Mayer v R [2015] NZCA 206 (29 May 2015)

Last Updated: 4 June 2015

IN THE COURT OF APPEAL OF NEW ZEALAND
CA100/2014 [2015] NZCA 206
BETWEEN	MALCOLM DUNCAN MAYER Appellant
AND	THE QUEEN Respondent

Hearing:	5 March 2015
Court:	Harrison, Fogarty and Dobson JJ
Counsel:	P Dale for Appellant T Simmonds for Respondent
Judgment:	29 May 2015 at 2 pm

JUDGMENT OF THE COURT

A The appeal against conviction is dismissed.

B The appeal against sentence is dismissed.

____________________________________________________________________

REASONS OF THE COURT

(Given by Harrison J)

Introduction

[1] Malcolm Mayer was found guilty following a five week trial before Judge Gibson sitting without a jury in the Auckland District Court on 16 counts of dishonesty using document and 10 counts of using a forged document.^[1] He was convicted and sentenced to six years imprisonment with a minimum period of imprisonment of three years.^[2]
[2] Mr Mayer appeals against both his conviction and sentence. His counsel, Mr Dale, who did not appear at trial, accepts that the Judge had an adequate evidential foundation for returning guilty verdicts on all charges. He does not assert that the Judge erred in fact or law. Instead, Mr Dale submits that the prosecutor deliberately misled both the Court and defence counsel when advising that the Crown was unaware of the whereabouts of Mr Mayer’s co-accused, Simon Turnbull, who had left New Zealand before trial. He says that the prosecutor’s misconduct was sufficiently egregious to justify a retrial. Alternatively, he says that it raises the risk of a miscarriage of justice.
[3] Mr Mayer appeals against the finite sentence on the ground that it was manifestly excessive and against the minimum period on the ground that it was inappropriate.

Facts

[4] While the trial lasted for five weeks, the essential facts were not in material dispute.
[5] The charges against Mr Mayer fell into three categories or tranches as they were called. In the first group he was charged alone with seven counts of fraud. In the second and third groups he and Mr Turnbull were charged jointly with 29 counts of fraud.^[3]
[6] The charges arose from Mr Mayer’s financial relationship with Trustees Executors Ltd (TEL), which is and was a second tier financier. Its policy was to lend a maximum of 80 per cent of a property’s registered value or $4 million in total to one borrower or an associated entity or entities. On 26 occasions between December 2003 and August 2007 Mr Mayer applied successfully to TEL for loans for himself or other entities, some of which were fictitious. False documents were tendered in support of all applications.
[7] Mr Mayer’s modus operandi was simple but crude. He practiced what is known as price hydraulicing. In the first category of transactions a fictitious party created by Mr Mayer would enter into an agreement to purchase property from a genuine vendor. The fictitious purchaser immediately entered into a second agreement to on sell the property to Mr Mayer or an associated entity at an inflated price. Mr Mayer then submitted the second or bogus agreement, but not the first or genuine agreement, to TEL in support of a financing application. In the result, TEL advanced Mr Mayer 80 per cent of the inflated purchase price. The loan equalled or exceeded the actual price paid under the first agreement. By this means Mr Mayer was able to secure 100 per cent financing to purchase seven properties. TEL loaned him just under $6 million on these transactions.
[8] In the second category of transactions were five properties which Mr Mayer or an associated entity agreed to sell to a company in which he was the sole shareholder and director. Mr Mayer immediately agreed to on sell the properties to Mr Turnbull or an associated entity. A further four properties were sold directly from one of Mr Mayer’s entities to one of Mr Turnbull’s entities. Again, Mr Mayer submitted the second or bogus agreements but not the first or genuine agreements to TEL in support of finance applications, allowing Messrs Mayer and Turnbull to obtain 100 per cent financing for their acquisitions..
[9] In some cases Mr Mayer also submitted deeds of lease to demonstrate a sufficient rental income flow to service mortgage outgoings. But no rental was ever paid. TEL advanced funds to the companies under Messrs Mayer and Turnbull’s control of $20.248 million secured over these nine properties.
[10] In the third category of transactions were ten properties which either Mr Mayer or a Turnbull associate purchased from a genuine vendor. As with the other two categories, successive but contemporaneous sale and purchase agreements were then entered into between the first Mayer or Turnbull associated entity and a second Mayer or Turnbull associated entity. Again, only the second or false agreements were submitted by Messrs Mayer and Turnbull to TEL in support of each finance application. So too were false lease agreements. By this means Messrs Mayer and Turnbull were again able to obtain 100 per cent financing for their purchasers, to a total of $21.629 million secured over ten properties.
[11] In total Mr Mayer either on his own or jointly with Mr Turnbull obtained advances from TEL of $47.845 million. Judge Gibson found that TEL’s net losses as a result of the fraud, allowing for sums recovered in exercising its mortgagee’s powers, were $19.146 million.
[12] In a subsequent interview with a weekly newspaper Mr Mayer essentially admitted his deception of TEL. As Judge Gibson noted:

[38] Mr Nottingham [a real estate agent engaged by Mr Mayer] arranged for a reporter, Mr A B Wall, to interview Mr Mayer on 5 September, 2009. Mr Wall was a reporter for the Sunday Star-Times and a story about Mr Mayer based on the interview was published in that paper on 6 September, 2009. Mr Mayer accepted he was aware of the TEL limit of lending per entity and insofar as the use of ‘dummy’ purchasers identified as members of his wife’s family or staff members, or members of Ms de Magalhaes and her husband’s family, he said that TEL was aware there were family members and there was a linkage but they did not ask and he did not tell, saying “As Dermott has pointed out to me that I didn’t think at the time there was anything significantly wrong in that but as Dermott has pointed out to me as well, there was obviously poor judgement on my part.”

[39] Mr Mayer also said he was aware TEL held him in high regard and trusted his judgement. He also agreed the agreements for sale and purchase shown to TEL were entered into using persons who would not have a beneficial interest in the property but so they could borrow from TEL without its $4 million cap not seen to be breached. He said he was guilty of omission in relation to the future settlement agreements with Mr Turnbull by not disclosing them to TEL and overall saw his actions as “crimes of omission” He accepted he had misled TEL but said that at the time he did not think it was significant or hurtful to anyone.

[40] He accepted that he represented to TEL that deposits were paid on the transactions for which agreements were disclosed but admitted knowing that they had not been and tacitly agreed with the comment that TEL would think the applicant was contributing cash to the purchase, when in fact that never occurred.

Defence

[13] Mr Mayer gave extensive evidence at trial. His defence was apparently based upon a claim of right. In defending the first category of offending Mr Mayer relied in particular on the factors that (a) all the purchases in the first tranche or category were supported by current market valuations; (b) he was attempting to use equity which had been achieved by purchasing a property at a price substantially lower than the current market valuation; and (c) there was no evidence that TEL had advised him of its loan to value ratios. In defending the second and third category of charges he relied on the fact that he was the vendor of properties with an equity of about $11 million which he could have sold on the open market; and that he had no obvious motive for defrauding TEL. Mr Turnbull was the real beneficiary. On three occasions, he asserted, Mr Turnbull had actually forged his signature.
[14] However, a compelling inference of dishonesty was available from Mr Mayer’s admission that he had prepared and presented to TEL a series of fabricated documents for the apparent purpose and with the invariable effect of persuading it to advance loans to himself and his associated entities for amounts in excess of its prescribed lending ratios. He admitted to a consistent pattern of deceit and forgery. On analysis, his real or underlying defence was one of justification. Its prospect of success in these circumstances was unpromising.
[15] Mr Mayer’s only chance of acquittal was to give an exculpatory explanation on oath which might raise a reasonable doubt about dishonesty. In forthright terms Judge Gibson rejected Mr Mayer’s evidence and his defence. It is unnecessary for us to examine the detail of his thorough and well articulated reasoning. Two examples will suffice. The first was his succinct and unchallengeable finding that:

[90] As will be seen from the reasons for these verdicts I have not accepted Mr Mayer’s evidence that he was not acting dishonestly or that he believed he had a claim of right to use the documents in the way he did. Firstly he concealed the true purchaser from TEL. I am quite satisfied that he did this to circumvent TEL’s internal requirements in relation to the cap. Accordingly he acted dishonestly and knew he was at the time. He admitted to Mr Wall that he misled TEL. He acted dishonestly in providing false agreement for sale and purchases to TEL and mortgage applications which were untrue. Although these were in the names of the nominated purchaser, and not Mr Mayer, for obvious reasons he was the facilitator of the applications and effectively managed them, both for himself and with Mr Turnbull. I do not accept his claim of right defence. That was based on his assertion that he had created an equity through judicious purchasing and could borrow against it. The flaw in that theory is the mortgagee was entitled to know about the matter and it was not for Mr Mayer to decide whether they should choose to lend on the valuation or the higher agreement for sale and purchase, when he had, contemporaneously, entered into agreements to purchase at a lower price. He knew that. That was the reason he disguised the purchasers and also the reason he only provided, what were false documents, namely fraudulent agreements for sale and purchase that were in effect shams. I am satisfied he did not misunderstand TEL’s lending criteria, he knew them only too well, hence the success of the scheme and he knew he was obliged to deal with the mortgagee in good faith, but quite deliberately chose not to be able to pursue the scheme. Therefore the defences of claim of right or not acting dishonestly fail in respect of each of the counts. He fully realised at the time that what he was doing was dishonest and that he had no proprietary or possessory right in the property, which were the documents, that allowed him to deliberately mislead TEL.

[16] Subsequently, when explaining his reasons for finding Mr Mayer guilty on a specific count, the Judge said this:

[300] Overall I find all the elements the Crown are required to prove for this count proved to the required standard of proof and find Mr Mayer guilty of the same. He well knew what he was doing was dishonest. He also knew that he had no right to use these documents in this way, even if he genuinely believed there was an equity created by judicious purchasing, because he well knew that any borrowing against that “equity” could only be legitimate if TEL was truly aware of the situation and made an informed decision to lend accordingly. Because he was aware, through his occupation as an active property investor and developer, of the unlikelihood of this happening he, once again, reverted to forging documents and causing them to be used as if they were genuine and allowed TEL to rely upon them as if they were.

Mr Turnbull

[17] The focus of Mr Dale’s argument for Mr Mayer was on information which John Dixon, the Crown prosecutor, acquired about Mr Turnbull on two separate occasions – first on 11 September 2011 and later on 7 and 8 October 2013. Both Mr Dixon and Gregory Bradford, Mr Mayer’s second trial counsel, swore affidavits. But, significantly in Mr Dixon’s case, neither witness was cross-examined.
[18] The brief background as relayed by Mr Dixon was this. In March 2008 Mr Turnbull, who came from South Africa but had family in Portugal, left New Zealand. In July 2008 the Serious Fraud Office (SFO) commenced its investigation into Mr Mayer’s conduct. Shortly afterwards Mr Mayer advised a newspaper reporter that he understood Mr Turnbull was doing business in Hong Kong.
[19] In mid 2010 the SFO laid charges against Messrs Mayer and Turnbull. In November 2010 Mr Mayer’s then senior counsel inquired of the SFO into Mr Turnbull’s whereabouts. In response, the SFO advised that it did not know where Mr Turnbull was located.
[20] In September 2011 an SFO investigator advised Mr Dixon by email that he had received a call from a person identifying himself as “Edward” who stated that Mr Turnbull was living in Singapore at an identified address. The SFO’s informant expressed a wish to remain anonymous and advised that his information was six weeks old. While Mr Dixon was initially attracted to the idea of making further inquiries, he soon began to entertain doubts about the veracity of the information. He did not consider it necessary or appropriate that the SFO should disclose it.
[21] In summary, Mr Dixon made this decision because (a) he doubted the veracity of the information, influenced by advice from the SFO of its inability to verify it; (b) even if the address was accurate, it was not material which the Crown was obliged to disclose given that Mr Turnbull had not been interviewed so that s 13(3)(c) of the Criminal Disclosure Act 2008 (the CDA) did not apply and it was not otherwise relevant to Mr Mayer’s culpability; and (c) if the information was in fact accurate, it might lead to the Crown deciding to apply for Mr Turnbull’s extradition with the result that it would be protected under s 16(1)(a) of the CDA.
[22] When Mr Mayer’s first trial started on 7 November 2011, Mr Dixon advised the Judge that the Crown was unaware of Mr Turnbull’s whereabouts. The trial, which was scheduled for four weeks duration, ran for much longer. It was eventually aborted in mid 2012 because of Mr Mayer’s ill health.
[23] After further delays, a new trial was ordered. By then Mr Bradford was acting as Mr Mayer’s defence counsel. In June 2013, in the course of preparation for trial, Mr Bradford requested a copy of the Crown’s exhibits on CD-Rom. The SFO obliged but it had inadvertently loaded on to the CD its entire file including all communications between Mr Dixon and its investigators, including the email sent in September 2011 about Mr Turnbull. The documents were, however, in an electronic subfolder or directory entitled “Privileged”.
[24] Despite the Crown’s clear categorisation of the documents as privileged, Mr Bradford downloaded them, about one large ring binder’s worth. He later disclosed to Mr Dixon that he had possession of these documents. He refused Mr Dixon’s request to destroy them and return the CD. While there is force in Mr Simmonds’ criticism of Mr Bradford’s conduct in retaining and disclosing material that was plainly privileged and protected, we do not need to determine that point for the purposes of this appeal.
[25] On 7 October 2013, the day before Mr Mayer’s new trial commenced, another SFO investigator advised Mr Dixon that an informant named “Ed” had provided information about Mr Turnbull. He was said to be operating as a small time property developer in London. The informant said that he would provide an address within the next two or three days. Later that evening the informant sent an email to the SFO which provided links to two web pages listing Mr Turnbull as one of the people involved in an architectural business.
[26] When opening the Crown’s case at Mr Mayer’s new trial on 8 October 2013, Mr Dixon advised the Court that Mr Turnbull was not within the jurisdiction and his whereabouts were unknown to the Crown. He doubted the accuracy of the information supplied the previous day. Indeed, Mr Dixon is now aware that the London Metropolitan Police has since advised the SFO that Mr Turnbull had departed the United Kingdom on 13 July 2013. He has not returned.
[27] On his return from Court on 8 October, Mr Dixon received an email from a Mr Thomas (who is unknown to him). Mr Thomas advised that Mr Turnbull was in Texas and in a relationship with an oil executive there. As Mr Dixon observes, the state of Texas has a population of about 30 million people. Without an address, Mr Dixon had no means of pursuing this information.
[28] So, in summary, in a little over two years Mr Dixon had been given three possible overseas locations for Mr Turnbull from three separate informants who did not identify themselves. He did not in any event consider that Mr Turnbull’s whereabouts in 2011 or 2013 could possibly be relevant to Mr Mayer’s conduct in 2006 and 2007. It did not occur to him that Mr Turnbull might in any way assist Mr Mayer’s defence: to the contrary, he assumed that Mr Mayer’s defence would be enhanced by Mr Turnbull’s absence because he would be able to transfer blame to an absent party for the events giving rise to the second and third categories of charges.
[29] Mr Dixon concluded his affidavit with these statements:

39 I would hope it would be apparent that there is no reason why I would want to risk my professional reputation and mislead Mr Bradford or the Court about this information. The Crown had what I thought was an overwhelming case against Mr Mayer. It never occurred to me that Mr Turnbull's whereabouts would be relevant to that or that there was any realistic prospect of Mr Turnbull offering any assistance to Mr Mayer. Much more likely, any evidence Mr Turnbull sought to give would inculpate Mr Mayer.

40 I always doubted the information I had received about possible places where Mr Turnbull might be. I did not consider the unverified tip offs as to these possible places to be relevant or required to be disclosed. If I am mistaken about that, then I have made an error of judgement or a mistake of law, but I would hope that this would not be characterised as a deliberate attempt to mislead the Court or counsel because I can assure this Court that it was not.

Decision

Criminal Disclosure Act 2008

[30] Mr Dale advanced Mr Mayer’s appeal on two alternative bases. The first was to the effect that the prosecutor’s conduct was so egregious that of itself it was sufficient to warrant a retrial. The second was that, in the alternative, the alleged misconduct was such as to raise a risk of a miscarriage of justice.
[31] Before addressing both grounds, we note that the Crown’s obligations to make disclosure in criminal trials is governed by the Criminal Disclosure Act 2008. Its purpose is “to promote fair, effective and efficient disclosure of relevant information between the prosecution and the defence”.^[4] Relevance is the guiding principle for disclosure: information is relevant where it “tends to support or rebut, or has a material bearing on, the case against the defendant”.^[5]
[32] The terms of the obligation to make full disclosure are both prescriptive and comprehensive.^[6] We accept, however, that they are not exhaustive. Initially, Mr Dale suggested the information held by the Crown fell within the specified categories of standard information. However, when pressed he was unable to identify the particular category. We accept nevertheless that a residual duty may arise to disclose other information provided it satisfies the cornerstone test of relevance.
[33] Mr Dale emphasised the concept of relevance. In reliance on the decision of the Supreme Court of Canada in R v Dixon, he submitted that where a defendant demonstrates a reasonable possibility that the undisclosed information could have been used in meeting the Crown case, advancing a defence or otherwise making a decision which could have affected the conduct of the defence, then a breach of the Charter right to disclosure is established even if the material would have only marginal value to the ultimate issues at trial.^[7] For this purpose, the undisclosed information must be examined to determine the impact it might have had on the verdicts; if there is a reasonable possibility that on its face the undisclosed information affected the reliability of the conviction, a new trial should be ordered. And even if the undisclosed information does not affect the reliability of the result, the Court must stand back and consider its effect on the overall fairness of the trial process. In this respect the Court must consider the lines of inquiry which would have been available to the defence if the information had been disclosed.
[34] We are prepared for the purposes of determining this appeal to adopt that more expansive test of relevance. The question is whether there is a reasonable possibility that the Crown’s possession of information from unverified sources relating to Mr Turnbull’s whereabouts might have advanced or affected the conduct of Mr Mayer’s defence and thus the reliability of his conviction.

Misconduct

[35] In support of Mr Mayer’s first ground of appeal Mr Dale relied on the cumulative effect of two instances of alleged misconduct: (a) the prosecutor’s advice to the District Court on 7 November 2011 at the start of Mr Mayer’s first trial that the Crown was unaware of Mr Turnbull’s whereabouts when it had received specific information two months earlier that he was residing at an address in Singapore; and (b) the prosecutor’s advice to the Court to similar effect on 7 and 8 October 2013, at the commencement of Mr Mayer’s second trial, when the Crown’s information was that Mr Turnbull was residing either in London or Texas.
[36] In Mr Dale’s submission the prosecutor deliberately withheld relevant information on both occasions for the purpose and with the effect of misleading the Court. He described this conduct as egregious. He submitted that ordering a retrial would signal this Court’s requirement that the fundamental responsibilities of a prosecutor must not be ignored or flouted and affirm that the interests of justice are paramount. He relied particularly on the observations of Richardson J in this Court in Moevao v Department of Labour, emphasising the public interest in the due administration of justice to ensure that the Court’s processes are used fairly by the state and the associated interest in maintaining public confidence in the administration of justice which is not to be eroded where the Court’s processes may lend themselves to oppression and injustice.^[8] In cases where the prosecutor’s conduct is shown to be such that the Court is satisfied it is being employed for ulterior purposes or to cause improper vexation and oppression it may be appropriate to stay a prosecution in order to protect the Court’s own processes from abuse.^[9]
[37] However, as Richmond P noted in Moevao, the Court must be satisfied that the case is truly one of abuse of process rather than simply one involving elements of oppression or abuse of authority.^[10] We are satisfied that prosecutorial misconduct if proved in this case would fall within this second or lesser category of wrongdoing. Moreover, the Court does not intervene to exercise a power of stay for disciplinary purposes nor to reflect a view about the prosecution.^[11]
[38] In any event Mr Dale does not seek the remedy of a stay. He submits that the prosecutor’s alleged misconduct is sufficient of itself to warrant the remedy of a retrial because it may have affected the course and conduct of the defence. This response, he says, is necessary to restore public confidence in the judicial system.
[39] We are satisfied that an allegation of prosecutorial misconduct in these circumstances requires proof that the prosecutor (a) was under a duty to disclose information; (b) knew or ought to have known of that duty; and (c) made a conscious or deliberate decision not to disclose.
[40] There is no doubt that the prosecutor made deliberate decisions on two separate occasions, at the start of each trial, not to disclose to the Court that the Crown had received information about Mr Turnbull’s location. But a deliberate decision not to disclose information does not equate of itself with a deliberate decision to give misleading advice to the Court.
[41] Mr Dale submitted that we should infer deliberate misconduct from the prosecutor’s admitted state of knowledge and because some of his explanations for his decisions are questionable. He gave the example of Mr Dixon’s doubt about the veracity of the Singapore address given for Mr Turnbull in 2011. Also, he submitted that when Mr Dixon advised the Court at the start of the first trial that Mr Turnbull’s location was unknown, his obligation was to advise that the Crown had some information but did not consider it reliable. He asserted that it was not Mr Dixon’s right to make decisions about the weight to be placed on specific information.
[42] However, these propositions are simply points of debate, calling into question the grounds for the prosecutor’s decisions; they do not call into question Mr Dixon’s state of mind or his credibility. What they establish, along with all the other information held by the Crown, is that Mr Dixon had a reasonable factual foundation for his conclusion that he was not under a duty to disclose. We accept that another lawyer may have decided to advise the Court and the defence that the Crown had unverified information about Mr Turnbull’s location from an anonymous source which it did not consider reliable, bearing in mind that the prosecutor’s statement was made in the course of his explanation for the absence of the co-accused. But the possibility that another lawyer may have exercised his or her judgment differently on the same facts falls far short of proving an intention to mislead.
[43] In effect, Mr Dale asks us to disbelieve Mr Dixon’s explanation. However, in our judgment Mr Dale’s failure to confront Mr Dixon with that allegation is fatal. We are not prepared to disbelieve a statement made on oath by an officer of the Court, and find prosecutorial misconduct with all its attendant adverse professional consequences, without first assessing the credibility of an explanation under crossexamination. That is especially so where on Mr Dixon’s unchallenged evidence he made a decision reasonably available to him on the known facts. In the absence of that challenge, we reject this ground of appeal and exonerate Mr Dixon of any suggestion of misconduct.

Duty of disclosure

[44] The second or alternative ground of appeal advanced by Mr Dale was that nondisclosure of the information known to the Crown at the start of both trials gave rise to the risk of miscarriage of justice. He relies on Mr Bradford’s evidence that his approach to the trials and in particular his advice to Mr Mayer to elect trial before a Judge alone would have been different. He would likely have advised Mr Mayer to maintain his original election for a jury trial.
[45] Mr Bradford appreciated that the defence could not insist upon Mr Turnbull’s extradition. But he says he would have urged the Crown to take that course “because of the tactical advantages and importance to Mr Mayer”. If the Crown had refused to apply for extradition, Mr Bradford said he would have exploited that fact before a jury. Moreover, the resulting additional delay might have provided an opportunity for Mr Bradford to persuade the Crown that it should extradite Mr Turnbull.
[46] Mr Bradford learned about this information on 27 September 2011, about five weeks before Mr Mayer’s new trial was due to commence. By this stage events had moved on and he considered that there was little he could do with the information. He thought that it was stale and he doubted Mr Mayer’s prospects of reversing his election.
[47] We accept that the fact that the Crown had received information relating to Mr Turnbull’s whereabouts, even if doubts were held about its reliability and utility, would have been of interest to Mr Mayer and his counsel. But the fact that information is of interest does not mean it satisfies the threshold of relevance. The question remains of how it might reasonably have been used to rebut the Crown case.
[48] Mr Dale’s argument is based upon Mr Mayer’s loss of an opportunity to exploit the Crown’s failure to seek Mr Turnbull’s extradition. However, he did not attempt to satisfy us that the Crown had a proper legal and evidential basis for seeking Mr Mayer’s extradition from Singapore in September 2011. It is not for us to make Mr Mayer’s case on this point except to note that extradition to New Zealand is governed by pt 6 of the Extradition Act 1999. It prescribes who has the requisite authority to ask another country to extradite a person accused of an offence against New Zealand law and how such requests should be made.^[12] When New Zealand makes such a request, it must be determined by the recipient country’s extradition law and any treaty obligations – in particular the information that needs to be provided, what must be proved and the grounds for denying extradition.^[13] In general, the recipient country will require a New Zealand arrest warrant.^[14]
[49] Mr Bradford would have been unable to exploit the Crown’s failure to seek extradition unless he had been able to establish a basis for it. In the absence of satisfaction that the Crown could and should have pursued this avenue, with a likely prospect of success, we cannot give any weight to a suggestion that defence counsel would have been able to exploit the point at trial. It is independently fatal to this argument that, if the Crown was considering using the unverified information to support an extradition application to Singapore, the Crown would have been entitled to withhold it from disclosure under s 16(1)(a) of the CDA.
[50] Furthermore, we agree with Mr Simmonds that Mr Mayer’s counsel would not have gained any tactical advantage before a jury in advancing a collateral attack on the prosecution for failing to apply for Mr Turnbull’s extradition: the trial Judge would have been bound to respond by directing the jury that only Mr Mayer was on trial and it was to consider only the admissible evidence relating to his prosecution. Also, the length of the trial, the participation of over 40 witnesses and thousands of pages of documents would have resulted inevitably in an order that the trial proceed before a Judge alone.^[15]
[51] Mr Dale separately submitted that the available evidence suggests that Mr Turnbull, not Mr Mayer, was the primary offender on the second and third tranches of charges. As a result, Mr Mayer’s prospects at trial would have been improved if Mr Turnbull had been tried alongside him. Mr Turnbull was a potential witness and it is at least possible that, if he had given evidence at trial, he would have exonerated Mr Mayer. He may also have been the source of further information relating to his dealings with TEL or even the prosecution.
[52] In support of this submission Mr Dale referred to evidence of Mr Mayer’s ownership of assets worth $20 million, supported by independent and unchallenged market valuations; his substantial equity in the properties which form the subject of the second and third tranches of charges; Mr Mayer’s provision of cross guarantees for all borrowing so that his assets were ultimately available to TEL; and his refusal to be part of a fraud proposed by Mr Turnbull of claiming GST on the higher amounts payable under the second agreements. He also referred to Mr Mayer’s evidence that he wished to preserve anonymity because he was buying well in the market but with heavy reliance upon independent valuations. Mr Dale accepted that while this defence was difficult it was not hopeless given the complexity and uncertainty about TEL’s own lending practices.
[53] This submission must fail for three independent reasons. First, it assumes, again without establishing an arguable foundation, that the Crown with unverified knowledge that Mr Turnbull was somewhere in Singapore, London or Texas would have been able to extradite him before Mr Mayer faced trial for the second time. The argument leads nowhere unless Mr Mayer can show that if the Crown had taken all available legal steps Mr Turnbull would likely have been extradited to New Zealand. It is not enough to speculate about what might have happened in a joint trial without first establishing on a sound factual basis that Mr Turnbull would in fact have been present if the Crown had done all within its power to enforce that result.
[54] Second, Mr Dale’s submission is contradicted by his own acknowledgement that on the evidence available it was open to Judge Gibson to convict Mr Mayer. He did not explain how Mr Turnbull’s presence at trial might have assisted in advancing a line of defence based on the factors he identified except to assert that Mr Turnbull may have given evidence in support. His submission ignores both the overwhelming weight of the Crown evidence independently available against Mr Mayer including his own admissions and the Judge’s emphatic rejection of the credibility of its explanations. In any event, the Judge took into account the factors which Mr Dale emphasises. They made no difference to his findings of dishonesty on a substantial scale.
[55] Third, we agree with Mr Simmonds. Mr Turnbull was Mr Mayer’s cooffender. In a joint trial he would have been entitled to exercise his right of silence. Mr Mayer’s counsel would have no right to cross-examine Mr Turnbull unless and until he gave evidence in his own defence. And, apart from exonerating Mr Mayer, there is the more likely prospect that Mr Turnbull would have incriminated him. The prospect that at trial Mr Turnbull would assume sole responsibility for the offending where there was overwhelming independent evidence of Mr Mayer’s criminality does not warrant serious consideration.
[56] We draw attention also to the related procedural difficulties which Mr Mayer would face with the suggestion that he might have been able to run his defence along those lines. He would have had to apply for severance of his trial from that of Mr Turnbull in order to call Mr Turnbull for the defence. But “[s]everance on this ground will rarely be granted”.^[16] Such a course would be unavailable without a factual foundation showing there is a reasonable possibility that the co-accused would give favourable evidence as a defence witness.^[17] Mr Mayer has not attempted to establish that this is one of those rare cases.
[57] We add that even assuming Mr Turnbull might have followed the unlikely path described by Mr Dale, and fallen completely on his sword, the trial Judge would have inevitably disregarded exculpatory evidence from a co-accused which was inconsistent with the substantial body of evidence independently available to incriminate Mr Mayer.

Summary

[58] In summary, we are satisfied that the prosecutor was under no obligation to disclose this information. Its existence did not approach the relevance threshold required by s 8 of the CDA and Mr Dixon’s decision to advise the Court that the Crown did not at the material times know of Mr Turnbull’s whereabouts was correct. Moreover, even if it had been disclosed, there is no reasonable possibility that the information would have affected the reliability of Mr Mayer’s convictions. In our judgment the information would have had no effect whatsoever on the overall fairness of the trial process.
[59] The appeal against conviction must be dismissed.

Sentence

[60] Mr Dale submitted that the finite sentence was manifestly excessive. He did not challenge the starting point of seven years adopted by Judge Gibson. He submitted instead that the Judge erred by not discounting the starting point by two years, instead of one, for a number of factors.
[61] In particular he submitted that the losses caused by Mr Mayer were significantly less than those found by the Judge; that while the means of acquiring loan advances was dishonest, the existence of unchallenged current market valuations was the foundation for Mr Mayer’s belief that TEL would suffer no loss; Mr Mayer brought substantial equity into the transactions; he was a secondary offender on the second and third tranches of charges; and he is now bankrupt.
[62] We do not view most of these factors as mitigating against the starting point. Rather, they are relevant to the overall assessment of Mr Mayer’s culpability.^[18] In our judgment the starting point of seven years was generous to Mr Mayer. It could have been higher. We are satisfied that the end sentence of six years was well within range.
[63] Mr Mayer also appeals against the imposition of a minimum period of imprisonment of three years or 50 per cent of the lead sentence. Mr Dale submitted that this sentence takes no account of Mr Mayer’s age (he was 57 years of age), previous good conduct, substantial financial losses and the likelihood that he would not re-offend. In Mr Dale’s submission a minimum period of imprisonment should not have been imposed.
[64] We are satisfied that it was well open to the Judge to conclude that the otherwise applicable minimum period of imprisonment, in the absence of a nonparole period, would be insufficient to adequately denounce and deter Mr Mayer’s conduct. He was guilty of fraud on a very large scale, causing substantial loss.^[19] We note also, as Mr Simmonds submits, that the Judge took into account Mr Mayer’s age and personal circumstances when fixing a minimum period of imprisonment at 50 per cent of the lead sentence.
[65] The appeal against sentence on the finite and minimum periods of imprisonment must fail.

Result

[66] The appeal against conviction is dismissed.
[67] The appeal against sentence is dismissed.

Solicitors:
Crown Law Office, Wellington for Respondent

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^[1] R v Mayer DC Auckland CRI-2010-004-8862, 20 December 2013.

^[2] R v Mayer DC Auckland CRI-2010-004-8862, 18 February 2014.

^[3] 10 of which were laid as alternative counts.

^[4] Criminal Disclosure Act 2008, s 3(1).

^[5] Section 8.

^[6] Section 13.

^[7] R v Dixon [1998] 1 SCR 244.

^[8] Moevao v Department of Labour [1980] 1 NZLR 464 (CA) at 481; Attorney-General v District Court at Hamilton [2004] 3 NZLR 777 (HC).

^[9] At 482.

^[10] At 470–471.

^[11] Fox v Attorney-General [2002] NZCA 158; [2002] 3 NZLR 62 (CA) at [37].

^[12] Extradition Act 1999, s 61.

^[13] See Law Commission Extradition and Mutual Assistance in Criminal Matters (NZLC IP37, 2014) at [11.3].

^[14] Laws of New Zealand Extradition (online ed) at [6], [20]–[22]. See also Law Commission, above n 13, at [11.8]–[11.10].

^[15] Crimes Act 1961, s 361D; Wynyard v R [2015] NZCA 100.

^[16] R v Taylor [2007] 2 NZLR 250 (CA) at [35].

^[17] At [34(c)] and [39].

^[18] See also R v Varjan CA97/03, 26 June 2003 at [22].

^[19] See D’Villiers v R [2010] NZCA 85 at [14]–[27], where a minimum period of imprisonment was upheld as proper in cases of substantial dishonest offending of a serious kind.