R v Petricevic - [2012] NZHC 785

IN THE HIGH COURT OF NEW ZEALAND AUCKLAND REGISTRY

CRI-2008-004-029179 [2012] NZHC 785

THE QUEEN

v

RODNEY MICHAEL PETRICEVIC

Hearing: 26 April 2012

Appearances: B Dickey, W Cathcart and T Molloy for Crown
C B Cato for Mr Petricevic

Judgment: 26 April 2012

Charges: Making false statements x6
Making false statement to trustee x2
Distributing offer documents containing false statements x10

Plea: Not Guilty

Sentenced: 26 April 2012
Making false statements – 6½ years’ imprisonment
Making false statement to trustee – 4 years’ imprisonment
Distributing offer documents containing false statements – 4 ½ years’
imprisonment
Total: Six and a half years’ imprisonment (concurrent)
SENTENCING NOTES OF VENNING J

Solicitors: Crown Solicitor, Auckland
Copy to: C Cato, Auckland

R V PETRICEVIC HC AK CRI-2008-004-029179 [26 April 2012]

[1] Rodney Michael Petricevic you have been convicted and are for sentence on six counts under the Crimes Act of making false statements, two counts under the Companies Act of making false statements in directors’ certificates to Covenant Trustee Company Limited and 10 counts under the Securities Act of distributing offer documents containing false statements.

[2] The maximum penalty for the offending under the Crimes Act is 10 years in each case, and five years for the offending under the Companies and Securities Acts.

[3] The convictions arise out of your actions as managing director of Bridgecorp

Ltd and Bridgecorp Investments Ltd (BIL).

[4] Bridgecorp was incorporated on 30 April 2001. It is a wholly owned subsidiary of Bridgecorp Holdings Limited, which is in liquidation (BHL), and a company registered in Australia.

[5] BHL was a small public company in New Zealand left as a shell after the

1987 sharemarket crash. Interests associated with you bought it in about 1992. You then sold a portfolio of mortgages into it in about 1994 and interests associated with you hold about 3.8 million shares in BHL – the Crown estimate that to be approximately in excess of 60 per cent of the shares.

[6] BHL started lending money in its own right and looked to the market to raise further money. It registered its first prospectus in the late 1990’s. At about that time a decision was made to migrate that company to Australia and Bridgecorp was incorporated to continue business in the New Zealand market.

[7] Bridgecorp’s principal activity was the sourcing of funding and lending in relation to property financing transactions. It primarily funded that activity through investments from the public by issuing secured debentures to members of the public and through issuing redeemable preference shares to BIL.

[8] In order to raise money in that way from investors Bridgecorp had to issue prospectuses and investment statements from time to time and to register them with

the Registrar of Companies. It was also required to appoint a custodian for the debenture holders, Covenant Trustee Company Ltd (Covenant).

[9] BIL was incorporated in April 2002 as a vehicle to raise further funds for New Zealand’s subsidiaries of BHL. It issued capital notes to the public…

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 R v Petricevic

Details

AGLC: R v Petricevic [2012] NZHC 785
Case: [2012] NZHC 785
Decision Date: 26 April 2012

CaseChat Overview and Summary

Rodney Michael Petricevic was convicted and sentenced in the High Court of New Zealand on multiple counts of making false statements, making false statements to a trustee, and distributing offer documents containing false statements. The charges arose from Petricevic's actions as managing director of Bridgecorp Ltd and Bridgecorp Investments Ltd. The court found that Petricevic deliberately made false statements intending to induce people to invest in Bridgecorp at a time when he knew the company was in serious financial trouble.

The legal issues included the appropriate starting point for sentencing and the mitigating factors to consider. The Crown sought a starting point of eight years imprisonment, while defence counsel argued for six years. The court considered the purposes and principles of sentencing, particularly denunciation, accountability, and the effect on victims. The court also noted the aggravating factors, such as the significant financial and emotional harm caused to investors, and the breach of trust involved.

After considering the mitigating factors, including Petricevic's age, previous good character, and expressions of remorse, the court decided on a sentence of six and a half years imprisonment for the Crimes Act offences, four years for the Companies Act offences, and four and a half years for the Securities Act offences, to be served concurrently. The effective sentence term was six and a half years.

Orders