R v Kendall
[2012] NZHC 3336
•11 December 2012
IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY
CRI-2009-004-7655 [2012] NZHC 3336
THE QUEEN
v
GRAEME JOHN KENDALL
Hearing: 11 December 2012
Counsel: N Flanagan for Crown
G Gotlieb and MA Karam for Offender
Judgment: 11 December 2012
SENTENCING NOTES OF TOOGOOD J
Solicitors:
N Flanagan/R McCoubrey, Meredith Connell, Auckland: [email protected] [email protected]
G Gotlieb/MA Karam, Auckland: [email protected] [email protected]
R V KENDALL HC AK CRI-2009-004-7655 [11 December 2012]
[1] Graeme John Kendall, you appear for sentence having been found guilty by a jury of two counts of perjury. I am required to explain the basis on which I intend to sentence you and since that will take some time, I want to confirm now that I propose to follow the probation officer’s recommendation and sentence you to home detention, rather than returning you to prison. I do not think that the alternative of community detention suggested by your counsel is sufficient to meet the proper sentencing purposes.
[2] Your trial followed a successful appeal to the Court of Appeal against your conviction by Courtney J, sitting alone, on the same two charges. On that occasion, the Judge had sentenced you to 12 months’ imprisonment. You had served three months of that sentence by the time the Court of Appeal allowed the conviction appeal and released you on bail pending the retrial.
[3] The two counts of perjury contained in the indictment were each based on an affidavit sworn, and in one case filed, by you in proceedings in this Court to set aside a statutory demand under the Companies Act. Because of the way in which Mr Karam and Mr Gotlieb have submitted on your behalf that I should approach a determination of the factual basis for the jury’s verdicts, it is necessary for me to explain the background in some detail. I am satisfied, having presided over the trial, that the following facts were established by the evidence.
[4] Mrs Patricia Murfitt is a teacher. You and she enjoyed a 12-month de facto relationship before marrying in March 2006. You are apparently something of an entrepreneur and at the time of the marriage you owned the shares in around
19 private companies, many of which owned residential or commercial properties around Auckland, including a property at 658 Rosebank Road, Avondale. The building on the property comprises three separate but conjoined units.
[5] In late 2005, Mrs Murfitt wished to buy a residential unit in Sydney Street, Takapuna, adjacent to one she already owned in a block of three. It was decided that one of your companies would be used as a vehicle for this purchase. The shares in the company, Home Pride Limited, were transferred to Mrs Murfitt in
November 2005. At about the time of the settlement of the purchase of the residential unit in January 2006, Mrs Murfitt and you met your accountant, Mr Williams, and a solicitor, to discuss the status of Home Pride Limited. You assured Mrs Murfitt then that Home Pride Limited was a “clean” company in the sense that it was not trading, it had non-active status with the IRD, and no assets or liabilities. In other words, it was a shell.
[6] The marriage did not last. There was an acrimonious exchange just prior to Christmas in 2006, as a result of which Mrs Murfitt left the matrimonial home and never returned. She had personal effects from her previous home stored in Unit 2 of the property at 658 Rosebank Road and a dispute arose between you over access to that unit to enable her to recover her belongings.
[7] In late January 2007, Mrs Murfitt received a statutory demand under the Companies Act 1993 asserting that Home Pride Limited owed one of your private companies, Feature Furniture Limited, the sum of $64,400 being rent for the premises at 2/658 Rosebank Road for the period from 1 April 2003 to
1 January 2007, a total of 46 months at $1,400 per month. This came as a huge shock to Mrs Murfitt, to the extent that she required medication. She knew absolutely nothing about any rental obligation being owed by Home Pride Limited, particularly since the rent period was said to have begun on 1 April 2003, some three years before your marriage and two years before you began a de facto relationship in February 2005.
[8] Mrs Murfitt was obliged to engage legal assistance to resist the claim that her company owed yours a substantial sum, the claim for which had been increased to
$72,000 by July 2007.
[9] The Crown alleged in the indictment that you made three false statements in an affidavit sworn in February 2007 in opposing Mrs Murfitt’s application to set aside the statutory demand. The allegations were that one of your companies had leased the property at 2/658 Rosebank Road to another company, Feature Furniture Limited; second, that Feature Furniture Limited had sub-leased that property to Mrs Murfitt’s company, Home Pride Limited; and, third, that Home Pride Limited
was storing approximately 2,000-3,000 LPG cylinders at the premises. You repeated two of those allegations, the Crown said, in an affidavit dated 12 July 2007 where you were alleged to have falsely stated that Feature Furniture Limited had sub-leased the property to Home Pride Limited and that Home Pride Limited was storing 2,000-
3,000 LPG cylinders at the premises.
[10] Your counsel submitted that the way in which the Crown framed the indictment has made it difficult for the Court to determine the basis upon which the jury’s verdicts were entered. He pointed out – and I am here referring to the written submissions on sentencing - that in giving a ruling on the form of the indictment and the issues paper, which was ultimately given to the jury in the course of my summing up to assist them in their deliberations, I had criticised the Crown’s approach of alleging, in effect, three separate instances of perjury contained in the first count and two separate allegations of perjury in the second. Because it was necessary, as a consequence, for me to direct the jury that they should treat each allegation separately and approach the alleged false statements sequentially, defence counsel now say it is not possible for me to establish the basis upon which the jury found you guilty of each count. In those circumstances, your counsel submit that I should assume for sentencing purposes that the guilty verdicts were reached on the basis of what is said to be the least culpable of the false statements, namely as to the quantity of cylinders stored at the premises.
[11] The background to that submission is that the Crown’s evidence, including that given by Mrs Murfitt, suggested that there were no more than two or three hundred cylinders stored at the premises; whereas evidence given by witnesses called on your behalf established a significantly greater number including, on the evidence of Ms Pansy, at least 2,000 cylinders.
[12] I do not think, however, that counsel’s submission adequately reflects the
position.
[13] The thrust of the statements in each of the affidavits was that the company then owned by Mrs Murfitt owed your company $64,400 in February, the amount of rental owing having increased by July 2007 to over $72,000. The basis of that claim,
which I have no doubt was entirely false, was that there were genuine leasing arrangements between the various companies. The storage of a substantial quantity of gas cylinders was put forward as the reason why Mrs Murfitt’s company had committed to paying rent, and why the debts claimed were genuinely owed. Viewed in that way, it did not matter particularly whether the number of cylinders amounted to two or three hundred, or five or six hundred as one witness claimed, or the 2,000 which Ms Pansy claimed to have seen.
[14] The Crown’s case was that you fabricated the lease documents on which you relied in making your claims about the rent. Your defence at trial included evidence intended to suggest that there was at least a reasonable doubt as to whether or not the lease documents were genuine.
[15] However, the jury’s verdicts are consistent with the view I formed on the facts which was that you falsely asserted that Mrs Murfitt’s company owed you that money, and that you knew that that assertion was false. You had assured Mrs Murfitt and your accountant that, at the earlier relevant time, Home Pride Limited was a non-trading shell which did not have any debts or liabilities. I am satisfied beyond doubt however, as I consider the jury must have been satisfied, that you swore the two affidavits with the intention of misleading the Court into believing that a substantial debt was genuinely owed.
[16] Furthermore, I have no doubt that your intention was to inflict suffering on Mrs Murfitt. You must have known that it was not simply a matter of her abandoning the company she owned and walking away from the debt because the company owned a residential property. Had you succeeded with your claim, Mrs Murfitt would have had to find the money to pay you in order to avoid having her company wound up with the residential property being sold in the process.
[17] Your counsel have submitted that perjury committed in civil cases of the kind involved here should be treated less seriously than perjury committed in a trial where allegations of serious criminal behaviour are involved. Mr Gotlieb has referred to other cases in which a sentence starting point of three years was regarded as appropriate in the context of perjury committed in the context of a trial involving
serious criminal charges. He characterises the proceedings in which you swore false affidavits as being only interlocutory civil proceedings and submits that your offending is therefore at the low end of the scale.
[18] The point is, however, that that submission overlooks the real nature of your offending. You set out on a deliberate course of mis-using the legal system, on the basis of entirely false assertions, to inflict considerable harm on Mrs Murfitt. You succeeded in your purpose by causing her great personal distress and inflicting financial harm. Because of the way in which you approached the case, she was required to instruct a solicitor and counsel to whom she paid fees of over $33,000. She could ill afford that kind of money but had no choice other than to meet the expense. Her victim impact statement describes poignantly the effect that that had on her in the context of her profession and her family relationships.
[19] Further, you repeated the false statements in separate affidavits sworn some five months apart. This was no momentary lapse of judgment in which you gave false evidence to escape a serious consequence; it was a deliberate campaign of deception which struck not only at your former wife but, even more significantly, at the heart of the judicial system.
[20] Against that background, therefore, I turn to consider the appropriate sentence to be imposed upon you. I am required first to decide a sentencing starting point, based on the nature of your offending and any aggravating or mitigating factors involved.[1] I am then required to look at personal circumstances which might be seen as aggravating or mitigating and therefore leading to an increase from the starting point or an appropriate reduction. In this case there are personal factors in your favour. Since you denied this offending and continue to deny it and lack any feelings of remorse, particularly with regard to the effects on Mrs Murfitt, those
factors are not available to assist you.
[1] R v Clifford [2011] NZCA 360; [2012] 1 NZLR 23.
[21] I regard this as serious offending of its kind. You embarked on a deliberate course of misleading the Court by making false assertions, and it matters little that,
in the end, you were not believed. You had achieved your purpose of damaging
Mrs Murfitt and, as I have said, the consequences for her have been serious.
[22] I consider that a starting point of three years’ imprisonment is consistent with the other cases referred to me by counsel.[2] A sentence of that period would reasonably reflect the seriousness of your offending and the need in such cases to impose a sentence which denounces perjury and serves as a deterrent to others.
[2] R v Koura CA16/05, 24 May 2005; R v Forrest [2010] NZCA 34; R v Wilkinson CA277/04, 16
December 2004.
[23] Turning to personal factors, I disregard your previous criminal history as being irrelevant and I give you credit for 40 years of worthy service to the community as a member of the Fire Service. I allow a six-month reduction in the sentence which would otherwise be appropriate on that account.
[24] You offered to pay reparation at the time you appeared before Courtney J. You were ordered to pay $25,000 but did not do so, and I assume that that was because of your challenge to the first conviction.
[25] I have considered whether this is a case in which an order for reparation is appropriate. On the information before me, the sum sought by Mrs Murfitt to compensate her for the legal fees she was forced to pay was $33,831.13. It appears that when you were first sentenced there was a claim that Mrs Murfitt owed you
$8,000 and that, it seems, led Courtney J to consider that the amount of $25,000 was appropriate.
[26] I have now received affidavits from Mrs Murfitt and you. Mrs Murfitt has been cross-examined and I have heard counsel's submissions. I accept that there was a degree of compromise on both sides in reaching a settlement of the litigation between you in the aftermath of your short marriage, including over legal costs. I accept also that the agreement included an acknowledgement by both of you that it was in full and final settlement of all actual and potential litigation between you.
[27] But this is not litigation between Mrs Murfitt and you; it is a criminal proceeding in which you have offended against society by deliberately undermining
the judicial process. And while Mrs Murfitt would be a beneficiary of any reparation order, an order for reparation is not made in a civil proceeding but as an integral part of the criminal justice procedure by making you accountable for your crimes, as the Sentencing Act requires.
[28] Further, it is reasonable to assume that your bargaining position in the settlement negotiations would have been substantially weaker had it been accepted then that the claims under the Companies Act were entirely fabricated and founded on perjury. Mrs Murfitt was required to spend $33,000 on lawyers she would never have had to pay but for your offending.
[29] Mrs Murfitt's loss must be proved on a balance of probabilities. Allowing for an element of recovery by her in the settlement of the civil claims, I find that the loss for which she should be compensated by a reparation order is $25,000.
[30] On that basis, therefore, that I intend to order you to pay that sum but allow a further discount of six months from the term of imprisonment which would otherwise be appropriate. That means that a sentence of two years’ imprisonment would be appropriate for this offending. I note that you have already served a period of three months’ imprisonment.
[31] It had previously been submitted by counsel that you should immediately be released on the basis that the time served by you amounts to adequate punishment but I think the reality of the position is that your counsel now accept that some further punishment must be imposed and Mr Gotlieb has suggested community detention. I am satisfied, however, that although you have endured time in prison already the seriousness of the offending requires that you should suffer some further significant loss of liberty.
[32] On any basis, the prospect of home detention as an alternative to imprisonment would have to be considered. There is the added factor of your age and ill health and the fact that you have already served part of the original term of imprisonment. I am satisfied on the evidence before me that returning you to prison would involve considerable hardship which would not be suffered by a younger
offender who enjoyed good health. In saying that, I do not dispute any of the findings which Courtney J made on the evidence available to her at the time, but the circumstances now are different: you are older and your health has deteriorated further. In those circumstances, therefore, I consider a sentence of home detention, which is not a soft option, to be an adequate response to the seriousness of your offending and to reflect the mitigating personal factors I have mentioned.
[33] The reports I have received indicate that the proposed arrangements for home detention are satisfactory.
[34] The maximum period of home detention that I can impose is one for
12 months. Three months’ imprisonment served for a man in your condition is roughly equivalent to four to five months’ home detention.
[35] On each count, you are sentenced to concurrent terms of seven months’ home detention to be served at 233 Meola Road, Pt Chevalier. Upon your release from Court you will go directly to that address and await the attendance of the persons responsible for fitting the monitoring device. You will co-operate with that fitting and any maintenance of the device which may be required. You will remain at
233 Meola Road at all times except as may be specifically approved in advance by the probation officer – and that, Mr Kendall, I note should include the need for you to attend for medical treatment. You will notify your probation officer of any change of employment and not undertake any new employment without your probation officer’s prior approval.
[36] You will pay Patricia Murfitt reparation in the sum of $25,000. As I have indicated Mr Kendall, I have taken the payment of reparation into account in determining the appropriate sentence to be imposed upon you and in those circumstances a failure to pay the amount of reparation ordered will not be tolerated.
[37] You may stand down.
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Toogood J
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