DALLY SENTENCED TO LIFE, NO PAROLE; FATHER OF TWO STILL DENIES GUILT IN WIFE'S MURDER.

Byline: Michael Coit Daily News Staff Writer

Still proclaiming his innocence, Michael Dally was sentenced Tuesday to life in prison without parole for conspiring with his lover to murder his wife, ending the sensational two-year case but easing none of the pain for Sherri Dally's family.

Judge Charles Campbell denied a defense motion for a new trial and pronounced the only sentence available. The same jury that convicted Dally of first-degree murder, kidnapping and conspiracy with special circumstances - lying in wait and committing murder for financial gain - deadlocked in April on whether to send him to Death Row.

At the sentencing hearing, Karlyne Guess testified that joy in her life vanished with the brutal death of her daughter, Sherri Dally.

``Her death has left me so empty, so sad. I can still feel the depth of that pain. It will not go away,'' Guess said.

Guess said that ``my life as I knew it stopped'' May 6, 1996, when Michael Dally called her to say that her daughter was missing. Sherri's remains, torn apart by animals, were found in a remote ravine north of Ventura on May 31, 1996.

``It took me a long time to get my mind out of that ravine,'' Guess said. ``It still bothers me. Other memories hit like a brick wall to send you back into grief.''

Michael Dally's father, Lawrence, declined to comment outside the courtroom on the sentence. Lawrence Dally is the legal guardian of Michael and Sherri Dally's two young sons.

He wrote a letter to the judge asking that his son be imprisoned close to Ventura County so that the boys can visit him. They have been visiting their father twice a week at the county jail, he said.

During her statement, Guess urged the judge ``to send him as far away as possible'' and not make it any easier for him to see the boys.

The judge noted in court that he has no control over where Dally will serve his sentence, as that is governed by the state Department of Corrections.

Dally, dressed in a blue jail outfit, also wrote a letter to the judge.

``I, Michael Dally, am innocent of all charges. Maybe one day the truth will be known,'' the letter says.

In the letter, he asked for a prison placement close to his sons so it would not be a hardship for his parents to bring them for visits. ``We love each other very much and are very close,'' he wrote.

Dally has been in the county jail since his arrest Nov. 15, 1996. His longtime lover, Diana Haun, was arrested May 18, 1996, released five days later, and then arrested for a second time Aug. 1, 1996.

She was convicted last fall of first-degree murder, kidnapping, conspiracy and the special circumstances of lying in wait and murder for financial gain. She also is serving a sentence of life in prison with parole.

County prosecutors said Haun disguised herself as a police officer, abducted Sherri Dally from a shopping center parking lot and then stabbed her to death. The victim's bloodstained seats of a car Haun rented just before Sherri Dally disappeared.

Witnesses said Haun was obsessed with Michael Dally, whom she met at work and wanted to marry. Witnesses also testified that Haun had talked about committing a human sacrifice as a birthday gift for her lover.

Guess also had testified at Haun's sentencing hearing. Her testimony at the hearing for her former son-in-law was lengthier, and she fought back tears while relatives, law-enforcement personnel and others listened in the courtroom.

Guess said her daughter was a caring and talented young woman who started an Indian Princess group in childhood, raised a puppy to be trained as a guide dog for a blind person, became the fastest supermarket checker around, and even learned how to change the oil in her car.

She excelled as a mother, Guess said.

``They were her life. She loved them so much. Her boys deserved their mother to raise them.''

Guess said the boys and others lost part of their lives when Sherri Dally was murdered. ``My dreams are shattered, and our hope is gone,'' testified Guess, who said her husband and son remain angry and sad.

Adding to the pain, she said, is Michael Dally's lack of remorse. She said he smoked a cigarette and said ``that wasn't so tough'' after completing the funeral plans for his wife.

But mostly Guess spoke about her only daughter, whose cremated remains are in an urn her mother sometimes holds to feel close.

``Losing her has taken the sun out of my days and the sleep out of my nights,'' Guess said.

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PHOTO (Color in Simi and Conejo Editions only) Michael Dally

Sends judge letter