A former sub-postmistress of St Keverne said she "sat and sobbed" after a judge ruled in favour of her and around 550 other claimants in the first of four trials against Post Office Ltd.

Susan Knight is part of a mass group action against the company over the Horizon computer accounting system, which they allege was the cause of discrepancies running into millions of pounds that cost many of them their jobs and life savings in attempting to personally cover the shortfalls.

In August 2013 Mrs Knight had been due to face trial at Truro Crown Court after being accused of false accounting involving sums alleged to be more than £20,000.

However, a verdict of not guilty was recorded against her when the prosecution decided that continuing with the case would not be in the public interest. At that time Post Office said it was reviewing all its cases under prosecution.

Around 550 claimants, largely sub-postmasters with a small number of Crown Office employees and managers/assistants, subsequently issued counter legal proceedings against Post Office Ltd and the first judgement was returned on Friday, in support of the claimants.

Mrs Knight, who had worked for the Post Office for 32 years, said: "The relief is unbelievable. I sat and sobbed; it's quite overwhelming."

She went on to praise the support she had received from people in St Keverne, adding: "The village is second-to-none. The support has been phenomenal."

In this trial the judge looked at 'common issues' of matters such as contracts and how Post Office Ltd handled their employees and sub-postmasters.

The Honourable Mr Justice Fraser ultimately criticised a new sub-postmaster contract brought in during 2011, which he said raised the contractual liability of the postmaster "very substantially," to entitle the Post Office to recover losses regardless of

any fault on the postmaster's part, and which "fails the test of reasonableness ."

Other clauses dealing with how the Post Office sought to "avoid remunerating" sub-postmasters who had been suspended over accounting discrepancies, even when they had been re-instated, also failed this test.

Judge Fraser said: "The Post Office describes itself on its own website as 'the nation’s most trusted brand'. So far as these claimants, and the subject matter of this group litigation, are concerned, this might be thought to be wholly wishful thinking."

He described it as a "bitterly contested litigation," adding: "The Post Office disputes the whole basis of the claimants’ case. Indeed, in its written opening for the common issues trial, the Post Office stated that, 'If the claimants were right in the broad thrust of their case, this would represent an existential threat to Post Office’s ability to continue to carry on its business throughout the UK in the way it presently does'."

A second trial is already underway, looking at 'Horizon issues' - ie the functionality of the system - and is expected to run until May.

Today a different system called Horizon Online 2010 is used.

Post Office chairman Tim Parker said following the first judgement: "We take this judgment and its criticisms of Post Office very seriously.

“While the culture and practices of the business have improved in many ways over the years, the judge’s comments are a forceful reminder to us that we must always continue to do better. We have taken his criticisms on board and will take action throughout our organisation.

“Our postmasters are the backbone of our business, and our first priority will be to consider the points raised about the management of our contractual relationships and how we could improve them.

“We will make sure that problems brought to our attention by postmasters are investigated even more quickly and transparently.

“In addition, we will further improve communications with postmasters, as well as the training and support they receive."

He went on to say that the Post Office would continue to defend the overall litigation and that the company was "seriously considering an appeal on certain legal interpretations" in the first judgement.