Phone-hacking trial: Secrets, shouting and MI6

David Spens QC, acting for former News of the World Royal editor Clive Goodman, was first to rise to question the defendant."You've said a lot of complimentary things about Mr Coulson but you have not had a good word to say about Mr Goodman have you," the barrister said. "That's not true," Kuttner replied, pointing out he said he had "trusted all of the staff at the News of the World". Spens asked the defendant about his comment that he had "indulged" Goodman. Kuttner said he could not recall saying that. "Those were the worlds you used," the barrister responded, and reminded the witness of Goodman's promotion to assistant editor in 2001. "People did not get promoted at the News of the World as an indulgence did they," Spens asked "I do not recall the matter sir," Kuttner replied.

The defence barrister then asked the witness about his previous evidence that he would have never asked a journalist to enter false names of sources on payment requests. Spens suggested that "this was a widespread practice and you knew it". "That's not true," Kuttner replied. The court was then shown a 2005 email from the deputy managing editor, Paul Nicholas, which Kuttner was copied into, which discusses having to pay 23 per cent tax on cash payments to sources and contributors. "This could only happen if the name and address were false and the person was untraceable by the tax authorities," Spens said. "That's not true," Kuttner replied. "They may have just moved on. I did not spend a lifetime in journalism in order to falsify documents."

Spens then put it to the witness: "You bear some animosity to Mt Goodman, don't you?" Kuttner replied: "I found his performance in latter years disappointing. There were instances when he rejected information given to him that was true, and times he refused to turn out for stories." The defence barrister suggested that the problems between the two began in 1992 when Goodman refused to provide background details for a biography of Princess Diana for his friend Nick Davis of the Daily Mirror. This book was designed to be a response to "Diana: Her true story" by Andrew Morton, which "was backed by the princess," Spens said. "One of the stories in the Morton book was to be about a suicide bid by Princess Diana and you asked Goodman for information on that." "I don't remember that," Kuttner replied. "None of that rings any kind of bell at all," he added.

The defence QC then moved on to Kuttner's evidence that he was "bombarded" by emails from Goodman. "He only ever emailed you about two things, credits and leader writing duties," Spens said. "In terms of credits you needed to be chased as you were very slow in signing them off," he added. "You liked to make people wait," he went on. "That is completely false sir," Kuttner responded. "I don't know why Mr Goodman chased, it was usually in support of exaggerated payments. I tried to run a tight ship over cash payments," the defendant told the court.

Spens then turned to Kuttner's evidence that he "trusted News of the World staff" and asked about occasions when the defendant would make unannounced visits to people on long-term sick leave. "There was a culture of looking after people that flowed down from Mr Rupert Murdoch," Kuttner responded. "You had a reputation for extreme scrutiny, you kept an eagle eye on every pound," Spens said. "I disagree with that," the defendant replied. "I took a macro-management view, as long as departments kept within their allocated budget," Kuttner said.

The defence QC then asked about a trip to Paris by Kuttner and Rebekah Brooks that the defendant testified yesterday he had to undertake as Goodman refused to go. Spens told the court that this was in relation to a man called James Bryant, who Goodman had already agreed to meet in London. "I have no knowledge of that," the defendant said.

Kuttner was then asked about Neil Wallis, who was appointed deputy editor of the News of the World under Andy Coulson. Kuttner said he did not know who appointed Wallis but agreed that his nickname was "Wolfman". Spens suggested that the name "Wolfman" was given to Wallis as he was "aggressive and hard to those who were junior to him". "He was very focused," Kuttner replied. "That's not an answer to my question is it, he was a bully," Spens suggested. "Quite a lot of shouting goes on at newspaper," Kuttner replied, but agreed Wallis "shouted more than most". Spens suggested that the News of the World had a "secret room" for confidential stories that had to be soundproofed as "Neil Wallis shouted so much the secret stories were getting out". Kuttner said he had no direct knowledge of that, but did not deny it was possible.

The court then took a short break.

When proceedings resumed Clive Goodman's QC asked the witness about cash payments to an Alec Hall which totalled £53,000 over four years. "Are you really saying that name meant nothing to you," Kuttner said. "The budget for the paper alone ran into many many millions of pounds per year. I have no recollection now and cannot recollect having a recollection of that name."

Spens then asked about Kuttner's testimony about Clive Goodman's arrest in 2006 and his statement that he picked Goodman up from Charing Cross police station as he "wanted to support him". The defendant told the court that Goodman "was one of the team, and we were quite unused to having a senior staff member being arrested by the police". The court was then shown a note, made by Kuttner when he met with Goodman a few days later. A reference to £100 in the note, Kuttner said, was a reminder to himself to draw out cash as Goodman had no money and his credit and debit cards had been seized by the police.

Spens suggested that the real reason he visited Goodman was not to "put an arm around him but instead was to obtain information on the police investigation and what he had told the police" He said: "What you wanted to know was if the police had named any other individuals in relation to phone hacking." "I disagree with that sir," Kuttner replied. "We were just trying to get to grips with things." The note states that Goodman had told Kuttner he "would get leftovers from SIS bugging" which Judge Saunders suggested related to the secret intelligence service MI6. "I was querying that," Kuttner said. The note goes on "Told Andy from the start" which the barrister suggested related to then editor Andy Coulson, "I think that is the reference," Kuttner agreed, adding that he was only noting down what he was being told.

Kuttner was then asked about a meeting on 10 August 2006 at the offices of the Sun attended by him, Andy Coulson, Neil Wallis and a criminal solicitor, Henry Brandman. The defendant asked the court to understand he had a heart attack and brain stem stroke which had led to memory loss. "Thinking back is not going to help," he said, "I don't have any recollection of the event other than an imprecise memory of various meetings with lawyers." The defence barrister put it to the witness that he would have informed Andy Coulson of what Goodman had told him. "That seems entirely reasonable but I do not remember," the defendant replied.

The defendant was then shown an email exchange from January 2007 between himself and Coulson discussing ending payments to Glenn Mulcaire. This was, Spens told the court, the day before Mulcaire and Goodman were to be sentenced for phone hacking and agreed to pay one last installment to Mulcaire "to keep him non-hostile". What did "non-hostile" mean to you, the defendant was asked. "I don't know if it meant anything to me," Kuttner said. "I suggest it meant keeping him sweet," the barrister said. "It might have meant stopping him talking to other press," the witness replied. "You were concerned he might go public on who else knew about hacking," Spens said, adding "you knew if he had gone public that posed a number of risks and might have implicated other journalists at the paper". Kuttner said: "I was aware that the News of the World was in a unique and unpleasant situation but I didn't know that anyone else was involved," adding: "If I was aware of it but as not conscious of it."

Spens suggested to the witness that he had authorised the payments to Mulcaire with the approval of Andy Coulson: "You were a party to keeping Glenn Mulcaire sweet." Kuttner replied: "I was a party to my own view, the News of the World was in a very unhappy situation, I was so appalled with what had gone on I thought our relationship with Goodman and Mulcaire should be severed."

The defence barrister asked Kuttner if, given this view, he was surprised that Goodman had not been sacked when he had first pleaded guilty to phone hacking in November 2006. "Did you ever say to Mr Coulson, why have you not sacked this man?" "That was my view but I don't recall ever asking that, no," Kuttner responded.

Finally the defence QC asked the witness about the payments he authorised for the "Alexander project" which the court has already heard was a code name for Glenn Mulcaire hacking the voicemails of members of the royal household. Spens asked if then editor Andy Coulson had asked him to pay the invoices. "That may be so," Kuttner replied, but again told the court he had no recollection of such a discussion but agreed that Goodman would not normally have had the authority to sign off the payments himself. "Although there may have been exceptions," he added. "If Goodman had came to you asking to give him £500 per week for someone he could not name you would have laughed him out of your office," Spens suggested. "I disagree with you sir. If the documentation indicated a source who was providing him with information, perhaps naively, I would have accepted that," Kuttner replied. Spens asked the witness: "Are you saying Mr Coulson did not authorise these payments?" "I have no recollection, none whatsoever," the defendant replied adding: "My position is Goodman deceived the newspaper but I was no party to any of it."

Andrew Edis QC, for the prosecution, then rose to cross-examine the defendant. He returned to the note Kuttner made of his meeting with Goodman in which he wrote "Andy knew about it from the start". Why was that important, Edis asked. "It was a serious allegation against the editor," he replied. "This senior spook from MI6 would be committing a crime, that's what it means," Edis suggested "and encouraging that person to commit that crime would also be a crime," he added. "That's out of my area," Kuttner replied and mentioned David Shaylor, an MI6 agent who was prosecuted for leaking secret information. "Why did you mention him," Edis replied. "I could go way back," Kuttner replied, "You could go back to Profumo," Edis reponded. He went on to ask the witness: "In the course of your career you must have came a number of stories where members of the security services were leaking information and being prosecuted, this was pretty serious and alarming news, and some of it turned out to be true." "He was certainly intercepting telephone calls," Kuttner replied.

Edis then turned to another part of the note where he writes that Goodman has mentioned he is worried another journalist, who we cannot name for legal reasons, was "doing the same thing". "Clive Goodman was someone who used to embellish," Kuttner said. "He wasn't embellishing he had been arrested had he," the prosecutor replied. Edis asked about the words "sal con" on the note and Kuttner confirmed that meant salary continued. "He had just told you he committed crimes, surely this was grounds for instant dismissal," the barrister asked. "These were just my short notes," Kuttner replied. Edis asked the witness about his statement that "he spent a lifetime making notes". Kuttner agreed and said he had left his notebooks in the News International archive on his retirement. "That's what newspaper people do," Edis suggested. "That's what this newspaper person did," Kuttner responded.

Court then rose for lunch