be influenced to hide their calculations in my case, could they be influenced to do the same in other, larger cases?  We have to wonder too, about the earlier Pyramid matter that FHCA also advised on.

Although I understand the position the FHCA project manager found himself in, I cannot condone his actions in withdrawing information from the finished report, at the request of the arbitrator.  We must also seriously question FHCA’s ethics in allowing this situation to remain in place.  Why didn’t they raise the matter of an arbitrator influencing the outcome of their investigation?  If such a highly regarded organisation can be swayed to change a completed legal report then it leaves doubt about how often this could happen in the future (as well as how often it had happened before!).

Lost documents and changed reports have plagued my arbitration from the beginning and the Australian Broadcasting Corporation (ABC) seemed to echo my feelings in their press release of 20 September 1998, which was headed “QAI says Telstra hid report”.  In this press release, the ABC go on to say:

“A prominent Australian telecommunications company has accused Telstra and the Federal Government of a cover-up for failing to make public a report on billing problems at Telstra.

QAI Australia Limited is suing Telstra for $14 million in damages, and is attempting to get a copy of the report, commissioned by Communications Minister Senator Richard Alston, through the Freedom of Information Act.

The Government has agreed to release an edited version of the report, but Telstra has appealed against this decision.

QAI’s Managing Director Jon Grunseth says it should be released.

“If the report is not material, if it has little relevance or significance, why the big secret?” Mr Grunseth said.

“What we have here in my view is something that’s akin to a fairly substantial cover-up, so if it is harmless, release it.”

On 17 June 1998 a letter arrived at my office, from Senator Alston’s office, regarding my claims that neither Telstra nor my arbitrator addressed the incorrect charging which I included in both my interim submission and in my final claim documents.  The Minister’s letter stated, in part:

“The TIO is currently investigating your claims of overcharging on 1800 numbers.  It is also investigating the disconnection of your gold-phone service.

The Government has no jurisdiction to intervene in matters being examined by the TIO.

The TIO scheme applies in addition to the general rights consumers of goods and services have flowing from contract law and forms of consumer protection such as under the Trade Practices Act 1974, and does not take away from those existing rights.

A complainant may elect within twenty-one days whether or not to accept the decision of the TIO.  In accepting a decision, a complainant releases the member carriage service provider from all claims, actions etc. in relation to the complaint.

In the event that the complainant does not accept the decision of the TIO, he or she may elect to pursue another forum.  The member is then fully released from the TIO’s decision.”

As I have said, I received this letter on 17 June 1998.  At the time of writing, it is December 1998 and still I have not heard what the TIO intends to do regarding the incorrect charging on my 1800 line.  I have recently been advised that the TIO sought legal advice on this matter six months ago.

Senator Alston’s office also mentioned the issue of the disconnection of my gold-phone.  Telstra disconnected this phone in December 1995 and it remains disconnected up to the present day (December 1998), so I have now been waiting for three years to have this issue resolved.  How much longer do the Communications Minister and the TIO expect me to wait?  My customers continue to complain about not having easy access to a telephone when my office is locked for the night.  Are we really living in the democratic society that our Prime Minister keeps referring to?

According to a Hansard report (page 4472), on 30 November 1995, the last Senate sitting before the Liberal-National Party Coalition won office, and therefore the last sitting before Senator Alston became the Minister for Communications, Senator Alston helped prepare a motion proposed by Senator Ron Boswell, the National Party Leader in the Senate.  This motion stated:

“That the Senate calls on the Minister for Communications and the Arts to establish an independent inquiry into the behaviour of ’Telstra’ in respect of the resultant costs to COT members of the extensive prolonged and excessively legalistic arbitration process.”

This motion was not opposed in the Senate by the then Labor Government but, now that Senator Alston has the power to carry out his own motion of three years ago, there has still been no inquiry, my gold-phone still remains disconnected and the TIO is still considering his options.

In the last paragraph of the letter which I received on 17 June 1998, Senator Alston’s office states:

“The Government has no jurisdiction to intervene in matters being examined by the TIO.  The Minister also wrote to Mr David Hawker MP as a result of representations you made to his office.  The Minister has informed Mr Hawker that it is inappropriate for the Government to intervene in this matter, particularly while it is still under investigation by the TIO.”

and yet this same TIO wrote to Mr Hawker at about the same time, advising Mr Hawker that I had only just raised the issues of incorrect charging on my 1800 service.  In response to this statement I was able to supply Mr Hawker with a copy of one of the first letters I had written to the TIO regarding incorrect charging:  this letter is dated 3 September 1995.  I also sent Mr Hawker copies of another ten letters which I wrote directly to the TIO, the last dated 31 October 1995 (making 11 letters to the TIO between 3 September and 31 October 1995 — all relating to incorrect charging).  How the TIO could possibly think I had ‘only just’ raised this issue, in 1998, is beyond understanding — I have continued to write to him regarding this matter ever since.  According to records compiled by my secretarial service, I have actually written over 120 letters to the TIO in all; most of them related to incorrect charging.

The TIO himself actually replied to some of these letters.  One of his replies, dated 28 November 1995, stated:

“The resource unit have provided clarification of the reason for deletion of references to a potential addendum on possible discrepancies in your Telecom bills from the final technical report as follows.

‘At a late stage of the arbitration process, at the time of preparation of the technical evaluation report, there were discussions about billing issues which had been raised by Mr Smith.  A draft of the technical evaluation report therefore included references to the billing matters, which it was thought might require further work beyond the time of issue of the report.’ ”

Later in this same letter, the TIO goes on to say:

“A second matter involved 008 calls.  Again this matter was current at a late stage (April 1995) of the arbitration process.  This matter concerned possible over-lap in the records of 008 calls made to Mr Smith, and for which he was billed.”

On 17 February 1998, by registered mail, I sent the TIO a 49 page bound submission detailing examples of incorrect charging issues.  This submission included copies of some pages taken from the transcript of the oral hearing conducted on 11 October 1994, between Telstra, the arbitrator and myself.  I reminded the TIO that a representative from his office also attended that oral hearing.  Pages 92 to 94 from the transcript clearly show that my claim documents relating to Telstra’s incorrect charging were accepted into the arbitration procedure at the oral hearing, having been previously submitted in my interim claim.  Pages 91 to 93 cover my explanation of the significance of the material I was submitting and, on page 94, the arbitrator is reported as stating “I don’t think we need any further examples.”

Taking all this into account, with the TIO clearly having mountains of evidence of incorrect charging in his possession at least from the day of the oral hearing, how can he state that the 008 incorrect charging matter was only ‘current at a late stage (April 1995) of the arbitration process.’?

The letter on the next page, from the TIO’s office, shows that, in relation to the incorrect charging on my 1800 line, the TIO has finally (2½ years late) asked Telstra to advise whether they “... agree that this matter was not addressed ...”  in my arbitration. 

At the time of writing this, in December 1998, I have not yet received a copy of Telstra’s response to this October 1997 letter from the TIO. 

According to information provided on good authority, a judgement against Telstra in the matter of incorrectly charging their customers on a regular basis would set a dangerous precedent so, even though my evidence clearly shows that this has been happening for some time, it seems that Telstra will avoid facing the issue at all costs.

This just confirms for me that one cover-up followed another, again and again.  It also raises questions about why the arbitrator, who was duty-bound to address ALL the issues I raised in my arbitration, did not address this particular issue.

Please read the following letter from the TIO


Other pages taken from the oral transcript have also been sent to the TIO, and to the Minister for Justice as well as the Attorney General.  Pages 37 - 38 and 40 - 41 are particularly interesting.  From the information in these pages it is clear that, at that time at least, the arbitrator intended to address Telstra’s unethical tapping of my phone lines, particularly in relation to their listening to my private phone calls during the arbitration procedure.  On pages 31 and 32 the arbitrator is reported as confirming that, if I included my allegations of telephone bugging in my claim, then Telstra would have a right of reply.  It is clear from my reply that I wanted these matters addressed as part of my claim.  The transcript actually states:

“Arbitrator to Smith:          ... and again I make sure Mr Smith understands what it means — is that effectively any reference in your claim documents to date regarding unlawful phone tapping will be treated by me and the resource unit as unsubstantiated and therefore not relevant for the purpose of determining whether you’re entitled to compensation? - -

My reply is recorded as being: “No, I will leave it in the claim because - - - -”

To which the arbitrator responds: “You understand if you leave it in your claim, Telecom is entitled to ask what is the basis for this allegation?”

My reply:  “Right, Okay, yes, all right.

The arbitrator:  “So you want to leave the allegation in?

My reply:  “I will leave the allegation in.”

If Telstra is allowed to get away with this (not addressing past eavesdropping on businesses) while it is Government owned, then what does the future hold for Australia once it is completely privatised, with no Government control at all?  Security for Australian businesses is at risk.

In my own situation, legal documents were ‘lost’ between my fax and their intended destination and my private and business arrangements were known by Telstra a long way in advance of the actual event, even while I was in litigation with them.  These issues, although raised again and again with the appropriate people, have still not been explained.  How many other businesses are having their private matters watched?  How many overseas investors are being ‘bugged’ without their knowledge?  How many businesses fighting a take-over bid have their private information passed around to whoever might benefit from a bit of inside knowledge?  How many faxes are copied off and passed to someone other than the intended recipient, thereby illegally giving information to someone who could well use it to the detriment of the other party?

An article on electronic security in the Melbourne Age newspaper of 10 October 1998 reported that it is currently possible for anyone with access to the network to monitor faxes as they are sent and to keep copies, without the sender’s knowledge.  This article also pointed out that telephone operators can eavesdrop on calls and Telstra has the ability to access all calls, though this is supposed to be under strict controls.  The Age article went on to ask questions in relation to this apparent easy access to our personal and private information:  What could someone use this information for?  What if it is misinterpreted?  Where might this information end up?

How can the Government privatise an organisation which has run vicious and vindictive campaigns against a group of their own customers simply because those customers took up their right to challenge the service they were being provided with?  Before the Bill to sell off the rest of Telstra is passed, this question needs further investigation by the Senate as a matter of priority.

If, when I first raised the issue of my faulty phone services, everyone involved had abided by the rules of natural justice, I would have reluctantly accepted the arbitrator’s award but, because I discovered that the arbitrator himself had breached not only the rules of natural justice, but also the rules of the arbitration procedure itself, I couldn’t just walk away.  If I had not seen the documents inadvertently given to me by the arbitrator’s secretary, and understood what these documents proved in relation to the unjust handling of my case, I would probably have reluctantly accepted the award the arbitrator handed down.  If Telstra officials had addressed the issue of lost faxes and eavesdropping, I would probably have reluctantly accepted the award — if the arbitrator had addressed the issue of lost faxes and eavesdropping, I would probably have reluctantly accepted the award. 

The lost faxes in particular raise a number of questions, not the least being — since many of the missing faxes were actually my claim material, and they therefore never reached the arbitrator, how could he arrive at a fair decision without the information contained in those important claim documents?

Many questions remain unanswered for the members of COT.

As it happened, neither the rules of natural justice nor the rules of the arbitration procedure were abided by and, after the arbitration had been ‘completed’ I was inadvertently allowed to see sensitive documents which were apparently hidden from me during the arbitration.  If the arbitrator had raised the issue of Telstra using falsified and impracticable documents as part of their defence then his integrity would not need to be questioned because it would be clear that he wasn’t being influenced by Telstra.  Again, this didn’t happen and so another question is raised:

All Australian citizens have a duty of care to expose unlawful conduct if that conduct could be detrimental to the welfare of other Australians.  I may have once been a ‘Pommy’ but now I consider myself a ‘true blue Aussie’ and I have spent many years trying to expose the fiasco I found myself caught up in because I believe the law should be observed at all costs.  Without a democratic society we would no longer have the freedom we currently take for granted; a freedom so many young Australians have gone to war to preserve.  The law is in place as a protection for all Australians, not just those politicians and corporate lawyers who choose to manipulate the system for their own benefit, often to the detriment of other Australians, as this story has demonstrated.

On page 28 of his award, under the heading ‘Faults Caused By Claimant’, the arbitrator appears to have based at least part of his award on a belief that Telstra’s defence documents were based on fact.  He says:

“(c)      Telstra nevertheless maintains that most reported faults were attributable to mis-operation by the claimant or by his callers or to normal wear and tear on the equipment they were using.

(d)        In this regard I have noted for example, the Statutory Declaration by (name no. 1 deleted)*, a senior technical officer (grade 1) who concluded that specific fault allegations involving the claimant’s answering machine, cordless phone, and facsimile machine could only be attributable to operator error.  I have also noted that statement by (name no. 2 deleted)*, senior Telstra technician officer grade 2, to the effect that reported facsimile machine faults were attributable to customer error.”

* These names have been deleted by the author to protect individual Telstra employees. The author and other COT claimants believe that a number of Telstra employees were pressured by the Telstra Corporation into giving false statements in support of Telstra’s defence.

The following statements, taken from Telstra’s own archival material, completely contradict the Statutory Declaration made by the first technical officer mentioned in point (d) above.

1.         From an early fault report dated 5/3/93:

“Rang Cape Bridgewater but Mr Smith was out, his assistant stated she had received several calls where on lift off all she heard was dial tone, this is after we shifted 267 267 and 267 230 into system 3 in the RCM.  I believe this may be tied up with the Portland AXE Network problem.”

2.         FOI document K00960, dated 31/1/94, in relation to my fax line 055 267 230, further states:

“Fax tests to Cape Bridgewater needed as Telstra’s Steve Black had problems faxing Smith Telstra information.”

3.         And again, FOI document R37914, dated 19/3/94, also in relation to my fax line, states:

“Found fault to be in RCM at the Cape Bridgewater.  Common equipment card due to data corruption.”

Appendix 5, at the end of this book, shows that both the engineer the memo was addressed to, and the National Facsimile Support Centre, had experienced fax problems themselves, when attempting to send faxes to my business.  Further FOI documents (K03752 & 7), currently being held in a safe place, show the actual pages and half-pages received by the writer of this memo from the addressee on 28/10/93.

Evidence provided earlier in this book clearly indicates that the faults experienced by these two Telstra people continued to plague my business right through my arbitration (1994/5) and up to at least July/August 1998.  As I have explained earlier, during 1994 I alerted both the Minister for Communications and Austel that I was having problems sending faxes during my arbitration.  It still seems however, from statements in his ‘award’, that the arbitrator accepted that the Telstra technical officer no. 1 (in point (d) above) had presented the arbitration with a true and factual Statutory Declaration and that my fax faults were therefore ‘attributable to operator error’.  Obviously the technical officer has committed an unlawful act of perjury in a legal arbitration process

I wonder if the TIO has still not investigated my fax problems because he believed this perjured information, even though the problems with my fax line were still being experienced long after my arbitration was completed?  It seems clear to me that he too believed there were no problems with my fax, simply because the technical officer’s Statutory Declaration suggested that I was the problem, not Telstra.

It is interesting to remember here that the TIO Board is made up of representatives from a number of Telecommunications carriers, including Telstra, Optus, Vodaphone, Primus and AAPT (among others).  Since the TIO’s office acted as administrator to my arbitration and should therefore have been aware of the unlawful way in which this procedure was conducted, they should have convened their own investigations into the serious matters raised by any false statements or Statutory Declarations which were provided to my arbitrator. All this information was supplied to the TIO Board and their lawyers in August/September 1999.  So now we wait to see what might or might not happen next.

It seems to me that some of the issues around the COT arbitrations have also been deliberately covered up by the Australian Government so they would not have to be correctly investigated before the partial sale of Telstra.  My evidence proved conclusively that Telstra continually incorrectly charged me on all three of my service lines over a prolonged period.  This is against the Australian Trade Practices Act.  If this incorrect charging was occurring on my phone lines, how many other lines had the same problem?  Surely then the Australian Government should have notified the share-buying Australian public that it appeared that at least some of Telstra’s profits had come from incorrect charging of their customers? 

I believe that the Minister for Communications had a duty of care to:

This story, and the documents included in this book, certainly seem to indicate that my arbitrator was not totally impartial.  By not addressing the incorrect charging, the short duration calls (which probably indicate call diversion) or the phone bugging, the arbitrator favoured Telstra to my detriment.

If all this happened to me, and it certainly did, who else could it happen to?  Could it happen to you too?  And, if Telstra can do this, how many other large, powerful corporations are wielding the same sort of power over small business and individuals alike?

It should be remembered that COT members are not only fighting for justice in their own individual cases, they are also fighting for the rights of the Australian public — we are all being ‘ripped off’ by Telstra as long as they are allowed to continue to send out incorrect telephone accounts.

Questions must be asked about the number of alarming connections which seem to exist between Telstra’s lawyers and some high profile politicians.  It is also interesting to note that I have alerted the President of the Liberal Party, who is also the Chairperson of the Counsel of the TIO’s office, to this alarming situation, but had no response.  Surely these people must be aware by now of the conspiracy and cover-up that has taken place here?  Certainly most of them have been given plenty of information; information which should prompt them to dig deeper.

This book has not only been written to alert the public to the treatment meted out to the members of COT, it has also been written to raise the issue of the cover-up carried out by legal vultures and large corporations and, hopefully, to stop such a situation ever arising in Australia again.

When I look back over the years since my arbitration ‘award’ was handed down I recall many moments when I contemplated giving up the fight for justice but how could I when the ‘award’ had left out so much?  How could I when the arbitrator stated in the ‘award’ that tourism numbers in my region had dropped over the period of my claim, even though the actual statistics available show an increase?  How could I when this down-grading of tourism numbers effected the final ‘award’ which was less than ten cents in the dollar against the amount my accountant calculated I had lost?  How could I when the chairman of Austel had guaranteed that consequential losses would be included in any awards made, and this did not happen?  How could I after all the financial expenditure involved in preparing my case for arbitration and all the business I had lost, firstly because of the faulty phone system and then because of all the time I had to devote to the case?  How could I when I had been forced to re-mortgage three times just to stay in the fight to bring these matters to the attention of the Australian public and the communications minister?  And how could I when I recalled all the issues which had not been correctly addressed, issues which impact on all Telstra’s customers, not just on me?

On  the twenty-sixth of February, 1999, I sent three faxes to another COT member, Graham Schorer:  the first and third of these faxes arrived at Graham’s office as intended but the second has never arrived.  Graham’s fax journal, on the following page, covers the time span during which I sent these faxes from my fax machine and shows the two faxes which were received, marked with an arrow.

My Telstra account for my fax line, below, also covers the time span during which I sent these faxes. 



Graham’s fax line number, 03 9287 7001, appears quite clearly on my phone bill.  Obviously, according to Telstra, I sent these faxes to the right number and so I was duly charged for the long-distance transmission of them.  Comparison of my fax account to Graham’s fax journal confirms that Graham received the fax I sent at approximately 10:53 and the fax that I sent at approximately 1:35 (this appears on Graham’s journal as 13:35) but the document sent from my fax at 11:20 did not arrive at Graham’s fax.

If I hadn’t happened to phone Graham to discuss the document which didn’t arrive, we would probably never have discovered that it had ‘gone walkabout’ between our faxes.  Now most people would accept a single incident like this as just a ‘blip’ in the system.  Unfortunately this has happened on many more occasions.

Back on the twenty-third of May, 1994, I sent seven faxes to my arbitrator.  According to a signed document later supplied under FOI by a Telstra senior executive, Telstra acknowledges that these seven faxes did not reach the arbitrator’s office because, according to the arbitrator’s secretary, their fax line was engaged at the times I sent my faxes.  After receiving this signed document I asked for Telstra’s technical CCAS data print-out for this particular day and, lo and behold, these seven faxes appear as having arrived at the arbitrator’s office.  And, you guessed it, my Telstra account shows that I was charged for these faxes as if they arrived at their intended destination, just as I was charged for the fax I attempted to send to Graham Schorer, four and a half years later on the twenty-sixth of February, 1999.

On page 199 I have related the story of forty-three faxes which ‘went missing’ over the months during which I was lodging my claim with the arbitrator.  The seven missing faxes mentioned above are included in this total of forty-three.  When I examined Telstra’s defence unit’s list of documents which they received from the arbitrator, it was clear that they had not received any of these forty-three faxed claim documents and yet Telstra has charged me for all of them, some lasting for up to eight minutes (long-distance).  The length of transmission time indicates that many pages were being sent.

Two important questions must be asked, in relation to these episodes of vanishing faxes:

1.Where are these forty-three documents?

2.Are they in the same place as the recent fax which didn’t reach Graham Schorer?

If you are still not convinced that something strange is afoot here, either a serious fault in Telstra’s network or some under-handed skulduggery, then I have yet another story to add to this list.  Back in March of 1996 my secretarial agency in Melbourne phoned to discuss a document that had been faxed to me earlier in the day.  My fax journal for this period shows quite clearly that the fax did not arrive at my office and yet the Telstra account for the agency shows that it did arrive.  They were charged for a long-distance transmission lasting four minutes and twenty-five seconds.

We also have to wonder how many other similar occurrences have not been noticed over the years and how many individual or business people send faxes, never discover that they didn’t arrive at their intended destination and so happily pay their Telstra accounts.

As you are aware, having read this far, neither Telstra nor the arbitrator addressed the incorrect charging on my 1800 line and my fax line, nor did they address the problems associated with my gold phone and it’s later disconnection.  Now we see that at least some of these problems continue right up to the present day and yet they have still not been addressed by Telstra or the elusive Telecommunications Industry Ombudsman.

Over the years I have attempted to raise these issues with the Australian Government in a variety of different ways.  There are a number of politicians and senators who have the power to call for an investigation into the matters I have raised:  I have written to them all, including:

The Hon. John Howard, Prime Minister

The Hon. Peter Costello, Federal Treasurer

The Hon. Daryl Williams, Attorney General

Senator Richard Alston, Minister for Communications

Senator Amanda Vanstone, Minister for Justice

Senator Ian Campbell, Parliamentary Secretary to the Minister for Communications

Senator Geoff Prosser, Minister for Small Business

Mr David Hawker MP, Federal Member for Wannon

Mr John Pinnock, Telecommunications Industry Ombudsman

Mr Wally Rothwell, Deputy Telecommunications Industry Ombudsman

Professor Alan Fels, Australian Competition and Consumer Commission.

Despite numerous pleas to each of these people, none of them have succeeded in getting Telstra to account for their incorrect charging or for faxes that don’t arrive at their destination. In August of 1998 I forwarded on to the Telecommunications Industry Ombudsman’s office, copies of letters from four different professional organisations, each detailing their experiences of faults related to my fax line over the years following the ‘completion’ of my arbitration.  Some of these letters refer to incidents as far back as 1994 or as recent as August 1998 and each organisation states that, although they send and receive many faxes, mine is the only one to give them so much trouble.

Early in 1998 Telstra sent two officers to meet with me.  My accountant/business adviser was present at this meeting to take the minutes and observe the process.  These two executives made it quite clear that they were then negotiating with the TIO’s office regarding a proposed assessment of the incorrect charging issues I had raised.  During this meeting I showed the Telstra people a fax that had arrived on my machine from the Crown Casino in Melbourne.  This fax was obviously not intended for me and it was one of many I was to receive over the following months, all from within the Crown Casino complex.  Finally I complained to the TIO in July 1998 and, although the TIO’s office never responded to my complaint, these faxes from the casino stopped coming.  I have never been able to understand how these faxes, originating from the casino, reached my fax machine.  Not one of them was addressed to a fax number remotely like mine;  they were not even in a similar range.  In fact, most of the numbers the faxes were intended for were four hundred and fifty kilometres away.

After the meeting with the two Telstra officers I waited for some sort of resolution of the faults I had raised but nothing happened until October 1998.  At this stage of the proceedings I had been paying only part of my fax account in an effort to highlight the problems which had not been addressed.  Even though the account for this fax line was still in dispute, Telstra disconnected the line.  I continued to pay off the account although this meant I was paying off the rental for a service that no longer exists.  The final payment was made on 20 March, 1999, six months after the line was disconnected.  This means that, since October 1998, I have been forced to move most of my office duties to my residence in order to connect my fax machine to a working phone line. My faxes are now all sent from my residence and although some faults continue to occur, there are not nearly as many as I had suffered prior to July 1998.  On the twenty-eighth of January, 1999, I sent a fax to a business associate some distance away.  My Telstra fax account shows charges for two fax calls to his number on this date, one at 08:23 p.m, lasting for forty seconds, and a second call at 08:24 p.m, lasting for three minutes and thirty-one seconds.  According to my fax journal, the first call was not answered — so why was I charged for this call?  Remember, these are all long-distance, timed calls, not a single twenty-five cent local call charge.  And then, according to my associate, the second fax never arrived — so where is it?

If you are still thinking that all these examples of missing faxes could be simply glitches in the system, and of little importance, there are even more astounding and as yet unexplained events.  On the nineteenth of March, 1999, my secretarial agency in Melbourne sent a six page fax to my office.  My fax machine doesn’t cut off each page, so a multi-paged fax comes off the machine as one long strip of paper.  As I watched this fax roll off the machine, it began to ring as if a new call was coming in, even though the line was fully engaged at the time.  The fax from the secretarial agency stopped and a two-page fax from my solicitor, also in Melbourne, followed on.  While I stood gaping in surprise the phone rang again.  The fax from my solicitor ended and the final three pages from the secretarial agency rolled out of the machine — all in one continuous strip:  three pages from one address, two pages from a second, totally unrelated address, another three pages from the first address.

And so we arrive at the question on the cover of the book:  are your faxes also being lost or intercepted?  Who knows?  What we do know is that the technology exists to divert calls from one phone (or fax) to another and what we must now ask is — how is that technology being used?

On page 168 I discuss short-duration calls (lasting only a few seconds) which I had complained about for many years.  As reported there, Telstra wrote to Austel back on the eleventh of November 1994, stating that they would address these short-duration calls as part of their defence of my claims.  Of course this didn’t happen and the short-duration call issue remains unresolved.  Another can of worms is opened in regard to short-duration calls by a Telstra document (FOI number A03610) which states that Telstra believed that some of these calls were being diverted.  Let me assure you now, I certainly did not have a call diverter on any of my lines back in 1994, not even to divert calls to Telstra’s message bank —  I have my own answering machine.  So, if these calls were being diverted, where were they being diverted to?  Who arranged for them to be diverted?  And why were they being diverted?  Again, I don’t have the answers.

What I do know is that I am not the only Telstra customer suffering from this ‘phantom diverter’ problem.  The members of COT have provided the Victoria Police and Telstra with the name of another Telstra customer who contacted our group some time ago.  It has been proved, and Telstra has acknowledged, that some of this customer’s business calls were being diverted to her competitor.  Again the question must be asked:  how many other customers suffer from unrecognised interference with their phone calls and faxes?  Why haven’t the Telecommunications Industry Ombudsman or the Federal Police investigated any of these issues?  How long is the Minister for Communications going to continue to ignore these issues?  Telstra’s enormous profits continue to grow and Telstra shareholders continue to reap the benefit which is a good thing — unless, of course, these profits come from faulty billing procedures and ‘ripped off’ customers. 

Telstra have recently sent another disconnection notice for my office fax line, the one that was disconnected some time ago.  How they plan to disconnect an already disconnected line is quite a puzzle but even more of a puzzle — the latest account for this disconnected line includes a charge for $60 rental to take the account up to June 1999!

COT members only recently discovered the TIO and Telstra met in private, without a representative of the COT group, during the planning stages of our arbitration.  What they actually discussed at this secret meeting may never be uncovered, however this same lawyer later informed me that the rules of my arbitration had been specially drawn up so that the process would be non-legalistic.  Legal experts have since stated that the COT arbitrations, far from being non-legalistic, were actually a legal minefield for anyone without a high level of legal training.

To continue the conflict of interest theme, I have also recently learned that the arbitrator and his resource unit also met with Telstra in private, before we signed for the arbitration.  Again no COT representatives were notified of this meeting either.  In lay terms, this is similar to the presiding judge meeting in his chambers with the defendant in a court case, and the defendant’s lawyers, without the opposite party or accuser.

This secret meeting raises many questions:



As you have read through this long and complicated story I have sometimes asked that you re-visit earlier chapters in order to refresh your memory on particular details;  now I ask you, once more, to turn back to pages 193 and 194 where I relate the details of the John Tuczynski story.  John, you will recall, ran a business called Liberty USA Pty Ltd.  He was another small business person caught up in the ‘Big Brother Syndrome’ of Telstra’s dealings.

John could not believe the result of his eminently winnable case against Telstra.  To add to his distress, John and his wife are convinced that losing this unlosable battle may well have contributed to his father-in-law’s death.  John decided to look for another way to secure justice ... and “CyberJustice, The People’s Court” was born.  This Internet site details the way a number of Australian citizens have been treated by our justice system.  Evidence from more who have suffered continues to roll in as I write.  I have also drafted a movie script of the COT saga.

Although my battle has raised many different justice issues, I believe the invasion of my privacy is the probably the most devastating.  An Australian journalist with a number of manuscripts to his credit has also commented on the privacy issues raised in my story.  He says they are the most damning he has read and he agrees that the Telstra officers who have been prepared to infringe on the civil liberties of Australian citizens must be made accountable for their actions and for the heartache and damage those actions have caused.

One small result of the pressure I have put on Telstra to treat their customers in a more civilised manner, was an invitation, on 22 March 1995, during my arbitration, to visit Parliament House in Canberra, together with three other members of COT -- Ann Garms, Graham Schorer and one other (who wishes to remain anonymous -- I will call him Mr X). The Government of the day at the time appeared to be seriously concerned about the privacy issues which had been raised by COT members, particularly the evidence of illegal voice monitoring and phone bugging by Telstra.  We were invited to participate in a Senate debate regarding an amendment to a proposed re-writing of the Telecommunications Laws Act.  At this debate I tabled most of the information now included in this book.  The four of us also met separately with individual Senators.  One of these Senators in particular appeared to be totally disgusted at the information we placed before him.

During the Senate debate itself, our Mr X detailed the problems he had experienced in dealing with Telstra.  Mr X lived in the country at the time and worked as a telephone counsellor:  he produced proof that these intensely private and confidential telephone discussions had been listened to at his country telephone exchange.

Even after all of this though, the members of COT are concerned that nothing has changed and so, on 28 August 1999, I wrote again to my local Member of Parliament (MP), detailing stories that I strongly believe should be told before the full sale of Telstra.  A number of these stories relate, unbelievably, to Telstra’s use of the Mental Health Act in their dealings with customers who complain about Telstra’ services.

During our battles with Telstra, we learned that various Telstra officials were referring to some COT members as being of ‘unsound mind’.  Recently a number of other instances of similar situations have been brought to my attention.  One of the documents which I forwarded to my MP on 28/8/99 was a copy of a letter dated 9/8/99, addressed to a current Senator, from a practising lawyer who had grave concerns regarding two of her clients: a lady from Queensland and a man from country Victoria.  The man is the person previously referred to as Mr X.  Both these people have claims against Telstra, similar to the COT claims and they have both given permission for their stories to be told (anonymously) in this book and the movie script.  The details supplied by their lawyer to the Senator include the fact that both these people have been the subject of warrants issued by the Telstra Corporation under the Mental Health Acts of Queensland and Victoria.  In her letter, the lawyer asks the Senator if the present Government has taken steps to see that the relevant States revoke such authority and if not, whether the Government believes it appropriate for the Telstra Corporation to exercise such authority.  In my letter to my MP I asked the same questions.

All Australians should now be asking if Telstra still have this same power and will they continue to have this power once Telstra has been privatised or will they have even more power, once they are outside Government control?

Another of the many issues COT members have with Telstra relates to one of the original COT members.  This man once owned a successful, telephone dependant pizza parlour.  His business had, in fact, become so successful that he decided to expand his advertising into the ‘Dial A Pizza’ area.  Just as he launched this advertising campaign, many callers to his business began to complain of problems getting through on the phone.  I understand that, at the time, Telstra suggested that his telephone was the cause of some of his phone faults.  The telephone under discussion was a model called T200.

In appendix 9 you will find a copy of FOI document D01026, a document discussing possible faults with 450,000 Exicom T200 telephones.  As you can see from this document, because the faults with these phones were believed to be caused by high humidity, Telstra deployed the phones to areas where they believed there was minimal humidity.  COT members are now wondering if our pizza parlour owner was a victim of one of these re-deployed T200 telephones?  His shop may have been in a designated ‘low-humidity’ area geographically, but what about the humidity levels INSIDE the shop?  I imagine the heat and humidity generated by pizza ovens could well have created the very conditions known to cause problems with these phones. 

Are you surprised to find that, along with the two clients whose lawyer is now querying the Senate, our pizza parlour owner was also the victim of Telstra’s rampant imagination with suggestions that he may be insane?  His experience of Telstra’s ‘mental health’ syndrome occurred one day while he was driving, with his children in the car.  He was pulled over by the police for not wearing his seat belt and provided his driver’s licence as requested.  Almost immediately he was ordered out of the car.  He was saved from arrest only because he had been pre-warned of the possibility of Telstra issuing a mental health order against him and so he was carrying a certificate attesting to his sanity.

As it happens, after many years of struggling in the legal arena, with hundreds of thousands of dollars of debt accruing, finally the Australian Senate intervened in the pizza parlour versus Telstra case.  The result?  The once proud pizza parlour owner, now quite ill as a result of all the worry and stress, has finally been awarded a substantial out-of-court settlement, to be paid by the Telstra Corporation, under the watchful eye of the Senate.  Could this possibly suggest that he had never had any mental problems but was simply demoralised and distracted as a result of Telstra’s attempts to discredit him?

During my own arbitration, as I have mentioned on page 162, Telstra’s defence lawyers commissioned a high profile clinical forensic psychologist to travel from Melbourne to assess my mental state.  Before he saw me, Telstra’s defence unit provided this man with a number of reports and other documents to help him evaluate information regarding my allegations that Telstra had not provided me with a phone service up to network standard.  I have since been able to gain access to this information myself and it is quite clear that, before these reports were passed to the psychologist, at least some of the information had already been acknowledged, by a member of Telstra’s defence team, to be flawed and impracticable.  Even so, the material was still provided to the psychologist and he was not alerted to the flaws in the documents.

The Australian Senate must now ask Telstra’s Board and Telstra’s senior executives:

Surely this outrageous behaviour by an Australian corporation must have us all asking questions about our own safety.  Could you be the next person to be institutionalised by Telstra?  How much longer will Telstra be allowed to get away with this behaviour?  How many more defenceless businesses will go under before Telstra is finally brought to account for their activities?


An earlier draft of this book, before the addition of the final chapters, has been sent to all seventy-six Australian Senators in an attempt to highlight Telstra’s unlawful conduct. In response, Senator Kim Carr wrote (refer prologue) to express his concern about the information contained in this manuscript, and a number of other Senators have expressed concern directly to the media, particularly regarding the privatisation of Telstra.  Perhaps it was ‘Ring For Justice’ that alerted them to some of the problems that still exist with the Telstra corporation.

Prior to publication of this book, a copy of this final chapter (Chapter 36) was sent, in full, to the Australian Prime Minister, in an attempt to alert him to my concerns.  It seems however that the Prime Minister’s office in not concerned about proof that Telstra customers cannot trust their telephone lines, even when (or perhaps particularly when) they are involved in legal proceedings.

Perhaps the worst infringement on our rights as Australian citizens is occurring, I believe, as a result of Telstra officers who are illegally accessing the intricate telecommunications security network system which is located on the thirty-seventh floor of Telstra House in Exhibition Street, Melbourne.  This area is so vital to Australia’s security that I have been loathe to raise this issue anywhere else in this book.  The fact that I have resorted to detailing these security infringements here indicates that all other attempts to have my concerns addressed by the current Government, including the Prime Minister’s Department, have failed.  My hope is that this exposure of the problems surrounding Floor 37 will eventually bring these illegal activities to a halt.

After I forwarded copies of ‘Ring For Justice’ to all the Senators, at a personal cost of more than thirteen hundred dollars, I was contacted by a number of ex-Telstra employees who somehow managed to acquire a copy of the book.  Some of these people have complained primarily about termination pay entitlements being incorrect; others have been so incensed at what they have read that they have forwarded material, too sensitive to include in this book, which supports all that I have detailed here.  One person related the following story of Floor 37, in front of a witness.

We were interested to hear that many Telstra employees refer to Telstra House as ‘Bullshit House’ but, aside from this amusing comment, the story of Floor 37 should give rise to grave concerns.

According to this informant, there is tight security in place on Floor 37 because, secreted below a false floor, there is an intricate network of communication equipment which allows direct access to every telephone line in the country, including lines used by Telstra’s opposition -- Optus, Vodaphone, Primus, AAPT etc. Apparently this floor also has a data-base room which monitors customer information.  Naturally the security level is therefore required to be extremely high.  In fact, if the system is working correctly, only very high level Telstra executives have access to the area.  It seems, however, that the system is not working correctly.

The existence of floor 37 in Telstra House can easily be checked: what actually takes place on that floor is not quite so easily uncovered.  The existence of all this equipment in one central location however, could well explain some of the problems suffered by various members of COT throughout Australia.  Back on page 104 of this book you will find a copy of a letter to Mr Steve Black of Telecom / Telstra, from John MacMahon, General Manager, Consumer Affairs, Austel.  In this letter Mr MacMahon acknowledges receipt of nine audio tapes from Telecom / Telstra and notes that these tapes have been passed on to the Australian Federal Police.  The letter makes it quite clear that these nine tapes related to the ‘taping of the telephone services of COT Cases.’  No warrant was ever issued by the Federal Court for this taping, neither was a warrant issued in either of the Australian States in which the taping took place.  Clearly, therefore, this taping was carried out unlawfully.  Further, it was carried out during a resolution process which had been put in place for the COT members.  What we don’t know is the ‘how’ of the process, or the ‘where’.  Could this taping have been carried out by Telstra officers who gained illegal access to Floor 37?

This book has already shown the haphazard way in which Telstra’s officers conduct the affairs of the company and it is therefore quite frightening to ponder on who will have control of Floor 37 and all the intricate network equipment it houses if Telstra is no longer under Government control.  If Telstra executives have been allowed to get away with the behaviour we have so far uncovered, while the company was Government owned, how much worse will the situation become if there is no Government control and no accountability to the Australian public?

Now that the Australian Government is pushing to fully privatise Telstra I believe the Prime Minister’s Office must answer the following questions:

1.Do all seventy-six Senators know how Floor 37 will operate once Telstra is fully privatised?

2.Who will be appointed to oversee the daily duties associated with Floor 37?

3.Have the Federal Police, or any other Government Agencies, been notified that Telstra officers may have used this intricate security network to Telstra’s own commercial advantage (ie by live voice monitoring of phone lines) during an Australian arbitration process?

4.If any Government agencies are aware of this illegal activity, are they also aware that any phone bugging or live voice monitoring that may have occurred must have been carried out without the knowledge or authorisation of the people whose lines were being interfered with?

5.If any Government agencies are aware of this illegal activity, have they carried out any investigation in relation to this illegal activity?

6.If investigations have been carried out, what was the outcome?


On page 140 of this book I have referred to a report prepared by Bell Canada International (BCI), on behalf of Telstra.  As previously noted at the end of page 140, a number of pages from Hansard Parliamentary Records were forwarded to me just as I was completing this book.  Two of these pages follow here.  In relation to these pages from Hansard it is also interesting to note that, at one point, Telstra were considering ‘cleansing’ this BCI report (refer page 191, FOI document A05254) and, as reported on page 140, both BCI and Telstra have admitted that the BCI report was ‘impracticable’.

On page 108 of the Hansard document (following) Mr Armstrong refers to ‘one of the COT members’ alleging that the BCI report was fabricated.  I believe Mr Armstrong was referring to me at that point and he knew, at the time, that I was right:  NONE of the tests included in the addendum to the BCI report could possibly have taken place to 055 267 211, the test PTARS phone, because of other testing which was also being carried out, by Telstra, on the same day and at the same time.  The power of Telstra continues to amaze me.  Not only did they lie to the Senate, but they have, so far, gotten away with it.

At the top of Hansard page 109 Mr Armstrong refers to ‘an apparent clash of dates ... with two sets of testing.’  He goes on to say that, as he recalls, BCI then ‘provided a letter saying that there was an error in the report.’  As it happens I have a copy of this BCI letter; I believe it is a phoney because BCI only refers to a single test being flawed but, as I have explained on page 114, none of the BCI tests could have taken place.  These two Hansard pages are reproduced on the following pages.

It is interesting to note, in his first comment on Hansard’s page 108, that Senator Schacht was not only concerned about the alleged inaccuracies included in the BCI tests, but also the ‘hundreds of millions of dollars between various service providers and other telecommunications providers claiming false overbilling’ .  (my emphasis)

It is also interesting to remember that two of the issues I raised during my arbitration were:

1.Telstra’s incorrect charging and

2.Evidence of serious flaws in the BCI test at Cape Bridgewater.

No-one has yet looked at the link between these two issues.

Why have the Government and the TIO’s office allowed the incorrect charging to continue?  In my own case this situation continued for at least twenty-two months after the completion of my arbitration.  In the end, the only way I could control the incorrect charging on my 800/1800 free call line was to discontinue the service:  the only alternative was to continue to suffer the incorrect billing.  It would seem that the Government has very little concern for the small business sector.

At the end of Hansard’s page 109, after establishing that Mr Benjamin was both the Telstra person  ‘designated to handle the CoT cases’  and also a ‘member of the TIO council’, Senator Schacht asked Mr Benjamin if he had declared his interest in the COT cases to the TIO.  On the next Hansard page (not included here), Mr Benjamin replied ‘There was no formal declaration...’.

As part of my continued search for justice I finally approached the Victoria Police and, in April 1999, I was notified that the matter had been taken up by the Major Fraud Group (see letter below).  Over the months since the start of this investigation, as the Fraud Group have delved into the intricacies of my case against Telstra, I have provided them with numerous documents, including all the documents in this book.  When I realised the significance of the Hansard pages I received late in August of 1999 I immediately forwarded them to the Major Fraud Group (see following letter dated 1/9/99).

As I explained in this letter to the Fraud Group, when Mr Armstrong’s comments (as reported in Hansard) are coupled with information about the flaws in the BCI report it is clear that Telstra knew that their defence of my arbitration claims were based on flawed information.  You and I can see this and so can the Major Fraud Group.

Now we just have to hope that the Victoria Police Major Fraud Group are allowed to complete their investigations without interference from any Government body, Commonwealth or State.  I believe these investigations will clearly support all my allegations.  The results of this investigation will be announced on our CyberJustice web page as soon as they come to hand.  Meanwhile, I have issued a challenge to Telstra .....


If Telstra is determined to stand by the comments made to the Senate on 26 September 1997 then I suggest they replicate the testing now, under identical circumstances and conditions to the tests allegedly carried out by BCI.  This should include arranging for NEAT testing to occur at the same time.

If Telstra will not agree to take up this challenge, why will they not agree?  Could it be that they know full well that the testing recorded by BCI in their report addendum could not have been carried out to the same PTARS 055 267 211, at the same time as the NEAT testing conducted by Telstra?  Could it be that they are aware that an admission of this would mean that they would then have to admit that the BCI test results were flawed?  Could it be that they are aware that an admission that these tests could not have been carried out as reported in the BCI report would mean that they would have to admit that they have misled the Senate?

Finally, as a result of my experiences laid out in this book, I believe Telstra must remain accountable to the Australian Parliament as do a number of Senators and other politicians from both sides of the Australian Government. 

In ‘The Australian’ newspaper of 9/9/99, Michelle Gilchrist reported that the Federal Labor MP and Committee Vice-Chairman, David Cox, has said that ‘Telstra should be accountable to the Senate process because it was responsible for billions of dollars of publicly owned assets.’

Greg Rule reported, also on 9/9/99, that ‘The Australian Democrats Communications Spokeswoman, Senator Allison, backed Labor’s stance, saying Telstra must continue to be accountable to Parliament while it was still in majority public ownership.’

How can a corporation like Telstra be allowed to be free to do whatever they want without having to answer to anyone other than their shareholders?  Would those shareholders actually care if some small-business person has lost their business somewhere in rural Australia as a result of Telstra not supplying a reliable phone service?  If Telstra’s decisions ruin a few small-businesses but the value of the shareholder’s shares goes up, my bet is that the shareholders would turn a blind eye.

‘Ring For Justice’ has proved, beyond reasonable doubt, that, in my case at least, Telstra spent an enormous amount of money, in a valiant attempt to hide the inadequacies of their phone service from the public.  If Telstra’s financial director has his way Telstra would only be accountable under corporate laws.

The TIO’s office is supposed to offer an unbiased investigation and resolution process for all telephone companies and their customers.  According to my experience that is certainly not the case, although the TIO has told a number of Senators that he believes that my arbitration was ‘fairly run’.  The TIO has also stated that my arbitration is now completed but I have to ask, how can it be complete if the phone and fax faults that drove me to arbitration in the first place continued to plague my business throughout the arbitration process itself and for at least another two years after the arbitrator had handed down his award?

Of course we cannot allow Telstra to only be accountable under corporate law!

Senator Alston wrote to my Member of Parliament on 27/2/98 and again on 29/5/98 stating that Telstra had undertaken to examine all the documentation with a view to resolving my concerns. Tom Dale, from the Minister’s office, wrote to the author on 13/2/98 stating that ‘Telstra has indicated that it is currently investigating your claim that you were overcharged on your 1800 service.’  A later letter dated 9/6/98, from the Deputy TIO stated:

‘The purpose of my intended meeting with Mr Hughes (arbitrator) is to clarify whether he did consider the 1800 issue 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.’

Both these letters were written some three years after my arbitration had been deemed to be complete.  To date I have not been advised of the results (if any) of these investigations.  If Telstra and the TIO had correctly investigated these short duration and incorrectly charged calls during my arbitration, they would have discovered that many of these incoming calls were being illegally diverted to an unknown location.  I can only assume that I have not heard from either the TIO or Telstra regarding their findings because they would have then had to admit to the unlawful diversion of these calls.  Since they still haven’t advised me of the result of their investigations, I have to assume that they DID uncover this illegal call diversion by unknown people, and they have decided to hide this fact.

Since these faults continued after the alleged finalisation of my arbitration, I have literally been forced to pay for some of the incorrectly charged calls under threat of disconnection of my phone service if I didn’t pay my on-going accounts.  In fact, two of my phone lines were disconnected because the TIO would not correctly address my valid claims.  I believe this is nothing short of blackmail.

Various letters, reproduced throughout this book, show that the organisations and government ministers I have approached in search of help appear to have ignored the truth.  Clearly I had no other option left to me but to present the facts in this format, in an attempt to find true justice.

The Google link below shows others with more experience as Investigative journalists deal with the injustices bestowed upon the COT Cases. After reading My story - warts an all and the Google link below, you will be able to judge the validity of my claims more.

Telstra’s Acronyms & Jargon

AOMP:  An Ericsson TMOS Network Management System tool for handling Operations & Maintenance functions for one or more AXE exchanges – particularly suited for use as an O&M centre for a number of rural exchanges which are spread over a large geographical area. Please note: while the AOMP has not operated in the Cape Bridgewater location Alan Smith has documented here because documents at hand have discussed this tool.

AOTC: Australian and Overseas Telecommunication Limited – former name of Telstra Corporation Limited – comprising the merged Telecom Australia and Overseas Telecommunication Corporation

ARE-11: Ericsson Analogue Crossbar Controlled Exchange. Please note: this type of exchange was operational during a period Graham Schorer had his problems.

ARF: Urban or large crossbar exchange by Ericsson

ARK: Rural or small crossbar exchange (Ericsson ) Please note: In the Casualties of Telecom (COT) report dated 13th April 1994, AUSTEL reported that the Cape Bridgewater exchange up and until the RCM was installed was an ARK, when in fact the system at Cape Bridgewater was an ‘old’ outdated RAX see below. An ARK crossbar exchange was manufactured approximately 20 years after the RAX system. Portland during the early nineties until August 1991 was an ARK which fed calls to the Cape Bridgewater RAX system.

ATUG:  Australian Telecommunication User Group was operating well before the Telecommunication Industry Ombudsman (office of complaints) was formed in June 1993. ATUG was a voice for small businesses and as such paled a roll in enhancing services in the communication industry. Graham Schorer was a member of ATUG. Deputy TIO Wally Rothwell, before being appointed as Deputy TIO was Chief Executive Officer of ATUG for ten years.

AUSTEL: Australian Telecommunication Regulatory Authority. Please note: in July/August 1992, the then General Manager of AUSTEL’s Consumer Affairs, Amanda Davis, became involved with helping the COT group establish themselves as being responsible small business people who had legitimate phone complaints. It was through Amanda Davis’ stand in helping beyond the normal role as an officer of a regulator that she was literally forced to terminate her position.

AXE:  Stored Programme Controlled (SPC) Digitally Switched exchange developed by LM. Ericsson, large numbers exist in the Australian network; used also for ISDN

AXE 104:  LM Ericsson Digital Switch (Rural). Please note: This is the digital exchange that was installed in Portland in August 1991, cutover from the ARK system (see ARK above). In the AUSTEL COT Report p 167 and questions raised by Senator Alston in the Senate Estimates 25th February 1994, relating to the problems being experienced by Alan Smith while connected to the AXE 104. The Senate Hansard referred to here can be located in Ted Benjamin (Appendix 16(a).

BS: Base station.

Busy Hour:  The hour of the day when the average traffic of an exchange is highest. In Telstra Australia practice, it is defined at the two busiest consecutive half hours commencing at the hour of half hour. NETWORK – The hour during which the total traffic flows through the network under consideration is highest. Please note:  The Bell Canada International (BCI) tests were supposed to be generated through the Busy Hour. In the case of Alan Smith it has now been confirmed that the BCI tests (if they were done at all) were not generated through the Busy Hour.

C & BI:  Charging and Billing Integrity. Please note:  Alan Smith has seen reference to this in his Telstra related billing files (somewhere) and therefore has included the acronym here.

CABS:  Charging AND Billing System (CABS) is an automatic system for billing customers. CABS was replaced by FLEXCAB (when Mr Smith is not sure when) however, FLEXCAB was supposed to have improved the billing capabilities.

Call Trace:  A feature that allows the Customer to cause the last call received to be traced.

Can: Customer Access Network. The part of the network between the telephone exchange main distribution frame and the Service Delivery Point at the customer premises. Please note: on page 243 in the AUSTEL COT Report point 11.8: “…AUSTEL had written to Telecom informing it that the claim in the Bell Canada International report to the effect that Telecom’s customers received a grade of service that meets global standards goes to far because the study was an inter-exchange study only and did not extend to the customer access network – AUSTEL had agreed to the study being so limited on the basis that other monitoring it had requested Telecom to undertake on AUSTEL’s behalf should provided AUSTEL with the data on the efficacy of the customer access network – See Verification issues LGE 7.

CANES:  Customer Access Network Evaluation System – C&C system – provides a complete fault registration, recording, diagnosis & analysis environment aimed at improving responsiveness to reported fault – uses A1 technology – interfaces with SULTAN. Please note:  this is another system for fault finding by way of intercepting telephone conversations.

CCAS: Call Charge Analysis System – monitoring charging of selected services in analogue exchanges. CCAS type systems can not detect the answer signal & hence can not determine if the call was effective or what the chargeable time is on an effective call – the CCAS records are still of considerable use i.e. to allow comparison of CCR & CCAS records on a-party number b-party number, date, call clearance time. Please note: The CCAS data which was not provided to Alan Smith during the SVT testing, now confirms that the SVT tests were not generated as stated in Telstra’s arbitration defence – see Verification issues LGE 7

CCAS ELMI: This is the monitoring equipment that Telstra used under direction from Telstra to test Alan Smith’s service lines during 1992/93. Gordon Stokes, a local Portland technician had this equipment attached to Alan Smith’s 055 267267 service on the 13th October 1992, but denied to senior Telstra executives that this equipment had been in use during the day it detected incoming call losses to Alan’s business – see Chronology for this date.

CENTOC: Centralised Traffic Occupancy – computerised traffic recording & monitoring for analogue exchanges. Please note: this information was never provided under FOI by Telstra to either Graham Schorer or Alan Smith during their respective arbitrations. While neither Graham nor Alan actual asked by name they required CENTOC data, as the information being sought under the respective FOI requests, they did ask for all ‘network monitoring’ information. Both Graham and Alan have been advised Telstra’s guards the CENTOC, which is some times referred to as CENTOCTRAXE with armed guards as this data does not lie and will determine whether there are network problems affecting certain locations.

 CHARMS:  Charging Maintenance System – provides locations, rates & charging scales for Telstra’s customer charging – does not store unique customer details, but significant information to classify customer groupings attached to any exchange within the Telstra network.

CLI:  Calling Line Identification – a customer facility in crossbar and SPC exchanges for billing and surveillance purposes – identifies the number of the calling party’s line.

CPE: Customer Premises Equipment. All telecommunications terminal equipment located on the Customer premises, encompassing from the analogue telephone to the most advance data terminals and Customer switches. Please note: Page 53 of the Coopers & Lybrand report acknowledged that Telstra had a habit of blaming CPE for faults instead of proper investigation.

DNF:  Difficult Network Fault, Please note: in the Coopers & Lybrand and AUSTEL COT Report, they jointly refer to the COT Cases as DNF customers.

DOTAC: Department Of Transport and Communications. Please note: the abbreviation for the Communication’s Ministers Office being used by telcos  DCITA – Department of Communications Information Technology and the Arts.

ELMI:  Portable Telephone Charge Analyser. Brand of CCAS equipment used mainly in country area’s.

EOS: End of selection code – used to monitor switching & congestion loss. Please Note: this equipment allows the person operating the monitoring switching device to listen in on conversations. See Gordon Stokes witness statements for Telstra’s arbitration defence of Alan Smith’s claims.

FLEXICAB: A system similar to CABS (see above) but, with many more processes and capable of producing very meaningful management reports. Please note: neither Graham Schorer or Alan Smith was provided with any FLEXICAB and/or CENTOCTRAXE data information under their FOI requests (during their respective arbitration’s). This update information would have assisted both the TIO appointed technical consultants as well as the claimant's consultants in determining if the SVT testing was authentic or not.

IRS: Inter-network Routing Service.

ISDN:  Integrated Services Digital Network (CCITT) – A switched digital transmission network that provides, through a single digital access point, speech, data and other telecommunication sciences. The hierarchy of digital switching & transmission methods.

LEOPARD:  Local Engineering Operations Processing and Analysis of Recording data – a plant recording & maintenance system for telephone services; a computerised system to cater for all field technical records associated with provision and maintenance of services. Please note: While Alan Smith has not fully looked into Graham Schores’s technical information regarding Mr Schorer’s registered fault complaints, Alan has been able to determine that even after Mr Smith had supplied fault information to either 1100 or the designated special fault centre at Waverley (Victoria),Telstra did  not all ways registered those faults in Leopard.

LOOP: Pair Gain Signalling System

Macrolink:  Telstra’s Primary Rate Access ISDN services that provide a high speed service for speech and data.

MCT:  Malicious Call Trace: Please Note: During May to August 1993, Telstra connected Alan Smith’s incoming 055 267 267 service as well as his 008/1800 free-call service to MCT. Also during May to September 1993, Telstra connected Alan’s facsimile service line 055 267230 to MCT. The side affect-problem with MCT is that it does not allow any other intended incoming call to connect for a 90 second period – see witness statement of Telstra’s Dave Stockdale.

MDF:  Main distribution Frame. Structural hardware, on one part of which terminate the permanent outside lines entering the Customer’s premises and on another part of which terminate the subscriber line multiple cabling, used for associating any outside line with its corresponding internal exchange wiring.

MOSAIC: Trouble Management system – replaced the Leopard system of fault recording.

Multiplexer:  The combining of multiple channels onto a single transmission medium; any process through which a circuit normally dedicated to a single user can be shared by multiple users. Please note: The telephone system that service Alan Smith from August 1991 to 2001, operates using a multiplexer system.

MUX: Multiplexer.

NASM: National AXE System Manger.

NCC:  Network Control Centre.

Neat System:  Network Evaluation and Test System. A test call system consisting of remote transponders, each connected at the network exchange MDF point as a normal customer, and central management and control unit. This system can conduct a schedule of test calls between transponders to measure call set-up, and hold performance, together with transmission, noise, post dialling delay, and other tests. Please note: During the AUSTEL COT Case investigations, AUSTEL implemented through Telstra that all the DNF problem customers had to have Neat Testing performed at their local exchanges. In the case of Alan Smith, it has now been confirmed (see CAV targets) that NEAT testing was performed at the Cape Bridgewater RCM as shown in the AUSTEL report. The NEAT Ericsson equipment used in the Cape Bridgwater tests October/November 1993, allowed for each test to remain open for a minimum of 120 seconds, allowing for transmission testing for noise, post dialling delay faults. This type of Neat transmission testing was used for the SVT tests carried out on Mr Smith’s service during his arbitration (see CAV targets 7 and the Brian Hodge MBE report for more information.

NODE:  A point of a network where various links come together and which generally contains a switching element to direct traffic.

NRR:  Not Receiving Ring. Please note:  the NRR fault was a major problem uncovered by the COT Cases during late 1992 and into 1994. Example: A caller rings a service and does not get connected either receiving a dead-line, or piecing sounds like a facsimile type noise even though no facsimile is connected at the calling end. In the case of Alan Smith, numerous complaints registered to him by customers (when they finally getting through) or by writing to Alan, was the only way he became aware that a customer was lost.

OAS:  Operator Assisted Service.

OFMUX:  Optical Fibre Multiplexer Equipment.

OMP: Operations Maintenance Processor.

OPAS: Operations Performance and Support. Please note: from what Alan Smith has observed from reading a number of technical documents is, that OPAS is the last resort used by local rural technicians.

Outrage:  Is the time that Service to the customer will be unavailable for. Please note: this type of happening to a customer should be kept to a minimum however, Telstra in the case of Graham Schorer and Alan Smith, their customers experiencing (RVA see below) was an outrage from them twofold.

PABX:  Private Automatic Branch Exchange. A small switching system located on a customer’s premises which serves speech and data extensions within a business complex and provides access to the public network. Please note: during the COT arbitrations’ Golden Messenger was operating off of a PABX. System.

PSTN: Public Switched Telephone Network. Public telephone network which generally provides switching and signalling for local, long-distance, and international voice and low-speed data.

RAX: An outdated communications system that only operated in low call rate locations, designed in the 50s. Please note: the Cape Bridgewater Holiday Camp was connected to an RCM until August 1991.

RCM: Remote Customer Multiplexer – digital pair gain system. Please note: The Cape Bridgewater Holiday Camp operates off of an RCM which is housed in a hut. This system is not an exchange and is totally unmanned.

REARK:  Private company which produces TELCATS reports. Please note: often –quite often, from 1992 through to 1994, REARK was used by Telstra to enable them to provide reports to the Minister of the day, including the regulator AUSTEL

RUBAS: Traffic figure based on the 50 highest half-hour average traffic figures over a 7 day period. Please Note: like the CENROC TRAXE and CABS data, the traffic information obtained from RUBAS in the Warrnambool and Portland locations (South West Victoria) was also not supplied to Alan Smith under FOI during his arbitration.

RVA:  Recorded Voice Announcement. A recorded message is played through to a caller (who might have dialled the right number) but is confronted with a recorded message stating that “the number you have called is not connected.”  Please note: Telstra has recognised that the RVA fault was a known National Network Software problem that came about when they implemented the 1800 number. The RAX and RCM system installed at Cape Bridgewater, which suffered congestion, gave the same type of (recorded message) to the caller into Cape Bridgewater when the system was congested.

 SMART 10:  Subscriber Monitoring & Registration Terminal. This system operates similar to the CCAS see above.

SPC 1 Stored Processor Controlled (Exchange) e.g. AXE, ARE

SULTAN:  Subscriber Line Test Access Network – provides test information vital for diagnosis of customer fault reports and network performance monitoring – used with LEOPARD and CANES –C&C system. Please note: this is another tool for voice interception.

TIMS:  Telephone Information Management System.

TRAFFIC:  A term applying to simultaneous calls in progress, not to total calls generated over a period of time.

TRAXE:  Traffic Recording for AXE – data acquisition system – uses Data General minicomputers located in each State – apart from traffic analysis. Please note: Alan Smith has already mentioned above, that CENTOC TRAXE data information should have been provided to him under FOI during his arbitration. The Customer Remote Multiplexer RCM at Cape Bridgewater was service via an AXE in Portland.


The matters discussed on this website are said according to my interpretation of the  Public Interest Disclosure Act 2013

Download Attachments

AUSTEL’s Adverse Findings

Front Page Part Two 2-A to 2-B


False Witness Statement File No 3-A to 3-D

Cape Bridgewater unidentified faults File 4-A to 4-C

False Witness Statement File No 16-A to 16-B

False Witness Statement File No 17-A to 17-D

Can We Fix The Can - Copper-Wire Network

False Witness Statement File 15-A to 15-N

Front Page Part Two File No/3 A to 3 C

D-Lewis File 1-A to 1-K

SVT Evidence File No 1 to 3

AXE Evidence File 1 to 9

Absent Justice Ebook

Read Alan's book


Absent Justice - My Story - Senator Ron Boswell

Threats made and carried out.

Page 180 ERC&A, from the official Australian Senate Hansard, dated November 29 1994, reports Senator Ron Boswell asking Telstra's legal directorate why were my FOI documents being withheld from me during my arbitration:

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

After receiving a hollow response from Telstra, which the senator, the AFP and I all knew was utterly false, the senator states:

“…Why would Telecom withhold vital documents from the AFP? Also, why would Telecom penalise COT members for providing documents to the AFP which substantiate that Telecom had conducted unauthorised interceptions of COT members’ communications and subsequently dealt in the intercepted information by providing that information to Telecom’s external legal advisers and others?” (Senate Evidence File No 31)

As I have reiterated throughout this website, the threats against me during the arbitration proceedings came to fruition, and the withholding of pertinent documents is deeply concerning. Regrettably, neither the Telecommunications Industry Ombudsman nor the government has investigated the detrimental impact of this malpractice on my overall submission to the arbitrator. Despite assisting the Australian Federal Police (AFP) in their investigation into the illicit interception of phone conversations and arbitration-related faxes, they never came to my aid.

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“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

“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

“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

“…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

“…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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