R v Taylor

[2012] NZHC 3531

IN THE HIGH COURT OF NEW ZEALAND NAPIER REGISTRY

CRI-2011-041-1486 [2012] NZHC 3531

THE QUEEN

v

BRETT COLIN TAYLOR

Defendant

Hearing:         10 December 2012

Counsel:         F E Cleary for Crown

C R Carruthers QC and R P Harley for Defendant

Judgment:      19 December 2012

Reasons:        19 December 2012

REASONS FOR JUDGMENT OF MACKENZIE J

[1]      The accused is charged with one representative count of causing loss by deception.  His trial before a judge alone is set down for 18 February 2013.  He has applied for discharge pursuant to s 347 of the Crimes Act 1961 on the grounds that there is insufficient evidence to justify arraignment at trial, and that it is in the interests of justice that the accused be discharged.  I have, in open court, made an order directing that the accused not be arraigned on the indictment and that he be discharged. These are my reasons for making that order.

[2]      I set out first the facts as the Crown alleges them to be.

R V TAYLOR HC NAP CRI-2011-041-1486 [19 December 2012]

[3]      Prior to 1 November 2004, the accused owned and operated Taylor Corporate Services Ltd (“TCSL”), an incorporated accountancy company located in Napier. The  accused  and  another  chartered  accountant,  Mr Ogier,  subsequently  formed Taylor Ogier Ltd (“TOL”), a chartered accountancy practice.   TOL purchased the practice, assets and clients of TCSL.   The accused and Mr Ogier were the sole directors of TOL.  The arrangements that governed their relationship were contained in a shareholders’ agreement.   All work performed by the directors and staff was required  to  be  billed  through  TOL.     The  directors  were  prohibited  by  the shareholders  agreement  from  providing  professional  services  in  their  personal names.

[4]      Everyone at TOL was required to account for their time on a daily basis. Time  spent  working  for  a  client  was  recorded  in  a  computer  system.    Both chargeable and non-chargeable time were recorded in the system.   In order to bill clients, the practice manager reviewed the monthly work-in-progress reports at the end of each month and made recommendations to the directors regarding fees or write-offs.  After the work-in-progress reports were reviewed by the directors, the office administrator would prepare the invoices.  Only chargeable time was included in the work in progress reports.

[5]      In February 2010, Mr Ogier discovered that the accused had been spending a significant amount of time working for one particular client, Mr Clare.   Mr Ogier discovered that the time the accused spent working for Mr Clare had not been billed for 18 months.   Rather he had charged his time to an honorary code, which was generally used for non-chargeable work.

[6]      Mr  Ogier  subsequently  located  a  spreadsheet  on  the  TOL  work  server prepared by the accused called “Loan Clare”.   The spreadsheet showed that the accused or entities associated with him had borrowed considerable sums of money from Mr Clare.

[7]      The  Crown  says  that  the  spreadsheet  also  showed  that  the  value  of  the unbilled time had been offset against the amount owing to Mr Clare…