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ORIGINAL BY POST
9 March 2000

Private & Confidential
Hubert Taylor Esq
HTD Business Services
2-18 St Michaels Road
Hockley
BIRMINGHAM
B18 5LA

By fax:
Our ref:

Dear Sir

National Federation Of Small Businesses

We act for and are instructed by the Federation of Small Businesses Ltd and for its Secretary and former National Chairman, Mr David Dexter.

As you know, a website published by you through an Internet Service Provider, Freenetname, was closed down at the end of last week.

As soon as our clients became aware of the website they instructed us to take immediate action to ensure that the website was closed down on the grounds that it contained material which was grossly defamatory of the Federation and also of Mr Dexter, as well as other members of the Federation. In accordance with instructions we contacted the Internet Service Provider to inform them of this fact and they, quite rightly, required the site to be closed down.

The Internet Service Provider was not of course the author of the website. The responsibility for that is with you.

Notwithstanding that the site has been closed down, whilst in operation you were responsible for publishing on it allegations against the Federation and its officers which were scurrilous and grossly defamatory. On the opening page of the site in the page menu, you refer to:

(i)	"Bogus Investigation".
(ii)	"Sham Office"
(iii)	"Serious Cronyism"

Lewis Silkin Solicitors
Windsor House
50 Victoria Street
London SW1H 0NW

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(iv)	"False Qualifications"
(v)	"Kangaroo Justice"

And then on a green background in a rectangular box, the words in bold print were published "Federation of Small Businesses Scandal!".

Thereafter, there are detailed allegations, which include:

1. Against Mr Dexter, that he is in breach of his Statutory responsibilities as Company Secretary.

2. That a member was expelled without following proper procedures.

3. That there has been actual fraud within the FSB.

4. That the FSB treats its members with disdain to the point of expelling them.

5. That Mr Dexter is dishonest and has failed to disclose his financial interests.

6. That Mr Dexter abuses his position as Secretary of the Federation.

7. That the FSB Executive Board are guilty of an establishment cover up.

8. That the Federation's accountants are guilty of negligence.

9. That Mr Don and Mrs Kate Anslow are guilty of fraud and that the Federation have conspired with them.

10. That Mr Bernard Juby and Mr Gerald Godby, former Regional Chairmen, are guilty of irregularities and/or improper expenses claims.

11. That Mr Gerald Godby has acted fraudulently.

12. That Mr David Dexter and the National Treasurer, Mr Gordon Catto are guilty of gross incompetence, negligence or fraud in relation to expenses claims.

13. That Mr David Dexter improperly barred a National Councillor from election and conspired to prevent him taking office in breach of his obligations and in abuse of his authority.

14. That Mr David Dexter in his capacity as National Secretary has prevented the Federation from acting democratically and has deliberately stifled debate.

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15. That Mr Dexter and National Councillors from the Executive Board are guilty of "kangaroo injustice".

16. That Mr David Dexter refused "point blank,' to Permit Members of the Federation to have their say at the Annual General Meeting, thereby abusing his position.

17. That the principal officers in the FSB have hi-jacked the Federation and are silencing those who dare to object.

18. That the Federation improperly and wrongly prevents the police and/or a Court of Law from applying proper legal procedures.

None of the allegations that you have made are true. Their natural and ordinary meaning is clear namely that the Federation has concealed fraud, has been negligent, and that it has retained officers who are fraudulent, dishonest, and undemocratic and who have been negligent. Given the background to the matter, namely the refusal of the Federation to renew your subscription, and the fact that you were thrown out of the Federation by virtue of your conduct, it is obvious to our clients that the allegations posted on the site were inspired by malice. Also, that the allegations made were made recklessly in the knowledge that they were not true in an act of spite and vengeance, principally against Mr Dexter.

It is not necessary for us here to relate the events leading to your expulsion from the Federation. Suffice to say that the decision was one democratically made after lengthy enquiry and investigation.

Our clients are not prepared to tolerate publication of these libels upon them on any website, or in any other medium. Nor are they prepared to tolerate the publication of slanders or malicious falsehoods upon them.

The Federation has a duty to its 146,000 members. It is determined to preserve its record as a pressure group with no equal in the UK in respect of achievements on behalf of the self-employed and small business sector.

The lies and untruths that you have published against the Federation and its officers are deliberately designed to damage that reputation and undermine the confidence of its members and prospective members.

Since the closure of the site, http://www.htdbs.co.uk, on Friday we understand that you telephoned the offices of our clients' West Midlands solicitors to inform them that you had set up another website. We have visited your new site and see that you are now publishing the same or similar allegations on this new site as you did on the old site. Accordingly, we will be taking immediate steps to inform the ISP of that site, of the position and seek to close that site down as well.

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In any event, the purpose of this letter is both in relation to the publication that has already taken place as well as future publication. Our clients require the following from you:

1. An immediate and unqualified withdrawal of all the defamatory allegations made and being made against our clients (and other officers named and the subject of similar defamatory allegations).

2. A suitable letter of apology to the Federation and to Mr Dexter withdrawing all such allegations against the Federation, Mr Dexter and other officers and apologising.

3. An undertaking that you take immediate steps to cease publishing the same allegations or similar allegations in any shape or form, written or oral, electronic or in document form or howsoever.

4. The payment of legal costs incurred and to be incurred in this matter by our clients on an indemnity basis.

With regard to our client's entitlement to recover substantial damages from you, we are instructed that on the basis that you comply with the requirements listed above forthwith, then our clients will not pursue any claim for damages against you. However, if you do not so comply then you must expect our clients to claim damages against you. In addition, if you do not indicate a willingness to comply with our client's requirements, then we must advise you that our clients will have to give consideration to an application being made to the High Court of Justice for an injunction to restrain you. In this connection we would also mention that the publication of confidential documents, which are the property of the Federation, is a serious infringement of their rights and breach of confidentiality. As an additional requirement, our clients would expect that you should now deliver up all documents which are the property of the Federation, and which are in your power, possession or control.

In the circumstances and given the gravity of the situation, we would suggest that you seek legal advice without delay and if you do instruct solicitors, please would you provide us with their name, address and reference.

Time is of the essence and we would ask that you please respond to this letter within 24 hours, acknowledging its receipt and confirming that you will abide with our client's requirements.

Yours faithfully

(signed copy of letter held)

Lewis Silkin