R v Sullivan (No 7)
[2014] NZHC 925
•6 May 2014
IN THE HIGH COURT OF NEW ZEALAND TIMARU REGISTRY
CRI 2011-076-1948 [2014] NZHC 925
THE QUEEN
v
EDWARD ORAL SULLIVAN ROBERT ALEXANDER WHITE and LACHIE JOHN McLEOD
Hearing: 12, 13, 17, 18, 19, 21, 24, 25, 26, 27, 31 March 2014
1, 2, 3, 4, 7, 8, 9, 14, 15, 16, 28, 29, 30 April 2014
1, 2, 5 and 6 May 2014Counsel:
C R Carruthers QC, N F Flanagan, P W Gardyne and
E Rutherford for Crown
P H B Hall QC, M A Corlett and K H Cook for Mr Sullivan
R B Squire QC for Mr White
J H M Eaton QC for Mr McLeodJudgment:
6 May 2014
JUDGMENT (NO. 7) OF HEATH J
This judgment was delivered by me on 6 May 2014 at 4.30pm pursuant to Rule 11.5 of the High Court Rules
Registrar/Deputy Registrar
R v SULLVIAN [2014] NZHC 925 [6 May 2014]
Introduction
[1] The Crown alleges that Mr Sullivan, Mr White and Mr McLeod engaged in dishonest conduct in the course of particular activities which they carried out while acting on behalf of South Canterbury Finance Ltd (South Canterbury). At material times, Mr Sullivan and Mr White were directors of South Canterbury; Mr McLeod was its Chief Executive. The trial began on 12 March 2014.
[2] On 28 April 2014, immediately after the Easter break, Mr Sullivan, supported by Mr White and Mr McLeod, applied for additional disclosure from the Crown. The application is made under s 30 of the Criminal Disclosure Act 2008 (the Act).1
[3] The application was heard on 30 April 2014. On that day, a consent order was made in respect of one class of the documents to which the application was directed. They were documents to which reference was made in a brief of evidence from Mr Grant Graham, a forensic accountant from Korda Mentha, a firm based in Auckland. He is being called as an expert witness by the Crown. The remaining
aspects of the application are opposed.2
The scheme of the Act3
[4] The purpose of the Act “is to promote fair, effective, and efficient disclosure of relevant information between the prosecution and the defence, and by non-parties, for the purposes of criminal proceedings”.4 Disclosure is required to promote an accused person’s rights to a fair trial, and equality of arms. Those objectives are affirmed by the New Zealand Bill of Rights Act 1990.5 As the Law Commission made clear in a report that was partially responsible for introduction of the regime:6
A person accused of a crime must be made aware of the nature and extent of the allegation; without adequate disclosure, a defendant will be unable to prepare their defence properly. The extent to which defendants should be entitled to disclosure of information from the prosecution depends upon a
1 Set out at para [8] below.
2 The nature of the documents that remain in issue is set out at para [18] below.
3 Generally, see Cant v R [2013] NZCA 321 at [29]–[31] and R v Medcalf [2013] NZCA 333 at paras [4]–[7].
4 Criminal Disclosure Act, s 3(1).
5 New Zealand Bill of Rights Act 1990, ss 25(a) and 24(d) respectively.
6 Criminal Prosecution (NZLC R 66, 2000) chapter 8, para 193.
fair balance between the general public interest and the important personal rights of individual citizens. Defendants should not be handicapped by a lack of relevant information and by an imbalance of resources available to them in preparing a case compared with those resources at the disposal of the State. …
[5] In seeking to achieve the correct balance, Parliament created two distinct regimes. One requires the prosecution to disclose information in its possession, or under its control. The other is concerned with disclosure required from non-parties to the criminal proceeding. The former puts an affirmative obligation on a prosecutor to disclose certain types of documents within stipulated times. The latter requires the Court to be satisfied that it is appropriate to force an outsider to the prosecution process to provide information in its possession or under its control. In both types of case, the Act specifies grounds on which relevant information may be
withheld, as part of the balancing exercise to which the Law Commission referred.7
[6] Disclosure by a prosecutor has two stages; “initial disclosure”,8 and “full disclosure”.9 If a defendant believes that a prosecutor has not disclosed all relevant information, or has wrongfully withheld information on one or more of the grounds set out in ss 16, 17 and 18 of the Act, he or she may request “additional disclosure”.10 When considering an application for additional disclosure the Court exercises a supervisory function to ensure that information that has been wrongfully withheld is disclosed.11
[7] The regime for non-party disclosure is different. The Court is involved from the outset. The starting point is an application to the Court for a non-party disclosure hearing.12 If the application for a non-party disclosure hearing were granted,13 service of the application and a summons for the non-party to produce the
information would be required.14 The non-party is summoned to attend at the court
7 Criminal Disclosure Act 2008, ss 15, 16, 17 and 18 (in respect of prosecution disclosure) and 29 (in respect of a non party).
8 Section 12.
9 Section 13.
10 Section 14.
11 Section 30.
12 Section 24.
13 Section 25.
14 Section 26.
on a specified day and to bring the information requested.15 At that time, a non-party disclosure hearing (at which the non-party is entitled to be heard)16 takes place. After that hearing, a judicial determination is made about whether a non-party disclosure order should be made.17 A variety of factors, designed to balance competing public and private interests, are taken into account in conducting that exercise.18
The application
[8] Section 30 of the Act provides:
30 Court order for disclosure of information
(1) The defendant may apply to the Court for an order that a particular item of information or type of information in the possession or control of the prosecutor be disclosed on the grounds that—
(a) the defendant is entitled to the information under section 12,
13, or 14, as the case may be, and—
(i) the prosecutor failed to disclose the information; or
(ii) the prosecutor refused under section 14, 16, 17, or
18 to disclose the information, and—
(A) none of the reasons described in section 16,
17, or 18 for which information could be withheld applies to the information; or
(B) in the case of a refusal under section 17, the information ought to have been disclosed under section 17(3); or
(C) in the case of a refusal under section 18, the information ought to have been disclosed under section 18(2); or
(b) even though the information may be withheld under this Act, the interests protected by the withholding of that information are outweighed by other considerations that make it desirable, in the public interest, to disclose the information.
(2) If the Court is satisfied, on an application made under this section, that the defendant is entitled to the disclosure of any particular item of information or type of information, or that any particular item of
15 Section 26(3).
16 Section 27.
17 Section 29.
18 For example, see s 29(1)(b), (2) and (3).
information or type of information should be disclosed to the defendant under subsection (1)(b), the Court may order that the item or type of information be disclosed to the defendant.
(3) An order made under this section may be made subject to any conditions that the Court considers appropriate.
(Emphasis added)
[9] “Initial disclosure” is required by s 12 of the Act. This is given at the commencement of criminal proceedings, or as soon as practicable thereafter. It includes a summary that is sufficient to inform a defendant fairly of the facts on which it is alleged an offence has been committed, and the facts alleged against the particular defendant.
[10] Sections 13 and 14 deal with full disclosure and requests for additional disclosure. Certain “standard information” must be provided as soon as is reasonably practicable after a defendant has pleaded not guilty.19 Section 13(2) and (3) provide:
13 Full disclosure
…
(2) The information referred to in subsection (1) is—
(a) any relevant information, including, without limitation, the information (standard information) described in subsection (3); and
(b) a list of any relevant information that the prosecutor refuses under section 15, 16, 17, or 18 to disclose to the defendant together with—
(i) the reason for the refusal; and
(ii) if the defendant so requests, the grounds in support of that reason, unless the giving of those grounds would itself prejudice the interests protected by section 16, 17, or 18 and (in the case of the interests protected by section 18) there is no overriding public interest.
(3) The standard information referred to in subsection (2)(a) is—
(a) a copy of any statement made by a prosecution witness; and
19 Criminal Disclosure Act 2008, s 13(1).
(b) a copy of any brief of evidence that has been prepared in relation to a prosecution witness; and
(c) the name and, if disclosure is authorised under section 17, the address of any person interviewed by the prosecutor who gave relevant information and whom the prosecutor does not intend to call as a witness; and—
(i) any written account of the interview, whether signed or unsigned, and any other record of the interview; and
(ii) any statement made to the prosecutor by the person;
and
(d) any convictions of a prosecution witness that are known to the prosecutor and that may affect the credibility of that witness; and
(e) a list of all exhibits that the prosecutor proposes to have introduced as evidence as part of the case for the prosecution; and
(f) a list of all relevant exhibits in the possession of the prosecutor that the prosecutor does not propose to have introduced as evidence; and
(g) a copy of any information supplied to the prosecutor in connection with the case by any person or persons whom the prosecutor proposes to call to give evidence as an expert witness or witnesses; and
(h) a copy of any relevant information supplied to the prosecutor by a person or persons whom the prosecutor considered calling to give evidence as an expert witness or witnesses, but elected not to do so.
….
[11] The obligation to disclose relevant information is a continuing one. If information of the type to which s 13(2) comes into the possession or control of the prosecutor, or is prepared in recorded form before the hearing or trial is completed, it must be disclosed “as soon as is reasonably practicable”.20 Indeed, entitlement of a defendant to s 13 information continues while the criminal proceedings are in progress; including the period from the conviction until the expiry of the time for
lodging an appeal against conviction, and the time during which any appeal is
pending.21
20 Section 13(5).
21 Section 13(6).
[12] Nothing in the Act requires a prosecutor to disclose information if the prosecutor is not in possession or control of that information or does not hold the information in recorded form at the time the disclosure obligation arises, or at any later time when a request for additional disclosure is made.22
[13] At any time after the duty to make full disclosure has arisen under s 13, a defendant may request that a prosecutor disclose “any particular information, identified by the defendant with as much particularity as possible”.23 That information must be disclosed unless it is irrelevant or the prosecutor is entitled to withhold it under ss 15, 16, 17 or 18 of the Act.24 It may also be declined if “the request appears to be frivolous or vexatious”, but it would be unusual for disclosure to be refused on that ground alone.25
[14] If a request for additional disclosure is refused, s 14(3) provides that:
…, the prosecutor must, as soon as is reasonably practicable after making the decision to decline the request, inform the defendant of that decision, together with—
(a) the reason for the decision; and
(b) if the defendant so requests, the grounds in support of that reason, unless the giving of those grounds would itself prejudice the interests protected by section 15, 16, 17, or 18 and (in the case of the interests protected by section 18) there is no overriding public interest.
[15] Section 30 enables the Court26 to make “an order that a particular item of information or type of information in possession or control of the prosecutor be disclosed” in cases where either the prosecutor has failed to disclose information to which a defendant is entitled, or has wrongly withheld it on grounds set out in ss 16,
17 and 18 of the Act.27 An order may only be made if the Court were “satisfied …
22 Ibid, s 15(1).
23 Ibid, s 14(1).
24 Ibid, s 14(2)(a) and (b).
25 Ibid, s 14(2)(c).
26 Defined by s 7 of the Act as the Court before which, at any given time, the proceedings are being conducted.
27 Criminal Disclosure Act 2008, s 30(1).
that the defendant is entitled to the disclosure” of the information in issue. Even
then, the Court retains a residual discretion not to make an order.28
[16] Sections 16, 17 and 18 of the Act identify reasons why a prosecutor may withhold information to which a defendant would otherwise be entitled. Relevant parts of ss 16 and 18 provide:29
16 Reasons for withholding information
(1) A prosecutor may withhold any information to which the defendant would otherwise be entitled under this Act if—
…
(c) the information is—
(i) material that is prepared by or for the prosecutor to assist the conduct of the hearing or trial; or
(ii) a communication dealing with matters relating to the conduct of the prosecution and is between—
(A) the prosecutor and another person employed by the same person or agency that employs the prosecutor; or
(B) the prosecutor and any adviser to the prosecutor; or
(iii) analytical or evaluative material prepared, in connection with an investigation that led to the defendant being charged, by a person employed by a person or agency for another person employed by that person or agency or for the prosecutor; or
…
(j) the information could be withheld under any privilege applicable under the rules of evidence; or
….
(n) the information does not exist or cannot be found; or
(o) the information—
28 Section 30(2), set out at para [8] above.
29 Section 17 deals with restrictions on disclosing the address of a witness or an informant, neither of which has relevance on the present application.
(i) reflects on the credibility of a witness who is not to be called by the prosecutor to give evidence but who may be called by the defendant to give evidence; and
(ii) is not for any other reason relevant.
(2) If part only of the information may be withheld, the prosecutor must make the remainder of the information available if it is possible to protect the withheld information by deletion, summary, or otherwise.
(3) If the prosecutor becomes aware that there has ceased to be any justification for withholding all or part of any information that has been withheld under this Act, the prosecutor must, if the criminal proceedings have not yet been completed, disclose that information to the defendant as soon as reasonably practicable.
18 Trade secrets may be withheld
(1) The prosecutor may withhold any information to which the defendant would otherwise be entitled under this Act if disclosing the information—
…
(b) would be likely to unreasonably prejudice the commercial position of the person who supplied, or who is the subject of, the information.
(2) Despite subsection (1), information must not be withheld under this section if, in the circumstances of the particular case, the interests in subsection (1) protected by the withholding of that information are outweighed by other considerations that make it desirable in the public interest to disclose the information.
….
[17] Under s 30(2) of the Act, even though information might, prima facie, be withheld, the Court is enjoined to consider whether “the interests protected by the withholding of [the] information are outweighed by other considerations that make it desirable, in the public interest, to disclose the information”.30 An obvious factor to be taken into account in making that decision is the ability of an accused to mount an effective defence to the charge or charges without the information sought.
[18] Mr Hall QC, for Mr Sullivan, formulated the live parts of the application by reference to three categories of information:31
30 Ibid, s 30(1)(b).
31 The reference to “SFO” is to the Serious Fraud Office which, prior to the filing of an indictment, had carriage of the prosecution. The reference to “Meredith Connell” is to the Crown Solicitor’s firm in Auckland who were instructed to carry out certain work on behalf of the Serious Fraud Office.
1.That disclosure of all invoices rendered by Korda Mentha in relation to any investigation into South Canterbury Finance including but not limited to invoices rendered to the SFO and/or Meredith Connell;
…
3.All documents/correspondence/records between the SFO/Crown/Meredith Connell and Mr Grant Graham/Korda Mentha; and
4.All correspondence between the SFO/Crown/Meredith Connell and any witness or potential witness in relation to the South Canterbury Finance investigation/trial.
[19] Mr Hall submitted that an order was required because the Crown had not disclosed all relevant information to the defendants, despite a request for additional disclosure, under s 14 of the Act.32 The terms “information” and “relevant” are defined by ss 6(2) and 8 of the Act:
(a) Section 6(2):
(2) In this Act, a reference to information means any recorded information—
(a) in whatever form it is contained, for example, in a report, statement, list, or interview; and
(b) in whatever medium it is recorded, for example, in hard copy, electronic form, or as a sound or visual recording.
(b) Section 8:
8 Meaning of relevant
In this Act, relevant, in relation to information or an exhibit, means information or an exhibit, as the case may be, that tends to support or rebut, or has a material bearing on, the case against the defendant.
[20] The application was preceded by correspondence between the solicitors for Mr Sullivan and the Crown. In a letter dated 4 April 2014, Mr Sullivan’s solicitors wrote:
Re: R v Sullivan & Ors
Further Disclosure Arising Out Of The Evidence of Grant Graham
32 See para [19] below.
1. At paragraph 25 of Mr Graham’s brief of evidence dated 29
November 2013, he states: “In forming my opinion I have reviewed
and relied on the Korda Mentha reports mentioned above that were
prepared for the Treasury, BNZ, SFO and FMA.”
2.We have received by way of disclosure the Korda Mentha report to Treasury dated 4 September 2009 referred to in paragraph 17.2 of Mr Graham’s brief. We do not appear to have received a copy of the preliminary report to Treasury dated 17 July 2009 referred to by Mr Graham in paragraph 17.1 (but without an SFO number). Please provide a copy of same, or identify the SFO number for the report.
3.Nor have we received copies of what in paragraph 17.3, Mr Graham describes as progress updates to Treasury over the course of this assignment.
4.We have not received by way of disclosure the Korda Mentha reports to the SFO and the FMA which Mr Graham states he has relied on in forming his opinion. These reports are obviously required by counsel and by the defence expert (Mr Hagen) to appreciate the basis for Mr Graham’s opinion. Please provide a copy of same.
5.Mr Graham also refers at paragraph 19 of his Brief to Korda Mentha being engaged by the Crown as an inspector under the provisions of the Crown Deed of Guarantee, including on asset quality and related party loans. Mr Graham goes on in his brief to give opinion on these issues. Please provide a copy of all reports provided to the Crown by Korda Mentha pursuant to this engagement.
6.Mr Graham states at paragraph 21 that Korda Mentha continued to provide advice to Treasury as requested until the company was placed into receivership. This advice is also said to have included asset quality and related party matters. Please provide a copy of all reports provided to Treasury pursuant to this engagement.
7.Further, we believe there are issues as to Graham’s status as an independent expert witness. To enable us to consider that issue in greater detail, we would be obliged if you would provide us with copies of all invoices rendered by Korda Mentha for work done by Mr Graham in connection with the preparation of the report and progress updates referred to above.
8.We should be grateful if copies of all documents requested above could be supplied to us and Counsel for Messrs Sullivan and McLeod as a matter of urgency.
….
[21] A response was provided on 15 April 2014:
Re: R v Sullivan & Ors – CRI 2011-076-001948 – South Canterbury
Finance Limited (In Rec)
Further to your 4 April 2014 letter on behalf of your instructing client Mr Sullivan requesting further disclosure arising out of the evidence of Mr Grant Graham in respect of the above. We reply with specific reference to your paragraph numbers and in accordance with the obligation of continuing disclosure under the Criminal Disclosure Act 2008 (CDA) as follows:
2.As you know, disclosure is not required of publically available documents, and the SFO has never had this document in its possession. Korda Mentha’s 17 July 2009 report is part of a Official Information Act release made by Treasury which is available to the public. To assist we have prepared a summary of the significant number of documents made available to the public by Treasury through their website which specifically includes Korda Mentha’s reports (see attached) or:
to refer to point 2 above (the position is the same).
4.We attach the following reports in the possession or under the control of the Serious Fraud Office (SFO):
Korda Mentha report to the SFO dated 20 May 2011;
Korda Mentha report to the SFO dated 18 October 2011; and
Draft Korda Mentha report to the Financial Markets
Authority (FMA) dated 18 July 2011.
5.The SFO have provided copies of all Korda Mentha reports in its possession or under its control both during the course of earlier disclosure and under the cover of this correspondence. We reiterate the point noted at paragraph 2 above as to the public release of the materials you seek.
6. Refer to refer to point 5 above (the position is the same).
7.Please note the SFO are withholding invoices rendered by Korda Mentha on the basis that the information is not relevant and disclosure would be likely to unreasonably prejudice the commercial position of Korda Mentha or the SFO.
[22] In an email of 28 April 2014, under cover of which the application for disclosure was sent to the Crown, counsel for Mr Sullivan disputed the Crown’s entitlement to withhold the invoices, and added a comment in relation to a prior communication from the Crown in which reference was made to privilege considerations arising out of the provisions of the Evidence Act 2006:
… I am particularly concerned about the comment “[y]ou will appreciate of course that other materials need not be disclosed and s 56 of the Evidence Act will apply to certain correspondence”. I d not accept that s56 Evidence Act 2006 applies in this context. Therefore, I have included a request for these documents in the aforementioned disclosure application. However, that may not be the end of this issue in a wider context. Has this principle – that is the s56 Evidence Act 2006 ability to withhold documents – been applied in relation to any other witnesses? If so, can you please list the witnesses as there may well be an application in relation to any documents that have been withheld in reliance on that section.
[23] In its notice of opposition to the s 30 application, the Crown stated:33
Documents sought in paragraph 1 of the application
4.The Crown is not obliged to disclose information unless it is relevant (s 14(2)(a) CDA). Information is relevant if it tends to support or rebut, or has a material bearing on, the case against the defendant (s
8 CDA). That is a broad test, but not without certain boundaries:
Edwards v R [2012] NZCA 375.
5.Invoices rendered by Korda Mentha in relation to the investigation into South Canterbury Finance do not have any material bearing on the case against the accused. They go to no element of the offence, nor issue in the proceeding that is yet apparent. In particular, it is unlikely that the honesty or credibility of Mr Graham (as opposed to his views on particular issues) can be at issue.
6.Even if the invoices were relevant, the Crown would be entitled to withhold the information under s 18(1)(b) of the CDA as disclosure would be likely to unreasonably prejudice the commercial position of Korda Mentha.
…
Documents sought in paragraphs 3 and 4 of the application
8As noted above, s 8 CDA defines information as relevant if it tends to support or rebut, or has a material bearing on, the case against the defendant. The defence seeks “all documents/correspondence/records”. That by definition includes irrelevant material. Obvious examples involve correspondence about travel arrangements, witness expenses, and so on.
9.Plainly then orders cannot be made in the terms sought. All that can properly be ordered is that relevant material be provided, and that obligation is already imposed under the CDA. The Court should not make orders that merely restate the already existing legal obligations of the Crown.
33 I have excised the Crown’s response to those documents in respect of which a consent order has
already been made.
10.Finally, the documents sought in paragraphs 3 and 4 will also inherently include documents that are subject to privilege under s 56 of the Evidence Act 2006. The Crown is entitled to withhold disclosure on that basis (s 16(1)(j) CDA).
Analysis
(a) The Korda Mentha invoices
[24] Mr Hall made it clear that the invoices rendered by Korda Mentha to the Serious Fraud Office and/or Meredith Connell were required so that Mr Sullivan (and other accused) could determine whether there was any activity carried out by Mr Graham that would put his independence as an expert witness into issue.
[25] It is fair to say that Mr Graham’s forensic analysis is an important component of the Crown case. It is accepted that, in addition to undertaking work for the Serious Fraud Office and engagement to appear as an expert witness, Mr Graham acted as an Inspector for Treasury under a Deed of Guarantee by which certain retail deposits were guaranteed by the Crown.34 Mr Hall was content to submit to a condition of an order that the actual fees charged be redacted to avoid any argument about commercial prejudice, of the type to which s 18(1)(b) of the Act refers.35
[26] Mr Flanagan, for the Crown, assured me that all relevant information had been provided and submitted that there was no obligation on the Crown to provide invoices of the type sought by Mr Sullivan. He reiterated the point raised in the Crown’s notice of opposition that the content of the invoices (whether or not they contain references to the amounts charged) do not have any material bearing on the case against the accused. Mr Flanagan accepted that a refusal to disclose based on commercial prejudice could not succeed if the amounts charged were redacted.
[27] Section 30 of the Act does not envisage the Court interfering in the prosecution disclosure obligations unless the Court can be persuaded that an accused
is entitled to information to which ss 12, 13 or 14 apply.36 The Court’s authority to
34 Generally, see R v Sullivan (No. 6) [2014] NZHC 725 at paras [3]–[11].
35 Section 18(1)(b) is set out at para [16] above.
36 Criminal Disclosure Act 2008, s 30(2); set out at para [8] above.
order disclosure is limited to “a particular item of information or type of information in the possession or control of the prosecutor”.
[28] The first point is that the Crown could only be required to disclose invoices in its possession or control, in its capacity as a prosecutor. Other Crown entities37 and Korda Mentha itself would be entitled to be heard under the non party disclosure provisions of the Act. On that basis, the application’s reference to invoices “including but not limited to” those rendered to the Serious Fraud Office and/or Meredith Connell is too wide.
[29] The only issue to which the narrative of the invoices could go is Mr Graham’s independence. On this point, I have considered his signed witness statement of 29 November 2013, which was served on the accused on or about 2
December 2013.
[30] In his brief, Mr Graham refers to:
(a) His professional qualifications and experience; including forensic roles in examining the books of some 30 finance companies, with loan receivables exceeding $5.6 billion, over the previous four years.
(b)His previous involvement with South Canterbury. Mr Graham refers expressly to his firm’s appointment as an Inspector by Treasury under the Deed of Guarantee, on 12 June 2009. He explains the nature of his assignment in carrying out that task.
(c) An engagement by the Bank of New Zealand, in its capacity as agent for a syndicated debt facility, which also involved the Commonwealth Bank of Australia. He describes that engagement as “essentially a subset of the scope for the wider Treasury review”.
(d) A subsequent appointment by Treasury under a second Deed of
Guarantee, on 30 April 2010, and indicates the nature of his inquiries.
37 As an example, see the situation concerning the Accident Compensation Corporation, discussed in R v Medcalf [2013] NZCA 333.
(e) Subsequent engagements by the Serious Fraud Office and Financial
Markets Authority.
[31] Mr Graham confirms that he is “familiar with the High Court Code of Conduct for Expert Witnesses and [agrees] to be bound by it”. That includes an understanding of the need for independence on the part of an expert witness and the prohibition on experts acting as advocates for the cause promoted by the party by whom they are called.38 He also states:
25 In forming my opinion I have reviewed and relied on:
25.1the KordaMentha reports mentioned above that were prepared for the Treasury, BNZ, SFO and FMA;
25.2the SFO numbered documents listed in the schedule attached to this statement; and
25.3 the formal written statements (“statements”) of:
(a) Peter Symes; (b) Ross Lund;
(c) Geoffrey Sullivan; (d) David Houldsworth; (e) David Jarman;
(f) Stuart Nattrass; (g) Ian Thompson; (h) Colin Armer;
(i) John Park; and
(j) Bradley Porter
[32] In my view, in order to persuade the Court that it was appropriate to go behind the Crown’s view that disclosure of the invoices was irrelevant, it would be necessary for a defendant to identify an evidential foundation for the proposition that an issue to be explored at trial required disclosure, to promote fair trial and equality
of arms considerations. I am not persuaded that is so.
38 High Court Rules, Schedule 4, cl 1 and 2.
[33] Mr Graham appears to have been frank in identifying the range of appointments that he has undertaken with regard to South Canterbury, and the impact of those various roles on his independence can be explored fully in cross- examination. Should anything emerge that casts doubt on his independence it would be open for the accused to make a further application under s 30, which I would be prepared to entertain, even if made orally. In those circumstances, I am not presently prepared to order disclosure of the invoices.
(b) Correspondence and documents involving potential witnesses
[34] Oral argument ranged over a wide area, including the extent to which litigation privilege conferred by s 56 of the Evidence Act 2006 was applicable in the context of a criminal proceeding. In general terms, any document that is brought into existence with the “dominant purpose” of preparing for a proceeding or an apprehended proceeding is privileged, unless the Court is prepared to override that privilege for public interest reasons.
[35] It is clear from s 67(2) of the Evidence Act that a claim to litigation privilege might be disallowed “if [a] Judge is of the opinion that evidence of the communication or information is necessary to enable the defendant in a criminal proceeding to present an effective defence”. The very existence of that provision tends to support a conclusion of litigation privilege applies in a criminal proceeding. But, for a Court of first instance, the point was put beyond doubt by the Privy
Council in B v Auckland District Law Society.39
[36] There have been a number of witnesses throughout this trial in respect of whom counsel for accused have cross-examined about steps taken in the preparation of their evidence. On only one occasion has any doubt been thrown on the disclosure made. That was in the case of Mr Jarman. He was employed as an Interim Chief Financial Officer of South Canterbury between December 2009 and
May 2012. During part of that time he kept minutes for directors’ meetings.
39 B v Auckland District Law Society [2004] 1 NZLR 326 (PC) at para [44]; see also Reid v Crown
Law Office HC Wellington CIV-2008-485-1203, 21 April 2009 at para [14] (Dobson J).
[37] Unbeknown to the Crown and counsel for the accused, he had kept handwritten notes from which the minutes had been prepared. They were disclosed when he came to Court to give evidence and his appearance was deferred until counsel for the accused had had an opportunity to consider them. No apparent prejudice was obvious to me as a result of the need for counsel for the accused to consider those documents before cross-examining.
[38] In my view, there is nothing in the Act to require Crown to disclose general communications between prosecutor and a proposed witness about the form of any brief of evidence. In a case such as this, I would expect such communications to take place in order to settle the final form of a witness’ evidence There is no evidence before me to suggest that the Crown has attempted to suborn the testimony of a potential witness. Nor is there any obligation to disclose more general correspondence that is not relevant to a trial issue. That being so, there is no evidential foundation for an order under s 30 to be made in respect of the second and
third categories of documents sought.40
[39] Having said that, I expect counsel for the Crown to provide to the accused any document that might affect the credibility of a witness, including any officers of a prosecuting authority to be called as witnesses. Although that is not something expressly identified in the standard information required to be disclosed under
s 13(3) of the Act,41 it is consistent with the need to disclose any convictions of a
prosecution witness that might affect his or her credibility.42 Section 13(2)(a) makes it clear that “any relevant information, including, without limitation,” the standard information described in s 13(3) must be disclosed. Similarly, the Crown should identify any documents to which privilege is claimed,43 and the basis for the claim so that any particular issue can be explored if necessary. Those disclosures may have been made already, but if not Crown counsel should attend to it now.
[40] I do not consider it is necessary, in the context of the present application, to determine questions of the scope of litigation privilege. The requests made on behalf
40 See items 3 and 4 of para [18] above.
41 Set out at para [10] above.
42 Criminal Disclosure Act 2008, s 13(3)(d).
43 Section 13(2)9b).
of Mr Sullivan are expressed in very general terms and there is no evidential foundation to suggest that the assurance given by Mr Flanagan that all relevant documents have been disclosed should be ignored. Should an evidential foundation emerge, a more particular application might properly be considered later.
Result
[41] For those reasons, other than in respect of the consent order made on 30 April
2014,44 the application for disclosure is dismissed.
[42] I do not consider there is anything in this judgment that should be suppressed from publication at this stage. Unless counsel raise any issue before 4pm tomorrow (7 May 2014) the Registrar shall make a copy of the judgment available to media
interests at that time.
P R Heath J
Delivered at 4.30pm on 6 May 2014
Solicitors:
Serious Fraud Office, PO Box 7124, Wellesley Street, Auckland
Meredith Connell, PO Box 2213, Auckland
Gresson Dorman & Co, PO Box 244, Timaru
Rhodes & Co, PO Box 13444, Armagh, Christchurch
Duncan Cotterill, PO Box 5, Christchurch
Counsel:
C Carruthers QC, PO Box 305, Wellington 6140
P H B Hall QC, PO Box 3750, Christchurch
R B Squire QC, PO Box 10157, Wellington
J H M Eaton QC, PO Box 13868, Armagh, ChristchurchM Corlett, PO Box 4338, Shortland Street, Auckland
44 See para [3] above.
7