User / group permissions ubuntu 12.04

Greetings. I recently installed Ubuntu 12.04 on a machine intended to work as a file server. After adding the users I set up a group (office) and added specific users to that group.

I'm having a dickens of a time with (I think) user and group rights.

My data folder has been set with chown to (me):office

The problem comes when either a file is modified, or a new directory is created.

That file, or directory, will only be accessible by the creator. My take on this is that the group rights are not overriding the owner rights.All files in this particular folder (and subfolders) are to be shared by all users of the office group,

The path to the directory is /media//data

Recursively, I set the ownership and group from the /data directory.

Again, after I run chmod 777 -R /media/media//data all the files and folders are accessible by everyone (obviously). But once one of those files has been modified, or a new folder created, it will only be accessible by the owner.

I suspect that the key to fixing this is with umask, but rather simply I can't wrap my head around the logic on it. I am also aware that the 777 rights is not the best setup, but I'm trying to take this one step at a time.

So – the first question is what further information to someone need to help me with this? And the second question is what am I missing?

Many thanks from the newbie...
Cheers,
Rob