Fraud: R. v. Robinson

Approved financial adviser Andrew Hrothgar Robinson was sentenced to six years jail for theft after stealing $2.69 million from clients of his company Strategic Planning Group Ltd.

Justice Muir described the thefts as premeditated, serious and sophisticated in the way Robinson used plausible explanations to have clients transfer funds out of their own accounts into his trust account from where funds were stolen between March 2010 and December 2012.  He targetted elderly clients, using guest lecture presentations at the likes of the University of the Third Age to gain introductions.

About twenty per cent of the money stolen was used to pay business and personal expenses, with the balance stolen to cover client losses.  Robinson said he was too afraid to tell clients about investment losses.  Handling client monies became akin to a Ponzi scheme.  One client was robbed to pay another.  The true state of each client’s individual investment accounts was hidden by issuing false investment and portfolio reports.  Thirteen clients, both individuals and trusts, were affected with sums invested ranging between $43,000 and $500,000.

R. v. Robinson – High Court (17.05.15)

15.081

Real Estate: Nottingham v. Real Estate Agents Authority

The Real Estate Agents Authority has been ordered to reopen a misconduct hearing against Royal Oak based Ray White franchisee Martin Honey after rival Dermot Nottingham appealed to the High Court.

Mr Nottingham’s real estate sales licence was not renewed after Mr Honey complained to the Authority about what he called “Mr Nottingham’s history of crime and psychopathic behaviour” in the course of a dispute between the two over alleged misuse of internet property listings.  After the Authority dismissed Mr Nottingham’s complaints about alleged misconduct by Mr Honey, the High Court ordered a reconsideration on grounds the Authority had apparently misunderstood the significance of evidence provided and crucially had failed to take fresh evidence into account.

The High Court in Auckland was told Dermot Nottingham, Phillip Nottingham and Robert McKinney purchased the Onehunga RE/MAX real estate franchise in October 2009.  Martin Honey operated in the neighbouring suburb of Royal Oak, initially as a RE/MAX franchise but rebranded from February 2009 as a Ray White franchise.  Allegations followed that Mr Honey was continuing to use the RE/MAX website for listings and sales while maintaining his own Ray White website.  When challenged, Mr Honey said he took down the RE/MAX link in April 2010 when made aware of the issue.  Mr Nottingham alleged that Mr Honey and his web designer deliberately and dishonestly maintained the RE/MAX link to poach business.  This allegation was dismissed following a hearing before the Real Estate Agents Authority along with a further allegation that Mr Honey made a false complaint to the Authority about Mr Nottingham’s behaviour in the course of their dispute.  Mr Honey sent a letter to the Authority in February 2011, with a copy forwarded to the Minister of Internal Affairs, alleging overbearing and intimidatory behaviour by Mr Nottingham.  Mr Nottingham said the allegations were false, designed by Mr Honey to minimise culpability and to garner sympathy for Mr Honey and his family.

Ordering the Authority to reopen its misconduct hearing against Mr Honey, Justice Thomas said the Authority had failed to properly consider two matters: evidence from one of Mr Honey’s former staff who said she had told him in July 2009 that the firm’s Ray White listings were being duplicated on the RE/MAX website and new evidence from a former personal assistant, now living in South Africa, stating part of her daily routine was to load property pictures and details onto both websites as had been instructed by Mr Honey.

Nottingham v. Real Estate Agents Authority – High Court (10.07.15)

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Fraud: R. v. Scutts

Sentencing former NZ Wine Company chief executive Peter Scutts to home detention for taking $64,000 in secret commissions on Australian wine sales, Justice Peters said the seniority of an employee is one of the criteria to be taken into account when determining the penalty.

Peter John Scutts was convicted on one charge of breaching the Secret Commissions Act and sixteen Crimes Act fraud charges following backhanders received on sales by Liquor Marketing Group Australia of NZ Wine product.  Over a 19 month period he was paid $64,000 on sales by Liquor Marketing: roughly one dollar on each case of NZ Wine sold.  Liquor Marketing is a co-op supplying hotels, bars and liquor stores in Australia.

The High Court was told Scutts made a declaration of interest to the NZ Wine board about his family’s supposed involvement in the Liquor Marketing contract.  He stated a company called Rochfort Rees Wine Company Ltd, owned by his wife and son, had been asked to provide consulting services to Liquor Marketing in respect of the NZ Wine product and that his son would be the consultant.  This was misleading.  Scutts and his son jointly held 98 per cent of the company’s shares.  His son never did provide any consulting services.  The backhanders to Scutts were invoiced on Rochfort Rees letterhead and paid into an Australian bank account in Scutts’ name.

Evidence was given that NZ Wine became aware of the backhanders after the company merged with Foley Family Wines in August 2012.  The payments had not been recorded in Rochfort Rees’ financial records or its tax returns.

Justice Peters sentenced Scutts to eight month’s home detention.  NZ Wine recruited you and paid you well because of your expertise and abilities, she said.  NZ Wine was entitled to your undivided loyalty.

R. v. Scutts – High Court (21.05.15 & 10.07.15)

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Partnership: Coxhead v. Dwyer

Sold at the knock-down price of $200 in a forced sale for unpaid agistment fees, thoroughbred mare Miss Meena now races in Australia with placings in 22 per cent of starts.  Former part-owner and racing manager Mr Barry Coxhead sued unsuccessfully for conversion.

The High Court was told Mr Coxhead purchased Miss Meena in 2009.  Almost immediately the horse was syndicated.  Interests associated with Mr Coxhead retained 52% and brothers Harjit and Hardesh Dheil purchased the remaining 48%.  The horse was stabled with Mr Don Dwyer at his Pukekohe training facility.  Two years later, following token efforts to get the Dheil brothers approval, Mr Coxhead decided to change trainers and move the mare to Taranaki.  A lawyer’s letter followed, written by solicitor Ms Mary Hackshaw – described to the court as Mr Dwyer’s domestic partner.  In the letter she pointed out Miss Meena is owned by a syndicate and decisions about the mare required consent from all syndicate members.  Evidence was given that Mr Dwyer and Harjit Dheil shifted Miss Meena temporarily to an undisclosed location thwarting moves to shift her south.  Over the next five months Mr Coxhead paid his share of some but not all the monthly training and agistment fees owing to Mr Dwyer.  This resulted in Mr Dwyer claiming a lien over the mare for unpaid fees and putting the horse up for auction.

The Court was told Mr Coxhead planned to attend the auction either to buy the horse cheaply or to bid up the price.  He missed the auction.  NZ Bloodstock advertised the sale for 9 May 2012, but in fact the mare was sold by auction the preceeding day to comply with the lien notice which specified 8 May for a sale.  Ms Hackshaw was the purchaser at $200.  Ownership was later registered in the names of the Dheil brothers, Ms Hackshaw and Mr Dwyer.  Miss Meena now races in Australia.

Justice Heath dismissed Mr Coxhead’s claim in conversion.  The mare was not his personal property.  She was property of the syndicate: partnership property.  Mr Coxhead had no right to unilaterally claim exclusive possession.  All syndicate partners had a right to possession.  A failure to pay agistment fees meant the mare was lawfully acquired by Ms Hackshaw at the lien auction.    

Coxhead v. Dwyer – High Court (9.07.15)

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Kiwifruit: Strathboss Kiwifruit v. Attorney-General

Kiwifruit growers have High Court approval for a class action against Ministry of Primary Industries following allegations government negligence caused Psa bacterium to infect local orchards.  It is estimated 37 per cent of kiwifruit orchards were affected.

A class action enables multiple litigants with a common cause to group together and pursue their common claim.  It is claimed some 1200 orchards were infested with Psa causing substantial crop losses and requiring removal of affected vines.  Auckland-based LPF Litigation Funding Ltd is financing the class action.

It is alleged the bacterium arrived in a 4.5kg consignment of kiwifruit pollen imported from China in 2009.  The following year, Te Puke orchards next to the importer were found to be infected. Growers claim Primary Industries was negligent and breached the Biosecurity Act by not strictly controlling the form of imported pollen.  Psa was first identified in Italy, around the Lazio region in 2007 or 2008.

Justice Dobson gave individual kiwifruit growers until 9 October 2015 to “opt-in” and join the class action.  LPF Litigation Funding was ordered to put up $250,000 security to cover the Ministry’s costs for preliminary steps prior to trial.  Primary Industries denies liability.

Strathboss Kiwifruit v. Attorney-General – High Court (8.07.15)

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