Dominion Finance trial – take two

The trial of three Dominion Finance directors restarts today with a new, non-conflicted judge.

The judge-alone trial of Dominion Finance boss Paul Cropp, director Robert Barry Whale and a third man with name suppression had an unusual setback last week when Justice Pamela Andrews stepped down over a career crossover with Mr Whale.

Justice Andrews realised after the trial had started last Monday that she had been a partner at law firm Kensington Swan at the same time as Mr Whale.

She stepped down from hearing the trial on Wednesday, before proceedings entered a third day.

A new trial will start this morning before Justice Graham Lang, where Crown prosecutor Brian Dickey will re-deliver his opening statements and recall the first of the Crown’s witnesses, including ex-Kiwi league player Matthew Ridge and “ratbag” property developer John Williams, who will have to fly in from Australia to give evidence for the second time.

The Serious Fraud Office has brought 12 counts of theft by a person in a special relationship against Messrs Cropp (four counts), Whale (five counts) and a third company executive whose name is suppressed (three counts).

SFO chief executive Simon McArley told NBR ONLINE he could not comment on the setback, as the trial was ongoing.

Comments from NBR ONLINE readers suggested the apparent memory lapse was unbecoming of a High Court judge.

“This is disgraceful. Judge Andrews knew full well who the defendants were before the case even got a hearing date and if she did not consider a conflict of interest when she was scheduled to sit on the bench for the hearing, well shame on her. Another waste of taxpayer money. This sort of nonsense has to stop,” says a comment left by one reader.

The new trial is expected to last for a month.

The SFO alleges the directors breached the financier's trust deeds when they took part in unauthorised related-party lending to the value of more than $20 million.

This related to allegedly stripping cash from Dominion Finance Holding's subsidiary North South Finance in favour of Dominion Finance Group, in order to stave off receivership.

A fourth director Terence Butler, who has cancer, was excused from the trial late last year.

In June, the three men face more criminal and civil charges, brought by the Financial Markets Authority after its separate investigation into Dominion's collapse.

Dominion Finance Group was placed in receivership in 2008, owing almost 6000 debenture holders $176.9 million. North South Finance was placed in receivership two years later, owing 3900 debenture holders $31 million.

Both companies were subsidiaries of NZX-listed Dominion Finance Holdings, which was placed in liquidation in 2009. They offered property and commercial loans.

Receivers have estimated recoveries of 10c-25c in the dollar for debenture holders in Dominion Finance Group and of 65c-70c in the dollar for those in North South Finance.

gbond@nbr.co.nz

This article is tagged with the following keywords. Find out more about My Tags

Comment & Question

Commenter icon key: Subscriber Verified

Post New comment or question

Plain text

  • No HTML tags allowed.
  • Web page addresses and e-mail addresses turn into links automatically.
  • Lines and paragraphs break automatically.

NZ Market Snapshot

Forex

Sym Price Change
USD 0.7785 -0.0048 -0.61%
AUD 0.8853 -0.0020 -0.23%
EUR 0.6219 0.0005 0.08%
GBP 0.4869 -0.0028 -0.57%
HKD 6.0413 -0.0333 -0.55%
JPY 87.4210 1.8540 2.17%

Commods

Commodity Price Change Time
Gold Index 1171.1 -27.000 2014-10-31T00:
Oil Brent 85.9 -0.380 2014-10-31T00:
Oil Nymex 80.5 -0.520 2014-10-31T00:
Silver Index 16.1 -0.310 2014-10-31T00:

Indices

Symbol Open High Last %
NZX 50 5370.2 5405.3 5370.2 0.33%
NASDAQ 4639.4 4641.5 4566.1 1.41%
DAX 9283.4 9339.3 9114.8 2.33%
DJI 17208.8 17395.5 17195.4 1.13%
FTSE 6463.6 6553.4 6463.6 1.28%
HKSE 23913.7 24046.4 23702.0 1.25%
NI225 15817.1 16533.9 15658.2 4.83%