DALLY TESTIFIES: CONVICTED KILLER TAKES STAND; DENIES HAVING ROLE IN SLAYING WIFE.

Byline: Don Holland Daily News Staff Writer

In a gamble to avoid a death sentence, convicted killer Michael Dally took the stand Monday and tearfully told the jury that he deeply loved his wife and played no role in her grisly slaying.

``I had nothing to do with the kidnapping, murder or the plan,'' Dally said after taking off his glasses off and turning to face the same jury that convicted him of those crimes two weeks ago. ``I happen to love my wife very deeply. I had nothing to do with my wife's demise.''

After answering a few questions from defense attorney James Farley, Dally fielded a barrage of pointed questions from Deputy District Attorney Lela Henke-Dobroth, the lead prosecutor in the case.

With his voice trembling occasionally, Dally persistently evaded the prosecutor's questions. At times, Henke-Dobroth was forced to ask the same question three times before getting Dally to respond with a direct answer.

Dally conceded that he had told an acquaintance that his wife, Sherri, had been kidnapped just hours after she disappeared from the parking lot of a Target store in Ventura.

But that remark, Dally testified, was based on his assumption that his wife had come to some harm - not direct knowledge of the kidnapping and murder plot, which another jury determined was carried out by his longtime lover, Diana Haun.

``The only way Sherri wouldn't come home or call me is if someone took her,'' he said.

But later, Dally testified that he thought that his wife might have been hiding in a motel in retaliation for his affair with Haun, whom he met at the supermarket where they both worked. ``I just kept waiting, wondering and worrying,'' he said.

Henke-Dobroth asked how, if Dally was so worried about his wife, he and Haun could have gone to the movies and then had sex in he and his wife's bed two days after the day-care worker disappeared.

``I was in love with two women,'' Dally responded. ``I didn't believe one would hurt the other.''

While prosecutors presented no direct evidence during his trial that Dally participated in the kidnapping and stabbing of his wife, they convinced jurors he had masterminded the scheme and manipulated Haun into actually committing the killing.

Dally, 37, did not testify during the first phase of his trial, when jurors found him guilty of conspiracy, kidnapping and first-degree murder. Nor did he appear on a list of witnesses that defense attorneys turned over to prosecutors last week.

But Dally and his attorneys decided that his own testimony might be needed to win him a sentence of life in prison without parole.

``This is not a cheap sympathy pitch,'' defense attorney Farley told the jury in his brief opening statement.

But much of Dally's testimony focused on his love for his wife and their two sons, who now are living with his father, Lawrence.

Dally testified that he was emotionally torn up by his wife's murder, but showed little sorrow because of the traditional Japanese stoicism that he learned from his mother.

``I keep my feelings to myself,'' said Dally, whose testimony will continue today. ``I keep my love inside of me. I keep my hurt inside of me. I keep my problems inside of me.'' Dally also said that many of the witnesses who testified against him during his trial - former co-workers, previous lovers and prostitutes he sometimes hired - were either lying or were simply wrong about the facts.

Although some spectators said they did not believe Dally's testimony, his father said he thought his son stood up well under tough questioning from prosecutors.

``This is his first time that he ever talked, you know,'' Lawrence Dally said outside court. ``I always think positive when it comes to my son. But honestly, I think he was credible. He's telling the truth as best as he can tell it.''

Dally's surprise appearance on the witness stand capped off a morning o`f testimony from family and friends of Sherri Dally.

For the first time, Sherri Dally's father, Ken Guess, testified. He recalled how he walked her down the aisle on her wedding day.

``I gave her to somebody who said he was going to love and cherish her,'' said Guess. ``I regret that because he didn't.''

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PHOTO (Color) Michael Dally

Says he loved spouse