Maxwell, The Outsider

by Tom Bower

  As they looked up at the judge, Maxwell's lawyers did not need the powers of clairvoyance to realise that there was no sympathy for the client or his cause on the bench above. Despondently they accepted that the odds were irrecoverably against them. The bias, they believed, was not only against their case but directed against them personally. The prejudice was unpleasant to mention but was, in their view, a reality. Like their client, all the barristers and solicitors were Jewish. 'Before that day,' recalls one of those lawyers, 'I disbelieved the possibility of anti-semitism, but I realised the truth at the end.' The sentiment was unanimous among Maxwell's lawyers, who had after all appeared before so many other judges, so one may conclude that their suspicions must have had some validity despite one circumstance which could also explain so much -namely, that Sir Phillip Wien was a Welsh Jew. (A less emotional view would be that Wien simply did not believe Maxwell's case.) That night, Maxwell refused to be infected by their despondency and belligerently urged them to fight on regardless.

  For three days Silkin sought to weave the arguments about the merits of Maxwell's unargued case into the constraints that Wien had established. At the end of the third day, Maxwell demanded a change of tactics. Sitting cramped with his four lawyers in Silkin's room in the House of Commons, Maxwell was aggressive. ‘I must have my third leg,' he shouted, implying that his lawyer should attack the inspectors themselves. Quietly, Silkin refused because Wien had emphatically forbidden that argument. Eventually, Maxwell seemed persuaded, climbed into his Rolls-Royce and drove off. Early the following morning, Maxwell telephoned his friend and said, 'You're fired. I'll argue the case myself.' His lawyers were amazed. 'You're like a Christian going into the arena,' said one but he was ignored. Silkin made his apologies to Wien and departed.

  Dismissing the barristers was a doubly perilous act for a man who had defended himself in front of the DTI inspectors as a hapless innocent who relied in matters of accountancy and finance upon his experts. How would Wien interpret Maxwell's impetuosity other than as confirming the inspectors' conclusions about Maxwell 'ignoring the views of others if these are not compatible.' It was also a perfect example of Maxwell's inability to understand the impression he was creating. Anxious not to suffer the same accusations as the inspectors, Wien allowed Maxwell four days to prepare his case.

  Working with his solicitor through the night in a suite at the Savoy Hotel, Maxwell prepared his presentation. On Monday morning, he rose with solemnity from the silk's bench in the courtroom. The result was an embarrassing shambles. Unable spontaneously to fashion a speech to build an argument, he presented a woolly monologue which ignored his prepared brief. In cross-examination of witnesses, he could not ask questions to support his case. At every stage, Wien was indignant about the submissions which Maxwell thrust towards him. With jarring repetition, Wien interjected: 'What is the point of this, Mr Maxwell?' Had Wien sat in Maxwell's board room with as limited an experience of finance as Maxwell displayed in the art of advocacy, Maxwell would have been equally impatient. After six days, Maxwell finally conceded that even he could not override the will of a British judge and selected a new barrister to represent him. Michael Ogden QC, an Establishment figure with a fruity voice, was deemed the most suitable. It was naturally to no avail.

  In his judgement, Wien pulverised the plaintiff. The inspectors, he said, had acted 'eminently fairly' despite Maxwell's deliberate obstruction, by giving him 'chapter and verse' of the case he was expected to answer. They did not have to show Maxwell their draft conclusions before publication. It was sufficient, he judged, that they gave him 'a fair opportunity of replying to what is said against him'. Clearly irritated by Maxwell, Wien ended by echoing the inspectors' own conclusions: 'He regarded professional advisers as tools to achieve his own ends and if they gave him advice not to his own liking he simply brushed it aside.' Maxwell was not in court on 20 December to hear the judgement although the costs were estimated at £50,000. He announced that he would appeal. With absolute certainty, he would again be judged by Lord Denning.

  One of Maxwell's great weaknesses and a source of irritation to others was his unwillingness to believe or even care that his behaviour had left a bad taste in someone's mouth. His insensitivity was of course also a source of strength; but while that doggedness might have provided the finance to open the doors to the Court of Appeal, it did not help much further. In January 1974, Lord Denning might have surmised that he was in a slight quandary. After all, he had set the guidelines for the observance of natural justice in 1970 and both Forbes and Wien, in contradiction of each other, had claimed to implement them. It would be, however, to underestimate the potent virtue of the common law not to accept that each judge fashions the law to suit the case. If Lord Denning were to accept that the inspectors had not followed his requirements as rigorously enunciated four years earlier, they would have been obliged to reopen the whole inquiry. Maxwell, it was commonly agreed, had committed too many sins to be granted that victory. Hence a not unusual ritual was performed.

  In his judgement, Lord Denning emphatically rejected Maxwell's appeal, citing from the original inquiry's transcript that in the case of each criticism the inspectors had indisputably put the facts 'fairly and squarely to Mr Maxwell'. Wien was right, said Denning: 'This is nothing more or less than an attempt by Mr Maxwell to appeal from the findings of the inspectors to the courts. But Parliament has given no appeal. So Mr Maxwell has tried to get round it by attacking the conduct of the inspectors themselves. In this he has failed utterly.'

  But Maxwell had not completely failed. Just as the accountancy profession changed their practices in the wake of the Pergamon revelations, so were the procedures for future DTI inquiries changed. Quietly, a procedural order was introduced spelling out how the rules of natural justice had to be followed; it included a provision that those who would be criticised in a report had to be given the opportunity to comment before publication. It was, some felt, an implicit criticism of Owen Stable's management of the inquiry.

  Maxwell was naturally determined to have the last word. In November 1973, the third and final DTI report, concentrating upon the private companies, was published. It was a voluminous and once again damning indictment with accusations of phoney and back-dated invoices and of rewritten board minutes; examples of Maxwell presenting documents allegedly to support his case which failed completely to live up to their promise; and repeated examples of how Maxwell sowed unusual confusion between his private companies and Pergamon. The inspectors encapsulated that confusion perfectly in paragraph 916: 'On the 30th June 1969, the debt of £104,166 was paid by MSI(DS) on behalf of MSI Inc. to MSI (1964) on behalf of Pergamon with money received from R.M. & Co. as trustee of MSI Inc. out of the proceeds of sale of the warehouse property at Wolverton, which is. . . .'

  An example of Maxwell's compartmentalisation suggesting the intentional injection of a conflict of interests into his commercial affairs which caused the inspectors to be so distrustful was cited in another exchange. Leach asked Maxwell why, in June 1966, there had been a sudden need for an agreement between Pergamon and MSI Inc. Maxwell replied: 'Because MSI Inc. continuously feared the competition of R.M. & Co. . . . and R.M. & Co. refused to be bound by this arrangement.' Both private companies were owned and effectively managed by Maxwell, yet he was suggesting that he was in genuine competition with himself.

  The third report was tarnished by the inspectors' admission at the beginning that the next contained an error. Although it was not serious, and only affected 9 out of 1,254 paragraphs in the report, their embarrassment was perfect ammunition for Maxwell's counter-attack. Contemporaneous to the publication of the third DTI report, he issued a thick press release entitled. 'They Must Be Fair', which charged the inspectors with damaging his reputation and going out of their way 'to whitewash everyone else'.

  Maxwell's document succinctly reflected the problem which the inspectors themselves found difficult to overcome. Every explanation provoked more questions and conf
usion. His own defence document proves that, even at the risk of possible unfairness, he was criticised on a balance of probabilities. Yet Maxwell's publication and the inspectors' own mistake sowed real seeds of doubt.

  The publication of the third report in November 1973 coincided with another attempt by Maxwell to return to the Pergamon board. Few could believe it possible that after all the revelations he still possessed the sheer energy and courage to attempt a comeback. The inspectors did not hide their own dismay that despite their massive indictments he gave no appearance of being crippled. In their final report they stated: 'to outward appearances, [the criticisms have not] abashed him or affected his fixation as to his own abilities'. After more than three years' hard toil, they had failed to suppress the businessman. At last, Maxwell was on the verge of resurrecting himself.

  11

  The national newspaper headlines were succinct: 'Maxwell Rides Again', 'The Second Coming of Mr Maxwell'. He shared the belief that he was about to stage a triumphant return from the wilderness to become once again the chairman of Pergamon and a Member of Parliament. Just as he had never relinquished complete control of Pergamon, he had similarly struggled to retain his position in his Bucks constituency, although in the aftermath of his election defeat his relations with some important party members had soured. Even from his entrenched position, his bid to return was fraught.

  Soon after the 1970 election, the Maxwells had organised votes of censure in several branches in the constituency against Jim Lyons, the election agent, whom they blamed for allowing the party organisation to deteriorate to the extent that crucial votes had been lost. As the emotional accusations and critical reports materialised, Lyons requested that the party's National Executive Committee undertake a proper investigation. Reg Underhill, the assistant national agent, arrived in the constituency on a Friday morning in early January 1971 expecting to leave at the end of the day. Instead, the inquiry lasted until 2.45 on Sunday morning. The drama in the New Bradwell Labour Hall as both Maxwells set out the indictment against Lyons epitomised all the circumstances which had frustrated his political ambitions. On one side of the room was Underhill, formerly a junior insurance clerk, born in Leyton, east London, whose life's credo was steeped in the traditional strengths and weaknesses of the British working class - loyal, decent but for some too blinkered. Underhill was dedicated to the party and Transport. House, whose inefficiency and petty politics were criticised even by Harold Wilson. On the other side of the room were two millionaires born in Czechoslovakia and France who had joined the party a mere eleven years earlier, and they were telling Underhill over and over again how the British working class should be organised. 'I didn't want to crush him,' sighed Underhill sixteen years later, 'but he kept on repeating himself. He did go on.' The lightness of the Maxwells' pleas was irrelevant. The Labour Party's representative was not in the mood to take lessons from their ilk.

  Paradoxically, in view of Maxwell's complaints against the DTI inspectors, Lyons was not told beforehand what charges he was expected to answer, but he was not slow to argue that there had been no complaints, only praise, until the election defeat. That was not quite true but the official report issued by Transport House was prepared to accept Lyons's defence and condemned the Maxwells for having distorted the evidence and 'exaggerated [the complaints] beyond limits that could be substantiated'. Underhill's report illuminated a distasteful relationship between the family and the agent and criticised the manipulations of Maxwell's supporters to increase their representation in party meetings. Officially, Transport House 'severely censured' Maxwell, his wife and 'others associated with him' for interfering with Lyons's work and for denying the agent absolute control over the election funds. Further, it ordered the constituency's rules to be amended to prevent the packing of the General Management Committee. Maxwell was personally 'warned as to his future conduct'. There was little precedent for such a sweeping condemnation of a former MP and his wife. 'I told the constituency', recalls Underhill, 'to look for a new candidate.'

  Maxwell was in America when the report was publicised. If either he or Betty were embarrassed, it never showed. Both let it be known that they were still attached to the constituency and expected to fight the next election. In most parts of Buckinghamshire, there was little overt reaction to the prospect but in the working-class area of Wolverton there was positive dismay.

  The Bucks Labour Party had been founded in Wolverton in 1917 and dedicated activists like Frank Atter, a party member for twenty-one years, saw themselves as the rock of socialism. To those members, loyalty to the party is as precious as loyalty to a school or a cricket club for those of another class. The Transport House inquiry and the censure were personally hurtful. During the summer, following the publication of the first DTI report, Atter and others in his branch were struck by the similarity in criticisms expressed by the inspectors and Transport House. From their limited and narrowly focused experiences, they had not realised that Maxwell's treatment of Lyons and his cavalier treatment of themselves as councillors reflected his behaviour in business. They were angry that Maxwell's oft repeated promises of future employment on the land he had bought from British Rail in Wolverton had failed to materialise and they more than ever resented his critical lectures about their allegedly parochial attitudes towards the new town in Milton Keynes. Compared to Maxwell they were inarticulate and even mute. To his face, they were unable adequately to express their disenchantment about his stranglehold over the party organisation which prevented them openly debating with him their views about political events. He interpreted their passivity as acquiescence and prided himself on his qualities of leadership especially of the workers. Unfortunately, he failed to make the distinction that these were not his employees. 'He just didn't think that the common man had any common sense,' according to Geoff Foster, the regional organiser. The first to protest against the grip of pro-Maxwellites over the constituency had been Ray Bellchambers in 1960.

  Bellchambers, who was employed at the Wolverton railway works and had been a member of the party since the age of fifteen, criticised Maxwell at a ward meeting. Without his knowledge, weeks later, Bellchambers was formally suspended from the party as the first step towards expulsion. 'The first I heard was when a friend telephoned,' he recalls. Bellchambers appealed to the party's National Executive at Transport House who ordered the pro-Maxwellites to reinstate the member because their act was unconstitutional. Reluctantly, the constituency complied but it did not hide its irritation.

  The working-class unease about Maxwell after the 1970 election defeat was articulated by new members who had recently taken jobs at the Open University at Milton Keynes. Young men like Geoffrey Edge, a lecturer, did not believe that Maxwell was a natural socialist. They were ambitious, irreverent newcomers who expressed, in Maxwell's opinion, a lack of respect for the status quo. Like Atter and Bellchambers, Edge and the other lecturers joined and worked for the Labour Party not because of the candidate, but for the cause. In their minds, the party exists to change society, and the evenings spent in political debate were important to their lives. Edge says that they joined the party with the best intentions but gradually resented the stifling of opportunities for their brand of political debate, although it was unlikely that university socialism would find many converts in the old rural constituency. Tf you didn't agree with him,' says Edge, 'you had to go. When the government inspectors said the same about him, we realised that our feelings weren't misplaced. We just didn't like the lack of freedom of speech in the constituency.' Maxwell's belief that he would continue as their candidate provoked their ire. In the autumn of 1971, although there was no liaison between the two dissenting groups (the workers had little in common with the lecturers), they felt individually predisposed to demand a new candidate.

  At the end of October, the Wolverton branch passed and publicised a motion of 'no confidence' in Maxwell and warned that they would not work for him in future campaigns. The resolution, proposed by Frank Atter
, stated that Maxwell's candidature 'would result in a humiliating defeat at the next election, with a corresponding and lasting erosion of Labour morale and support'. Within twenty-four hours the constituency Labour Party was deeply split. Wolverton's refusal to work for a candidate would be a serious impediment to any campaign. The question was whether the candidate was more important than party unity. Maxwell had no doubt about the answer. Confident that he still retained the support of the majority, he responded forcefully. Atter, he claimed, was unrepresentative, undemocratic and irresponsible. It was, he announced, 'an unprovoked personal attack which was made without notice and without giving me the courtesy of an opportunity to reply'. Atter's comment was harsh: 'What notice did he give Jim Lyons or Ray Bellchambers?'

  Thoughout 1972 the local party was plunged into a frustrating, fratricidal conflict. Public rows are not uncommon in the Labour Party, but the effect on a marginal constituency is more damaging than most. At the end of the year, Lyons retired and Transport House refused to sanction the appointment of a new agent. The party's organisation in the constituency began quickly to disintegrate as Geoff Foster paid repeated visits to 'make sure we had no more shenanigans about membership'. Fifteen years later, the scars had still not disappeared. 'It was rugged and unpleasant,' according to Atter, and 'Absolutely unremitting,' according to Edge. The pro-Maxwellites led by Jim Cassidy, the constituency's president, were equally hurt: 'It was ugly.' Although outsiders would attempt to characterise the battle as ideological, the issues of left and right were not strictly relevant. Cassidy and Atter never disagreed that the floating voter ruled in Bucks and only a centrist candidate could win the seat for Labour. The issue was Maxwell himself and for the majority like Cassidy, who described himself as a Gaitskellite, their former candidate was ideal: 'He succeeded from nothing. The other side could never dream of the poverties and personal tragedies which Bob suffered. Yet he's a giver, not a taker.'