Advice on Council tax please. Does Estoppel apply in this case and other advice?

[Runk]

ok, Im trying to sort this out for a friend who is just getting more and more stressed and flustered over this as it goes on. Its hopefully not too long winded and Ill try to keep to the relevant points only. From here on she will be refered to as Sally.

 

Ok, first thing that has been done is a letter has been written to Sutton Borough Council giving me permission to speak to them and deal with this on behalf of Sally, so I now have the ability to write and phone and disuss her account on her behalf.

 

The scenario:

Sally is a single mum but works full time and uses a childminder to collect her son after school. She is also a home owner and works hard for what she has, and as you can imagine money is tight.

She just changed jobs in September to a better paid one and one in the field for which she is currently studying and going to college in her spare time.

She gets some Working Family tax credit but no other financial support or benefit of any kind.

 

In August Sally was aware that with the change of jobs, the slight gap between the finish date and the start date of the new job and not getting paid till the end of the first month in arrears (which would be October) meant that she didnt have enough money to pay everything for a couple of months

 

Prior to this she has never been in any debt with the CT office and so does not have a record as a bad payer.

 

- On the 9th of September she phoned the Sutton Council tax office and explained that she was starting a new job and was having to borrow money for food for the next month and a half (which covered CT payment due on 1 Sept and 1 Oct) but when she was paid in October she would catch up by paying 50% extra for the remainder of the payment period and catch up.

 

The CT staff on the phone told her that although she couldnt officially make the arrangement that she was asking for, provided payment was made during October there should be no problem. Her account would be marked up and commented that she couldnt afford payments for this time. She was told that warning reminders would be sent out automaticaly by the computer. (I have checked and it is on record that this call took place, and that there would be no payment for the stated reasons untill mid/end of Oct)

On the same day Sally cancelled the direct debit so that a payment couldnt be taken and cost her bank charges too.

 

- 27thAugust a letter from the CT office arrived stating that the bank had informed them the DD had been cancelled.

 

- 21st September a payment reminder was recieved. As she had been told these were sent out by automation it was ignored.

 

- 25th October (a few days before a payment was about to be made) the next corespondence from the coouncil was recieved.

A summons for a court hearing due to be held on the 15th of November seeking payment of the entire amount, plus £80 costs.

 

- 28 October. On my advice made a £100 payment online to the CT office. It was a sunday and I figured that when Sally rang them the following morning it would prove she was not trying to avoid making payments, but genuinely just needed a bit of room for two months.

 

- 29 Oct Sally rung the CT office and was told that the court summons was to be withdrawn and she would not have to go to court. She had to set up a new monthly DD which included the outstanding amount, plus the £80 admin fee for the summons.

 

Now the questions.

There is no issue with the repayments by direct debit for the outstanding amount. It what was understood was going to happen anyway.

The issue is with the £80 fee that has been added.

My understanding of the law is that costs for a court summons can only be recovered if the summons is executed and the case goes to court. If the summons is withdrawn or stopped, any associated costs also have to be removed from the debt.

 

- 2nd of November a letter is recieved from the CT office stating the following:

Thankyou for your recent communication.

Detailed below is the special payment arrangement that was offered to you on the 29th October.

As has been explained to you the Council will be going to court to apply for a liability order at the court hearing to cover the outstanding balance.

Provided the new arrangement is adhered to, no further recovery action will be taken and the liability order will remain unactioned.

 

Failure to strictly adher to the arrangement will result in the liability order being passed to a collection agent witout any further warning.

This would also incur additional costs.

 

So this brings us up to date.

What Im trying to make head or tail of is this.

Is this £80 charge legal, can it be recovered by adding it to the council tax bill?

Has the summons been withdrawn or is it actually to be executed and a liability order obtained, which will then be held on file as a threat? And is it legal for them to apparantly openly do this?

 

And if all of the above is above board and correct, was the summons illegal in the first place(thereby making the £80 charge also illegal) if the legal doctrine of Estoppel is applied?

The way that I understand it, Sally was following what had been agreed over the telephone, so Estoppel would mean that the CT office could not punish her with additional costs provided she was following the agreement?

 

This £80 fee has really annoyed me and if I can sort this out on her behalf I will.

 

I look forward to all your replies, and thank you in advance for all advice and help given.

 

Nick.

 

ps. sorry for how long winded that got and thanks for wading through it all

[pt2537]

Hi Nick,

 

well, interesting question youve raised there

 

Estoppel would preclude a party who had given up rights to a contract then sueing the preson for breaching the contract and would appear to apply to this situation also albeit slightly different

 

i remember studying this in a Speech made by Lord Denning

 

however there are many different types of Estoppel, may i ask in what way you were thinking of applying Estoppel to this

 

 

 

however, in this case has it actually gone to court? my initial thoughts were that without going to court how can they add costs? after all it would be for the court to award costs

 

i will do some digging throughtthe legal databases and see what i can come up with

 

undoubtedly someone else will come along soon with some more info to help

 

Regards

paul

[Runk]

Thanks for the quick reply.

 

As for the £80 charge, it is stated on the magistrates court summons as

 

Costs already incurred:

Billing Authority for obtaining this Summons.

 

But as the plaintif is not now being summoned to court, is it a legal charge?

 

The way I was interpreting Estoppel was the fact that it can be applied to debtor and debt as well as contract law, after a phone call it was agreed in principle that there would not be a problem if a payment was skipped providing that payments were made during the October period. Effectively a verbal contract that is noted on the account? But that agreement was then reversed without notification when the court summons was issued?

 

That would mean that the way I am applying it, is the agreement was made and noted that increased payments were to resume during October, and the council then broke this agreement by issuing a court summons, making the £80 charge void.

 

I was also not sure about the fact that the case is still going to be heard, even though an agreed payment plan is in place and a liability order will still be obtained, and then held in a file as a threat against any further default for the rest of the year.

 

As I understand it, you obtain a liability order to recover a debt and execute it to recover said debt. Obtaining a liability order to keep on file just in case its needed at some point in the future appears to me to be a questionable tactic at best and certainly not what I understand a liability order to be for. Im not sure but I believe that it could also damage a credit rating as the liability order will be recorded by the credit reference agencies would it not?

 

Ive tried to read up on it but I cant seem to find a definitive answer if Ive understood the law correctly.

I dont have a problem with fines being levied for wrongdoing, but this is just over zealous and unreasonable.

Its not even about the amount of the charge to be honest because Ive already written a cheque to cover it for her.

Its the principle of the way shes been bullied that I dont like.

[Goldlady]

Whilst I do know a bit about estoppel, I think it is simpler than that. The council issue these summonses as far as I know without actually paying the court fee until the day arrives. We were issued a summons for our business rates and managed to successfully prove the council were in the wrong so it was withdrawn at the eleventh hour. The charge for the court proceedings disappeared from our account.

 

Also, if you involve your MP regarding bad behaviour by councils you will get results - have done it more than once;)

[gizmo111]

The £80 will be payable by Sally as it has cost the council that to issue the summons in the first place, whether they go ahead with a hearing or not they have already paid this to the court.

[pt2537]

Thanks Gizmo, i was in the process of looking up Estoppel on Halsburys Laws.

 

thats saved me a job as the document is 152 pages long:D .

 

Regards

 

paul

[Edz11]

I would tackle this from a different direction. I'd ring up your Councillor. (Make sure it's a Lib Dem one in Sutton) and tell them how unfair it is that when you're trying to keep up payments and let the Council know what's going on that you should get penalised in this way. If possible get a face to face meeting with the Councillor - puts a name to the face then.

 

You'll find that you'll get a positive response as hardly anyone gets in touch with Councillors about council tax payments and extra charges. It will make a nice change from dog poo and dustbins for them.

 

I speak from 20 years experience - one CT query only so I made it my job to resolve it !

 

When I say Lib Dem I say them as they're the majority party in Sutton. It may be another Party in another Council.

[gizmo111]

Thanks Gizmo, i was in the process of looking up Estoppel on Halsburys Laws.

 

thats saved me a job as the document is 152 pages long:D .

 

Regards

 

paul

 

 

Of course if it could be proved that they hadn't actually paid it, it would be reclaimable, but legislation around council tax is heavily loaded in the local authoritys favour. And I think it was asked earlier, but Liability Orders do not get reported to the CRA's

don't let me disturb your choice of bedtime reading Paul

[Goldlady]

Good comment Ed - I will remember that next time I have a problem:D. My local MP has been a great help in such matters (I am an ex civil servant and boy did people jump if someone had involved their MP.)

 

I rang the ASBO hotline - 101 (we have one round here) after a stray Rottweiler walked into my kitchen to be told that this was not antisocial behaviour :o but a police matter. I thought it was fairly antisocial myself!

[Conniff]

But they are going to court, the op has the letter that says so:

 

Thankyou for your recent communication.

Detailed below is the special payment arrangement that was offered to you on the 29th October.

As has been explained to you the Council will be going to court to apply for a liability order at the court hearing to cover the outstanding balance.

Provided the new arrangement is adhered to, no further recovery action will be taken and the liability order will remain unactioned.

 

Failure to strictly adher to the arrangement will result in the liability order being passed to a collection agent witout any further warning.

This would also incur additional costs.

 

It says the council will not act on the liability order.

[Edz11]

Doesn't matter - A councillor can get it stopped by shouting at the right person.

[make them aktiv runners]

- 2nd of November a letter is recieved from the CT office stating the following:

Thankyou for your recent communication.

Detailed below is the special payment arrangement that was offered to you on the 29th October.

No written evidence of earlier arrangement. A little sneaky of the council to ignore that.

 

As has been explained to you the Council will be going to court to apply for a liability order at the court hearing to cover the outstanding balance.

I would attend court and put my case. The magistrate will award costs on the day. I have had a magistrate order the council to pay charges and that earlier call is the evidence you need for your advantage. Non-attendance means the council will have their costs paid by Sally.

 

Provided the new arrangement is adhered to, no further recovery action will be taken and the liability order will remain unactioned.

 

Failure to strictly adher to the arrangement will result in the liability order being passed to a collection agent witout any further warning.

This would also incur additional costs.

 

see comments in red.

[make them aktiv runners]

If Sally can also clear the arrears before the court date then they are unlikely to get the liability order either.

[Conniff]

The £80 will be payable by Sally as it has cost the council that to issue the summons in the first place, whether they go ahead with a hearing or not they have already paid this to the court.

 

I have just looked up the court fees and it says:

 

Council tax and rates

5.1 Application for a liability order £3

 

 

It also states that councils may only charge a 'reasonable' amount. I can't see that it cost the council £77 to prepare and send a liability order request to court.

Perhaps a request for a breakdown of the court fee would be appropriate.

 

Also estoppel may apply here as the interpretation is:

 

"an estoppel occurs when one party, by words or conduct, has led the other to believe

in the existence of a certain fact situation and the other party has acted to his to his

detriment in reliance on that fact situation. In these circumstances the party whose

conduct created the difficulty may be prevented (estopped) from denying the

existence of that relevant fact situation"

 

Sally would have acted to her own detriment by not paying until October as she was told:

 

" provided payment was made during October there should be no problem"

[Edz11]

Trust me - if the Councillor does their job properly then they will be able to get the costs removed from the account...

[graceful_willow]

Hello Rank,

 

I used to work for a council (will not tell which..) so I pretty much know everything about ctax. The day sally rang and made an arrangement, she was probably told she doesn't need to go to court, but infact the summ wasn't cancelled at all. The "arrangement" is the agreement between sally and the council that she will stick to the monthly payments set for her.

 

The court cost will unfortunately remain - just the fact that they sent the letter out, the cost has already been incurred. The additional cost (liabilty order) that gives the council rights for further recovery (ie bailiffs) if sally default on the arrangement.

 

She should have been firm when she rang the council about the summons and demanded for the summ and the cost withdrawn. Council will look at her account and if she's been paying regularly for the past years they will be willing to cancel everything. She probably spoke to an unsympathetic advisor -fobbed her off by offering her an arrangement, not explaining the cost, so she can get on and take the next call.

 

It's not too late, she or you on her behalf, can still write a letter of complaint to the ctax manager. Put on the letter that she wasn't advise that the cost is not gonna be withdrawn. With previous regular payments showing on her account, they will definitely consider it.