Serious Fraud Office v Burns

[2014] NZHC 293

IN THE HIGH COURT OF NEW ZEALAND WELLINGTON REGISTRY

CRI 2013-485-86 [2014] NZHC 293

SERIOUS FRAUD OFFICE Applicant

v

JAMES STEPHEN BURNS ANTHONY JOHN HENDON JOHANNES HENDRIK MIDDLEDORP NOELENE KAY BANTON

Respondents

Hearing:                   25 February 2014

Counsel:                  G J Burston and P W Gardyne for Applicant

N J McKessar for Burns
S J Gill for Hendon

I M Antunovic for Middledorp and Banton

Judgment:                27 February 2014

JUDGMENT OF SIMON FRANCE J

[1]      This is an application by the Crown, pursuant to s 28J of the District Courts

Act 1947, to transfer these proceedings to the High Court.

[2]      The four accused are charged with what is sometimes called “pro-forma invoicing fraud” whereby invoices are rendered to recipients for fictitious services. Here the allegedly fictitious invoices involve claims that advertisements were placed in magazines on behalf of the invoiced organisations.   The scale of the alleged offending  is  significant  –  for  Messrs  Burns  and  Hendon  it  is  $1.076 million involving 884 alleged victims.   For Mr Middledorp and Ms Banton it is $477,000

involving 721 victims.  Fifty of the victims are common to both pools.  There is a

SFO v BURNS, HENDON, MIDDLEDORP & BANTON [2014] NZHC 293 [27 February 2014]

single charge against all four defendants of being a member of an organised criminal group, plus 24 charges against Messrs Burns and Hendon of using a document with intent to defraud and 10 such charges against the other two defendants.

[3]      Referencing the factors identified in R v Cozens,1 the Crown emphasises the gravity of the offending with particular focus on its scale, the likely complexity of the proceedings, the importance and profile of the case, and the interests of justice generally.

[4]      The  application  is  opposed  by  all  defendants.2    The  primary  focus  of opposition is that, broken down, the issues and tasks that will arise are ones that are routinely managed in the District Court.  It is submitted that in essence the case is just a charge of fraud, and it is noted document intensive cases occur often in the District  Court.    Similarly,  District  Court  Judges  routinely  deal  with  the  likely pre-trial topics of hearsay and propensity.   Nor, it is submitted, does the likely presence of large amounts of aural interception material affect matters.

[5]      In my view the application should be granted.   I acknowledge the points made by defence counsel but observe almost every criminal case can be broken down and analysed to some very basic concepts.  The real question is whether the combination of features means transfer to this Court is appropriate.

[6]      This  is  an  important  case  focussing  on  a  relatively  unexposed  type  of offending.   There are several accused who will appear not only in relation to the specific instances,  but  who are  brought  together by a  criminal  organised  group

charge. The alleged fraud is large both in dollar amounts and the number of victims.

1      R v Cozens HC Rotorua CRI 2006-087-1443, 24 May 2007, Asher J.

2      Mr Middledorp and Ms Benton are still awaiting a legal aid decision.   Mr Antunovic filed a notice of opposition and appeared to explain the situation and make very brief submissions. However, he does not have disclosure and could not realistically substantially contribute.  I am satisfied the opposing argument was adequately carried by counsel for the other defenda nts and there are, in the circumstances of the case, no defendant specific issues to consider on the application.

[7]      Experience suggests  these features  produce complexity,  and  a volume  of material and decisions, that are suited to determination in this Court.  Section 28J is not about “who can do what” but rather allows for reallocation of trials where, in advance, the interests of justice appear to require it.

[8]      Here there will be pre-trial decisions required, it appears, on hearsay and propensity.  The case will require careful management prior to the hearing.  At the hearing there will be a large quantity of documentation and it appears a large amount of intercepted conversations.   This is an unusual feature for a fraud trial.   It is anticipated the trial will take six to eight weeks.

[9]      Considering the nature and scale of the allegations, the subject matter, and the type of trial likely to occur, I conclude the Crown has discharged its onus.  It is in the interests of justice that the case be transferred to the High Court and I direct accordingly.

[10]     For completeness I record that it does appear that a decision either way would significantly alter when the trial could be heard.

Simon France J

Solicitors:

Hardy-Jones Clark, Blenheim

C Nicholls, Barrister & Solicitor, Lower Hutt

I M Antunovic, Solicitor, Wellington