Team effort – Unlawful "Head H" bailiff fees for the attention of MoJ

[outlawla]

I have read cases where bailiff firms – collecting debt on behalf of councils – unlawfully add a £24.50 "Head H" fee for returning levied goods, when they were never physically removed in the first place.

 

It also seems some councils back up their bailiff contractors when the debtor disputes this charge.

 

A Freedom of Information Response regarding this indicates that the "Head H" fee should not be charged to debtors on settlement of the debt if goods were never removed.

 

Freedom of Information Reply – Head H fee.doc

 

Where no sale takes place because the debt has been paid and goods returned to the debtor. The statutory fees specified under Header H of Schedule 5 of SI1992/613

 

 

i) Charges to be made per LO, not per case

 

ii) Only to be charged where goods have been physically removed from the debtor’s premises and then payment in full is received.

 

iii) Must not be charged where no goods are removed.

 

I have brought various council and bailiff issues to the attention of the Secretary of State for Justice, as well as the LGO etc, however, as you will imagine these issues have just been brushed aside. "Phantom visits" are standard practice with bailiffs collecting for councils, but authorities tend to ask you to prove that a visit didn't take place or a letter wasn't left, leaving them smugly knowing that the Police won't be investigating the fraudulent act.

 

Documentary evidence that bailiffs have been charging "to return goods" will be much harder to brush aside you would hope. So, if anyone who has been charged this fee when they shouldn't have and has evidence, I would be interested to collect samples of documents to back up a complaint. Personal details removed of course.

 

Thank you!

Edited January 13, 2012 by outlawla

[tomtubby]

Outlaw. Another good article and one that is of GREAT INTEREST to me.

 

[EDIT] the charging of this "Head H Fee" is very important indeed and almost all bailiff companies (and local authorities) continue to accept the explanation from CIVEA ( formerly, the Association of Civil Enforcement Agents) that this fee can legally be charged.

 

I DISAGREE!!!

 

ACEA (as it was then) commissioned Barristers opinion regarding the charging of a "Head H Fee" . This was in response to a complaint that had been raised by a local authority in the west of the country who had also received Counsels opinion following a serious complaint from a debtor.

 

I have read BOTH opinions and the one from the local authority made the point VERY clear that such a fee CANNOT be charged. ACEA decided to accept the one that they had commissioned (which I thought was not at all helpful to them).

 

What was very worrying at the time was that the local authority then advised their bailiff provider that they MUST no longer charge a “Head H” fee and I was horrified to then receive (under FOI) a copy of correspondence between the local authority and the bailiff company where the bailiff co advised the LA that they will continuing charging the fee of £24.50 BUT that they would NO LONGER CALL IT A HEAD H FEE and furthermore, that if any future complaints were received.......that they would provide an undertaking to the LA!!!

 

You may care to read the following which is an extract from a recent letter that I had sent to a senior investigator at the Local Government Ombudsman’s office on the subject of a "Head H" fee:

 

 

 

.

.

.

 

 

“Head H” Fee of £24.50

This particular fee is very controversial indeed and is once again almost routinely being charged by local authorities. As far as I am concerned this does not make it legal.

A Consultation Paper was issued by the Department of the Environment Transport and the Regions in 1997 and the outcome of the Consultation was published in the “Fourteen Council Tax Letter” to local authorities dated 19th December 1997.

This Letter also provided a draft copy of the Council Tax (Administration and Enforcement) (Amendment) (England) Regulations 1998 which was introduced on 1st April 1998

These new regulations provided for a fee under Head H of £20 (later amended to £24.50). As mentioned above, this fee was amended following a Consultation process. The Council Tax Letter also provided the outcome of the Consultation and the reason why changes to the fee scale were being introduced.

 

On the matter of a “Head H” fee, the DETR explained that under the Consultation, opinion was sought for the following:

• The introduction of a fee maximum of 5% of the amount of the liability order for advertising costs where a sale does not take place because the debt has been paid and the goods have been returned to the debtor.
  

The Council Tax Letter, states the following:

• A fee maximum was accepted in principle, but it was pointed out that for small debts this would not cover the costs of advertising. Therefore, we intend to amend secondary legislation with effect from 1 April 1998 setting a fee of £20 or actual costs incurred up to a maximum of 5% of the liability order, whichever is the greater.
  

As you can see, this fee was introduced into the Regulations to cover advertising costs where a sale does not take place because the debt had been paid and the goods returned back to the debtor. I have recently written to the Ministry of Justice concerning the dreadful abuses by local authorities at the charging by them of this fee when goods have neither been removed nor advertised for sale.

 

 

If you have any further queries, please do not hesitate to contact me. I have no objection if you wish to copy this letter and any of the attachments to the local authority.

Edited January 13, 2012 by tomtubby

[outlawla]

Thanks for your response tomtubby.

 

It's not surprising that CIVEA would plump for, and adopt the decision which benefited bailiff firms financially. It's also interesting to note that the statement on ACEA/CIVEA's Website, does not specifically state that a "Head H" fee can be charged to the debtor where levied goods have been left with them under a walk in possession agreement:

 

Following criticisms regarding the charging of fees under Head H to Schedule 5 of the Council Tax (Administration and Enforcement) Regulations 1992 this association sought legal opinion as to the legality of such charges.

 

This legal opinion unequivocally stated that the Fee under Head H of Schedule 5, 'where no sale takes place by reason of payment or tender' in accordance with section 45 (4) of the regulations, is perfectly legitimate and in accordance with the regulations. Furthermore, the fixed fee, currently £24.50, is recoverable regardless of the actual costs incurred.

 

ACEA fully endorses the right of its member companies to charge such a fee and strongly encourages the use of such incontestable statutory fees, where appropriate.

 

I'd say there was no basis for CIVEA to endorse the right of its members to charge a fee where goods have not been physically removed. In fact, it hasn't as far as I can tell, so, it's difficult to see why councils and bailiff firms have taken it upon themselves to interpret this to be the case.

 

Quite clearly, as your LGO correspondence shows, this fee functioned to cover the expense of advertising levied goods, but is now exploited by enforcement firms and, as a formality, added, like first & second visits, van etc etc fees, to accounts whether or not they are warranted.

 

Thanks for the letter, I'm sure it will come in useful.

[tomtubby]

The "Fourteenth Council Tax Letter to which I refer is NOT easy to locate but if you want a copy, please PM.

[outlawla]

......What was very worrying at the time was that the local authority then advised their bailiff provider that they MUST no longer charge a “Head H” fee and I was horrified to then receive (under FOI) a copy of correspondence between the local authority and the bailiff company where the bailiff co advised the LA that they will continuing charging the fee of £24.50 BUT that they would NO LONGER CALL IT A HEAD H FEE and furthermore, that if any future complaints were received.......that they would provide an undertaking to the LA!!!.....

 

Would be interesting to know how this bailiff firm disguised the "Head H fee"?

 

There's only one other statutory fee which coincides with this amount which is the £24.50 first visit fee, or possibly a levy fee if debt is under £100. Either way it would be unlawful, with the council open to legal challenge.

[tomtubby]

I wholeheartedly agree !!!

[brassnecked]

The question then is, how do we tackle a system that refuses to reform itself, and turns a blind eye to blatant fraud?

[tomtubby]

How indeed ....

[outlawla]

Example:

 

A council siding with its appointed bailiff firm 'Rossendales' over unlawfully charging debtors a Head H fee.

 

I would be very interested to collect any similar documents to reinforce a complaint to the MoJ.

 

Personal details removed of course.

 

Thank you!

[ploddertom]

Example:

 

A council siding with its appointed bailiff firm 'Rossendales' over unlawfully charging debtors a Head H fee.

 

I would be very interested to collect any similar documents to reinforce a complaint to the MoJ.

 

Personal details removed of course.

 

Thank you!

 

That link must contain some of the biggest steaming pile I have seen for a long time. Looks like someone is not reading the Regulations correctly.

 

PT

[brassnecked]

That link must contain some of the biggest steaming pile I have seen for a long time. Looks like someone is not reading the Regulations correctly.

 

PT

 

Outlawla has had to go to hell and back with those muppets, who have now quoshed the liability order

[ploddertom]

Outlawla has had to go to hell and back with those muppets, who have now quoshed the liability order

 

You may have misunderstood what I meant. The Council are obviously printing stuff that the Baiiliffs are advising them that is correct and in turn are trying to flannel their customers - the taxpayers. My comment was aimed at NELC & not Outlawla.

 

PT

[brassnecked]

You may have misunderstood what I meant. The Council are obviously printing stuff that the Baiiliffs are advising them that is correct and in turn are trying to flannel their customers - the taxpayers. My comment was aimed at NELC & not Outlawla.

 

PT

Sorry PT, am a bit knackered, been sorting a lappy that someone had allowed one of those "Helpful" cold callers says there is all sorts of malware on it, and let them loose on it with a remote assistance, so missed the correct context.

Yes they are apparently speaking bailiff as if it is the gospel truth and is always correct

[outlawla]

Does anyone with evidence (such as below) that a council allows their bailiffs to unlawfully charge debtors a £24.50 header H fee, wish to contribute?

 

[tomtubby]

It would be interesting to ask North East Lincolnshire Council whether they have received "independent" legal advice concerning the charging by THEIR AGENTS of a "Head H fee" !!!

[brassnecked]

Obviously NELC have been fed waffle by their bailiffs and are clueless as to where and when the head h fee is applied, and obviously are up the creek as according to the letter outlawla has, it is applied to EVERY LO before it is considered discharged

[outlawla]

It would be interesting to ask North East Lincolnshire Council whether they have received "independent" legal advice concerning the charging by THEIR AGENTS of a "Head H fee" !!!

 

Unfortunately I'm sure NELC would decline an invitation to demonstrate it had sound legal knowledge concerning the charging of a "Head H fee", especially if the request came from myself.

 

Dealing with council officers and obtaining any intelligent response from them is proving impossible as they have just the other day, refused to deal with a formal complaint I took the trouble to send them.

 

As it arrogantly replied:

 

...I can make you aware that North East Lincolnshire Council will not be raising your concerns as a formal complaint and will not enter into further dialogue regarding the issues you have raised.

 

 

Officers at North East Lincolnshire council are aware – and if they're not, they should be – that I'm after making sure some of these become accountable (in an arrow suited sort of way) for the part they play in the systematic fraud in council tax liability order applications and the subsequent crime they abet with their appointed bailiff firm Rossendales.

 

Obviously NELC have been fed waffle by their bailiffs and are clueless as to where and when the head h fee is applied, and obviously are up the creek as according to the letter outlawla has, it is applied to EVERY LO before it is considered discharged

 

Allowing their bailiffs to unlawfully charge the 'Head H' fee has been put to them. The council denies it has records of debtors who have been charged this fee. The evidence it supplied me in writing suggests they do hold, or can access this information if they so wanted.

[brassnecked]

Perhaps it's time to ask Rossers new gaffer in compliance Christine Sharples hot from the MOJ what she thinks then?

 

Bet she has been inculcated into the Rossendales culture by Mrs Green Jones, so we will get the usual platitudes,

[outlawla]

.....On the matter of a “Head H” fee, the DETR explained that under the Consultation, opinion was sought for the following:

• The introduction of a fee maximum of 5% of the amount of the liability order for advertising costs where a sale does not take place because the debt has been paid and the goods have been returned to the debtor.
  

 

The Council Tax Letter, states the following:

• A fee maximum was accepted in principle, but it was pointed out that for small debts this would not cover the costs of advertising. Therefore, we intend to amend secondary legislation with effect from 1 April 1998 setting a fee of £20 or actual costs incurred up to a maximum of 5% of the liability order, whichever is the greater.
  

As you can see, this fee was introduced into the Regulations to cover advertising costs where a sale does not take place because the debt had been paid and the goods returned back to the debtor. I have recently written to the Ministry of Justice concerning the dreadful abuses by local authorities at the charging by them of this fee when goods have neither been removed nor advertised for sale....

 

Just drafting a report for the fraud office and want to include the "Head H" fee. Need to get a definitive interpretation of how the "head H" should be detailed, taking into account all the amendments to the schedule 5 list of fees.

 

Most councils seem to interpret it as follows:

 

(H) Where no sale takes place by reason of payment or tender in the Circumstances referred to in Regulation 45(4);

Either:

(i) £24.50, or

(ii) the actual costs incurred, to a maximum of 5% of the amount in respect of which the liability order was made.

This is ambiguous and implies that the fee may not necessarily be connected with advertising costs. However, these fees do relate to out-of-pocket expenses for advertising fees, emphasised by tomtubby above.

 

If a case is to be put to the fraud office, I think from the various amendments, i.e, SI 1993/773, SI 1998/295 and SI 2006/3395, the Head H fee to schedule 5 would more accurately be detailed like this:

 

 

(H) Where no sale takes place by reason of payment or tender in the Circumstances referred to in Regulation 45(4);

Either:

(i) £24.50, or

(ii) the actual costs incurred, to a maximum of 5% of the amount in respect of which the liability order was made.

For fees incurred in respect of advertising.

 

whichever is the greater.

 

Anyone agree?

 

I'd be interested to know under whose authority, councils decided to drop the "advertising" aspect when detailing their lists of fees?

Edited February 19, 2012 by outlawla

[brassnecked]

I would imagine it is under their own interpretation, as they think they can take the regulations and bend them how they want so long as they put it in a code of practice or tterms of reference between themselves and their bailiff. BTW outlawla, Martin3030 has been sorting out those sub folders for the MOJ consultation, with the headings supplied by tomtubby.

[ploddertom]

You need to read the appropriate parts to what they say:

 

Schedule 5 Charges Connected with Distress states:

Where no sale takes place by reason of payment or tender in the Circumstances referred to in Regulation 45(4);

Either:

(i) £24.50, or

(ii) the actual costs incurred, to a maximum of 5% of the amount in respect of which the liability order was made.

 

The above states quite clearly you have to refer to Regulation 45(4) which states:

(4) Where an authority has seized goods of the debtor in pursuance of the distress, but before sale of those goods the appropriate amount (including charges arising up to the time of the payment or tender) is paid or tendered to the authority, the authority shall accept the amount, the sale shall not be proceeded with and the goods shall be made available for collection by the debtor.

 

This says to me that the goods have been seized and a sale has been arranged, therefore the goods must already have been removed. The debtor then pays in full incl all charges before the sale takes place, the sale of these goods is then cancelled/withdrawn and it very clearly says "the goods shall be made available for collection by the debtor." So for him to collect they must have been removed.

 

PT

[outlawla]

Thanks for that ploddertom,

 

When you put it like that, I don't think there's any ambiguity whatsoever. But what's niggling me is through the various amendments of the Council Tax Regulations, local authorities, (probably influenced by their bailiff contractors), have chosen to drop "fees incurred in respect of advertising", which could cause doubt as to what the fees compensate, i.e, out of pocket advertising expenses.

 

 

Schedule 5 Charges Connected with Distress states:

Where no sale takes place by reason of payment or tender in the Circumstances referred to in Regulation 45(4);

Either:

(i) £24.50, or

(ii) the actual costs incurred, to a maximum of 5% of the amount in respect of which the liability order was made.

 

For fees incurred in respect of advertising (This detail is never included in any bailiff's interpretation)

[ploddertom]

Others obviously have another take on this

 

http://www.civea.co.uk/news-5.htm

[outlawla]

Re; http://www.civea.co.uk/news-5.htm

 

This legal opinion unequivocally stated that the Fee under Head H of Schedule 5, 'where no sale takes place by reason of payment or tender' in accordance with section 45 (4) of the regulations, is perfectly legitimate and in accordance with the regulations.(providing goods have been levied and removed) Furthermore, the fixed fee, currently £24.50, is recoverable regardless of the actual costs incurred. (providing some costs have actually been incurred with respect to advertising)

[brassnecked]

Surely then the fundamental basis ids that they have actually removed them physically to another location say a saleroom,for sale, and incurred advertising cost, if not the head h is void no matter what council and bailiff claIm