Liability of Mr Samuel
97 Mr Samuel admitted that he was at all material times responsible as a director for the operations of Excite Mobile including the establishment of Excite Mobile's business operations, designing the method by which Excite Mobile promoted and supplied mobile telecommunication services to customers, and authorising the terms of the mobile contracts. However, he attempted to some degree to distance himself from the detail of establishing and operating its systems.
98 Mr Samuel submitted that the day cap was devised by Mr Brown and the scripts used were developed by Mr Brown and that Mr Samuel did not authorise the scripts prior to use by the call centre. He acknowledged that he did not object to the day cap plan or the scripts and accepted such responsibility as lay upon him as a director of Excite Mobile. The extent of his involvement in the development of the contract terms, he said, was an initial 40 minute conversation, in which Mr Brown discussed his idea of a day cap. Mr Samuel said that at that time, no other mobile networks or service providers were offering the day cap. Mr Samuel said that he trusted Mr Brown to be diligent in checking the scripts, to ensure that they explained the day cap. Mr Samuel said that he did not co-author the scripts, but that he was provided with a copy of the draft scripts before they were sent to the telemarketing services.
99 Mr Samuel admitted that he was aware that people were complaining about the impacts of the day cap and that there were better offerings in the market. Mr Samuel agreed that the voice contract scripts failed to fairly and adequately explain the operation of the day cap.
100 With respect to the sales method, Mr Samuel stated that he always understood that the complete list of fees and charges was included in the Welcome Pack received by the customer. Mr Samuel admitted that the terms of the Welcome Pack were not incorporated into the contracts. He also believed that the direct debit authority applied only to customers with poor credit profiles, and that he was not aware of what practice was adopted as only Mr Brown was responsible for the direct debits and billings in respect of Excite Mobile.
101 With respect to the coverage representations, Mr Samuel submitted that the representations made were not intended to, and that neither Excite Mobile nor Mr Brown or Mr Samuel intended for the company to, represent that customers would have coverage when in fact they did not.
102 With respect to the TIC representations, Mr Samuel said that he did not make the decision to advise customers to call the TIC phone number, that he was not involved in the registration of the business name as that was carried out by Mr Brown without the knowledge of or the authorisation of or any consultation with Mr Samuel, and that he did not authorise the content of the activation script.
103 Mr Samuel later admitted in the course of the hearing that he was involved in the registration of the business name. On 19 January 2010 Mr Brown sent an email to Mr Samuel, stating:
Hi,
Ok done…
Telecom Customer Complaints
Telecom Network Complaints
Telecom Company Complaints
Telecom Business Complaints
I sent all 4 so if they bloody don't approve one of these I am going to be pissed off… Top one would be best. But then it is much like TIO :(
104 Mr Samuel replied on the same day: "Perfect, either one of them is fine man …".
105 Mr Samuel also denied making the decision to advise customers to contact the TIC number, and denied that he was aware of the statements made to customers directing customers to contact the TIC number. Mr Samuel admitted that once he knew the practice existed he did not give instructions to operators or to the other respondents to stop advising customers to call the TIC number to the extent that he could have as a director. He cited his workload and responsibilities with Lime Australia as the reason for not making more detailed inquiries into the operation of TIC or trying to stop the use of that name in the way it was used.
106 In the course of the hearing, Mr Samuel admitted that he was aware that complaints were being made to the TIO. There was some question during the hearing as to whether Mr Samuel had been a recipient of the email quoted above from Mr Brown to Mr Saldanha of 16 September 2009. The first copy provided to the Court by Mr Samuel did not include the panel of "carbon copy" addressees who had also received the communication. A subsequent copy included the carbon copy, and showed that the email had been sent to Mr Samuel as well. There was some suggestion made that the copy Mr Samuel provided had been doctored to remove the "cc" reference which showed that Mr Samuel had been a recipient of that email. Mr Samuel later admitted that he had received that email but said that he did not read it.
107 Another email of 3 August 2009 was sent by Mr Brown to Lime Managers, where Mr Brown discussed script changes to reference the complaints / escalation phone number at the end of the call. In Mr Samuel's s 155 examination he stated that he received emails sent to that address. This conflicted with his evidence at the hearing, where he stated that he was not sure whether he received emails to that address.
108 More generally Mr Samuel advised that he did not read many of the emails directed towards him in a generic way as a manager of Lime Australia or Lime India because these were automatically filtered by his email account, and moved into a separate folder and that in fact he had 18,600 unread emails.
109 Regarding the Jerry Hastings letters, Mr Samuel submitted that he did not create or approve the Jerry Hastings letters, had no knowledge of the contents of the same, did not know about the order in which the letters were forwarded to customers, nor how many letters were sent, nor the dates on which they were sent. Mr Samuel submitted that he did not create the letters, that he had no knowledge of the letters until on or about 14 January 2010, that the sending of the letters was not part of the business of Excite Mobile under the control of Excite Mobile, and that Excite Mobile was experiencing financial difficulties at the time of sending the letters. He admitted that he took no action to stop the sending of the letters. Mr Samuel also denied being aware of the Jerry Hastings calls, and said that this came to his knowledge after the event.
110 Mr Samuel's email to Mr Brown of 4 January 2010 appears to conflict with his submission that he had not reviewed the Jerry Hastings letters. He wrote:
Yeah, cool as - likewise. So gone through the letter, haven't spell checked it, but all looks good 2 go for at least a test of 100 or so, as Reg Post costs $3.00 or something stupid, but its the only way.
111 The email sent in reply from Mr Brown included the Times are Bad letter in full, and stated:
Cool man… few more changes to letter I think I am just about finalized it about now though.
112 Mr Samuel did not concede that his email referred to the Times are Bad letter, and suggested that his comment may have meant that he may not have looked at it, or that he had skim read it at best.
113 On 9 January 2010 Mr Brown emailed Mr Samuel a copy of the Last Warning letter, stating "If you can review the below letter let me know what you think." Mr Samuel replied on 11 January 2010, saying:
Fuk oath, I read this on my iphone on saturday, it all seems good 2 me man. Nothing needs deleting really that i can see or that will make any impact on the letter in any case
114 Another email was sent on 29 January 2010 by Mr Brown to Mr Punia, Mr Grover and Ms Saldanha and "cc-ed" the managers at Lime India and the managers at Lime Australia. This letter included a draft of the Jerry Hastings "Overdue" letter. Mr Brown stated:
This is much the same, first page is same but now we have 2nd page that talks about centrepay, and then 2 final pages which is a pre filled in centrepay deduction form.
We are pressing hard on trying to get people to sign up for centrepay.
This form encourages people to do just that. Signup for centrepay and pay of there bills. Or signup and have this as their preferred payment method.
[…]
115 On 31 January 2010 Mr Samuel wrote to Mr Brown:
Hi Man,
How is everything going with collections? Processes are starting to take place?
How many collection plans are in place right now with the Jerry Hastings letter, as we spent quite a bit already with Reg Post & all… are we on track to cover costs & actually make people pay & are sticking to arrangements as yet? How many people do we need to spend $116 on + Serve to take them to court?
I know its early days as yet, but if you could do me the courtesy of keeping me in the loop that would be great man.
116 Mr Brown replied the same day, stating:
Hi,
Things are looking good…
So the results that we have so far are from 200 letters we sent.
200 Sent letters
155 Sent reminder letters
1 - Banrupcy [sic] (confirmed)
2 - Refusing To Pay
21 - Payment Plan Agreement
3 - Pay Agreement SIGNED
27 - Return to Sender
So the results we are looking at is 24 commitments to pay. Of which a number have paid but not just sure how many yet.
[…]
We need to do up a FULL ON COURT looking letter that is the final freak out letter !
This is the one thing that I do need your help on as we spoke about. I am putting my focus right now back on the overdue cases and then on the 30 day and 60 day letters.
[…]
117 Ms Smart said that when receiving complaints on the Jerry Hastings number she would pass these on to Mr Brown and the managers of Lime India, including Mr Samuel. She said that at each instance she would make a selection as to who to inform, depending upon who could help her the most. Mr Samuel, she said, never gave her written directions, but would give her oral instructions every time she went to the offices.
118 More generally, Mr Samuel submitted that he was only nominally involved in the day-to-day operations of Excite Mobile. Mr Samuel submitted that most of his time was spent in the business of Lime Australia, which was a separate business. Lime Australia was located at 117A Henley Beach Road, while Excite Mobile was located at 117B Henley Beach Road. There were no internal doors that connected the two offices, although they were physically in the one building. There were separate front doors to each office.
119 Lime Australia continued to run the customer service and accounts of people who had, prior to Excite Mobile's existence, contracted for mobile phone services with Lime Australia. Lime Australia at that time was also selling phones on eBay as well as conducting a small graphic design business. Mr Brown says that he had the same level of involvement in this work as Mr Samuel. Mr Brown further submitted that 95% of their work was with Excite Mobile and so it would not have made sense for Mr Samuel to spend all his time on Lime Australia and not Excite Mobile. Mr Brown says that he did more of the "grunt work" but that the responsibility to make decisions was shared evenly.
120 In Mr Samuel's s 155 investigation, he stated that as a director, he received daily reports on Excite Mobile by email, and that when things were going well, he would send the appropriate staff in Lime India a quick email "just congratulating them." In his s 155 examination, he also stated that he talked to Mr Brown on a daily basis about the business operations, and that he knew what was going on because of these daily chats. This is inconsistent with his oral evidence. During the hearing, Mr Samuel stated that the number of occasions in a week on which he would talk to Mr Brown about the operations of Excite Mobile varied from none to three or four occasions in any given week.