Inland Revenue Department v Calvert [2019] NZDC 10634 (31 May 2019)

Last Updated: 18 September 2021

IN THE DISTRICT COURT AT HUTT VALLEY I TE KŌTI-Ā-ROHE KI TE AWAKAIRANGI

CRI-2019-096-000122

[2019] NZDC 10634

INLAND REVENUE DEPARTMENT

Prosecutor v

ERIC FRANCIS CALVERT Defendant

Hearing:	31 May 2019
Appearances:	Ms C Mailer for the Prosecutor Mr A Davie for the Defendant
Judgment:	31 May 2019

NOTES OF JUDGE A I M TOMPKINS ON SENTENCING

[1] Eric Calvert appears for sentence today having entered guilty pleas to 56 tax evasion charges relating to the non-payment of PAYE tax spanning the period 31 October 2011 through to 31 March 2017. As noted in the written submissions filed on behalf of the Commissioner, the total tax shortfall amounted to a little under

$950,000, late payments of around $720,000 have been made resulting in a core tax shortfall of around $230,000. That represents the loss to the community through the Inland Revenue and in addition includes some $13,000 of Kiwisaver employer contributions due to the electrical firm operated by the defendant for that period which represents a loss to those employees.

INLAND REVENUE DEPARTMENT v ERIC FRANCIS CALVERT [2019] NZDC 10634 [31 May 2019]

[2] As is apparent from the dates already mentioned, this offending occurred over approximately a seven year period and by Mr Calvert’s early guilty plea, he has acknowledged that he was aware of the requirement to pay to the Commissioner the relevant tax deductions by their respective due dates but instead applied those funds to other purposes as Mr Davie submits in his written submissions to keep the company operating that Mr Calvert had progressed up through the ranks from initially an on the job electricians role through to management, the latter role being one that he was perhaps not well suited to.

[3] Both counsel for the Commissioner and counsel for the defendant have traversed a number of sentencing authorities in their written submissions including the Commissioner v Morrow.1 Inevitably in cases such as this arithmetical comparisons are not possible and Mr Davie submits that a synthesis of the approach taken by the Court in those cases and particularly by reference to the core tax outstanding leads to a starting of two years, nine months’ imprisonment, slightly below the three year, three month to three year, six month starting point advocated for by the Commissioner.

[4] There does not seem to be much dispute but that Mr Calvert is entitled to discounts for his previous good record, albeit the offending occurred over a long period of time together with his remorse and regret as evidenced in the letter written to the Court today and the fact that as a result of these convictions he may have put in jeopardy his fit and proper standing under the electricians registration legislation and ultimately the very early guilty plea that was entered. In addition, Mr Calvert is prepared to pay reparation over and above the late payments that have already been made, albeit that will have to be paid at a rate of $100 per week.

[5] Overall, I accept Mr Davie’s approach. I take a starting point of two years, nine months and whilst acknowledging that this offending occurred over a longer period that some of the authorities referred to by Ms Mailer in her submissions, the comparisons of the core tax payment as analysed by Mr Davie justify that approach. From that starting point Mr Calvert is entitled to deductions for previous good character and the payments that have already been made together with the reparation

1 Commission of Inland Revenue (CIR) v Morrow [2016] NZDC 13908.

that will today be ordered totalling four months which brings the starting point down to 29 months. From that he is entitled to a discount of 25 percent in accordance with Hessell which brings the end sentence down to a little under two years.2 In those circumstances home detention is an available sentencing option and the Commission in Ms Mailer’s written submissions was not opposed to that. The pre-sentence report notes that there is an approved and available address at which home detention can be served so in those circumstances the end sentence today imposed is 11 months’ home detention on the conditions set out in the pre-sentence report.

[6] Particularly given the employee Kiwisaver contributions that are still outstanding, I consider that a reparation payment should be made and given the amount of core tax still owing and bearing in mind the figure offered in Mr Davie’s written submissions, in my view a higher figure should be adopted so as to be more than a token contribution to the outstanding reparation. Accordingly, there will be reparation ordered of $20,000 to be paid at $100 per week or such other figure as is agreed from time to time with the Collections Unit.

A I M Tompkins District Court Judge

2 Hessell v R [2010] NZSC 135, [2011] 1 NZLR 607.