The Court of Appeal dismissed Auckland building contractor Stephen Eugene Foley’s appeal on cultural grounds for a reduction in sentence of two years eight months’ imprisonment for aiding and abetting his two companies in their failure to forward $356,000 PAYE deductions to Inland Revenue. Of Maori heritage, Foley said his actions were culturally consistent with an obligation to look after wider whanau, keeping them employed.
At their peak, his two companies had 89 employees. Foley said his contracting business provided opportunities for ‘fugitives’ from society. Neither company is currently trading.
The Court of Appeal was told Foley selectively paid company creditors, failing to forward PAYE deductions to Inland Revenue over periods spanning 2014 to 2017. Foley said a liquidity crunch arose because his business grew too fast.
While support for whanau is a strong component of Maori culture, the Court of Appeal said, equally important is the cultural duty to discharge obligations to others. Loyalty to employees with efforts to keep a failing business alive does not justify ignoring obligations owed the wider community by accounting for taxes due, the court ruled.
Separately, Foley said his sentence should be reduced because of an offer to pay reparations to Inland Revenue out of future income. Foley claims to have been offered a job paying $140,000 per year. Taking up the job requires his prison sentence be converted to home detention.
The Court of Appeal remitted his case to the District Court for a sentence review. The District Court is to check whether any reparations promised to date have been paid and also consider terms of his promised future employment.
Foley has yet to start his current sentence. The court was told he was bankrupted in 2001, and again in 2018. He has a history of business failures having been director of other companies which went into liquidation with unpaid debts, including unpaid tax debts.
Foley v. R – Court of Appeal (19.09.23)
23.158