Direct payments are not bound by section 13

[Whitely]

Following the judgement and transcript of a recent court hearing, an issue that has been a matter of great debate was addressed.

 

The matter of whether payments made directly to the creditor when a debt has been passed to a bailiff has resulted in two firm camps - those that say some or all of this money must be passed to the bailiff to allow him to deduct his fees, and those that say there is no legal obligation for creditors to do so and the bailiff must pursue his fees separately.

 

A barrister acting on behalf of a bailiff company, and agreed by the judge, said that direct payments were not subject to s13 of the Taking Control of Goods (Fees) Regulations 2014 and to argue that direct payments must be apportioned between the creditor and the bailiff is 'legal nonsense'.

 

This concurs with the 100+ FOI replies from local authorities from all over the country where 80% of the replies said that direct payments are not apportioned.

 

Now, this is not to say that fees are due, just that authorities should not be passing any portion of direct payments to bailiffs. Some argued that it was at the expense of the public purse to make direct payments as some of the money would need to be sent to the bailiff so I would expect them to be pleased that this isn't the case.

 

HMCTS are the biggest culprits in this - they will automatically send out a template letter stating that a direct payment has been sent to the bailiff blah blah blah, citing s13 as stated above. HMCTS are wrong to be doing this and it will now be brought to their attention.

 

Comments welcome.

[Bailiff Advice]

 

HMCTS are the biggest culprits in this - they will automatically send out a template letter stating that a direct payment has been sent to the bailiff blah blah blah, citing s13 as stated above. HMCTS are wrong to be doing this and it will now be brought to their attention.

 

This will be my only comment on here and it is a very serious one.

 

On your board, there are frequent public posts from your website owner in the past couple of weeks seeking out individuals who have magistrate court fines and who may have been subject to force entry by one of the four enforcement companies enforcing criminal court warrants. It is being publicly stated by him that one particular news channel is supposedly looking at making a documentary and would be interested in interviewing such debtors.

 

There is a very simple way to engineer an incident of 'forced entry' and that starts, with filling the debtors mind up with legal nonsense. This usually take the form of your website telling unsuspecting debtors that they should not make payment to Marston, Collectica, Swift or Excel (the 4 companies holding contracts to enforce these warrants) and instead, that they should divert their payment to HMCTS and furthermore, that they should only make payment (to HMCTS) of something called the 'sum adjudged'. Such advise is complete and utter garbage.

 

For the avoidance of doubt, in the case of criminal court fines, Magistrates take their lead from the Judgment of Lord Justice Simon Brown in R v Hereford and Worcester Magistrates Court ex parte MacRae (1999) where the Lord Justice stated the following:

 

'Once a warrant was issued the court was functors officio (in other words had finished its job and had no more to do with it etc etc.

 

Secondly, and most importantly, all four enforcement companies enforcing criminal court warrants must abide by the HMCTS Private Enforcement Contract. That contract specifically provides that once a warrant had been issued, and passed to one of the above four companies that HMCTS.........will not accept direct payments and to do so, would be a a specific breach by HMCTS of their own contract.

 

Please make sure that if you are going to continue to wrongly advise unsuspecting debtors with criminal court fines to divert their payments to HMCTS (minus bailiff fees) that you at least advise them of the reason why their payment will be forwarded straight over to the enforcement company.

 

Also, ensure that you advise debtors that if they make a payment to HMCTS of an amount less then the amount stated on the Notice of Enforcement, that the enforcement agent can continue to enforce against that debtor for their fees (as outlined in my post below):

 

http://www.consumeractiongroup.co.uk/forum/showthread.php?477812-Judge-orders-debtor-to-pay-%A37-000-in-costs-for-trying-to-avoid-paying-Compliance-fee-of-%A375......a-discussion-thread.&p=5029117&viewfull=1#post5029117

[Whitely]

Please make sure that if you are going to continue to wrongly advise unsuspecting debtors with criminal court fines to divert their payments to HMCTS (minus bailiff fees) that you at least advise them of the reason why their payment will be forwarded straight over to the enforcement company.

 

I see, so you still want to claim that direct payments must be forwarded to the bailiff, despite what has been said - that to argue this is 'legal nonsense'. You still want to peddle that?

[Whitely]

Just to add to that, I am astounded, BA, that you have continued to state that direct payments must be apportioned. Surely you should be querying why some authorities are doing so at the expense of public money.

 

One further thing.... The Hereford template ruling no longer applies because of Section 88(8) of the Legal Aid, Sentencing and Punishment of Offenders Act 2012 which now allows a warrant to be withdrawn. HMCTS have since stopped using it, although they took their time in catching up.

[Peterbard]

Pote.

 

I realise that you took the time to send over one hundred foi requests but really you must face the truth..They were a complete waste of time and government resources.

 

As the recent cse has shown the answers to your query are completely irrelevant, you may well have been asking about potholes.

 

Your request was sparked by a silly idea that this effected fees, we now know. and some of us have always known, the question of if payments are passed on is not significant in this, a waste of time and money as said.

 

I know that these requests were the crowning achievement of your lifetime Pote, and finding this out must be crushing for you, but there you are.

I sympathise. But it is not as if we didn't tell you at the time.

[Peterbard]

Just to add to that, I am astounded, BA, that you have continued to state that direct payments must be apportioned. Surely you should be querying why some authorities are doing so at the expense of public money.[/QUOT

 

Brick wall.

[Whitely]

Pote.

 

I realise that you took the time to send over one hundred foi requests but really you must face the truth..They were a complete waste of time and government resources.

 

As the recent cse has shown the answers to your query are completely irrelevant, you may well have been asking about potholes.

 

Your request was sparked by a silly idea that this effected fees, we now know. and some of us have always known, the question of if payments are passed on is not significant in this, a waste of time and money as said.

 

I know that these requests were the crowning achievement of your lifetime Pote, and finding this out must be crushing for you, but there you are.

I sympathise. But it is not as if we didn't tell you at the time.

 

Seeing as we are using names from elsewhere.... peterbard, my FOI's were only concerned with what happens when a LA receives a payment direct from the debtor when the account is with the bailiffs. 80% said they do not pass any of this payment to the bailiffs. The rest said they do, mainly citing s13 of the 2014 regulations. That is all they were asking, nothing more.

 

Time and time again, you and the usual few others ridiculed and ignored these replies and said the LA's must pass over any direct payments. You argued that the LA was bound by s13 and had no choice in the matter. You were wrong. Direct payments should not be apportioned as they are not bound by s13. You really are embarrassing yourself.

Edited May 22, 2017 by honeybee13
Name made less identifiable

[Peterbard]

Seeing as we are using names from elsewhere.... peterbard, my FOI's were only concerned with what happens when a LA receives a payment direct from the debtor when the account is with the bailiffs. 80% said they do not pass any of this payment to the bailiffs. The rest said they do, mainly citing s13 of the 2014 regulations. That is all they were asking, nothing more.

 

Time and time again, you and the usual few others ridiculed and ignored these replies and said the LA's must pass over any direct payments. You argued that the LA was bound by s13 and had no choice in the matter. You were wrong. Direct payments should not be apportioned as they are not bound by s13. You really are embarrassing yourself.

 

I cant remember ever mentioning section13 in relation to a sum paid to authorities.

 

I suppose you missed the bit about everyone agreeing tht the debt should not be paid to them, but to the bailiff.

 

I do remember however the hundreds of times you and your pals have advised that payment to the authority kills the debt(the fees).

 

Since it seems you have a new respect for what judges say, i take it you will be doing that no more, and you will be correcting others when they do so.

 

Your attempts to obscure the importance of the judgment with your silly personal fixation is completely transparent.

[Whitely]

Let's have one of the earliest examples: http://www.consumeractiongroup.co.uk/forum/showthread.php?433424-Ministry-of-Justice-explain-why-the-Compliance-Fee-of-%A375-is-deducted-first./page2&highlight=section

[Peterbard]

That seems to be about proceeds, you re going to have to be more specific.

 

I think I see your error here.

 

Just because the splitting of the proceeds is not mandatory, does not mean that the fees are not due, and if there are insufficient subsequent proceeds , it does not mean that the authority does not have to pay what is due out of the proceeds they have received.

 

This was not discussed, it was just the action of section 13, not the fact that the statutory fees are still due to the bailiff. You are attributing to much to this.

 

Also of course , just because the authority is not bound by section 13, does not meant that they cannot implement it.

 

If the bailiff invoices the authority for fees owed, they then will and must use apportionment under section 13 to justify and quantify their costs.

[Whitely]

That seems to be about proceeds, you re going to have to be more specific.

 

I think I see your error here.

 

Just because the splitting of the proceeds is not mandatory, does not mean that the fees are not due, and if there are insufficient subsequent proceeds , it does not mean that the authority does not have to pay what is due out of the process they have received.

 

This was not discussed, it was just the action of section 13, not the fact that the statutory fees are still due to the bailiff. You are attributing to much to this.

 

Also of course , just because the authority is not bound be set in 13, does not meant tht they cannot implement it.

 

Then let's lay it out for all to see......

 

Regulation 13 of the Taking Control of Goods (Fees) 2014 is entitled' Application of Proceeding' and covers all situations where payment is made of an amount of less than the total amount due.

 

Regulation 13 specifically provides that the Compliance Fee of £75 must be deducted first.

 

Given that the regulation do not permit a creditor to recover fees then common sense would tell you that the local authority/magistrate court cannot retain the Compliance Fee of £75. It is not their fee and if they use the Compliance Fee to reduce the debt this is clearly unlawful.

 

Yes indeed my thoughts too.

 

Dodgeball, you clearly subscribe to the idea that reg 13 applies to direct payments. The council or HMCTS have no legislative authority to apportion any part of a direct payment as this is, once again, a legal nonsense. If the council or HMCTS choose to pay the EA any fees that is a matter between them - it must not be taken from the direct payment. There is simply and absolutely no lawful authority to do so.

[Peterbard]

when was this 2013. ?

 

Remarkably accurate since the regs were so young, and of course may ha e been completely true, untill subsequent case law gave its interpretation.

 

What's your point?

 

Also the case says nothing about fees being deducted, it just says the creditor is not bound to use the procedure in 2013

 

 

This sort of thing is pointless and serves no purpose apart from.point scoring.

[Whitely]

when was this 2013. ?

....

This sort of thing is pointless and serves no purpose apart from.point scoring.

 

I know you've been on the page so I know you know it's from September 2014. It is however a stance you continued with and still continue with.

[Peterbard]

I know you've been on the page so I know you know it's from September 2014. It is however a stance you continued with and still continue with.

 

I think I said earlier, saw proceeds and lost interest

[Whitely]

I think I said earlier, saw proceeds and lost interst

 

[Whitely]

Since 2014 there has been an insistance that when an authority receives a direct payment from a debtor when the debt has been passed to the bailiffs then the authority must apportion this payment with the first £75 going straight to the bailiffs and the remainder split pro-rata between the authority and the bailiff.

 

Many discussion threads have been produced, the most recent ones being in April 2016 - http://www.consumeractiongroup.co.uk/forum/showthread.php?463050-Bailiff-fees-and-the-correct-procedure-to-follow-if-a-debtor-pays-creditor-direct.&p=5031561#post5031561 - with an additional thread in May 2017 citing a comment from an LGO decision - http://www.consumeractiongroup.co.uk/forum/showthread.php?477356-Local-Government-Ombudsman-(LGO)-decision....Vulnerability-...Paying-the-council-direct...Pro-Rata-distribution-and-more.

 

This is now shown to be incorrect. The legal position is that payments received directly do not need to be split, apportioned, given to the bailiff or however you want to term it. A recent court case clarified that direct payments are not bound by regulation 13 of the 2014 regulations. This means that direct payments cannot be classed as 'proceeds of enforcement'

 

Why is this? Well, 'proceeds of enforcement', if less than the sum outstanding must be applied in accordance with reg 13 - there is no choice in the matter, it must be done. As direct payments are not required to be applied to reg 13 then clearly they cannot be 'proceeds of enforcement'. If they were, they would be bound by reg 13, no choices.

 

A bailiff can only collect his fees from the proceeds of enforcement, that much is clear and undisputed. Following the logical path this means that a bailiff cannot collect his fees from payments made direct to the creditor. If a creditor, whether it be a local authority or HMCTS are telling you different then they are mistaken.

 

Now this is not to say that the fees vanish - they are still owed and the debtor is liable for them. However they cannot be subtracted from a payment made direct to the creditor - the bailiff must try to recover them separately. It's good to know that the public purse is not affected by paying the creditor direct.

 

This leads to the debate of whether fees alone can be enforced using the warrant for the debt when the debt has now been paid - in effect, there is no longer a creditor. Is it also correct that the bailiff can add more fees trying to enforce for previous fees only? A recent case says they can still enforce but this may be based on a misinterpretation of the law. Seeing as the case is subject to an appeal this position may change.

[Whitely]

I'm told I've been banned for posting this info. Is this true?