Stephen Shepherd Allen was born at Cheadle, Staffordshire, England, on 2 August 1882, the seventh of ten children of MP William Shepherd Allen and his wife, Elizabeth Penelope Candlish, herself the daughter of an MP. Stephen first came to New Zealand with his family as a child in 1892. His father had visited earlier, in 1885, and acquired a property, Annandale, later extended to 6,000 acres, near Morrinsville. Because of his father's perambulations between Annandale and his estate at Cheadle, Stephen made three journeys to and from New Zealand as a boy.
Educated at home, he attended Pembroke College, University of Cambridge, from 1901 to 1905, graduating with an LLB and an MA. After being admitted to the Bar in New Zealand in 1906, he opened a solicitor's office in Morrinsville in January 1907; he was involved in setting up the Hamilton District Law Society in 1912. From 1908 to 1913 he was the first chairman of the Morrinsville Town Board, and was also a Methodist lay preacher. By 1914 he had become a significant landowner. Taciturn and reserved, with a distinctive lisp, he nevertheless possessed 'a very keen brain and a devastating wit'.
While at university Allen served for three years in the Cambridge University Volunteer Reserve Corps. In 1911 he was commissioned in the Territorial Force's 6th (Hauraki) Regiment, and within three years had risen to major; as C Company's commander, he inaugurated the military career of the local dentist, Bernard Freyberg, when he persuaded him to be one of his subalterns. Allen enlisted in the New Zealand Expeditionary Force in March 1915, and joined the Auckland Battalion at Gallipoli in September. Following the evacuation, he became second in command of 2nd Battalion, Auckland Infantry Regiment, and proceeded with it to France. From 15 January 1917 he commanded the battalion as a lieutenant colonel.
Allen had a distinguished war record. He was slightly wounded on three occasions, and more seriously when an exploding shell broke his leg on 4 October 1917. After hospitalisation in England, he rejoined his battalion in February 1918, though still lame. He was appointed a DSO in January 1918 (and awarded a bar five months later) and a CMG in 1919. He was mentioned in dispatches four times. In 1920 he published an account of his battalion's experiences in France.
When he was repatriated to New Zealand in June 1919, Allen was accompanied by his wife, Mary Isabel Hay Foster, an Aucklander, whom he had married in London on 11 June 1918; they would have three sons and a daughter (two of the sons died as infants). Selling his land at Tatuanui, he acquired a 70-acre property closer to Morrinsville; he named this La Signy farm after a prominent locality on the western front, and built a house on it in 1921. Allen resumed his law practice in Morrinsville and became prominent in local business, chairing the board of directors of the Cargill Publishing Company. In 1922 he stood unsuccessfully as the Reform Party candidate for Ōhinemuri in the general election. On 27 April 1927, shortly after retiring from business, he was elected unopposed as mayor of Morrinsville.
Allen also remained active in the Territorial Force, commanding the 1st New Zealand Infantry Brigade from 1920 to 1925 and the Hauraki Regiment from 1926 to 1928 with the rank of colonel. In 1920 he was charged by the government with secretly preparing a force in the Hamilton area to deal with a possible 'bolshevistic outbreak'. Two years later he offered his services when the Chanak crisis briefly raised the possibility of another expeditionary force. From 1925 to 1928 he was an honorary aide de camp to the governor general.
Allen's mayoralty was cut short by his appointment, in March 1928, as administrator of Western Samoa. New Zealand's administration of its mandate was under severe challenge from the Mau nationalist movement, and Allen assumed office on 3 May 1928 shortly after a 74-strong force of military police had been sent from New Zealand. Under Allen's direction these men carried out a variety of policing duties until April 1929, when they were replaced by a civil police force.
Allen believed that the Samoans were a childlike people of very limited intelligence who were easily led astray by half-castes. He shared the view of his predecessor, Major General G. S. Richardson, that the latter were responsible for creating and sustaining the Mau. Although privately contemptuous of the Samoans, and especially their chiefs, Allen was more prepared than Richardson to deal directly with them. Each year at his own expense he sent two Samoan boys for a trip to New Zealand.
When Allen visited Wellington in April 1929 he found the government unprepared to accept a more coercive response. During the ensuing months his administration was hard pressed to maintain its authority in the face of an increasingly assertive Mau. In Allen’s mind, a convincing demonstration of its determination had become necessary. When a procession was planned by the Mau for 28 December 1929 he resolved to arrest a wanted person. The attempt to carry this out led to an affray, as a result of which at least eight Samoans, including the high chief Tupua Tamasese Lealofi III, were killed, along with one policeman. The government in Wellington declared the Mau seditious on 13 January 1930. A cruiser was sent to Apia, and shore parties of seamen and marines joined the police in scouring the islands for Mau supporters, possibly numbering as many as 1,500. These efforts were largely futile. However, Allen's policy of firmness seemed justified when the Mau, late in March 1930, came out of the bush and agreed to disperse, an outcome that was in part prompted by the administration's plans to use several hundred non-Mau Samoans to reinforce the sailors. So seemingly complete was the Mau's collapse, that a year later Allen could claim that it appeared to be dead.
Allen resigned from his post and left Samoa on 4 April 1931; he would be made a KBE for his services two years later. From 1932 to 1934 he was a member (and acting chairman) of the Central Licensing Authority, and in 1934–36 chaired the Transport Co-ordination Board. He also resumed command of the 1st New Zealand Infantry Brigade from 1933 to 1937. From 1934 he spent much of his time at a lakeside property at Rotoiti.
Allen travelled extensively in 1938–39, and was in Britain when the Second World War began. Commissioned in the British Army, he was appointed as staff captain, Salisbury Plain area. When consulted in November 1939 by the visiting New Zealand prime minister, Peter Fraser, about the command of the Second New Zealand Expeditionary Force, he confirmed Fraser's own preference by strongly recommending his former subaltern, now Major General Freyberg, under whose command he was then serving.
Allen also offered his services for the expeditionary force. Appointed as its military secretary in March 1940, he proceeded to Egypt, but was soon afterwards sent back to Britain to help administer the Second Echelon, which had been diverted to that country because of the threat of invasion by Germany. Returning to the Middle East when the New Zealand Division was consolidated there, he served in the campaigns in Greece and Crete and was mentioned in dispatches. On 12 July 1941 he relinquished his appointment and proceeded to the United Kingdom, where he was discharged the following October.
After serving in the Ministry of Home Security at Birmingham, Allen returned to New Zealand in December 1942. His surviving son, a submarine officer, had been lost at sea while serving with the Royal Navy in April 1942, and his wife died in 1946 after a long illness. A longtime Mason, he was, in 1948–49, grand master of the Grand Lodge of New Zealand. He wrote several papers for the Kipling Journal and in 1959 published Early Morrinsville. While driving near Maramarua on 4 November 1964 he suffered a heart attack and both he and his housekeeper were killed when his car left the road. He was survived by his daughter.