Cherry v R - [2013] NZCA 636

IN THE COURT OF APPEAL OF NEW ZEALAND

CA8/2013
[2013] NZCA 636

BETWEEN	EVAN PAUL CHERRY Appellant
AND	THE QUEEN Respondent

Hearing:	21 November 2013
Court:	Harrison, Simon France and Dobson JJ
Counsel:	S N B Wimsett for Appellant T Simmonds for Respondent
Judgment:	11 December 2013 at 11.00 am

JUDGMENT OF THE COURT

The appeal against sentence, including imposition of a minimum period of imprisonment, is dismissed.

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REASONS OF THE COURT

(Given by Dobson J)

On 11 December 2012, Mr Cherry was sentenced by Judge Dawson in the District Court at North Shore on two charges of making false statements by a promoter, one charge of theft by misappropriation and one charge of theft by a person in a special relationship. Mr Cherry had pleaded guilty to the charges. He was sentenced to six years and two months’ imprisonment, with the sentencing Judge also imposing a minimum period of imprisonment of three and a half years.[1]
[1]Serious Fraud Office v Cherry DC North Shore CRI-2012-044-5385, 11 December 2012.
Mr Cherry has appealed against the sentence on the basis that it was manifestly excessive, and also against the imposition of a minimum period of imprisonment, which he argued should not have been imposed.

Circumstances of the offending

Throughout the period to which the charges related, from June 2002 until February 2007, Mr Cherry was in business as an independent financial adviser. He took money from clients of his business for investment on specified terms and with Mr Cherry’s company undertaking to invest funds in good faith, in the best interests of the client, and with the level of care, skill, prudence and diligence that a prudent professional custodian would exercise.
Over the relevant period, Mr Cherry received some $9,073,400 from investors. He was sentenced on the basis that, of that amount, $4,727,720 was dishonestly misappropriated or stolen. On the collapse of his business, sums invested by clients totalling approximately $5,305,000 were lost.
In providing reports to clients, Mr Cherry had a pattern of providing a false opening value of the client’s portfolio, suggesting gains had been made, when the funds had not been invested as those reports suggested. The sentencing Judge concluded that the false statements were intended to induce the clients to maintain their investments with his company, and indeed to encourage the investment of further funds with it.
The investing clients appear to have been predominantly investors of relatively modest means, for whom the losses that were suffered on the collapse of Mr Cherry’s business have had catastrophic impacts on their retirement. In some cases, Mr Cherry encouraged the investors to borrow against the equity in their homes, to place further funds for investment with him.
The Judge sentenced Mr Cherry on the basis that he had not paid any reparation to the clients who suffered the significant losses involved.

Grounds of appeal

Mr Wimsett raised the following grounds for challenging the sentence as manifestly excessive:
· that counsel appearing for Mr Cherry on sentencing (Mr…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

Continue reading Cherry v R

Details

AGLC: Cherry v R [2013] NZCA 636
Case: [2013] NZCA 636
Decision Date: 11 December 2013 at 11.00 am

CaseChat Overview and Summary

Evan Paul Cherry appealed against his sentence of six years and two months’ imprisonment, imposed by Judge Dawson in the District Court at North Shore on charges of making false statements by a promoter, theft by misappropriation, and theft by a person in a special relationship. The appeal also contested the imposition of a minimum period of imprisonment of three and a half years. Cherry argued that the sentence was manifestly excessive and that a minimum period of imprisonment should not have been imposed.

The legal issues the court had to decide included whether the sentence was manifestly excessive, whether the imposition of a minimum period of imprisonment was justified, and whether there were errors in the sentencing process such as an incorrect summary of facts and failure to consider reparation payments. The court considered whether Cherry’s counsel’s performance was deficient and if the sentencing judge made any errors in applying the law.

The Court of Appeal found no merit in Cherry’s arguments. It determined that the summary of facts was accurate and that there was no error in the sentencing judge’s approach to the facts. The court also found that the payments made by Cherry to his clients could not be considered as reparation because they were treated as returns on investments until the business collapsed. The court was satisfied that the starting point for sentencing was appropriate and that the imposition of a minimum period of imprisonment was justified to ensure adequate denunciation and deterrence. Consequently, the appeal against both the sentence and the imposition of a minimum period of imprisonment was dismissed.

Orders