Norris v R

• Jurisdiction: New Zealand
• Judge: Ellen France J
• Judgment Date: 31 October 2013
• Neutral Citation: [2013] NZCA 526
• Docket Number: CA59/2013
• Court: Court of Appeal
• Date: 31 October 2013

BETWEEN

Patrick Dean Norris

Appellant

and

The Queen

Respondent

[2013] NZCA 526

Court:

Ellen France, Rodney Hansen and Mallon JJ

CA59/2013

IN THE COURT OF APPEAL OF NEW ZEALAND

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.

Counsel:

Appellant in person

H W Ebersohn and M J Inwood for Respondent

• 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.

JUDGMENT OF THE COURT

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 fees.

10 The matter was ultimately referred to the police and Mr Norris was charged under s 220 of the Crimes Act in April 2011.

The trial

11 The Crown case was that Mr Norris committed an offence under s 220 as he had, with the requisite knowledge and intention, breached the statutory and fiduciary requirements applicable to him as a liquidator. For present purposes, an important plank of the Crown case was that in fact little work had been done on the Astra file and that Mr Norris had created invoices totalling some $80,000 to try and justify the dissipation of the Astra money. Mr Norris' response was that he had done this work on the file and could prove it if he could find the original Astra file which he first discovered was missing on the day the Companies Office visited him, 28 March 2011.

12 The Crown case that little work had been done on the file was supported by three strands of evidence. 4 The first of these strands was the evidence of two persons, Warwick Savage and Ms Sunderland, who were working in the office of Norris Management over some of the relevant period. Both these witnesses gave evidence of concerns about the Astra liquidation and that Mr Norris was dismissive of those concerns. Mr Savage also addressed what happened on 28 March 2011 when the inspectors from the Companies Office came to inspect the Astra files.

13 We come back later to some of the detail of their evidence but for present purposes we note Mr Savage's evidence about the panic and flurry of activity that took place on 28 March involving the recreation of invoices for the work Mr Norris said he had done on the Astra liquidation. Mr Norris told Mr Savage that he “was always worried that Astra would be” his “Achilles' heel”. We also note Ms Sunderland's evidence about the lack of work done on the Astra file and of a discussion she had with Mr Norris in which he said the one liquidation file that “could bite him in the arse” was the Astra file.

14 The second strand of evidence relied on by the Crown was evidence as to the limited contact between Mr Norris and those who might have expected to hear from him in relation to the liquidation. These witnesses were in two groups. First, there was evidence from the various creditors and/or their advisors. Secondly, there was evidence from one of the two former directors of Astra, from her lawyer and from the solicitor for the other director of Astra who had by then died. These witnesses all gave evidence of the very limited contact they had had with Mr Norris and, variously, difficulties in getting any information as to what was happening with the liquidation.

15 Finally, the Crown called evidence from Laurence Chilcott, an insolvency practitioner. He described the Astra liquidation as a “simple” one. He said the only claim that would need to have any further investigation was that of the Manley Family Trust. In terms of that debt he said the matter could be dealt with in a straightforward manner. If the liquidator was not satisfied with the information

supplied, the liquidator could request further information from the creditor and if still not satisfied then simply reject the claim. Mr Chilcott noted that Mr Norris had raised invoices totalling $85,610.57 including GST for his fees which he considered was excessive for this liquidation. Ignoring a few small invoices for staff time, Mr Chilcott worked off a total of $76,050 excluding GST. On this sum, he noted that at a charge-out rate of $200 per hour (Mr Norris' first invoice was quoted at $225 per hour) that amounted to a total of 380 hours

16 At trial, as on appeal, Mr Norris disputed that there were any requirements applicable to liquidators that established the fiduciary relationship he said was necessary to found criminal liability. He also said that as liquidator he was an agent for the company so any fiduciary relationship “is for the statutory purpose of the liquidation … and not for persons”. 5 He further maintained that he had done considerable work on the Astra liquidation and the invoices produced after the Companies Office inspectors' initial visit, whilst recreated, were genuine.

17 Mr Norris gave evidence as did Claire Parr, his partner, who was also an accountant and who worked...