Council Tax Court Costs – Liability Order/Summons

[outlawla]

.....The Magistrates court are acting as a CIVIL JUDICIAL body under the relevant parts of the Magistrates Court Act 1980 and NOT an Administrative court. They must base their decision to grant a liability order based on the facts presented by the Plaintiff namely:

• The Council Tax has been set by the Authority
  
• The house appears in the Valuation List
  
• The amount has been demanded
  
• That Reminder/Final Notices have been issued
  
• That the summons has been issued
  
• And, the amount, including costs, has not been paid.
  

And that Council Tax payer as the defendant has the right to make a defence, including against the costs. Certain defences can not be used as they fall under the jurisdiction of the 'Valuation Tribunals'. In reality this does not happen either as the defendant does not turn up or because the council officer dissuades the payer from appearing and to make an agreement, which is why the process has been seen to fall into disrepute as a rubber stamping exercise.....

 

I'm assuming a disputed benefit claim would fall under the 'Valuation Tribunals' and therefore not strictly considered a defence against Magistrates granting a Liability Order. I won't paste all the information here, but in case anyone needs some ammunition to argue against a council obtaining a liability order in these circumstances, these posts on another thread should provide plenty: #9 ; #10 (LGO); and #12.

 

Note:

 

The high Court case on other thread, post #9 , i.e., Liverpool CC v Pleroma Distribution Ltd 2002 EWHC 2467 (admin) [2002].

 

To make the link work, manually replace lowercase 'a' in the address line to capital 'A' in the word "Admin".

 

This is because CAG software auto changes this and will not work because the URL is case sensitive.

 

 

Relevant information not on those links follows:

 

 

Excerpt from the Justices Clerks' Society under heading "Procedure: Liability Order Application":

 

2. The court hears a bulk application for all non-attenders: the Council representative proves the technical requirements and gives evidence that the sums levied have not been paid.

 

3. Any defendant attending or writing to the court is dealt with individually and orders made (or not made) in their case. Their attendance or otherwise is also recorded.

 

 

These are quotes from the Chartered Institute of Public Finance Accountancy's (CIPFA) website:

 

...Similarly, the existence of an outstanding or disputed claim for council tax benefit is not a valid defence against the issue of a liability order, but an authority would not normally proceed while a benefit claim was unresolved, unless it was made after the issue of the summons (R v Bristol City Magistrates Court and Bristol City Council ex parte Willsman and Young 1991).

 

Human Rights Act 1998

 

Local authorities must be careful not to infringe an individual's human rights. Potential areas for problems are:

 

• notice of hearing;

 

• being careful not to appear to stop the taxpayer appearing before the court, if they want only to make a payment arrangement;

 

• not having available a translator for people whose first language is not English; and

 

• not separating the roles of court taking officer and the person who gives evidence of process.

Edited April 6, 2013 by outlawla

[revshelp]

The VT's main areas of appeal are valuation band, liability, discounts and exemptions. Benefit appeals I think are dealt with separately by the Social Security (or similar) Tribunals, though since the changes on 1 April I have a feeling this may have changed??

 

Its a shame that all matters aren't dealt with by the same court/tribunal it wold certainly make things a lot smoother. But I guess the assumption is that once it gets to the Magistrates Court that underling matters have already been resolved and its just the failure to pay that outstanding. (From personal experience I know this is often not the case people tend to leave things go until they get a summons.)

 

The same council revealed that it aimed to cover the entire budget for running its Council Tax department from court penalties

That's scandalous!...not only are the costs open to challenge as the have not been 'reasonably incurred'...its poor budget management, surely they can't rely on individuals falling into arrears to fund a service - i'm sure a complaint for maladministration to the Ombudsman is in order

Edited April 6, 2013 by revshelp

[outlawla]

....That's scandalous!...not only are the costs open to challenge as the have not been 'reasonably incurred'...its poor budget management, surely they can't rely on individuals falling into arrears to fund a service - i'm sure a complaint for maladministration to the Ombudsman is in order

 

The local authority is North East Lincolnshire. The letter mentioned in the article (sent the Magistrates' court), is here.....

 

Its annual budget (£1.13 million 2011-12) claimed for all activity associated with recovery of Council Tax is itemised on this link......

 

The figure of £1.04 million (2011-12) as the cost for council tax administration including "staff costs, contact centre costs, enforcement, other running costs and central recharges", is revealed in this Freedom of Information Request......

 

The cost of collection for council tax administration which includes the staff costs, contact centre costs, enforcement, other running costs and central recharges for the required years are

 

2009 £785k

2010 £1187k

2011 £1043k (£1.04 million)

2012 £933k

 

For the same period, where the council claimed total costs for Council Tax Administration was £1.04 million, a higher figure (£1.13 million) was put forward to account for all activity associated with recovery.

 

The council is saying the recovery budget is £88,550 higher than the entire council tax administration costs which include council tax recovery expenditure.

 

Clearly, local authorities consider it acceptable that defendants paying court costs should be financing entire Council Tax administration, which according to Council Tax legislation is unlawful.

 

Would this be in the LGO's remit?

Edited April 6, 2013 by outlawla

[id6052]

The VT's main areas of appeal are valuation band, liability, discounts and exemptions. Benefit appeals I think are dealt with separately by the Social Security (or similar) Tribunals, though since the changes on 1 April I have a feeling this may have changed??

 

Appeals in respect of CTB are dealt with by First-tier Tribunals (Social Entitlement Chamber)

 

Appeals in respect of local CT reduction schemes will be dealt with by Valuation Tribunals

[TOPDET]

General advice from Alan Murdie (found elsewhere on the interweb) suggests applying to the court for a adjournment in order to have relevant VT issues decided by the VT if they have not been resolved prior to issue of summons - a place I find myself in.

 

I propose to seek an adjournment, hopefully get VT to agreed with my issue re liability and then head off to Magistrates Court to not only challenge their costs application but to make my own application for costs.

 

This thread has provided very useful links to relevant cases. I shall start my own thread to advise on my progress - thanks kindly for contributors here...

[outlawla]

General advice from Alan Murdie (found elsewhere on the interweb) suggests applying to the court for a adjournment in order to have relevant VT issues decided by the VT if they have not been resolved prior to issue of summons - a place I find myself in.

 

I propose to seek an adjournment, hopefully get VT to agreed with my issue re liability and then head off to Magistrates Court to not only challenge their costs application but to make my own application for costs.

 

This thread has provided very useful links to relevant cases. I shall start my own thread to advise on my progress - thanks kindly for contributors here...

 

From what you say, you probably have the news bulletins written by Alan Murdie, linked to on various threads. If not I'll search them out and post on this thread.

 

On another point, I came across two detailed accounts of Council Tax Liability Order hearings. One of them (I think the first) involves a claim of costs but dismissed by the court, despite detailed itemisation. Ironically, the councils costs, which had no evidence to support them, were awarded.

 

Liability Order Hearing.pdf

Liability Order Hearing 2.pdf

Edited April 8, 2013 by outlawla

[EWHC1362]

I totally agree that case law sets a precedent which is binding on the lower courts and that theres established law on proportionality of costs, etc.

 

I personally see Statute as creating a framework and Case Law filling the gaps, with both complimenting each other.

 

With regards to costs the to principal pieces of legislation to refer to for Council Tax would be:

 

Section 34 The Council Tax (Administration and Enforcement) Regulations 1992

 

(5) If, after a summons has been issued in accordance with paragraph (2) but before the application is heard, there is paid or tendered to the authority an amount equal to the aggregate of—

(a) the sum specified in the summons as the sum outstanding or so much of it as remains outstanding (as the case may be); and

 

(b) a sum of an amount equal to the costs reasonably incurred by the authority in connection with the application up to the time of the payment or tender,

the authority shall accept the amount and the application shall not be proceeded with.

 

(6) The court shall make the order if it is satisfied that the sum has become payable by the defendant and has not been paid.

 

(7) An order made pursuant to paragraph (6) shall be made in respect of an amount equal to the aggregate of—

(a) the sum payable, and

 

(b) a sum of an amount equal to the costs reasonably incurred by the applicant in obtaining the order.

(8) Where the sum payable is paid after a liability order has been applied for under paragraph (2) but before it is made, the court shall nonetheless (if so requested by the billing authority) make the order in respect of a sum of an amount equal to the costs reasonably incurred by the authority in making the application.

Section 64 Magistrates' Court Act 1980

 

(1) On the hearing of a complaint, a magistrates’ court shall have power in its discretion to make such order as to costs—

(a) on making the order for which the complaint is made, to be paid by the defendant to the complainant;

 

(b) on dismissing the complaint, to be paid by the complainant to the defendant,as it thinks just and reasonable; but if the complaint is for an order for the periodical payment of money, or for the revocation, revival or variation of such an order, or for the enforcement of such an order, the court may, whatever adjudication it makes, order either party to pay the whole or any part of the other’s costs.

 

(2) The amount of any sum ordered to be paid under subsection (1) above shall be specified in the order, or order of dismissal, as the case may be.

 

(3) Subject to subsection (4) below, costs ordered to be paid under this section shall be enforceable as a civil debt.

 

(4) Any costs awarded on a complaint for a maintenance order, or for the enforcement, variation, revocation, discharge or revival of such an order, against the person liable to make payments under the order shall be enforceable as a sum ordered to be paid by a magistrates’ court maintenance order.

 

(5) The preceding provisions of this section shall have effect subject to any other Act enabling a magistrates’ court to order a successful party to pay the other party’s costs.

 

How a council should go about calculation the costs applied for isn't clearly set out, the basic cost of a summons and liability order I think is around £10-20. So it would all depend on what else is being included such as the council's court officer's time, but I imagine that most costs would be covered by general administration budget.

 

 

Something makes me think there must be some other legislation governing costs in Council Tax liability order applications, or the procedure is flawed.

 

This is taken from a debt recovery policy (Brent Borough Council) and states the following:

"

Summons

costs are applied for when the Complaint is laid and the costs are put on the account shortly after this....Summons costs for Non-Domestic Rates are £140 and for Council Tax £90

"

 

"

Liability Order

costs for both council tax and non-domestic rates are £30.00. They are incurred when a Liability Order is granted. These costs can be asked for at Court even where the remaining balance outstanding relates to costs only."

Section 64 of the Magistrates' Court Act 1980 clearly states that "on the hearing of a complaint, a magistrates’ court shall have power in its discretion to make such order as to costs......"

 

In Brent Council's case, it applies for summons costs when the Complaint is laid. This is at least 14 days (according to Council Tax Regulations) before "the hearing". On the face of it, this is not in accordance with section 64(1)(a) of the Magistrates Court Act.

 

On the other hand, the liability order costs are applied for "on the hearing of a complaint" and presumably in accordance with section 64(1)(a).

 

Another observation is many local authorities load all costs to the summons and therefore do not ask for further costs at the liability order hearing. Consequently all court costs in these cases are charged to the debtor completely independent of the Magistrates' court.

 

What would be interesting to know is, if at a liability order hearing, Magistrates used their discretion not to award costs, how would this work when summons costs have been incurred independently of the court?

Edited April 12, 2013 by EWHC1362

[outlawla]

......That's scandalous!...not only are the costs open to challenge as the have not been 'reasonably incurred'...its poor budget management, surely they can't rely on individuals falling into arrears to fund a service - i'm sure a complaint for maladministration to the Ombudsman is in order

 

Here's a selection of cabinet documents and budget reports making you doubt whether summons costs bear any relation to actual costs incurred.

 

More likely they're plucked out of thin air and tinkered with when a budget deficits need addressing.

 

 

• Canterbury City Council acknowledges the downside that comes with fewer taxpayers falling into arrears; evident with its £55,000 costs income shortfall predicted in a report summary "here":
  

......there have been several award winning direct debit campaigns that have effectively reduced the number of council taxpayers that get into arrears and subsequently face summons or liability order costs.

 

The high collection rates and earlier direct debit dates means the city council’s cash flow is enhanced substantially, resulting in additional investment interest receipts. The negative side of all this is that

with fewer individuals getting into arrears the costs recovered are diminishing

, and a £55k income shortfall is now predicted.

• Blaby District Council reports in its General Fund Revenue Account – Budget Proposals 2011/12 that summons costs could be used as an instrument to plug a hole in its finances, presumably by raising the level to bring in "Additional Income" of almost £54,000.
  

Additional Income

 

The Council has also examined the potential to generate additional income, thereby reducing overall costs by identifying new sources. A total of £346,086 has been identified through this process and these are set out in the table below.

 

Council Tax Summons Costs – £53,909

• Nuneaton and Bedworth Borough Council, in its General Fund Revenue Budget and Capital Programme 2011-2012 revealed that by raising summons charges by £10 it could contribute £22,500 to the £749k it needed to meet the current deficit.
  

RESOLVED that

 

(a) That the General Fund draft revenue budget 2011/12, attached as Appendix A to the report be recommended to the Council for approval and the current deficit of £749,000 (para 4.13) be funded as follows:

 

(6) By increasing Council Tax summons charges by £10 – £22,500

• North East Lincolnshire Council detailed in its 2011 budget proposals that it would raise a forecasted additional £752,000 over 4 years by increasing the summons cost. It proposed to "Increase summons cost", listing this in their budget proposals under the heading "Income Generation" and forecasted additional revenue of £188,000 for each of the following 4 years.
  

Edited April 14, 2013 by outlawla

[postggj]

I KEEP ON HARKING ON AT THIS AND THE MESSAGE KEEPS GETTING LOST

 

How can a local authority set its summons costs in advance of a hearing with no schedule of costs being made available to both parties

 

How can a local authority claim costs that will be in excess of its department annual operating budget

 

How can a local authority claim cost, and those excess costs recovered be then used to fund other local authority departments not connected to council tax recovery

[outlawla]

I KEEP ON HARKING ON AT THIS AND THE MESSAGE KEEPS GETTING LOST

 

How can a local authority set its summons costs in advance of a hearing with no schedule of costs being made available to both parties

 

How can a local authority claim costs that will be in excess of its department annual operating budget

 

How can a local authority claim cost, and those excess costs recovered be then used to fund other local authority departments not connected to council tax recovery

 

Completely agree:

 

See what they come back with to this Freedom of Information

 

Application for liability order

 

In reference to, the Council Tax (Administration & Enforcement) Regulations 1992 (Reg 34. Application for liability order) Brent Borough Council states the following in Appendix G(ii):

 

Appendix G(ii)

"

Summons costs are applied for when the Complaint is laid and the costs are put on the account shortly after this....Summons costs for Non-Domestic Rates are £140 and for Council Tax £90"

 

"Liability Order costs for both council tax and non-domestic rates are £30.00. They are incurred when a Liability Order is granted. These costs can be asked for at Court even where the remaining balance outstanding relates to costs only

."

Please supply information to identify the above costs (from a legal standpoint) with any distinction between summons/liability order and Council Tax/NNDR:

 

Q1. If relating to court costs, are they Magistrates' court costs?

 

Q2. If Magistrates' court costs, which Act of Parliament or Statutory Instrument provides for the award of these?

 

Q3. If the Magistrates' Court Act 1980, is s64 (Power to award costs and enforcement of costs) the appropriate section?

 

Q4. Assuming application for the issue of summons is made under the Magistrates' Court Act 1980 would s1 or s51 of the Act apply?

 

Yours faithfully

 

 

Another similar here, but from a slightly different angle.

Edited April 14, 2013 by outlawla

[postggj]

I will look forward to the response

 

The lack of clarity to questions raised, and the way local authorities are allowed to bully people through the judicial process without adequate accountability needs to be addressed

 

The complete inertia on this by any form of official body is mind numbing and deceptive

[outlawla]

Carrying on the theme of "fantasy court costs", West Somerset Council's Review of these are an eye-opener.

 

In its bid to align its charges with other Somerset authorities, it upped the summons by 11% and introduced Liability Order costs of £11 – in all, a 44% hike in costs.

 

Its combined Council Tax and Business Rates budget for 2010/11 was £44,500 which compared with £58,050 costs raised in 2009/10.

 

Even with £3,483 of this paid to the Magistrates Court in fees (£3 for each case listed), the council it seems was not only within its budget but was in fact £10,067 in the money.

 

It estimated with the increase in Summons Costs and introduction of a Liability Order fee it would generate total additional income of approximately £19,500 annually.

 

Either West Somerset Council's figures were wrong or my calculations are, because it considered the revised charges were necessary to fully recover the councils cost. These were already more than covered, but with increased charges, there would be an estimated £29,567 surplus.

 

Even factoring in a 10% write-off which the Council states is the average of Court Costs written off; before upping costs, the council would still be £4,262 in the money.

 

Perhaps the "draft fees policy" which it referred to, played as much a part to incentivise certain behaviour (like encouraging prompt payment), as the additional income generated.

 

4.1.4. As well as covering the Districts Council’s costs it is envisaged that the increased level of Summons Costs and the introduction of the Liability Order fee will act as a further incentive for Charge payers to ensure that their instalments are kept up to date. This is also in accordance with the draft fees policy as it is designed to ‘encourage behaviour’.

 

6. SECTION 151 OFFICER COMMENTS

 

6.1. This is one example of the practical application of the fees policy. Without that document to act as guidance, it is nonetheless good practice to recover costs in respect of court action from those ‘driving’ the level of activity, and to encourage payment with a deterrent.

 

6.2. Councillors will note the comparative charges for other authorities, and that the proposed fees are not inconsistent.

 

 

Taunton Dean Borough Council in its similar Review to increase Summons and Liability Order Costs was more ambitious with a 63% overall increase to roughly match its Strategic Finance Officer's calculation that the cost of these were £74.57.

 

3.8 The Strategic Finance Officer has calculated the cost of issuing summonses and liability orders for non-payment of Council Tax and Business Rates as being £74.57. Allowing for small variation in the assumptions made, it is suggested that the charge for a summons be increased to £63.50 and the charge for a liability order be increased to £10 from 1 April 2011.

Edited April 15, 2013 by outlawla

[AudaciousAngel]

&&

Edited September 21, 2013 by AudaciousAngel

[ploddertom]

 

Always ask questions. Do not give into their bullying tactics. It's all fear mongering in this world. I've taken Jacobs Bailiffs to a small claims court for the attempt to defraud me of £124.50 without evidence of the court liability order.

 

 

The result being?

[AudaciousAngel]

The result being?

 

I have to wait for the 14-days to run, so the verdict will be in soon.

[ploddertom]

I have to wait for the 14-days to run, so the verdict will be in soon.

 

Does this mean they have not submitted a defence and you are hoping to get Judgment by Default? Any particular reason you edited your original post?

[AudaciousAngel]

Does this mean they have not submitted a defence and you are hoping to get Judgment by Default? Any particular reason you edited your original post?

 

its obvious that you want me to fail. ****, can you not see the corrupt hearts in men and women. The fraud and manipulation has to stop.

[Consumer dude]

Some people are corrupt. I'm on a non paying council tax mode as well until further notice..

[ploddertom]

its obvious that you want me to fail. ****, can you not see the corrupt hearts in men and women. The fraud and manipulation has to stop.

 

Your original post was so full of inaccuracies, and you say you have taken them to court but do not know what is happening - sorry something wrong somewhere.

[tomtubby]

Carrying on the theme of "fantasy court costs", West Somerset Council's Review of these are an eye-opener.

 

In its bid to align its charges with other Somerset authorities, it upped the summons by 11% and introduced Liability Order costs of £11 – in all, a 44% hike in costs.

 

Its combined Council Tax and Business Rates budget for 2010/11 was £44,500 which compared with £58,050 costs raised in 2009/10.

 

Even with £3,483 of this paid to the Magistrates Court in fees (£3 for each case listed), the council it seems was not only within its budget but was in fact £10,067 in the money.

 

It estimated with the increase in Summons Costs and introduction of a Liability Order fee it would generate total additional income of approximately £19,500 annually.

 

Either West Somerset Council's figures were wrong or my calculations are, because it considered the revised charges were necessary to fully recover the councils cost. These were already more than covered, but with increased charges, there would be an estimated £29,567 surplus.

 

Even factoring in a 10% write-off which the Council states is the average of Court Costs written off; before upping costs, the council would still be £4,262 in the money.

 

Perhaps the "draft fees policy" which it referred to, played as much a part to incentivise certain behaviour (like encouraging prompt payment), as the additional income generated.

 

 

Taunton Dean Borough Council in its similar Review to increase Summons and Liability Order Costs was more ambitious with a 63% overall increase to roughly match its Strategic Finance Officer's calculation that the cost of these were £74.57.

.

.

.

 

You and I have spoken a number of times about summons costs etc and I cannot stress how much I admire your dedication on this and other subjects.

 

However making a "small claim" in the county court for fee recovery could be fraught with difficulties and from a number of cases that I have been hearing about very recently courts will not entertain such claims. As everyone will know, County Courts will not be happy if precious court time is taken by Small Claims being made for "fee recovery" unless the defendant ( in this case the local authority) have first been given the opportunity to consider the claim and anyone failing to do so could quite rightly find themselves at risk of an adverse cost order.

 

With the internet offering "no win, no fee' cases like confetti I am hearing of such "claims" reaching local authorities and they are being dismissed straight away and it is simple to see why. The statutory regulations allow summons and other "costs" to be charged but local authorities merely make DECISIONS to charge a certain fee but the AUTHORITY to actually charge the fee to the individual debtor is one taken by the MAGISTRATES COURT !!!

 

Therefore, if a court were minded to consider such a claim he would be overruling a decision made by the MAGISTRATES COURT !!!

 

The entire matter of "summons costs" is a minefield and in order to ascertain whether the fees or right or wrong you would need to go back to official documentation from April 1996. I was very much involved in a case only a while ago to the Audit Commission on this very subject. Very complicated indeed.

[tomtubby]

]I have to wait for the 14-days to run' date=' so the verdict will be in soon.[/color'][/i]

 

.

 

From the very little that you have written it is very difficult to know whether you have issued a claim or whether you have been in court?

 

Can you give some further details as this is a subject that is important for many people.

 

What was your claim for?

 

Did you issue a claim against the local authority or bailiff company?

 

Was your claim defended?

 

etc etc