Norris v R

JurisdictionNew Zealand
CourtCourt of Appeal
JudgeEllen France J
Judgment Date31 October 2013
Neutral Citation[2013] NZCA 526
Date31 October 2013
Docket NumberCA59/2013

[2013] NZCA 526

IN THE COURT OF APPEAL OF NEW ZEALAND

Court:

Ellen France, Rodney Hansen and Mallon JJ

CA59/2013

BETWEEN
Patrick Dean Norris
Appellant
and
The Queen
Respondent
Counsel:

Appellant in person

H W Ebersohn and M J Inwood for Respondent

Appeal against conviction and sentence on charge of theft by a person in a special relationship under s220 Crimes Act 1961 (“CA”) — offending related to monies appellant received as liquidator of a company — appellant banked this money into the trading account of his business, and it was used largely to repay debts of the business and appellant — important plank of Crown case that appellant had done little work on the file and he had created invoices totalling $80,000 to justify the dissipation of the money — whether s220 CA applied to appellant as a liquidator.

Held: It was an essential ingredient of an offence under the predecessor to s220 CrA that the receipt of money was on terms requiring the recipient to account of pay ( R v Norris (1993)). The authorities on the predecessor to s220 made it clear that the section applied “if a person agreed to take money on terms requiring it to be paid to a third person and then failed to do so” ( Nisbet v R). Those terms could be merely contractual. The Court in Nisbet also noted that simply because a relationship was a fiduciary one that was not the end of the inquiry — it was still necessary to look at the circumstances.

It was plain from a consideration of the relevant provisions in the Companies Act 1993 (“CoA”) and the Companies Act 1993 Liquidation Regulations 1994 (“CALR”) that, as a liquidator, N had acquired the funds on specific terms. The relationship was more than that of a debtor and creditor. The funds had been acquired for a particular purpose and so were earmarked in the sense referred to in the cases. The money was not N's to use as he like. That was sufficient to dispose of the matter.

The words of reg 37 CALR (deposit of company funds) required that the payment of funds from a company be made to a bank account to the credit of the company in liquidation if not put in a trust account. The idea was to make sure the funds were kept separate from the liquidator's personal assets or from other assets generally and gave effect to the principle that the money did not belong to the liquidator. It was not relevant that the applicable insolvency industry guidelines did not advise caution as to specific requirements relating to fiduciary obligations imposed in terms of funds received or held. The Judge was correct that N knew of the obligations and this element of the charge of was proved beyond reasonable doubt.

The approach to the admission of new evidence was well settled with the principles discussed most recently by the Privy Council in Lundy v R. When assessing the need to consider the effect of the new evidence of the safety of the conviction, it had to be considered whether the fresh evidence, if considered alongside evidence given at the trial, might reasonably have led the judge to return a verdict of not guilty. Their Lordships observed that the nature of the “overriding” test was that the new evidence should be admitted if the interests of justice required it.

The Crown accepted the evidence N sought to have admitted was fresh. The issue therefore was the credibility or cogency of the new evidence and its potential impact on the verdict. It was not credible that S had been offered inducements and had somehow colluded with the Companies Office. Further the witnesses could not state whether documents they had seen S's possession were from the Astra file. The evidence however was not sufficiently cogent to meet the test for admission. There was evidence at trial accepted by the Judge supporting the Crown case that invoices had been recreated after a visit from Companies Office inspectors and did not accurately reflect the work done in liquidation and some of this evidence was not challenged. This was not a case where the proposed new evidence might reasonably have made a difference to the verdict.

In terms of procedural matters raised by N, it was plain that the two purposes for an inspection set out in s365 CoA were applicable in this case. The relevant purposes in this case were ascertaining whether N as liquidator had met his duties as liquidator and whether he had made any false statements in his liquidation report, and assisting in establishing whether the Registrar should exercise any of his powers under CoA. There was no evidence of any ulterior purposes. There was nothing in the words of s366 CoA (disclosure of information and reports) to suggest that the direction to give a document to the police could not be made in advance of an inspection and on the basis that it was to be given if evidence of criminal offending was uncovered.

Application for leave to adduce new evidence and appeal against conviction dismissed.

Appeal against sentence allowed in part with order N pay reparation of $31,724 to the Ms quashed and order N pay $40,000 reparation to Astra substituted.

JUDGMENT OF THE COURT
  • A The application for leave to adduce new evidence is dismissed.

  • B The appeal against conviction is dismissed.

  • C The appeal against sentence is allowed in part. The order that the appellant pay reparation of $31,724.42 to the Manleys is quashed. An order that the appellant pay $40,000 reparation to Astra Enterprises Ltd (in liquidation) is substituted on the conditions set out in [108] below.

  • D The appellant must resume his home detention sentence. He is to be at the address for home detention at 10.00 am on 4 November 2013, and remain there to await the probation officer and the security company representative.

REASONS OF THE COURT

(Given by Ellen France J)

Table of Contents

Para No

Introduction

[1]

The factual narrative

[4]

The trial

[11]

The Judge's reasons for verdict

[19]

Does s 220 apply to this case?

[28]

The elements of the offence

[31]

The submissions

[32]

The approach to s 220 - New Zealand

[36]

The position in England and in Australia

[39]

The obligations on Mr Norris as liquidator

[47]

The proposed new evidence

[61]

Should the new evidence be admitted?

[71]

Procedural matters

[90]

The s 344A application

[91]

Section 347 application not dealt with prior to trial

[100]

District Court rather than High Court

[103]

Sentence

[105]

Result

[108]

Introduction
1

Patrick Norris was convicted after a trial before a judge alone of theft by a person in a special relationship under s 220 of the Crimes Act 1961. 1 He was sentenced by the trial Judge, Judge Behrens QC, to 10 months home detention, 100 hours community work, and was ordered to pay reparation of $31,724.42 to creditors, Mr and Mrs Manley. 2 The offending related to monies Mr Norris received as liquidator of a company called Astra Enterprises Ltd (Astra), of which the Manleys were creditors. Mr Norris banked this money into the trading account of his business, Norris Management Services Ltd (Norris Management) and it was used largely to repay debts of Norris Management or of Mr Norris.

2

Mr Norris appeals against his conviction and sentence. The conviction appeal raises issues about the application of s 220 to Mr Norris as a liquidator.

In addition, Mr Norris says there is fresh evidence that might reasonably have led to a not guilty verdict. Finally, Mr Norris raises various procedural issues that are said to give rise to a miscarriage. On the sentence appeal, Mr Norris challenges the ability to make a reparation order in favour of the Manleys.
3

After setting out the background, we deal first with the conviction appeal and then with the sentence appeal.

The factual narrative
4

We adopt the description of the chronology set out in the respondent's written submissions. We begin by noting that Astra's business was buying and renovating properties. Astra went into liquidation on 28 November 2008 on the petition of the Manley Family Trust. The company had only cash assets, namely, the net proceeds of the sale of a property.

5

Christine Johnston was appointed liquidator. She resigned from that position on 3 August 2009. 3 Mr Norris was then appointed the liquidator. He was at the same time the director of Norris Management. At Mr Norris' request, Astra's assets of $80,960.51 were paid to him. Mr Norris deposited the money into Norris Management's bank account on 10 August 2009. At that time, the account was overdrawn. By 4 November 2009 the account was again overdrawn.

6

During the liquidation, Mr Norris received three unsecured creditors' claims, namely:

  • (a) on 13 August 2009 from the Manley Family Trust for $27,800;

  • (b) on 18 August 2009 from Bell Gully for $3,197.35; and

  • (c) on 26 August 2009 from the Inland Revenue Department for $33,472.48.

7

The only creditor to receive any payment was Bell Gully which, in April 2011, received the amount owing to it.

8

The Companies Office became involved in Astra's affairs when, in March 2011, Ian Ramsay from the Companies Office was contacted by Nyle Sunderland. Ms Sunderland had worked as an assistant and office manager at Norris Management. She suggested that the Companies Office should investigate the Astra liquidation. Mr Ramsay and John McPherson were then appointed to undertake an investigation.

9

The important event for present purposes took place on 28 March 2011 when the Companies Office inspectors arrived at the office of Norris Management. They asked for the Astra file and related bank statements. Mr Norris asked them to come back later that day, which they did. They took away what Mr Ramsay understood was Mr Norris' complete file in relation to Astra including bank statements. Mr Norris told them that the missing $80,960.51 had been spent on his...

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3 cases
  • Norris v Gemmell
    • New Zealand
    • Court of Appeal
    • 6 October 2014
    ...44 It is significant that Mr Norris made a similar application to adduce new evidence when he appealed his conviction to this Court in Norris v R. 26 He sought to rely on statements of the same people (Messrs Raharuhi and Rowland). He sought to introduce the same email trails involving Mess......
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