KEITH THOMAS JAQUES AND COMMISSIONER OF INLAND REVENUE DEPARTMENT
[2024] NZHC 2846
•1 October 2024
IN THE HIGH COURT OF NEW ZEALAND WELLINGTON REGISTRY
I TE KŌTI MATUA O AOTEAROA TE WHANGANUI-A-TARA ROHE
CRI-2024-485-000059
[2024] NZHC 2846
BETWEEN KEITH THOMAS JAQUES
Appellant
AND
COMMISSIONER OF INLAND REVENUE DEPARTMENT
Respondent
Hearing: 23 September 2024 Counsel:
Appellant in person with D Jaques as McKenzie Friend T G Bain, M A Gavey and A H Instone for Respondent
Judgment:
1 October 2024
JUDGMENT OF BOLDT J
Introduction
[1] This case is, or rather was, an appeal against conviction. The appellant, Mr Keith Jaques, appealed against his convictions on eight charges under the Tax Administration Act 1994. Although he had been represented at trial, Mr Jaques appeared on his own behalf in this Court.
[2] At the commencement of the appeal, Mr Jaques and I had a brief discussion about the need, in any appeal against conviction, for an appellant to establish a miscarriage of justice.1 After this discussion, Mr Jaques consulted with his McKenzie Friend and withdrew his appeal. Nonetheless, I briefly outline the
1 Criminal Procedure Act 2011, s 232.
JAQUES v COMMISSIONER OF INLAND REVENUE DEPARTMENT [2024] NZHC 2846 [1 October 2024]
background to the appeal and the reasons Mr Jaques, correctly in my view, concluded his appeal had no prospect of success.
Background
[3] After a two-week trial in February and March 2024, Judge R L B Spear found Mr Jaques guilty on eight charges of failing to discharge his tax obligations.2 He was acquitted on two others.
[4] The charges arose from Mr Jaques’ management of businesses which sold doughnuts and other refreshments at events, including large sports events in Wellington, Auckland and Hamilton. While some of the businesses’ takings came from eftpos transactions, most — around 90 per cent — were in cash.
[5] The first set of charges concerned the 2013, 2014 and 2015 tax years. The Commissioner of Inland Revenue (the Commissioner) alleged Mr Jaques substantially under-reported his businesses’ cash income, both in his GST returns and later for income tax purposes. The Commissioner also alleged that Mr Jaques failed to deduct PAYE for his employees.
[6] There is no dispute the tax returns Mr Jaques filed substantially under-stated his cash returns. There was also evidence of large cash deposits going into bank accounts associated with Mr Jaques, which roughly corresponded with the shortfall.
[7] Mr Jaques gave evidence that he was operating as a sole trader at the same time he was running his main businesses (Wellington Events Ltd and Donut Express Ltd). He said the unreported cash deposits were the revenue he had derived from that business. But if the sole trading enterprise existed — and Judge Spear found it did not
— Mr Jaques did not account for its cash takings either.3
[8] Judge Spear found Mr Jaques guilty on five of the seven charges in the first set.
2 Commissioner of Inland Revenue Department v Jaques [2024] NZDC 9248.
3 At [51].
[9] There was a second set of charges covering the period between 2019 and 2020, again accusing Mr Jaques of evading GST and failing to deduct PAYE from staff. In addition, the Commissioner also alleged Mr Jaques had failed to provide information when required to do so by tax law. The Judge found Mr Jaques guilty on those three charges. Once again, the Inland Revenue Department (IRD) identified significant discrepancies between the cash takings of Mr Jaques’ business and the sums recorded in his tax returns. Mr Jaques admitted he had not provided the information the IRD had required him to provide, and had not deducted PAYE.
[10] Judge Spear sentenced Mr Jaques to 12 months’ home detention, recording that he had avoided prison by the narrowest of margins.4 The Judge applied a 20 per cent credit for personal factors associated with Mr Jaques, including his remorse and the prospect of full rehabilitation.
[11] Mr Jaques’ remorse and rehabilitative prospects were discussed in the pre-sentence report. It recorded that Mr Jaques “now accepts responsibility for his offending”. He wrote a letter of apology to the Court, noting the personal stresses in his life at the time of the offending, and accepting he had ultimate responsibility for all accounts and tax returns. His letter included the following passage:
My approach to the IRD debt was cavalier, treating them like an “optional” creditor. I failed to sufficiently address my personal tax responsibilities, which has resulted in significant additional hours spent on my case. I regret that my actions have eroded the “trust model” of our tax system.
[12] Mr Jaques’ letter reiterated that he had been running a sole trading business, but acknowledged he “would accept guilt for not being GST registered when I had
$800k of sole trader revenue over the 36 months”. Mr Jaques accepted he had not enrolled his casual employees for PAYE, and observed “I accept that a punishment is required for the poor decisions I have made.”
[13] Mr Jaques filed an appeal notice which ran to 54 paragraphs. He invited me to overturn numerous findings of fact and credibility.
4 Commissioner of Inland Revenue Department v Jaques [2024] NZDC 15642 at [44].
Discussion
[14] Mr Jaques acknowledged it would not be sufficient for him merely to demonstrate errors or irregularities at trial, but that he would also have to show those errors might have affected the outcome.5
[15] Mr Jaques contended that the details associated with his convictions were wrong. For example, he said the Judge had been wrong to attribute the non-payment of GST to his companies; it was actually his own responsibility in his capacity as a sole trader.
[16] It was clear Mr Jaques faced three formidable hurdles to establishing a miscarriage. The first is that he was seeking to overturn findings of fact and credibility, made in a detailed reserved decision by a Judge who had heard two weeks of evidence.6 Mr Jaques did not identify any instances where the Judge had made material findings without an evidential foundation; he simply submitted the Judge should have preferred the defence case.
[17] Second, and as already noted, Mr Jaques accepted he had failed to account for around $800,000 in cash takings. It is not a defence to say he had taken the cash in his personal capacity rather than as an agent for one or more of his businesses; he accepted he was required to account for it either way. If the Judge had found the sole trading enterprise existed, the prosecution may have required leave to amend the charges. But if that occurred Mr Jaques would have been no less culpable. He acknowledged that even if he had been operating as a sole trader, he would still have been guilty of evading taxes in that capacity.
[18] Finally, Mr Jaques noted, before sentencing, that he had reflected on his conduct and fully accepted responsibility for his offending. Indeed, the Judge used those remarks to support the final sentencing discount which enabled him to consider, and impose, a sentence of home detention rather than a term of imprisonment. In this
5 Criminal Procedure Act, s 232(4).
6 See Sena v Police [2019] NZSC 55 at [38]–[40]. The Court expressed that an appellate court will exercise “customary caution” in assessing evidence, in light of the advantages a trial judge has in hearing the evidence at first instance.
Court Mr Jaques did not resile from his acceptance of responsibility and expression of remorse. His criticisms of the Judge’s decision were technical rather than substantive.
[19] After canvassing those matters with Mr Jaques, I invited him to reflect on whether there was any basis for him to contend that a miscarriage of justice had occurred. After taking time to consider his position, Mr Jaques accepted there was not, and elected to withdraw the appeal.
[20] I agree no miscarriage of justice arises. The Judge had a clear evidential foundation for his findings, and the fact Mr Jaques acknowledged he took roughly
$800,000 in cash but did not account for tax on those sums is decisive, at least with respect to the first set of charges. As for the later charges, Mr Jaques acknowledged both a failure to provide information required by the IRD and that he failed to deduct PAYE on behalf of his employees. As for the final 2019 charge, the Judge had ample evidence entitling him to infer that Mr Jaques had not accounted for all the cash payments his business received.
[21] Given Mr Jaques accepts he is unable to establish a miscarriage of justice, the appeal must fail. Technically, the appeal is dismissed for want of prosecution, but, as the above discussion illustrates, it is clear there was no prospect of Mr Jaques establishing a miscarriage in any event.
Result
[22]The appeal is dismissed.
Boldt J
Solicitors:
Crown Solicitor, Wellington for Respondent
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