The Post Office was urged by its external law firm to “try and suppress” disclosure of a key document for “as long as possible” as branch owner-operators tried to mount legal action against the state-owned postal company, a public inquiry has heard.

Rodric Williams, a senior in-house lawyer at the Post Office, giving evidence to the inquiry into the Horizon IT scandal was asked about an email sent to him in which it was suggested that his employer should withhold disclosing its investigation guidelines as they could harm its defence to a lawsuit brought by post office operators.

The inquiry is looking into how hundreds of these individuals were pursued and prosecuted for more than a decade by the Post Office over alleged financial shortfalls in their branch accounts, which it has since emerged were caused by bugs in the organisation’s Horizon IT system.

The inquiry was told on Thursday that Williams, who is the head of legal (dispute resolution and brand) at the Post Office, was sent an email in 2016 by its external law firm Womble Bond Dickinson (WBD) at the very early stages of the high court lawsuit that paved the way to the convicted post office operators ultimately being exonerated.

At that time, lawyers acting for the branch operators led by Alan Bates, whose campaign for justice was dramatised by ITV this year, were asking the Post Office for disclosure of its investigation guidelines.

The email from WBD dated 5 October 2016 was shown to the inquiry. It read: “Although we may face some criticism later on, we are proposing to try and suppress the guidelines for as long as possible on the grounds that the most recent version is not relevant … For now we’ll do what we can to avoid disclosure of these guidelines and try to do so in a way that looks legitimate.

“However, we are ultimately withholding a key document and this may attract some criticism … we’ll adopt this approach until such time as we sense the criticism is becoming serious.”

WBD said on Thursday: “The firm has great sympathy for all those affected by the failings of the Horizon IT system and recognises the very real personal impact that this has had for those involved.” It said it could not comment further but continued to engage with the inquiry.

Williams told the inquiry it was a “concerning email” and “regrettable” but added that he “did not recall” it or reply to it. He said the email was sent relatively early in the litigation and before orders for disclosure were made. “I do not believe POL [Post Office Ltd] sought to ‘suppress’ disclosure during the litigation,” he said in his witness statement.

Sir Wyn Williams, the retired judge chairing the inquiry, put to him: “In reality Mr Williams this email should have had a prompt response from you to the effect that you can’t possibly do that. That’s right, isn’t it?”

The Post Office lawyer replied: “I’d like to have said I did that, but I didn’t.”

The testimony came as the government confirmed it had agreed to an independent review of separate computer software linked to a second IT scandal at the Post Office. The Department for Business and Trade will be setting out details “shortly”, Rishi Sunak’s spokesperson said.

They added: “As soon as these specific accusations came to light, we asked the post office to investigate the Capture system. They have been investigating their records to identify postmasters that may have had issue with Capture, and we would continue to encourage anyone who has experienced issues to come forward so we can review that information.”

The Horizon inquiry also heard on Thursday that as an in-house lawyer Williams was involved in the Post Office’s response to the BBC in 2014 as the broadcaster prepared to broadcast a programme about branch operators and their concerns about the Horizon system.

The journalist Nick Wallis had asked the Post Office for any data backing up its position that the vast majority of branch owner-operators were having no problems with Horizon and loved and trusted the IT system.

In emails shown to the inquiry, Williams called Wallis’s request “puerile”, while the Post Office’s then head of government affairs, Patrick Bourke, described the journalist’s email as having a “breathtaking facetious tone”.

Williams sent an email in 2016 saying that the Criminal Cases Review Commission, which reviews miscarriages of justice, was “jumping down every rabbit hole” when it asked for information about bugs in the Horizon IT system.

Jason Beer KC, counsel to the inquiry, suggested that the Post Office had a “siege mentality” and saw any challenge “ as hostile and must be fended off.”

Williams replied: “There is probably something in that.. I think, that’s fair..”