SCF defence formalises call for judge to quit

Another attempt is being made to disqualify Justice Paul Heath from adjudicating over a High Court trial of two former directors and a chief executive of South Canterbury Finance who are charged with fraud.

Defence counsel attempted on Wednesday in verbal arguments to have the judge stand down, but will now take that to a formal level with a written application for him to recuse himself to be filed between now and Monday, when the trial resumes.

Justice Heath will then consider the application and rule on the application.

Two former South Canterbury Finance (SCF) directors, Edward Sullivan (72) and Robert White (70), and former chief executive Lachie McLeod (50) have denied charges of fraud involving $1.6 billion, New Zealand's biggest fraud trial, which is expected to last three to four months.

Justice Heath, who is sitting alone without a jury, rejected arguments on Wednesday he should stand down because of a comment at a conference on Friday by Serious Fraud Office director Julie Read. She said it was ''very fortunate to have Justice Heath as our trial judge''.

It was argued that could create a perception Justice Heath was biased, but he rejected that.

Yesterday, defence counsel discussed the issue during a three-hour lunch break. Bruce Squire QC, appearing for White, Pip Hall QC, for Sullivan, and Jonathan Eaton QC, for McLeod, decided to file the formal recusal application, along with two supporting affidavits.

Mr Squire said it had been decided to put the recusal issue ''on a formal footing''.

Justice Heath said the recusal application was ''obviously an issue that needs to be dealt with sooner rather than later''.

If he decided to recuse himself, the trial would have to stop until a new Justice was found.

If he declined the application, the trial would continue.

However, that could become a point of appeal if the defendants were found guilty.

The trial was supposed to continue today after the Crown's Colin Carruthers completed his opening statement just before lunch yesterday.

The defence counsel all declined to make opening statements.

The court adjourned until 2.15pm on Monday when it will hear arguments and consider affidavits, providing they can be sworn and filed by then, on the recusal application.

After that, the Crown will start calling about 40 witnesses, including two senior SFO officers who were virtually the officers in charge of the investigation, former SCF employees, people involved in financial dealings with the company and forensic or expert witnesses.


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