Paying the local authority or court direct...who is entitled to these 'direct payments'

[Bailiff Advice]

Following the new regulations in April 2014 many people (in particular those who support the Freeman on the Land ideology) have tried to avoid bailiff fees by making payment direct to the court (in the case of court fines) or the local authority (in the case of council tax ). In the early months of the regulations many local authorities were still trying to grasp the new regs and computer systems needed to be updated and accordingly, the local authorities (and magistrate courts) were slowly coming to grips with the way in which payments made direct to them after a warrant had been issued should be apportioned in line with the regulations (ie; the Compliance Fee of £75 being deducted in full and the balance being split on a pro rata basis between the debt to the creditor and bailiff fees).

 

As many will remember on this forum, an astonishing number of Freedom of Information requests have been made to local authorities (and magistrate courts) by a handful of people seeking clarification as to how an individual local authority (or court) deal with 'direct payments' and sadly there are many examples on the popular Freedom of Information website; WhatdoTheyKnow.com of local authorities being subjected to costly 'internal reviews'. Worryingly, these 'reviews' have almost always been against those local authorities who had responded to the FOI requests confirming that they forwarded direct payments to the enforcement company.

 

Yesterday an article appeared in a popular trade magazine that is circulated to all enforcement companies and local authorities addressing the subject of 'direct payments'. The article is written by the Director of a well known enforcement company and I have been given permission by him to reproduce the article on the forum.

[Bailiff Advice]

WHO IS ENTITLED TO “DIRECT PAYMENTS”?

 

 

'This might seem an odd question, but it is a topical one as a large number of Local Authorities have received FOI requests challenging their authority to pay the sums received by them directly, to the Enforcement Agent who is executing an enforcement power on their behalf. This principally refers to Council Tax recovery.

 

The payments that are being discussed have been made to the LA as a consequence of actions taken by the enforcement contractor and those payments are made under the compulsion of the enforcement power – without the actions of the EA no payment would have been made.

 

Those who are challenging an LA’s duty to account to the EA for these payments are not motivated by any sense of CIVIC duty, rather they are simply trying to frustrate the collection of local taxes. These ‘activists’ would perhaps be more gainfully employed utilising their time and energy to help individuals address the root cause of their indebtedness.

 

I am sure that no LA officers have any sympathy with the arguments being advanced, but anyone tempted to use this challenge or any other proposition, such as accounting rules, as a reason to retain payments without the required distribution, should remember that one of Governments principal aims for the reforms was the creation of a sustainable fee structure for enforcement businesses. If that fee structure is undermined Government will be forced to revert to its initial position that creditors should be responsible for funding the compliance fee in unsuccessful cases – a principal that was introduced for High Court Enforcement.

 

In regard to the FOI request and the challenge to the principle that an LA must account for a direct payment, it is clear that where an enforcement power confers a right to take control of goods and sell them to recover a sum of money, then the enforcement must be conducted in accordance with the procedure in schedule 12 Tribunals, Courts and Enforcement Act 2007 and the TCE regulations. Paragraph 1(2) of schedule 12 defines an “enforcement power” as a power to use the procedure in schedule 12 to recover a particular sum. The definition is wider than the physical taking control of goods.

 

The TCE enforcement regime requires a Notice of Enforcement to be issued as the first stage in the enforcement process, prior to goods being taken into control, subject to an exception where a court order has been obtained. This “compliance stage” is therefore an integral part of the TCE enforcement “procedure”.

 

It is therefore not necessary for goods to be taken into control for the provisions of the TCE to apply and this includes with regard to the distribution of monies.

 

The “amount outstanding” is defined at paragraph 50(3) of schedule 12 as the sum of

 

(a) The amount of the debt which remains unpaid;

 

(b) Any amounts recoverable out of proceeds in accordance with regulations under paragraph 62 (costs)

 

The proceeds from the exercise of an enforcement power must be used to pay the amount outstanding: paragraph 50 (1).

 

Proceeds are defined as any of -

 

(a) Proceeds of sale or disposal of controlled goods

 

(b) Money taken in exercise of the power.

 

The compliance stage fee is, in accordance with regulation 5

 

(1) (a) of the TCOG (Fees) Regulations 2014, due and payable from receipt by the EA of the instruction to use the schedule 12 procedure. Therefore, from the point in time when the EA receives the instruction, the sum required to settle the liability includes the appropriate fee.

 

Money paid to a client following the issue of an instruction to an Enforcement Agent, is clearly money paid, and taken, under compulsion of the Enforcement Power and accordingly any such payment is subject to the TCE procedures.

 

The distribution of funds where an amount less than the full sum outstanding is paid is governed by regulation 13 of the TCOG (fees) regulations and where relevant to a direct payment, this regulation directs that the payment should be allocated in the following order, compliance fee and then pro rata in payment of the debt and fees.

 

The explanatory note to the TCOG (fees) regulation explains regulations 13 as follows:

 

“Regulation 13 provides for the order of application of proceeds where the amount recovered is less than the amount outstanding. Any fees and expenses owed to an auctioneer, and the compliance stage fee for the enforcement agent are prioritised, with the remaining proceeds being divided pro rata between the debt and payment of the remaining fees and disbursements due to the enforcement agent”

 

The provisions of the TCE stipulate that the fees are due to the Enforcement Agent and also direct how any payments must be allocated, with priority being given to the payment of the compliance stage fee in its entirety , with a pro rata distribution thereafter. This gives effect to the central policy aim of creating a sustainable fee structure.

 

As detailed above, an Enforcement Agent is entitled to the compliance stage fee upon receipt of the instruction and accordingly any payment made after this date must in accordance with the provisions of the TCE be allocated firstly against the relevant fee, regardless of whether an EA has attended and taken control of goods, as the procedure in schedule 12 commences upon receipt of the instruction and the issue of a Notice of Enforcement.

 

The statutory rules governing the distribution of money taken in exercise of the power apply to whoever a payment is made to. Money “taken in exercise of the power” includes any payment made by or on behalf of the debtor. I would submit that there is no exception that would allow a client to deal with a direct payment other than in accordance with the rules detailed within the TCE and the above regulations'.

[Bailiff Advice]

[quote=Bailiff Advice;4735951

 

 

The statutory rules governing the distribution of money taken in exercise of the power apply to whoever a payment is made to.

 

Money taken in exercise of the power includes any payment made by or on behalf of the debtor.

 

I would submit that there is no exception that would allow a client to deal with a direct payment other than in accordance with the rules detailed within the TCE and the above regulations'.

 

The point about money taken is a crucial one and this is why there are so many failures when debtors try to avoid bailiff fees by paying the council direct.

 

In the case of Magistrate Court fines, it is the case that once a warrant has been issued all courts simply forward the payment onto Marston Group, Collectica, Excel or Swift and the court will advise the debtor by letter that all future payments must be made to the enforcement agency.

[outlawla]

I'm sure people will see this for what it is.....the most pathetic attempt at pulling the wool over anyone's eyes who is prepared to read the propaganda.

[Peterbard]

Nope, I think that most will see it as the plain honest truth.

[Peterbard]

Following the new regulations in April 2014 many people (in particular those who support the Freeman on the Land ideology) have tried to avoid bailiff fees by making payment direct to the court (in the case of court fines) or the local authority (in the case of council tax ). In the early months of the regulations many local authorities were still trying to grasp the new regs and computer systems needed to be updated and accordingly, the local authorities (and magistrate courts) were slowly coming to grips with the way in which payments made direct to them after a warrant had been issued should be apportioned in line with the regulations (ie; the Compliance Fee of £75 being deducted in full and the balance being split on a pro rata basis between the debt to the creditor and bailiff fees).

 

As many will remember on this forum, an astonishing number of Freedom of Information requests have been made to local authorities (and magistrate courts) by a handful of people seeking clarification as to how an individual local authority (or court) deal with 'direct payments' and sadly there are many examples on the popular Freedom of Information website; WhatdoTheyKnow.com of local authorities being subjected to costly 'internal reviews'. Worryingly, these 'reviews' have almost always been against those local authorities who had responded to the FOI requests confirming that they forwarded direct payments to the enforcement company.

 

Yesterday an article appeared in a popular trade magazine that is circulated to all enforcement companies and local authorities addressing the subject of 'direct payments'. The article is written by the Director of a well known enforcement company and I have been given permission by him to reproduce the article on the forum.

 

It is gratifying to see the precise same arguments we have been stating for the last eight months stated by an authoritative source, not that they needed any authorization, it is all in the act.

[Peterbard]

You have to wonder whose side the likes of Mr proceeds and co are on, all that money they must have raised for bailiffs by advising people to pay direct, then landing them with further enforcment fees, now we have the HP situation.

Are they getting a cut I wonder.

[Bailiff Advice]

Nope, I think that most will see it as the plain honest truth.

 

I can honestly say that I cannot see any errors with the article. At least by having a copy of the article published on the forum all visitors (to the forum) and all those who may find a copy by way of google searches will be aware of the enforcement agencies view of how payments made direct to the local authorities (and courts) should be dealt with.

 

The article also clearly defines that 'proceeds' include money 'taken' and that the 'amount outstanding' includes enforcement agent fees.

[Peterbard]

Of course BA anyone capable of rational thought would reach the same conclusion.

 

Providing they knew how to read legislation of course.

 

Most realize this is the situation now, there are just one or two who either lack the mental capacity, or who have a financial interest in misinterpreting the regulation.

[Bailiff Advice]

Of course BA anyone capable of rational thought would reach the same conclusion.

 

Providing they knew how to read legislation of course.

 

Most realize this is the situation now, there are just one or two who either lack the mental capacity, or who have a financial interest in misinterpreting the regulation.

 

All that is important is that we all continue to provide good accurate information to debtors. That is what this forum is well known for. The number of visitors is testament to that. Keep up the good work DB

[Peterbard]

All that is important is that we all continue to provide good accurate information to debtors. That is what this forum is well known for. The number of visitors is testament to that. Keep up the good work DB

 

Thanks, appreciated

[ripvan]

Something is not quite right about a thread like this appearing on a consumer help website which by all accounts serves to provide assistance to those being oppressed by grasping local authorities claiming to be entitled to interpret the law any way they choose.

 

I'm surprised the owners of the site have allowed it and wonder why such bodies like the LGO, Debtline and CAB etc. have not felt the responsibility to oppose all the claims of the principle contributors which obviously aim to influence debtor's actions to ensure that enforcement companies profit to the max.

[Peterbard]

I think many people confuse what they wish were the case to what actually is the case.

The legislation is clear, if ,you can read it as it was intended to be read and without any personal agenda.

 

The regulations may contain information which you do not like or do not agree with, but it is legislation and what we may think is largely irrelevant, that is just the way it is.

 

The explanation of the regs given on this thread are 100% accurate, like it or not I am afraid.

[GrumpyToSayTheLeast]

Something is not quite right about a thread like this appearing on a consumer help website which by all accounts serves to provide assistance to those being oppressed by grasping local authorities claiming to be entitled to interpret the law any way they choose.

 

I'm surprised the owners of the site have allowed it and wonder why such bodies like the LGO, Debtline and CAB etc. have not felt the responsibility to oppose all the claims of the principle contributors which obviously aim to influence debtor's actions to ensure that enforcement companies profit to the max.

 

Its posted here because this is a forum that ALLOWS discussion to be started and arguments and agreements to be heard. Unlike some other bailiff "help" sites which close down and hide arguments that they don't like or are proving them wrong.

 

You say that local authorities are interpreting the law any way they choose, but I say that for the most part, they are falling in line with the regulations and abiding by its codes(to an extent but it can't/wont happen overnight) whereas other sites are doing what they can to interpret these regulations into something they CLEARLY cannot be, often to the detriment of the debtor.

[brassnecked]

It is best to be upfront and honest, even if the truth is unpalatable to the OP, as in the long run it may cost them less than following Snake Oil dodgy advice.

 

And yes Grumpy and HCEOs are from the Enforcement side, but both have given helpful advice to desperate posters on here, and given clarity as to what is right and what is wrong in an enforcement context.

[Peterbard]

Incidentally there are also ex and current NDL and CAB advisers on this forum, if anything said by the major contributes was incorrect, you can be sure we would know about it. This is an advantage of coming to a credible forum.

[Peterbard]

There are those of course who dissagree with this interpretation and of course they are welcome to engage in discussion, however these people generally have a very low threshold for civilized debate, and when their argument fail, they invariably resort to childish personal abuse and rhetoric, the proof of this is not hard to find, and speaks for itself.

[caledfwlch]

Something is not quite right about a thread like this appearing on a consumer help website which by all accounts serves to provide assistance to those being oppressed by grasping local authorities claiming to be entitled to interpret the law any way they choose.

 

I'm surprised the owners of the site have allowed it and wonder why such bodies like the LGO, Debtline and CAB etc. have not felt the responsibility to oppose all the claims of the principle contributors which obviously aim to influence debtor's actions to ensure that enforcement companies profit to the max.

 

You are doing a massive disservice to people like Bailiff Advice and HCEO, people who have day jobs, but spend a huge amount of time helping posters on here out.

 

BA as the name suggest helps people with Bailiff issues out in the "real world" and has probably helped hundreds by now, and thats not counting those on this forum.

 

Just because the Message is not one you like, does not mean the message is wrong. And given that following the wrong advice, for this see the woes of people who attempt to fight Bailiff's by putting up notices "banning" them from entering the garden and then end up being hit with multiple thousands of pounds in costs by the courts, drops people into even worse problems, it is better to get the real advice, not the fake/misinformed, eh?

 

Debtors with woes on other sites are being intentionally misinformed by people who are basically using them as guineas pigs for people testing out their own experimental "legal" theory, if the word legal can even be applied to the nonesence, and that is not fair, those experimenters arent the ones ending up with huge legal costs, and threats of prison, it is their victims. And it is absolutely malicious.

[Bailiff Advice]

This thread has been picked up by SCOOP and it surely must be better to discuss the contents of the article. I have no interest in silly comments being made elsewhere and would urge others to ignore them as well.

 

As a few of you are aware from reading the trade publication, this article is just one of many interesting articles featured and it is pleasing to read the other articles which point towards the enforcement industry confirming that the new regulations are working and that the level of complaints have significantly reduced.

[mikeymack2002]

Having read the magazine quoted above, by highlighting a paragraph and pasting it in to Google I was able to read the rest of the magazine and thought that this was worth a mention from page 10

 

 

"Whilst vulnerability is not something new and has been apparent for decades, it is incumbent for us to deliver the necessary training for Enforcement Agents to have the awareness when identifying different vulnerability categories and conducting the necessary checks before proceeding to take control of goods."

 

 

 

Or see the attachment

[mikeymack2002]

Also within this document is a good story regarding 3rd party good on page 13 a worthwhile read as well... See the above attachment

[ripvan]

You are doing a massive disservice to people like Bailiff Advice and HCEO, people who have day jobs, but spend a huge amount of time helping posters on here out....

 

What day jobs are you referring to. With the amount of posts that go into endorsing the latest enforcement regulations and the distribution of proceeds, it would not be an unreasonable assumption to make that the day job would include advising the MOJ on the regulations.

[Bailiff Advice]

What day jobs are you referring to. With the amount of posts that go into endorsing the latest enforcement regulations and the distribution of proceeds, it would not be an unreasonable assumption to make that the day job would include advising the MOJ on the regulations.

 

If your aim is to insult individuals then you have joined the wrong forum. If your aim is to assist debtors then your comments would be welcome and I look forward to hearing them.

[Peterbard]

Yes of course.

 

The article seems to have been prompted by the huge amounts of FOI requests sent to authorities. The situation is a simple one and is being complicated in order to find a way of avoiding payment.

Simply if a debtor does not pay his debt then the account will be passed to the bailiff, if this occurs the bailiff will be able to charge fees for his services, it really is as simple as that. It makes no difference who the money is paid to after the debt has been passed for collection, the bailiff has been engaged and is entitled to his fees.

 

It is true that the new regime is working, you see it on the forums, in the reduced number of complaints regarding over charging and general bailiff misbehavior.

 

Some ares of enforcment such as assessing vulnerability are going to be very much down to the EA and only training and experience will ensure that vulnerable debtors are adequately protected.

 

There is no definition for vulnerability in the regs, and the concept is so diverse I do not see how there ever could be.

 

I wait with interest to see what measures are made to rectify the unintended consequences of the legislation later this year.

[Bailiff Advice]

Yes of course.

 

The article seems to have been prompted by the huge amounts of FOI requests sent to authorities. The situation is a simple one and is being complicated in order to find a way of avoiding payment.

 

It is true that the new regime is working, you see it on the forums, in the reduced number of complaints regarding over charging and general bailiff misbehavior.

 

I wait with interest to see what measures are made to rectify the unintended consequences of the legislation later this year.

 

The astonishing number of Freedom of Information requests made regarding 'direct payments' is simply dreadful and I have highlighted this in a number of different threads, one of which is below:

 

http://www.consumeractiongroup.co.uk/forum/showthread.php?439517-Avoiding-bailiff-fees-by-paying-creditor-direct.....Freedom-of-Information-requests.

 

You are also correct in that the regulations are clearly working and this is evidenced in the number of enquiries on forums.

 

Before last April, this forum was simply overrun with enquiries (many of them very serious) and the county courts were struggling to cope with Form 4 Complaints. Since the new regs the number of enquiries on here has thankfully reduced and other smaller forums are seeing just one or two enquiries a day. Even forums such as Money Saving Expert have no more than three queries daily and sites linked to the 'freeman on the land' or 'beat the bailiff' theories are also seeing significant reductions.

 

I would hope that in some small way the 'Information threads' (such as this one) and the 'Sticky's' that I have started on this forum since last April may have assisted debtors and contributed to the welcome reduction in complaints.

Edited May 16, 2015 by ploddertom
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