Late in 2009, an investigation into the charity African Aids Action was becoming one of the most contentious the Charity Commission had worked on in recent years. The chair, Eyob Ghebre-Sellassie, was making allegations of racism, threatening to appeal to the charity tribunal and writing to his MP and the Prime Minister.
This was happening just as another difficult case was coming to a head. The charity tribunal was about to rule on the appeal by Nagendram Seevaratnam, chair of the Sivayogam Trust, which runs a south London Hindu temple, against a commission order removing him as a trustee for failing to dissociate the charity from the proscribed Tamil Tigers in Sri Lanka.
The commission's confidence about the AAA case had already been undermined by an embarrassing mistake earlier in the year when it had issued an order - checked by its lawyers - directing the trustees to wind up the charity. But there had been an error in the wording and it had been withdrawn.
So far the case had been handled by David Orbison, a senior case officer in the compliance unit in Liverpool. But in early September Kenneth Dibble, the commission's head of legal services, received a letter about the case from James Brokenshire, then the MP for Hornchurch & Rainham and Ghebre-Sellassie's local MP; and soon afterwards the word went out to staff that Dibble was looking into the case.
At the start of October, the commission received another broadside from Ghebre-Sellassie - this time, a 20-page complaint copied to Brokenshire and the Prime Minister of the day, Gordon Brown. And a few days after that, the tribunal ruled against the commission in the Sivayogam case, rejecting all seven reasons the commission had given for its actions and ordering his immediate reinstatement.
This was a serious blow for the commission, which was already wary of the recently created tribunal as a route for people to challenge its decisions. It started a review of its investigatory procedures and decided on 2 November to close the AAA case. Dibble emailed a colleague: "We are so vulnerable on this case to the sort of concerns which were thrown up in the tribunal decision of Siv this month and which the board is extremely concerned about (an understatement)."
So Orbison and others were called to a case conference and told that the AAA investigation was to be closed and the trustees instead given an action plan for improving governance. An order freezing the charity's bank account, made at the start of the inquiry in August 2008, was also to be withdrawn.
At the meeting, Lynn Killoran, head of the commission's Liverpool office, urged Orbison and others who did not agree with the decision to accept it and move on. But Orbison was astonished by what he called "a complete U-turn". He thought it unlikely that a charity that had repeatedly refused to acknowledge any wrongdoing would comply with an action plan, and pointed out that only a few weeks earlier an internal review of the freezing order had concluded it was sound and should stay in place.
"The new case strategy, as determined by senior management, and particularly Kenneth Dibble, was wholly driven by the commission seeking to avoid charity tribunal proceedings at all costs in this and any other case," he said in his witness statement to the Employment Tribunal where his protest eventually ended up.
"By offering advice only and discharging the order, senior management had engineered proceedings so that any subsequent appeal to the tribunal would be likely to fail since it would have no jurisdiction over 'advice only' and a discharged order."
Orbison felt so strongly that, instead of accepting the decision, he made a Public Interest Disclosure, following the procedure that the commission had drawn up to comply with the 1998 law that protects staff who draw attention to what they believe to be criminal acts, a failure to carry out legal obligations or a miscarriage of justice. He made it clear he believed criminal offences had been committed at AAA, that the commission was failing to carry out its legal obligation to investigate abuses in charities and that a miscarriage of justice had occurred.
On 4 November AAA, which did not yet know about the decision to close the case, appealed to the charity tribunal against the decision to hold an investigation and the freezing order. Four days later the commission informed the charity of its decision, but the charity did not withdraw the appeal, which was eventually heard and struck out in February 2010.
Meanwhile, several internal procedures were going on: another commission official was investigating Ghebre-Sellassie's complaints in a so-called 'customer service inquiry report'; a senior manager, David Locke, was looking into the PID; and Orbison was asking for protection by the commission, including possible legal action, against abusive messages from Ghebre-Sellassie such as an email calling him "evil and racist".
The conflicts and suspicions that arose in these processes worsened when Orbison said the customer service report was "less than objective" and the colleague who wrote it demanded an apology. He also protested about the delays in Locke's report on his PID, and about its outcome.
Things worsened further when a copy of a harsh early report on the AAA case, drafted before the decision to close the inquiry, was leaked to Third Sector in March 2010. Third Sector put the contents of the report both to the commission and to Ghebre-Sellassie in order to produce a balanced story. This increased the commission's difficulties: AAA had been told of the decision to close the inquiry, but a final report had not yet been produced. The leak thus infuriated both Ghebre-Sellassie and Andrew Hind, then chief executive of the commission.
When the final report appeared in August it was longer and milder than the draft. It listed spending that trustees could not show as "in furtherance of the charity's purposes" and set out the action plan for improving governance that Orbison considered to be a travesty.
Orbison went off sick in April 2010 and was diagnosed with anxiety and depression caused by work-related stress. He resigned in November 2010, claiming in the Liverpool Employment Tribunal that he had suffered detriment and unfair dismissal because of his PID, indirect discrimination under the Equality Act, and discrimination because of the disability caused by his illness.
His final claim - that the commission had failed to make 'reasonable adjustments' in its dealings with him while he was off sick - was the only one to succeed, by a majority decision. The two lay members of the tribunal felt the commission should have agreed to his request not to have to discuss his situation directly with Killoran. But the judge, Keith Robinson, thought that the commission's requirement for Orbison to meet her was "entirely reasonable".
The judgment said Orbison had made his PID in good faith, but the commission was not trying to avoid its statutory obligations: "It may be that the respondents were, in Mr Orbison's words 'risk-averse', but that does not mean they dealt with AAA in an inappropriate way."
Next week - The commission's compliance policies and management style
PROFILE - The case officer who challenged his senior managers
David Orbison was full of enthusiasm when he started work in June 2008 as a senior case officer in the compliance unit of the Charity Commission in Liverpool. "I used to walk to the office every day kicking my heels in delight," he says.
He had spent 18 years working for a specialist chemical company and saw the new job as an extension of other work to benefit the community, including volunteering in a Citizens Advice Bureau, serving as a Clwyd county councillor and sitting as a magistrate in the Wirral.
After a year, things were going well. "He brings to the team a blend of wider experience, good analytical judgement and a willingness to question convention," his manager wrote in his annual appraisal. "This has generated very good feedback from outside organisations."
But as Orbison's second year began, things were going sour over his investigation into African Aids Action, a charity set up with the aim of raising $500m (£321m) to build a factory in Africa to make antiretroviral drugs. He had discovered accounting irregularities and wanted the case pursued.
When the commission decided to close it (see main article), the deterioration of his relations with management began. By April 2010 he was on sick leave, suffering from stress; and in November that year he resigned, lodging a number of claims with the Employment Tribunal, which last week upheld by a majority decision his claim for constructive unfair dismissal on the grounds that the commission had failed to make "reasonable adjustments" when he was off sick. His other claims were dismissed.
Orbison, aged 54, has not worked since his resignation. He still suffers from anxiety and depression caused by work-related stress, and resigned as a magistrate last year. The case has clearly become a dominating factor in his life and he talks about it fluently and persuasively, with precise recall of details.
The tribunal's judgment said: "Over time the claimant had become obsessed with the case of AAA. He is an intelligent man who knows his way around this area of the law - whistle-blowing. This obsession has led to him almost overwhelming his senior managers with emails, commentaries and discussions about the charity. A sense of proportion went out of the window."
Orbison says he simply responded to events: "My main concern was the risk-aversion in the commission and the defensiveness of management. I do not think it obsessive to raise these concerns, not least given the current review of the Charities Act."
He says his life has been on hold for more than two years. "My integrity and reputation were attacked by senior management simply because I tried to do the right thing," he says. "The resulting depression has made me feel worthless."
Orbison is particularly angry about the commission's attempt to obtain documents concerning a dispute with his previous employer over its pensions scheme. He had left with a compromise agreement, receiving a payment in return for waiving further claims against the company.
"They applied to the tribunal for disclosure of my previous employment records and the judge turned them down flat," he says. "They claimed that my motivation was to get a pay-off. Their case was based entirely on a character assassination.
"I have self-funded my proceedings throughout, left with little alternative but to defend my reputation. I refused to be bullied and their allegation as to my motivation is preposterous."