4 Mar 2014

Ex-mayor knew work unlawful - Crown

9:00 pm on 4 March 2014

A former central Hawke's Bay mayor conspired with a property developer to get loans from a finance company without investors knowing, the Crown has told a court.

Hugh Edward Staples Hamilton has denied charges of theft by a person in a special relationship, making a false statement as a promoter and making a false statement as a trustee.

Prosecutor Nick Williams told the High Court in Auckland on Tuesday that Mr Hamilton was a lawyer and represented Raymond Schofield when Mr Schofield bought Belgrave Finance in 2005.

However, Mr Williams said Mr Schofield's name was left off the documents so he could take out loans with Belgrave Finance for the benefit of his companies and the key issue at the trial would be Mr Hamilton's state of mind.

Mr Williams said Mr Hamilton's defence is likely to be that he acted on instructions and made a mistake, but Mr Williams said Mr Hamilton has 40 years of experience as a lawyer and knew that he was acting unlawfully.

Defence lawyer John Robertson told the court his client may have been overworked and out of his depth, but he did nothing wrong.

Mr Robertson said there were plenty of other people who should have been monitoring the Belgrave Finance books aside from Mr Hamilton.

The Crown says the deal was hidden so Mr Schofield could take millions in loans to himself and businesses he controlled.

But Mr Robertson said his client was only following instructions. He said it is ironic that the Serious Fraud Office is relying on his client's meticulous records but questioned why Mr Hamilton would keep such records if he was doing something wrong.