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Bailiff industry Director confirms that new fee scale 'could be open to abuse by unscrupulous bailiffs' !!

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Ever since it was known that the government were intending to introduce the 'Interpleader/Third Party' provision into the new regulations it has been my personal opinion that this clause will lead to a significant number of complaints. I am more convinced than ever before of this.

 

Most seriously was the fact that at the Consultation stage it was made very clear that an enforcement agent would only be able to charge a relatively modest sum (of £110) if goods were to be removed and that this fee would cover all costs including the removal through to the sale of vehicles (or household goods). It was a dreadful shock to discover months ago that enforcement agents would also be able to charge daily STORAGE fees for all goods removed. This was NEVER the intention at Consultation stage and MOJ confirmed that as a direct result of the introduction of the 'Third Party Interpleader' clause that it became necessary to apply STORAGE fees. In other words...all debtors will now be charged daily storage fees as a direct consequence of the introduction of a clause that should in effect on apply to a very small number of debtors !!!

 

The introduction of daily storage fees will almost certainly lead to enforcement agents finding that the immediate removal of goods is financially very rewarding for the company.

 

In the past few weeks I have written a number of urgent letters to the Ministry of Justice (and others) as I was aware from conversations with various enforcement companies that they would be looking at 'immediate removal' of goods given that the statutory regulations had been drafted in such a way so as to allow the 'sale fee' (of £110) to be applied to the account at the point when a bailiff 'attended to remove' (in other words..when a call has been made to the office to 'send a removal vehicle'. The current position under the regulations in force today is that this is referred to as an 'aborted van fee' (and highly questionable). Under the new regs, the charging of this fee would be LEGAL.

 

It would seem that the enforcement industry themselves are now worried that what I had been highlighting for many weeks may well be about to happen !!! Below is a 'word copy' of an article that features in a trade magazine today.

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New fees scale ‘could be abused by bailiff firms’

 

 

 

The new simplified fees scale for debt recovery could be open to abuse by unscrupulous bailiffs, according to Alan Wood, director of development at bailiff firm Whyte & Co.

 

The new fees, which come into effect on 6 April, will apply to all types of non-High Court debt while High Court debt will have its own set of fees. Under the changes there will be three enforcement stages for non-High Court debt: the ‘compliance’ stage fee will be £75; ‘enforcement’ stage fee £235; and ‘sale’ or ‘disposal’ stage £110.

 

Wood welcomed the new scale,which he believes is more transparent than the myriad fees that debtors used to face. But he warned there was ambiguity over when a bailiff firm would be able to apply the sale stage. “The new regulations are not without their flaws and, as always, the devil is in the detail, or should I say interpretation.”

 

He said that some firms may operate outside the “spirit” of the new regulations and apply the sale fee at the same time as the enforcement fee on every visit, rather than at the actual point of removal. “The legislation allows for the sale fee to be applied during the enforcement stage, but this should be the exception rather than the rule.Some firms may try to introduce the combining of the two stages as a matter of course.”

Wood urged councils to closely monitor how and when the fees are applied at each stage. “Local authorities should monitor what percentage of cases their bailiff partners are recovering at each stage. If one firm is showing a much higher percentage of cases at sales fee stage compared with other contractors this might suggest they are acting improperly.”

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Nasty no other way to describe it, so person on benefits ends up owing £000s, s for the meagre household contents the bailiff takes away as they ignore the rules stating what are exempt goods to claim the storage fees. Are these storage fees set in stone or can the bailiff make them up as he goes along?


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The bailiff: A 12th Century solution re-branded as Enforcement Agents for the 21st Century to seize and sell debtors goods as before Oh so Dickensian!

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The 'storage' fees are not 'set in stone' and if challenged, the enforcement agent merely must be able to provide evidence that they were charged such fees. This should not provide difficult at all. MOJ should have known that this would happen. The previous fee scale has been open to abuse merely because the draftsmen wrote the regs in such a way that different 'interpretations' could apply. The same (if not worse) has happened all over again.

 

We now have 'an attending to remove fee' (dressed up as a 'sale fee' that is legally chargeable as outlined above. Legal challenges will be of little use. It hardly matters whether the charging is in the 'spirit' of the regulations.

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As now, any storage fees have to reasonably and actually incurred.

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Exactly, so £110 plus £25 per day for household contents worth £150 at auction is entirely possible under this pigs ear! Nice one MOJ (NOT) it would be unfair to Kermit to describe this as the work of Muppets.


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As now, any storage fees have to reasonably and actually incurred.

 

 

What is "Reasonable" £10, 20, 50 per day?

 

So when the bailiff takes that third party car, the rightful owner may have to find an extra £110, plus all storage fees up to and including the date of the hearing on top of everything else, maybe 30 days of storage?


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What is "Reasonable" £10, 20, 50 per day?

 

Reasonable could be £10 per day for household goods, £20 for a car I would say but that's not the point - 'Actually' is the key word here.

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Reasonable could be £10 per day for household goods, £20 for a car I would say but that's not the point - 'Actually' is the key word here.

 

So "actually" is the fee charged to the bailiff by lets say Lock Stock, or some other storage compound plus VAT for storage? What if the bailiff keeps them in his garage or in a warehouse owned by the bailiffco ?

 

So a worse case scenario may be if the debtor is from a minimum wage or benefit family faced with council tax payments for the first time, has little of value, the bailiff clears the house goods are worth less than a weeks storage and the £110 sale fee. I know that is extreme but in the past it is exactly the sort of behaviour that the new regs are supposed to be stamping out. looks like it may become worse much worse.


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So "actually" is the fee charged to the bailiff by lets say Lock Stock, or some other storage compound plus VAT for storage? What if the bailiff keeps them in his garage or in a warehouse owned by the bailiffco as I have seen some do?

 

Yes to your first question and I have never heard of what you say in the second.

 

My thoughts are that if a bailiff stored them in his own garage the fee could be challenged. If he could prove that his garage was insured for such things and he had relevant security then I guess he could charge something.

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There is something further that does need mentioning that is vitally important:

 

Under the new regulations a bailiff MAY (if he wishes) enter into a Controlled Goods Agreement with the debtor. The 'old wording' for this was of course a Walking Possession Agreement. By entering into a Controlled Goods Agreement the debtor will be able to continue to use the goods listed until the debt is paid (assuming of course that there is no default in the agreed payment arrangement).

 

However, what a lot of people may not realise is that under the Enforcement of Road Traffic Debts Order 1993 it also provided for a FORM 8 Walking Possession Agreement (on more or less identical terms as outlined in the new regs). As many on this forum are aware I do have an outside business and in the past 7 years I can count on one hand the number of times that a bailiff has agreed to a Walking Possession for a motor vehicle (for an unpaid PCN). In reality such an Agreement is a rarity.

 

Try for a moment to take the place of the enforcement agent. If he were to agree to a Controlled Goods Agreement the fees that he can charge are £75 and £235. If however he removes (or intends to do so) his fee rises by £110 and more attractive is that daily storage fees apply as well. The 'average' daily fee for storage is around £30 (£150 of 5 days, £210 for 7 days or £300 for 10 days).

 

Debtors must ensure that they engage with the enforcement company at an early stage.

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There is something further that does need mentioning that is vitally important:

 

Under the new regulations a bailiff MAY (if he wishes) enter into a Controlled Goods Agreement with the debtor. The 'old wording' for this was of course a Walking Possession Agreement. By entering into a Controlled Goods Agreement the debtor will be able to continue to use the goods listed until the debt is paid (assuming of course that there is no default in the agreed payment arrangement).

 

However, what a lot of people may not realise is that under the Enforcement of Road Traffic Debts Order 1993 it also provided for a FORM 8 Walking Possession Agreement (on more or less identical terms as outlined in the new regs). As many on this forum are aware I do have an outside business and in the past 7 years I can count on one hand the number of times that a bailiff has agreed to a Walking Possession for a motor vehicle (for an unpaid PCN). In reality such an Agreement is a rarity.

 

Try for a moment to take the place of the enforcement agent. If he were to agree to a Controlled Goods Agreement the fees that he can charge are £75 and £235. If however he removes (or intends to do so) his fee rises by £110 and more attractive is that daily storage fees apply as well. The 'average' daily fee for storage is around £30.

 

More vehicles will be taken away for all types of debt then, including third party, but will the bailiffs be cheeky enough to try to charge the £110 plus storage to the owner before they will release the vehicle even if they accept the proof proffered when the owner turns up at their office, or will they as now still try to charge them to the debtors account? That will be interesting to say the least.


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Yes to your first question and I have never heard of what you say in the second.

 

My thoughts are that if a bailiff stored them in his own garage the fee could be challenged. If he could prove that his garage was insured for such things and he had relevant security then I guess he could charge something.

Thanks HCEOs, I know you work at the ethical end of enforcement,and your opinions and input is valuable but I sometimes go a bit wild with scenarios to try to second guess what stunts the unscrupulous bailiffs will try for a beer token. It looks like in partially solving some issues they have made others. worse. As you rightly indicate your main client base are businesses that won't pay, but many here are private individuals who simply can't pay, it is they that will lose out under the new regime potentially.


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The bailiff: A 12th Century solution re-branded as Enforcement Agents for the 21st Century to seize and sell debtors goods as before Oh so Dickensian!

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Thanks HCEOs, I know you work at the ethical end of enforcement,and your opinions and input is valuable but I sometimes go a bit wild with scenarios to try to second guess what stunts the unscrupulous bailiffs will try for a beer token. It looks like in partially solving some issues they have made others. worse. As you rightly indicate your main client base are businesses that won't pay, but many here are private individuals who simply can't pay, it is they that will lose out under the new regime potentially.

 

Thank you for your kind words brassnecked.

 

It could be argued that my industry has indeed been tarnished with what the unscrupulous bailiffs you talk of have done over the years. The very size of that sector of enforcement meant many a rogue could find their way in. And with these new reforms, clearly aimed at the enforcement of LA / HMCTS debt rather than the HCEO/CRAR industry, genuine court judgment creditors and commercial landlords may well find any chance of levying goods to aid the recovery of genuine debt reduce from next Monday.

 

But we are where we are and the powers that be have chucked everything into one pot (aside from fees).

 

And yes I wholeheartedly agree that vulnerable debtors need the protection the regulations were intended to give them. But whilst some aspects certainly aid the vulnerable it appears others do not.

 

It is a shame that the last stages of this long and arduous process of reform had to be rushed to meet Government deadlines. Another 6 months could have seen many of the foibles ironed out.

 

Ho hum.

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There is one thing I have noticed that has cropped up on a regular basis.

 

It seems to me that the MOJ are making more of the words "Enforcement Agent" and phasing Bailiffs out. I wonder therefore do we need to get a step ahead and rename this Forum to take account of the new procedures.


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There is one thing I have noticed that has cropped up on a regular basis.

 

It seems to me that the MOJ are making more of the words "Enforcement Agent" and phasing Bailiffs out. I wonder therefore do we need to get a step ahead and rename this Forum to take account of the new procedures.

 

Good idea PT, as the term bailiff is redundant from Sunday.


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Good idea PT, as the term bailiff is redundant from Sunday.

really ?

will private bailiffs be no more ?

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really ?

will private bailiffs be no more ?

 

It's bailiffs Jim but not as you know them. Apparently they will all be "Enforcement Agents" Either way more nasties to come are popping out of the woodwork


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It seems to me that the MOJ are making more of the words "Enforcement Agent" and phasing Bailiffs out. I wonder therefore do we need to get a step ahead and rename this Forum to take account of the new procedures.

 

.

It is not so much that MoJ are using the term 'Enforcement Agent' it is more to do with the fact that the common law rules applicable to 'distress' will effectively be revoked from 6th April.

 

What this means in reality is that words (or terms) such as ....distress.....levy....walking possession.....impound....distrain and most importantly....the word 'bailiff' will cease to have effect from the above date. Once again.....all of this will be outlined in the 'Practice Note/Guidance' that I have offered to put together for the site team to use as STICKY's . These should all be available over the forthcoming weekend.

 

Coming back to your question....the forum does indeed need to be renamed to include the word "Enforcement Agent'.

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all of this will be outlined in the 'Practice Note/Guidance' that I have offered to put together for the site team to use as STICKY's . These should all be available over the forthcoming weekend.

Thank you. I look forward to it.

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OK, will County Court Bailiffs become County Court Enforcement Agents?

 

If not, the word Bailiff certainly wont be dead and buried just yet...

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