1 Thursday, 2 November 2017 1 (11.02 am) 2 CHAIR OF THE INQUIRY: Yes, Mr Lake. 3 MR LAKE: The next witness is Phil Wheeler, my Lord. 4 MR PHIL WHEELER (sworn) 5 CHAIR OF THE INQUIRY: You are going to be asked questions 6 initially at least by Counsel to the Inquiry, Mr Lake. 7 If you listen to the question and answer it as directly 8 as possible. If you also keep your voice up by speaking 9 to the microphone so that the public, other people can 10 hear you, and if you speak relatively slowly, but at an 11 even pace, so that the shorthand writer can keep up with 12 you. 13 A. Understood. 14 Examination by MR LAKE 15 MR LAKE: Mr Wheeler, could you state your full name, 16 please. 17 A. Philip Wheeler. 18 Q. I think the Inquiry has details of your address. 19 I think you have variously been a Director of tie, 20 a Director of TEL, and a Director of Tram Project Board. 21 A. Correct. 22 Q. All to do with the tram project. 23 I would like you to look at a document with me, 24 please. You should have a paper copy in front of you, 25 but it will also be shown on the screen. It's 40 1 TRI00000092_C. 2 You can see that on screen in front of you? 3 A. I do. 4 Q. It should be the same as you have on paper. Is that 5 a copy of the statement you have prepared for the 6 Inquiry and have signed? 7 A. It appears to be so. 8 Q. Are you content that that be adopted as your evidence 9 for the purposes of this Inquiry? 10 A. Indeed. 11 Q. Thank you. I have already indicated the various bodies 12 you were a member of, tie, TEL and the Tram Project 13 Board. Were you aware of the different roles performed 14 by each of them? 15 A. There was certainly a certain amount of overlap, and at 16 times it probably wasn't clear actually quite which 17 meeting you were at, because the personnel were fairly 18 similar. And the main thing was getting on with the 19 job. 20 Q. Even allowing for that overlap in both personnel, did 21 they have distinct roles as to what each was supposed to 22 do? 23 A. Indeed. I was reasonably clear about different people's 24 roles at these meetings, yes. 25 Q. The different roles of each of these three bodies, the 41 1 role of TEL as opposed to the role of tie, what was the 2 difference? What did each of them do? 3 A. TEL was to be the holding company for both Lothian Buses 4 and the tram service when it came into place, whereas 5 tie was the facilitator, I suppose, of the actual tram 6 project and delivering the tram track and so on. 7 Q. Which company or entity did the Council look to, to 8 actually deliver the tram infrastructure for it? 9 A. I would say that was tie because that was their main 10 purpose. 11 Q. If we could look at page 9 of your statement, please. 12 If we could look at paragraph 28, right at the top. 13 You note there in that light that: 14 "The TIE Board had responsibility for the capital 15 costs of the Tram Project." 16 What did you have in mind when you said it was 17 responsible for the capital costs? 18 A. My understanding, my recollection is that tie was 19 responsible for getting the tram project, the physical 20 work done, and paying for it. 21 Q. Of these three bodies, tie, TEL and the Tram Project 22 Board, which was responsible for advising the Council in 23 relation to issues of the trams? 24 A. I suppose that -- depending on what sort of issue you're 25 talking about. Whether it was a construction issue, 42 1 procurement issue, or whether it's actual maintaining 2 a public service. 3 Q. I should have made that plain. It's construction and 4 procurement. Who -- which company provided the advice 5 on that? 6 A. My recollection was that that was tie's responsibility. 7 Q. Was there any hierarchy between these companies and 8 bodies, that one was overall in charge? 9 A. I'm not sure that there was. There seemed to be a bit 10 of parity, I think. 11 Q. If we could go into your statement again, please, and 12 look at page 3, paragraph 10. You note in the first 13 sentence: 14 "As Director of TIE, I had a duty of confidentiality 15 and a duty not to divulge matters that had been 16 discussed in confidence at the Board." 17 If I just pause there, did you understand that would 18 extend to everything discussed on the Board or just 19 specific matters that had to be kept confidential? 20 A. I had difficulty in differentiating what was not 21 confidential at the Board, and I tended to err probably 22 maybe in hindsight a bit too much on the safe side, and 23 regarded most of what I gleaned at tie Board meetings 24 and suchlike places as being confidential. 25 Q. Were there times when you were told in particular by 43 1 others that certain items must be kept confidential? 2 A. I'm sure there were. 3 Q. You can't recall any particular -- 4 A. I can't recall a particular instance, but it would have 5 been unlikely not to have happened. 6 Q. Reading on in your paragraph, in the second line, you 7 say: 8 "I felt hamstrung by this. It sometimes placed me 9 in a difficult position with my colleagues at group 10 meetings, as they wanted me to fill them in on more 11 things than I felt comfortable doing so. I had to try 12 and resolve that with my conscience as to where I drew 13 the line with confidentiality and to what extent 14 I should trust anybody." 15 How then did you decide where you were going to draw 16 the line? What guided you as to where you would draw 17 it? 18 A. Whether I -- well, I had to try and, as I said, had to 19 try and resolve it with my conscience, to decide whether 20 certain information was not particularly sensitive 21 and I could disclose it to my colleagues. And other 22 things I thought, no, I can't discuss that. That 23 obviously was an ongoing thing throughout the time I was 24 involved with the project. 25 Q. Can you remember what sort of things you felt you were 44 1 unable to discuss with your colleagues? 2 A. Certainly when it got to the dispute stage, we were 3 warned very much not to reveal what was going on lest it 4 got into the public domain and affected the negotiations 5 between the different parties. 6 Q. What sort of things were you unable to discuss at the 7 dispute stage? 8 A. Just the fact that there was a disagreement. 9 Q. Were you able to discuss what was being done in relation 10 to that disagreement, what the strategy was? 11 A. I suppose the factual matter that some matters were 12 being referred for arbitration, but not the specifics of 13 them. 14 Q. Did your colleagues -- your colleagues would be aware 15 that you knew more about these things than they did? 16 A. Indeed. 17 Q. Were they actually asking you what's going on? 18 A. Yes, but they appreciated also that I was restricted in 19 what I could share. 20 Q. Did you feel there were situations arising within the 21 Council or committees that decisions had had to be taken 22 in relation to the trams where you had material that 23 would be relevant to that decision, that other people 24 didn't? 25 A. That was bound to be the case. 45 1 Q. For example, in relation to the disputes, fellow 2 councillors might have had a different approach to the 3 tram project if they knew what was going on, on the 4 disputes, either favourable or unfavourable, it might 5 have changed their approach? 6 A. I suppose so. 7 Q. Was there a tendency for councillors generally to defer 8 to the councillors that were on the tie, the Tram 9 Project Board and TEL, on the assumption that they must 10 know more about it than the others? 11 A. I expect so, but you would need to ask the people who 12 were affected that way. 13 Q. Were you aware of it? 14 A. I don't remember there being any issues at this stage, 15 but maybe some of them did feel left out. 16 Q. What did you understand was the reason for the purpose 17 of putting councillors on the Boards? 18 A. Because the Council was the ultimate owner of all these 19 companies, it made sense to represent the Council on -- 20 Council and its interests, and the public purse, by 21 having councillors present on the Boards. 22 Q. To what extent do you think the Directors were able to 23 represent the Council, carry forward Council views into 24 the Board? 25 A. Well, we were non-executive Directors, but we had 46 1 obviously the right to make our point in committee, on 2 Board meetings, and to ask questions as appropriate. 3 Q. If you were making a point, was that really fighting the 4 Council's corner before the Board? 5 A. I think we were basically acting in the role of 6 non-executive Directors of the Board. But we were there 7 obviously by dint of being councillors. 8 Q. Were you aware of any times when there was -- could be 9 a conflict of interest between the Council on the one 10 hand and the companies on the other? 11 A. I suppose that that was a risk, yes. 12 Q. Were you aware of it happening in practice? 13 A. I can't think of instances offhand. 14 Q. As the situation got towards the contract close, it was 15 obviously in the interests of the company to get 16 a contract concluded for the trams and to deliver the 17 trams, because that was the single purpose of the 18 company; would you agree? 19 A. Indeed. 20 Q. The Council obviously had very much broader purposes, 21 the very many roles that it had to fulfil; would you 22 agree? 23 A. Yes. 24 Q. Ultimately, perhaps the major difference between the two 25 is that the Council were the body that was actually 47 1 going to be paying for the trams, whereas it was -- 2 didn't make any financial difference to tie or TEL? 3 A. The Scottish Government was the ultimate paymaster who 4 were putting up the bulk of the money for the tram. 5 Q. I think the Scottish Government put up a sum of 6 GBP500 million. 7 A. That was the eventual sum, yes. 8 Q. It was originally intended that the Council would put up 9 GBP45 million. 10 A. Yes. 11 Q. But obviously they had to make up the whole of the 12 balance over the 500 million that the Scottish 13 Government put in? 14 A. Correct. 15 Q. So the Council's very different interests from tie is 16 that it was going to be footing any overrun of the bill? 17 A. Yes. 18 Q. Did that create a conflict of interest, or a difference 19 in interest, to put it more neutrally, between tie on 20 the one hand and the Council on the other? 21 A. I suppose it did when it became clearer that we weren't 22 going to get the tram -- tram project delivered within 23 the original funding. 24 Q. Was that potential difference of interest apparent at 25 the time of the conclusion of the contracts or decision 48 1 to award in December 2007? 2 A. No. Not -- not that I recall. 3 Q. I think as well as being on the various companies, you 4 obviously also were taking decisions as a councillor and 5 that you sat on a Policy and Strategy Committee? 6 A. Indeed. All the committee conveners joined together on 7 this Policy and Strategy Committee together with certain 8 members of the opposition. 9 Q. You, I appreciate, were not the only one in this 10 position, but did you feel there was any difficulty in 11 that the Council and the Policy and Strategy Committee 12 would be overseeing the work of tie and TEL and the Tram 13 Project Board, where in fact you were on all the bodies? 14 A. We had guidance on declarations of interest which -- at 15 the start of any meeting where something affecting an 16 outside board or a company that you were involved with 17 was on the agenda, you declared that at the start of the 18 meeting. The clerk asked if there were any 19 declarations, and they were noted at the start of the 20 minutes. 21 Q. So everybody was aware if you were on the Company Boards 22 as well as sitting on the Policy and Strategy Committee? 23 A. Correct. 24 Q. But even with that openness, did you feel there was any 25 difficulty in that you were on -- effectively overseeing 49 1 work you'd taken in another capacity? 2 A. I suppose you could describe that as a potential 3 conflict, but I don't recall seeing it as that at the 4 time. 5 Q. With the benefit of hindsight, do you think it might be 6 managed better? 7 A. You could always do things better by hindsight. 8 Q. I want to look now at the lead-up to the award of the 9 decision to proceed with the project in December 2007. 10 Could we look, please, at paragraph 30 of your 11 statement. If you could look at page 9, paragraph 30. 12 You have noted here: 13 "The design and utilities works were supposed to be 14 finished before the infrastructure works commenced. In 15 practice, insufficient time was allowed for MUDFA to be 16 completed. Issues were also caused by the takeover of 17 the contractor: Carillion took over Alfred MacAlpine and 18 there were various changes of key personnel as a result 19 of that takeover. I think there were also problems with 20 some of their sub-contractors doing different streets." 21 Now, by the end of 2007, when it came to deciding to 22 proceed with the project, was it apparent to you that 23 the MUDFA works were not complete? 24 A. Indeed, it was evident on the streets. 25 Q. What was the state of the design work at that time, 50 1 completion of the design? 2 A. Do you mean the design for MUDFA or the design for the 3 tramline? 4 Q. The design for the trams generally, the infrastructure? 5 A. That was always dragging. That's my recollection, that 6 it was dragging all the time. So it was never quite 7 where it was wanted to be or where it was needed to be 8 to enable progress to be made properly. 9 Q. Now, despite the fact you had these -- the design was 10 running late and MUDFA was running late, the contract 11 was -- nonetheless in December, a decision was taken to 12 proceed with the contract. 13 Was there any consideration of whether or not there 14 should be a pause at that time, as neither the design 15 nor MUDFA were proceeding according to plan? 16 A. I don't recall that. 17 Q. Was any advice given in relation to whether or not it 18 might be appropriate to pause? 19 A. Again, I don't recall. 20 Q. If it's suggested to you that there was advice from the 21 solicitors instructed in relation to the matter, that 22 there should be a pause, would you recall that? 23 A. I'm sure I would recall it if I'd been aware of legal 24 advice to that effect, yes. 25 Q. I'm going to ask you to go on and look at paragraph 43 51 1 of your statement, which is on page 14. 2 If we look right to the foot of that page, we can 3 see, the last line: 4 "The advice I got from the lawyers and from the 5 technical people ..." 6 This is all in December 2007: 7 "The advice I got from the lawyers and from the 8 technical people was that we were ready to go. When 9 voting on the Final Business Case I was satisfied that 10 the aims of the procurement strategy had been met." 11 Can you recall what advice you were being given at 12 this time? 13 A. I'm sure that was from the Council's in-house lawyers, 14 and also no doubt at the tie Board from their lawyers. 15 And from the various executives at tie at the time that 16 everything was in place. And probably from some of the 17 senior officers of the Council as well. I was getting 18 advice in various directions or from various directions 19 at times. 20 Q. When you refer there in the sentence at the top of the 21 page to the aims of the procurement strategy had been 22 met, do you recall what aims did you have in mind? What 23 aims had been met? 24 A. The aims were to find a contractor to deliver the tram 25 scheme. 52 1 Q. Do you recall -- if I can ask you, please, to look at 2 page 21 of your statement, I want to look at some 3 questions in relation to risk in the contract. 4 If we firstly look at paragraph 58 at the top of the 5 page here. The third line: 6 "Design risk lay with TIE until such time as the 7 novation was complete, but I cannot recall if this was 8 discussed or if it was reflected in any risk registers. 9 The lawyers were told by the TPB that the risk was to 10 lie with the contractors in the contract." 11 What risk are you discussing there, can you recall? 12 A. I think particularly that the risk that the design 13 wouldn't be ready when required. 14 Q. Who was to carry the risk of that, as far as you were 15 concerned? 16 A. That was my understanding, that there was novation 17 discussions as part of the negotiation with the 18 potential contractors for them to take on the risk of 19 the designers. 20 Q. So -- 21 A. Or making sure that the designs were managed and 22 delivered. 23 Q. The risk was to be managed through the novation process; 24 is that what you're saying? 25 A. The risk would be transferred to the contractors as part 53 1 of the novation progress. 2 Q. Who was giving you that information, can you recall? 3 A. I'm sure that was information I was gleaning at the 4 Board meetings from the senior officers of tie and those 5 who were doing the negotiations. 6 Q. Can I refer you forward to page 23 of your statement and 7 look at paragraph 64. You are referring here to the 8 minutes of the 13 March meeting. They record 9 a GBP10 million increase in the project price and 10 records Stewart McGarrity as having explained some 11 components of the increase: 12 "I cannot remember why these arose." 13 The point I'm interested in: 14 "The minutes record Willie Gallagher as referring to 15 a buy out of the risk of SDS non-performance." 16 You're obviously just making a reference there to 17 what's in the minutes, but do you recall what it was 18 suggesting what risk should be bought out at this stage, 19 in March 2008? 20 A. I don't recall that detail now. It's nearly ten years 21 ago, after all. 22 Q. Were you given any advice at the stage, either in 23 December 2007 or when the contract was ultimately signed 24 in May 2008, as to what likelihood there might be 25 changes to the contract works or the programme that 54 1 might generate further liabilities on the part of the 2 Council or tie? 3 A. I was aware of the general risk that any change to the 4 programme incurred or requested by tie or the Council 5 was bound to have cost implications. The contractors 6 wouldn't do it for nothing. 7 Q. Were you given any indication of how likely it was that 8 there would be such changes to the contract? 9 A. Well, we were just warned that that was a risk that 10 would have to be accepted. 11 Q. Were you told ever that certain Pricing Assumptions were 12 contained in the contract and if those assumptions 13 didn't hold true, they would be treated as changes 14 generating an entitlement to additional payment? 15 A. I don't recall that. 16 Q. Were you ever told that it was already known that 17 certain of those assumptions were not true and that 18 there would, as soon as the contract was signed, be 19 claims for additional payment? 20 A. Again, I'm not aware of that. 21 Q. I would like to look at some resolutions that were 22 considered in January 2008. Could we have document 23 CEC01515189. If you could start by enlarging the upper 24 half of the screen, we can see it's headed "TRAM PROJECT 25 BOARD RESOLUTION OF THE MEMBERS OF THE Tram Project 55 1 Board AT A MEETING ON 23 JANUARY 2008, HELD JOINTLY WITH 2 THE BOARDS OF Tie Limited AND Transport Edinburgh Limited". 3 "The Board resolved after due consideration of the 4 papers presented and discussion of matters at the 5 meeting: 1. to approve the terms of Infraco Contract 6 Suite and all related agreements and documents ..." 7 2: 8 "to recommend to the Board of Transport Edinburgh 9 Limited that the Board approve the terms of Infraco 10 Contract Suite and all related agreements and 11 documents ..." 12 3: 13 "to approve the terms of the governance and 14 delegations paper ..." 15 4: 16 "to approve the proposed delegated authority 17 arrangements to be adopted in order to ensure an 18 efficient and properly controlled process was followed 19 through to contractual commitment and during project 20 implementation." 21 Do you recall this document? 22 A. I don't recall it offhand. 23 Q. We can see that the effect of the delegated authority 24 below was that: 25 "A Committee of the Boards of the Company, the Tram 56 1 Project Board and tie Limited would be immediately formed 2 comprising Messrs Gallagher, Mackay and Renilson ..." 3 Those would be names familiar to you? 4 A. Indeed. 5 Q. "... to whom authority is delegated to approve final 6 execution by the tie Chairman of Notification to Award, 7 the Infraco Contract Suite and any necessary related 8 agreements ..." 9 Certain conditions are there. Do you recall that 10 authority being given to that committee of three? 11 A. I'm sure it was given. I don't recall that particular 12 document, but I'm sure that that committee was the 13 relevant one set up at that time. 14 Q. If that committee had been set up, do you recall how 15 much further consideration you as a member of these 16 three entities, TEL, tie and the Tram Project Board, how 17 much further consideration you had of the decision of 18 whether or not the contract should be entered into? 19 A. Well, the authority had been delegated to that 20 committee. Therefore, it was up to them to do the 21 final -- make the final decision, and get the 22 contract -- the contract suite executed. That's my 23 reading of it. 24 Q. Could I ask you, please, to look at page 29 of your 25 statement. Could we look at paragraph 76. If I read 57 1 from the start: 2 "The Infraco contract suite was duly signed on 13 3 and 14 May 2008. The change that had been made to the 4 contract between December 2007 and contract signing in 5 May 2008 was that BBS wanted more money for more risk." 6 Just pausing there, were you aware when they had 7 requested further money and how much further money they 8 had requested? 9 A. I don't recall the detail. 10 Q. When you say "more money for more risk", do you mean 11 that that was the contractors taking on additional risk? 12 A. That must have been from the documents I was reading, 13 when I had my interviews last year, that I picked up 14 something there that I've commented on in the statement. 15 But I think that is sort of a quid pro quo. If more 16 risk was being transferred, then they wanted 17 remuneration for it as well, and you can understand that 18 point of view. 19 Q. If you have picked this up from statements within the 20 documents, had you carried out any assessment of your 21 own as to whether or not risk had been transferred to 22 the contractor? 23 A. Probably not to any extent. 24 Q. Can you remember being given any advice as to transfer 25 of risk to the contractor or the other way? 58 1 A. Only in general terms. It was discussed at board 2 meetings. I don't remember any detailed briefing on 3 risk and the elements of risk. 4 Q. We noted earlier the parts of your statement where you 5 say the intention was that risk, design risks, could be 6 transferred to the contractor? 7 A. Indeed. 8 Q. By the time you got to contract close in May, what was 9 your understanding as to where that risk lay? 10 A. Well, that -- my understanding was that the novation was 11 part of the contract suite, and therefore the risk for 12 getting the designs finished had transferred as part of 13 that suite of documents. 14 Q. In addition to the actual risk, the cost of completing 15 the design, it might be said there's another risk of any 16 increased cost of actually building the tramway as 17 a result of changes in design. 18 A. Indeed. 19 Q. Do you understand who was to bear the risk of any 20 increase in construction costs resulting from changes in 21 design? 22 A. I think that's being negotiated item by item thereafter. 23 That's my recollection. That's where the individual 24 bits of dispute arbitration came in, because they were 25 specific areas of the tram track, particular bridges or 59 1 whatever. So that's obviously when detailed design came 2 to construction, and it didn't quite match with what had 3 been originally priced. 4 Q. If I continue reading from where I left off, you say: 5 "I cannot recall if I received a briefing from 6 CEC legal officers, at any time, on the effect of the 7 contract, including the pricing in Schedule 4. However, 8 we did discuss it at TIE Board meetings or the TPB [Tram 9 Project Board]. Some of those meetings were attended by 10 DLA who probably explained it to us. At that stage 11 I was still under the impression that the risks all lay 12 with the contractor. That was what we were told by 13 Willie Gallagher, Tom Aitchison and Gill Lindsay. I was 14 not familiar with, nor did I understand the Pricing 15 Assumptions set out in Schedule 4. Once I became aware 16 that the price was fixed with the design drawings issued 17 at November 2007, I then knew that the change was going 18 to cost TIE a lot of money." 19 Just looking at one of the first points there, you 20 said that meetings were attended by DLA who probably 21 explained it to us. Is that something you recall or is 22 it something you are assuming would have happened? 23 A. I'm assuming with hindsight. 24 Q. All right. Because -- 25 A. I don't have any record one way or the other. 60 1 Q. From what you said, again further down in that 2 paragraph, it appears -- I should ask it -- do you have 3 a recollection of being told matters by 4 Willie Gallagher, Tom Aitchison and Gill Lindsay to the 5 effect that the risks all lay with the contractor, or 6 again, is that inference? 7 A. I'm sure it would be one or other of them, if not all of 8 them at different times, probably telling me the same 9 information or near enough. 10 Q. Can you actually recall having been told that by people, 11 or is it an assumption? 12 A. I don't recall any individual discussions on it, but 13 just scrolling back, I'm sure there was a discussion 14 with these people and maybe some others on the topic at 15 the time. 16 Q. You note right at the end there that once you became 17 aware the price was fixed in relation to certain design 18 drawings, you knew the change was going to cost tie 19 a lot of money. Can you recall when you became aware of 20 that? 21 A. Not offhand, but I knew it was a risk, that we were 22 talking about earlier, that if there were design changes 23 coming through, they could be expensive. 24 Q. Can you recall even in general terms, was this about the 25 contract close or was it very much later, years later, 61 1 that you had the awareness of the issue? 2 A. It's probably shortly after close that these things 3 started to emerge. 4 Q. In what context did they emerge? Was it within one of 5 these tram bodies, or was it in the Council as a whole? 6 A. It would be at one of the Tram Boards. 7 Q. I'll ask you in a little while about how matters 8 progressed with the works when they started, but for the 9 moment I would like to ask you about -- if you could 10 turn to page 18 of your statement. 11 CHAIR OF THE INQUIRY: Before doing that, you've mentioned 12 Mr Aitchison who was Chief Executive of the Council at 13 that time, and Gill Lindsay who was the 14 Council Solicitor. 15 To what extent did you as a councillor expect the 16 Council, senior Council officials and the Council Legal 17 Department to be involved in giving advice about this? 18 A. I did obviously look to them for advice, both from the 19 Chief Executive and from the Council Solicitor. Yes. 20 I had occasional meetings or periodic meetings with them 21 at the time to discuss the issues of the day. 22 CHAIR OF THE INQUIRY: Was that separate from the advice 23 that tie was receiving from DLA? 24 A. Yes, that would be probably a one-to-one meeting with 25 one of these people. 62 1 CHAIR OF THE INQUIRY: Thank you. 2 MR LAKE: Could I ask you, please, to look at paragraph 53 3 on this page. You refer there to: 4 "The same papers for the 23 January 2008 meeting 5 contained the Report on the Terms of Financial Close. 6 I do not recall the TPB [Tram Project Board] having any role 7 in the finalisation of the Close Report. That was 8 largely done by the lawyers. The function of the report 9 was to update the Board on where we were. I satisfied 10 myself that the statements made in the Report were 11 correct, but I did rely on discussions with 12 Willie Gallagher and his senior officers, and with 13 Andrew Fitchie. There were no independent checks of the 14 statements in the Close Report." 15 You said there that you took the effort to satisfy 16 yourself as to the statements in the report. Was that 17 something that was, as far as you were aware, done by 18 others on the Board or other -- 19 A. I can't comment on other people's actions. 20 Q. So this was essentially an exercise you undertook on 21 your own? 22 A. Some of the discussions were at the different Tram 23 Boards, where Willie Gallagher and his senior officers 24 and Andrew Fitchie were present, and getting assurances 25 from them. 63 1 Q. So did you ask them questions: what about this, what's 2 the basis for that? 3 A. I'm sure I did. 4 Q. Could we look, please, at the papers in question you are 5 referring to in that paragraph. It's CEC01015023. 6 We can see that these are the papers for a meeting 7 of the Tram Project Board, tie Board and TEL Board that 8 took place on 23 January 2008. You were referring 9 within your statement to page 35, if you could look at 10 that, please. 11 We can see the heading. This is "REPORT ON TERMS OF 12 FINANCIAL CLOSE ('CLOSE REPORT')". 13 Underneath: 14 "FOR THE ATTENTION OF THE TRAM PROJECT BOARD, 15 TEL BOARD AND TIE BOARD." 16 This is marked draft 21 January 2008. 17 This is the document you're referring to in your 18 statement; is that correct? 19 A. I think that would be it, yes. 20 Q. What I want to do is just look at some of the statements 21 in this report. 22 If you could turn forward to page 38 of this. If 23 you look at the upper half of the page, we'll see 24 there's a paragraph to the effect -- it is the lower one 25 we can now see on screen: 64 1 "In broad terms, the principal pillars of the 2 contract suite in terms of programme, cost, scope and 3 risk transfer have not changed materially since the 4 approval of the Final Business Case in October 2007. It 5 is felt that the process of negotiation and quality 6 control has operated effectively to ensure the final 7 contract terms are robust." 8 Now, are you able to recall from whom you sought 9 assurance that this was correct? 10 A. I'm sure that the -- I had confidence, reasonable 11 confidence in the officers and directors and so on who 12 had drafted this report. I'm not sure whose name is at 13 the foot of it, but that was the sort of assurance that 14 I had to go with. 15 Q. I appreciate I'm asking you to look back a long time, 16 but can you recall whether this was something on which 17 you sought assurance, or can you simply say that you 18 would have sought assurance on everything that was in 19 the report so this would have been included? 20 A. I think quoted there in broad terms, I received 21 a general assurance by the fact that we had all this 22 information in the report and -- that I had no reason to 23 doubt the authors of the report. 24 Q. So is it essentially a matter of you were relying on the 25 authors of the report to ensure that it was correct and 65 1 you had no independent means of verifying what was or 2 was not correct? 3 A. Indeed. 4 Q. This report was an early draft. We can see it's dated 5 21 January. There were -- different versions of this 6 came out much later in the process, all the way up to 7 financial close. Did you continue to monitor these 8 reports and ask questions, or was your involvement 9 largely finished at an earlier stage of this? 10 A. I think when -- when the report came up at subsequent 11 Board meetings, obviously you had the opportunity to ask 12 questions about progress and so on. 13 The main concern was whether or not some sort of 14 agreement was getting close. 15 Q. What sort of agreement? 16 A. Agreement between tie and the consortium. 17 Q. So do I understand from what you're saying, the 18 principal concern was just to get a contract concluded? 19 A. Yes. 20 Q. Was there some pressure to get the contract concluded, 21 either in December or in May? 22 A. I think there was to get clarity, and to get on with the 23 job, really. 24 Q. Where was that pressure coming from, do you think? 25 A. Probably from the general sentiment of the Council. 66 1 Q. Was there any pressure within tie to get it done that 2 you were aware of? 3 A. Yes. I'm sure the people who had been involved in the 4 negotiations were getting a bit frustrated that they 5 hadn't come to a conclusion. 6 Q. Looking now -- we have finished with that document -- to 7 the contract works commenced. It's known obviously that 8 there were problems with the tram works. When did you 9 first become aware that there were problems? 10 A. I can't put a date on it. 11 Q. Can I ask you to look at a document, to try and fix 12 a date. Can we look at CEC01210242. 13 We can see that we're looking here at papers for the 14 Tram Project Board for the meeting that was due to take 15 place on 22 October 2008, which would put it some four 16 months or so after the contract had been awarded. 17 Could we look at page 10, please. And the lower 18 half of the page. There's a table there setting out 19 what the progress had been, described as "Summary 20 against agreed Infraco contract milestones is shown in 21 the table below (number of milestones)". 22 If we look, we can see that the prelims are all 23 marked as 100 per cent complete. Can you see that? 24 A. Indeed. 25 Q. If we look at the line underneath, construction, and 67 1 perhaps focus on the right-hand side, the cumulative 2 position, we can see that of 85 planned milestones, none 3 have been achieved. So there's a 0 per cent progress 4 noted. What was your reaction to getting this 5 information in October 2008? 6 A. Obviously I was very disappointed that the construction 7 work hadn't begun, given that it was some months, as you 8 said, after contract close. And that it appeared that 9 the contractors were not mobilising with any urgency. 10 Or that's certainly what we were being told; both 11 getting manpower and plant to get on with the job. 12 Q. If you could look over the page, please. We can see the 13 top of the page, if we enlarge the upper half, it notes: 14 "The project continues to experience problems with 15 slow mobilisation and, in particular, appointment of 16 direct BSC resource and final appointment of the main 17 package contractors." 18 It notes then that work has commenced on some sites. 19 If we look below the table, we can see bullet points, 20 and above it, it says: 21 "Key reasons for slippage include ..." 22 It notes difficulties in the concrete pour at 23 Edinburgh Park, redesign of Haymarket viaduct and the 24 delay of the Leith Walk as a result of utility works not 25 having been completed. 68 1 Were you told that there were any more general 2 issues with the contractor at that time that were 3 delaying the progress? 4 A. Well, the very fact that, as shown on the previous page, 5 very little work had been done. So it was obvious that 6 there was a general reluctance to get on and deliver the 7 job. 8 Q. Was there any discussion that you can recall as to what 9 was going to be done about that? 10 A. I'm sure the senior officers of tie were encouraged to 11 speak to the contractors and try and get things moving. 12 Q. Do you recall a dispute emerging in relation to works on 13 Princes Street in early 2009? 14 A. Yes. 15 Q. Now, do you recall that being discussed at the Tram 16 Project Board? 17 A. Yes, it would have been at the time. 18 Q. The difficulty was simply that the consortium were not 19 willing to start works for the infrastructure on 20 Princes Street? 21 A. Yes. 22 Q. Were you aware what the reason for that was, why they 23 were not starting works? 24 A. I can't remember the detail of it now. 25 Q. Could you look at paragraph 87 of your statement, 69 1 page 34. 2 At the foot of this page, and this is more in 3 relation to disputes generally, rather than 4 Princes Street in particular, you note: 5 "There were discussions at Board meetings and I was 6 given expert advice, both from the contractual people, 7 and Andrew Fitchie from DLA Piper. They kept 8 reinforcing the view that the contract was a sound one." 9 Over the page: 10 "My views on these matters only changed when 11 Gill Lindsay retired. It was then pointed out that 12 there might be problems." 13 Were you aware that there were arguments even taking 14 place about the contract round about this time? 15 A. I don't think -- well, the advice we were getting and 16 the tone of the Board meetings was that the contract was 17 robust and it was the contractors who were in breach. 18 And that was the point of view that was being emphasised 19 all the time. 20 Q. Were you ever given a notification that there might be 21 a weakness within the contract that would enable the 22 contractors to claim that there were what were termed 23 Notified Departures? 24 A. Not at that point. 25 Q. Just to put it quite specifically to you, did 70 1 Andrew Fitchie of DLA give advice to any of these 2 bodies -- that's the Tram Project Board, tie or TEL -- 3 to the effect that there was a problem with the contract 4 and the Council would be able to claim additional 5 monies? 6 A. Sorry, would you like to repeat that? 7 Q. Yes. Did Andrew Fitchie of DLA give advice to tie, TEL 8 or the Tram Project Board that there was a weakness in 9 the contract that would enable the Council to claim 10 additional monies? 11 A. I don't recall that. 12 Q. Had you been told that, do you think you would have been 13 able to recall it? 14 A. I'm sure if I had heard that someone like Mr Fitchie had 15 questioned the robustness of the contract, I'm sure 16 I would have remembered that. 17 MR MARTIN: My Lord, I apologise for interrupting. My 18 learned friend said the Council could claim extra money. 19 He may have meant that deliberately, but if not, in 20 fairness to the witness, I wonder if it could be 21 clarified one way or the other. 22 MR LAKE: Mr Martin is of course quite correct. I have made 23 a mistake there. It should be -- what I said was: there 24 was a weakness in the contract which would enable the 25 contractors to claim money from the Council. 71 1 A. I realised that was a slip of the tongue and that you 2 meant contractors. 3 Q. I'm obliged. 4 I'm obliged to my learned friend. 5 Are you aware how the dispute in relation to 6 Princes Street was resolved? 7 A. By a separate agreement, the Princes Street -- PSSA, the 8 Princes Street Agreement, which obviously was an 9 additional settlement. A variation on the main contract 10 obviously. 11 Q. Were the Tram Project Board, including yourself, 12 consulted on whether or not that should be entered into? 13 A. I'm sure it was brought to the Board. You'll probably 14 have the minutes at your fingertips. And we felt we had 15 little option, I think, but to go along with it. If we 16 wanted the work done with Princes Street. 17 Q. I want to go on to a wider dispute. Could we look at 18 page 44 of your statement, please. 19 Paragraph 103, you note here that there was 20 a dispute between the Base Date Design Information and 21 issued for construction drawings, had arisen by this 22 time and was considered at the meeting. I should say 23 that's a meeting of 6 May 2009: 24 "The PD [Project Director] report in the papers 25 referred to 'constructive discussions' on the issue. This 72 1 was all about the design problems between basic drawings 2 and those that were ready for construction, by which 3 time they had been vetted and gone through planning." 4 You see that's what you've recorded in your 5 statement, first of all? 6 A. Sorry? 7 Q. You see that's what you said in your statement? 8 A. Yes. 9 Q. If you could look at the document you have referred to 10 there, in the May minutes, it's CEC00633071. 11 We can see that these are the papers for the meeting 12 on 6 May 2009. And the reference within your statement 13 is to page 9. If we could look at that, please. We can 14 see this is the Project Directors' Report. 15 If we look at the foot of the page, the lower half 16 of the page, under the heading "Commercial", there's 17 a statement about: 18 "The Project Management Panel set up as part of the 19 solution to the disputes surrounding works on 20 Princes Street has now met on three occasions and has 21 been focusing on key priorities for the project which 22 are impacting on programme and commercial issues. This 23 is helping to build the relationships between both teams 24 and some successes have been delivered through this 25 process including ..." 73 1 Then if we look to the last bullet point: 2 "Constructive discussions in relation to the 3 movement between Base Date Design and IFC drawings." 4 That's the only statement that's given in relation 5 to this issue. 6 Were you given much more information about what the 7 problem was there? 8 A. There's probably a discussion to elaborate on that, but 9 I don't recall that or the Director may be -- Project 10 Director in his -- presenting his report probably spoke 11 a bit about it at the time. 12 Q. At the time, going back to May 2009, to what extent was 13 this seen as a major problem? 14 A. He certainly seems to be helping to build relationships 15 and some successes have been delivered. So there's 16 obviously some good news there. 17 Q. That's the first two bullet points, but in particular in 18 relation to the movement between Base Date Design and 19 IFC drawings, were you given any indication as to 20 whether this was a big problem or a little problem? 21 A. So many years after the event, I don't recall. 22 Q. Still staying within the same papers, can we look at the 23 risk register for it, and look at page 18. 24 Do you recognise this document? 25 A. Yes. It's one of the set of documents we got for Board 74 1 meetings. 2 Q. Was this document -- you can see it's titled "ETN 3 Primary Risk Register". Was that discussed at the 4 meeting, in your recollection? 5 A. Yes. I'm sure one of the people responsible for risk 6 management would have gone through it to talk about 7 changes from the previous time. 8 Q. If you could highlight the upper entry here, it's got 9 number 1077. Perhaps just halfway across the page so we 10 can make it large enough to read. 11 We can see the risk or ARM risk ID is 1077 and the 12 cause is said to be: 13 "Lack of visibility of design changes between 14 November 2007 and May 2008." 15 Now, I'll just ask you, was your understanding, is 16 that the same issue as the BDDI to IFC issue or do you 17 think this is considering something different? 18 A. I think it's the same. 19 Q. We see the event is described as: 20 "Tramworks price based on a design which may have 21 been altered." 22 Was there any discussion then about whether or not 23 it was only may have been altered, or whether it was 24 known that the risk had been altered by that time? 25 A. I don't recall. 75 1 Q. Could we highlight now the text to the right of this, so 2 we can see what the treatment strategy was for it. The 3 treatment strategy for that is noted as: 4 "Establish a process which will act as a control 5 mechanism for design changes. (If one exists already then 6 ensure process is complied with.)" 7 Now, reading that, that reads -- it's intended to be 8 a process for controlled design changes in future. Is 9 that correct? 10 A. Yes. Whoever put that entry on the register obviously 11 wasn't sure if there was such a process already in 12 place. 13 Q. We saw what the risk was or the cause of the risk. It 14 was a lack of visibility of design changes which had 15 taken place more than a year earlier between 16 November 2007 and May 2008. Was there any discussion of 17 what use that treatment would be for something that was 18 finished a year before? 19 A. Not that I recall. 20 Q. If we go back to your statement, please. Go back to 21 your statement, please, page 44. Looking at 22 paragraph 103 again, if we see just above halfway down 23 the screen as it is at the moment, there's a sentence 24 that begins: 25 "It was apparent from a very early stage that the 76 1 programme had slipped." 2 This is the same point you've already been noticing, 3 that matters were deteriorating in that regard. 4 A. Yes. 5 Q. Jumping around, could I ask you to look at the papers 6 for the June meeting then of the Tram Project Board, 7 which is reference CEC00983221. We can see that these 8 are the Tram Project Board papers for the meeting that 9 took place on 8 July 2009. 10 Could we go, please, to page 40 of this. 11 The original of this was in colour. So I think 12 there is a colour version available. I wonder if we 13 could put the colour version of this page on screen. It 14 involves switching to the camera to look at a hard copy. 15 The colours are not entirely easy to see, but we can see 16 a range of different colours running down the right-hand 17 side there. Can you see them now? 18 A. Yes, I have them on screen. 19 Q. If we look, for example, halfway down, if we look almost 20 halfway down the table as we see there it, there's an 21 entry, "Utilities works complete". 22 A. Yes. 23 Q. Do you see that? 24 A. Yes. 25 Q. Under the column, "Baseline programme date", we can see 77 1 it's November 2008, and the actual forecast -- the 2 actual current forecast date is now given a year later 3 as November 2009. 4 A. I see that. 5 Q. It's coloured. It's quite difficult -- it looks 6 a reddish pink colour there, doesn't it? 7 A. Yes, I could just make it out. 8 Q. If we look below that at the -- beneath that, Haymarket 9 viaduct complete, it was originally intended a date of 10 8 December 2008, and it's now noting January 2010. Do 11 you see that? 12 A. Yes. 13 Q. For example, we might look further down that to the 14 Carrick Knowe Bridge complete, and we can see there's 15 a slippage there from 11 May 2009 to 26 January 2010. 16 A. Indeed, I see that. 17 Q. Now, if we look over the page to the colour key on this, 18 I don't know if we can zoom in on it because it's very 19 small type, to make it clear. Just hold it there for 20 a second. Let it come into focus. 21 We can see that in relation to matters that are 22 pink, it's significant slippage but expect recovery can 23 be achieved. Red is: 24 "Notable/significant slippage - difficult to recover, 25 even with action." 78 1 It's difficult to see on the version, the colours 2 that are there, but if you can take it from me on the 3 original, the ones we've been looking at come within the 4 pink or purple category: 5 "Significant slippage but expect recovery can be 6 achieved." 7 Was there any discussion of whether or not and how 8 realistic it was to expect that recovery could be 9 achieved? 10 A. I think we were beginning to have doubts as to whether 11 anything could be expedited by that stage, when you see 12 the sheer amount of stuff in the red column or marked 13 red and pink on that report. 14 Q. We have finished with that. 15 I think you are aware that Richard Jeffrey joined 16 tie in 2009? 17 A. I did. 18 Q. One of the things he did was to have a review of the 19 strategic approach to dealing with the contractors? 20 A. Indeed, yes. 21 Q. Could you look at another document with me. It's 22 document CEC00379021. 23 We can see this is headed "Joint ..." 24 It's print of a PowerPoint presentation. On the 25 front page is the heading "Joint Tram Project Board and 79 1 tie Board", and a date is given as 8 July 2009. Do you 2 see all that? 3 A. I see that, yes. 4 Q. Could you look, please, at page 15 with me. We have got 5 the heading, "Recap of mediation and 8 July Tram Project 6 Board": 7 "Mediation held week covered 8 individual items 8 and whilst useful discussions were held and additional 9 information provided, no overall movement or agreements 10 were reached." 11 Do you recall a mediation having taken place shortly 12 before this in 2009? 13 A. Not offhand, no. 14 Q. We can then see there's four options presented to the 15 Tram Project Board in July. That would be the earlier 16 meeting. It's got: 17 "(a) Negotiate settlement of all issues with BSC." 18 In relation to that, it's noted that: 19 "3 months and mediation has not delivered an 20 outcome which is acceptable in terms of certainty on 21 delivery, engagement, programme and costs." 22 Now, that's obviously the view of the person that 23 prepared this presentation. Did you have a view in 24 relation to that option? 25 A. Well, certainly I think when Richard Jeffrey joined tie, 80 1 he brought a fresh pair of eyes and a fresh approach to 2 things. And obviously he was quantifying what he'd 3 found. He'd only been in the business for a few months 4 at this stage, but he was already starting to spell 5 things out in a different way. 6 Q. We can see that the next approach is respectively: 7 "Formal contractual approach; reduce/rephase BSC 8 scope", and (d): 9 "End BSC contract." 10 Do you recall discussing these various options? 11 A. I do remember those options being discussed, yes. 12 Q. The one that was ultimately selected was perhaps 13 inevitably the one that's highlighted in red, the formal 14 contractual approach. 15 A. Yes, we tried to go down that road, if that was 16 feasible, using the dispute resolution procedures and so 17 on. 18 Q. Were you in agreement with that approach? 19 A. Yes. It seemed a reasonable way to approach things at 20 that stage. 21 Q. If the decision was to use the Dispute Resolution 22 Procedures, had you the benefit of advice as to the 23 strength of the arguments in relation -- that would be 24 advanced at a Dispute Resolution Procedure? 25 A. I'm sure at that stage we were still being assured that 81 1 the contract was robust. Therefore, we reckoned if we 2 were insisting on the contract as clause (b) suggests, 3 then we were within our rights. 4 Q. Who was telling that you the contract was robust? 5 A. Nobody had told me otherwise at that point, as far as 6 I recall. 7 Q. What was the intended effect that this would have on the 8 contractors? 9 A. To persuade them to keep moving with the project and 10 keep things moving as best they could. 11 Q. Was there any discussion of what would happen if the 12 decisions went against tie in Dispute Resolution? Where 13 would that leave tie? 14 A. I don't recall discussion of that at this point. 15 Q. I think -- which issues were to be taken to Dispute 16 Resolution Procedure? 17 A. These were obviously individual areas of the -- of the 18 track and so on where there was a difference of opinion 19 about the work and the cost thereof. 20 Q. Are you aware of any particular issues that required to 21 be resolved that might unlock the contract? 22 A. Sorry, what do you mean by unlock? 23 Q. Were there particular matters in dispute between the 24 parties, issues of principle that if they were resolved, 25 might enable things to proceed more speedily? 82 1 A. We were getting the impression certainly from the 2 commercial people that the billing they were getting 3 from the contractors seemed to be generous in their 4 favour for different stretches of work. And the attempt 5 was to go to -- my recollection was to go to arbitration 6 to try and get things sorted out. 7 Q. When you're referring to arbitration, there's a process 8 that could take place under these contracts called 9 adjudication. Does that ring a bell with you? 10 A. I think that's probably the phrase I should have used. 11 Q. So the matters that were going to be taken to 12 adjudication, was it just a matter of querying the 13 bills, as it were, that were coming in from the 14 contractors? 15 A. That's certainly the nub of it, the detailed part of it, 16 that's where some of it came from, and obviously that 17 there were breakdowns in the relationship there. 18 Q. Was it the view within tie, TEL, Tram Project Board, 19 that if the decisions went in favour of them, that the 20 relationship would be repaired and things would improve? 21 A. That was the hope, I'm sure. 22 Q. What was the outcome of these matters going to 23 adjudication? 24 A. Well, we were told that the earlier items referred were 25 found in tie's favour, but then after a while, the 83 1 pendulum seemed to swing and the rulings went the other 2 way. 3 Q. What effect did that have on tie's position? 4 A. It weakened it, obviously. 5 Q. Were any decisions taken as to adopt a different 6 approach in light of that weakness? 7 A. I don't recall other than, as I say, we kept being told 8 that the contract was robust, and therefore it was the 9 contractors who were being difficult. 10 Q. So you were being told that even after the adjudication 11 decision returned? 12 A. I'm sure. 13 Q. Could you look, please, at page 51 of your statement. 14 I'm interested in paragraph 115, which begins at the 15 foot of the page here. You start by noting here: 16 "The decisions of the Carrick Knowe and Gogarburn 17 adjudications were made available." 18 Were you actually provided with copies of those 19 decisions? 20 A. No. 21 Q. What were you told about them? 22 A. We just got a summary of the outcome. 23 Q. Did you ask for copies of the actual decisions? 24 A. Probably not. 25 Q. You say, if you go to the following page: 84 1 "We had no input." 2 You might want to read that in context actually. 3 If you go back to the previous page, you say: 4 "The decisions of the Carrick Knowe and Gogarburn 5 adjudications were made available. An independent 6 arbiter who dealt with the DRP processes was conducting 7 the review. I do not know who it was. The TPB [Tram Project 8 Board] only noted the outcome. We had no input." 9 What do you mean, you had no input? 10 A. Well, we were just informed of the outcome. There was 11 no discussion of it at that stage. I think that's what 12 I meant. 13 Q. Did you want -- would you have welcomed a discussion? 14 A. With hindsight, probably yes. But at the time I didn't 15 feel it was necessary. 16 Q. From what you're saying here, it seems you were told 17 that these decisions were to be the subject of review. 18 A. Yes, I think that was the case, wasn't it? 19 Q. Do you know what -- were you ever told what the outcome 20 of that review was, can you recall? 21 A. I don't recall. 22 Q. Do you recall ever having been involved in a decision as 23 to whether or not to challenge the decisions of the 24 adjudicators? 25 A. I don't think so. 85 1 Q. If we could look, please, at page 58. And if we could 2 enlarge the upper half of the page. I should provide 3 the context of this. You're talking about a report, an 4 update report, issued by the Directors of City 5 Development and Finance to the Council in June 2010. 6 If we read about eight lines down, there's 7 a sentence which begins "The report stated that ..." 8 Towards the right-hand side: 9 "The report stated that the outcome of the DRPs was 10 'finely balanced' in terms of legal principles." 11 And that you -- I should read on: 12 "Some of TIE's claims were sustained by the 13 adjudicator but some were unsuccessful. This was the 14 nature of independent adjudication. The Report stated 15 that it was 'prudent' to plan for a contingency of 16 10% above the approved funding of GBP545 million 17 because of the current lack of clarity on programme and 18 cost. I believed that this was a realistic assessment." 19 Just pausing there, was it a concern to be told that 20 this additional money was going to have to be found? 21 A. As I say, I was being a realist that it was going to 22 cost money to keep things going. 23 Q. What did you understand the report meant when it said 24 that the DRPs were "finely balanced in terms of legal 25 principles"? 86 1 A. I think some of them, there had been a split decision by 2 the adjudicator that he'd found some points made by the 3 one side and some points made by the other about 4 individual issues. So it wasn't as clear cut that -- 5 100 per cent decision on a particular item that had been 6 referred. But sometimes certain parts of it were 7 accepted one way and certain parts were found in the 8 other party's favour. 9 MR LAKE: Thank you very much, Councillor Wheeler. 10 My Lord, those are the only questions I seek to ask. 11 CHAIR OF THE INQUIRY: I don't think there's any other party 12 who has questions. 13 Thank you very much, Mr Wheeler. That's the end of 14 your evidence. You're still subject to your citation in 15 case you need to be recalled, but I think that's 16 probably unlikely. 17 If that does happen, someone from the team will get 18 in touch with you. Thank you for your attendance and 19 your help. 20 A. Thank you, my Lord. 21 MR LAKE: My Lord, I've got no further witnesses today. The 22 witnesses who will be giving evidence on Tuesday of next 23 week are Graeme Barclay and Andrew Malkin. 24 CHAIR OF THE INQUIRY: We will adjourn until Tuesday at 25 9.30. 87 1 (12.17 pm) 2 (The hearing adjourned until Tuesday, 7 November 2017 at 3 9.30 am) 4 88 1 INDEX 2 PAGE 3 MR ALLAN JACKSON (sworn) .............................1 4 5 Examination by MR LAKE ........................1 6 7 MR PHIL WHEELER (sworn) .............................40 8 9 Examination by MR LAKE .......................40 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 89