Trevor Allan Ludlow appeals against two different but related sentence decisions arising out of the collapse of National Finance 2000 Ltd (National Finance) which he owned and controlled. The first is the decision of Judge Bouchier on 20 October 2011 where he was sentenced on seven charges involving significant commercial fraud to five years and seven months’ imprisonment.[1] The second is the decision of Toogood J on 26 January 2012 where on related charges Mr Ludlow was sentenced to a further nine months’ imprisonment.[2] The total resulting penalty for all this offending was six years and four months’ imprisonment.[3] The appeals are heard together.
[1]R v Ludlow DC Auckland CRI-2009-004-23758, 20 October 2011.
[2]R v Ludlow HC Auckland CRI-2008-004-20412, 26 January 2012.
[3]At [34].
Mr Ludlow had been a shareholder and director of National Finance. His experience and credentials were emphasised in a 2005 prospectus issued by National Finance. The company operated in the financial services market, primarily offering motor vehicle finance. Members of the public were able to invest in the company through secured debenture stock and unsecured subordinate promissory notes. A significant proportion of the advances made by National Finance were to companies in the Payless group of companies, of which Mr Ludlow was the sole director and shareholder.
When National Finance went into receivership in May 2006, investments by debenture holders totalled over $21 million. Mr Ludlow has assisted the receivers in the recovery process. Total losses after all recoveries are estimated at $14 million.
Following the receivership, two different sets of charges were laid against Mr Ludlow. The Serious Fraud Office (the SFO) charged him with six counts of theft by a person in a special relationship under s 220 of the Crimes Act 1961, which carries a maximum sentence of seven years’ imprisonment, and one charge of false accounting under s 260 of the Crimes Act 1961, for which there is a maximum sentence of 10 years’ imprisonment. Mr Ludlow pleaded not guilty to all but one of those charges. After a trial in the District Court he was convicted by Judge Bouchier,[4] and sentenced to five years and seven months’ imprisonment.
[4]R v Ludlow DC Auckland CRI-2009-004-23758, 26 July 2011.
The second set of charges was laid by the Financial Markets Authority (the FMA). There was one count of misstatement in a registered prospectus under s 58 of the Securities Act 1978 which carries a maximum penalty of five years’ imprisonment, and seven counts of making false statements under s 41 of…

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.

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Details

AGLC: Ludlow v The Queen [2013] NZCA 196
Case: [2013] NZCA 196
Decision Date: 7 June 2013

CaseChat Overview and Summary

Trevor Allan Ludlow appeals against two sentencing decisions made in relation to his involvement in the collapse of National Finance 2000 Ltd. In the first instance, Judge Bouchier sentenced Ludlow to five years and seven months’ imprisonment on seven charges of significant commercial fraud. In the second, Toogood J sentenced Ludlow to a further nine months’ imprisonment on related charges. The total penalty for all Ludlow’s offending amounted to six years and four months’ imprisonment. Ludlow argued that the sentences were too high, and that the sentence on the Financial Markets Authority charges should have run concurrently with the sentences imposed in the District Court. The Court of Appeal found no basis for criticism of the sentences imposed, and the appeals against sentence were dismissed.

The Court of Appeal examined the seriousness of Ludlow’s offending, which involved dishonesty over a lengthy period, a breach of trust, and harm to vulnerable victims. The Court found that the starting point of six and a half years’ imprisonment for the Serious Fraud Office charges was within the range. The Court also noted that the starting point for the Financial Markets Authority charges was appropriate, given the aggravating factors. The Court found that the discount for mitigating factors allowed by Toogood J was fair, and rejected the suggestion that the sentence on the Financial Markets Authority charges should have run concurrently with the sentences imposed in the District Court. The Court found no error in the sentencing approach of either Judge, and the effective end sentence of six years and four months’ imprisonment was within the range.

Orders