Local Government Ombudsman decision.....Liability Order and where no enforcement steps taken for 6 years.

[Bailiff Advice]

In the main area of the forum a few days ago, a debate took place regarding a question from a member of the public regarding a letter that he has received from a firm of bailiffs in relation to a Liability Order granted 6 years earlier. The OP wanted to know whether the Liability Order was statute barred (which it is not).

 

Another poster advised that a complaint to the Local Government Ombudsman should be considered and that the LGO may likely make a finding of 'maladministration'. The following two LGO decisions would indicate that a complaint to the LGO would not amount to 'maladministration'. and furthermore that a Liability Order is not covered by the Limitations Act.

[Bailiff Advice]

Westminster City Council (14 008 092)

 

 

Summary:

 

The complaint is about the Council’s decision to try to collect historic Council Tax debts. The complainant says she has not kept records going back that far, so cannot prove she paid the debt. My decision is the Council was entitled to try to collect the debt.

 

The complaint

 

The complainant, whom I shall refer to as Ms S, complains the Council has instructed bailiffs to enforce Council Tax debts from 1996 and 2001. But Ms S says she has no way of challenging these debts, or proving she had settled them. She did not know about the disputes before and has not kept records going back that far.

 

What happened

 

Ms S lived in a property in the City until 2003.

 

In 2011 Ms S wrote to the Council asking it to confirm the exact date when her Council Tax liability ended. The Council says this letter alerted it to Ms S’s new address (which was outside the City). It added this address to her Council Tax account which it says had a balance remaining on it.

 

In July 2012 the Council wrote to Ms S reminding her of arrears on her Council Tax account from 1996 and 2001.The Council had liability orders for both debts. Ms S contacted the Council disputing these arrears. It contacted her in August asking her to provide proof if she disputed the balances or her liability. It warned it would pass the older account to its bailiffs after 28 days.

 

The Council passed the older account to its bailiffs in October. Its notes say Ms S declined an offer to set up a payment arrangement.

 

In response to Ms S’s complaints, the Council advised it had tried to enforce the older debt at the time. When Ms S moved she did not tell the Council of her new address.

 

In 2014 the Council again passed the debts to its bailiffs. The bailiffs tried to enforce, but returned both debts to the Council.

 

Analysis

 

The essence of Ms S’s complaint is that, by delaying for many years in seeking enforcement of liability orders, the Council has denied her an opportunity to prove that she had paid the Council Tax.

 

The first question I need to consider is whether the Council was lawfully allowed to seek recovery. As it obtained liability orders at the time, it clearly was not unlawful of the Council to seek to enforce them (see paragraph 6).

 

I have also considered whether it was fault to seek to enforce the liability orders so long after they were granted. The reason for the delay was because the Council did not know where Ms S lived, until she contacted it in 2011.

Given the debts are for money properly owed to the public purse, I cannot be critical of the Council seeking to collect them after it was alerted to Ms S’s address.

It correctly contacted Ms S before trying to enforce and allowed her time to provide evidence that she had paid.

 

Ms S disputes whether the debts remained unpaid. And that, given the passage of time, she has not kept proof of payment. But the disposal of receipts always carries some risk. Here, that risk was assumed by Ms S, leaving her with no evidence to prove her assertion she had paid the debt. So, while I can understand her frustration, my view is the attempt to enforce the debt does not amount to administrative fault.

 

Final decision

 

The Council was entitled to collect its debt, so I see no evidence of fault and so I have completed my investigation.

 

 

http://www.lgo.org.uk/decisions/benefits-and-tax/council-tax/14-008-092

[Bailiff Advice]

Barrow-in-Furness Borough Council (14 000 238)

 

 

The Ombudsman's final decision:

Summary:

Ms X complained the Council unreasonably delayed pursuing her for a council tax debt and sent bailiffs to recover the debt without any prior warning. There is no evidence of fault in the Council’s actions.

 

The complaint

 

Ms X complained the Council unreasonably delayed pursuing her for a council tax debt from 2006/07 and 2007/08 and has failed to clearly explain how much she owes and how the debt was calculated. In addition the Council sent bailiffs to collect the debt without any prior warning when she had no contact from the Council about the debt for many years.

 

How I considered this complaint

 

Ms X moved into the property in May 2006. In June 2006 the Council issued her with a council tax bill. Ms X claimed council tax benefit and so the Council issued a revised bill.

Further changes to her council tax benefit resulted in the Council issuing her revised council tax bills. By December 2006 Ms X owed £96 for 2006/07.

 

In January 2007 the Council wrote to Ms X requesting evidence of income as she was no longer receiving job seekers allowance. Ms X responded in February 2007. The Council requested further information and carried out a claim visit but no-one was home. The Council requested further information in relation to her earnings, copies of bank statements and evidence of arrears.

 

Ms X corresponded with the Council but did not provide all the information requested and on 6 March 2007 her council tax benefit was cancelled.

 

This increased her liability for council tax for 2006/07 from £96 to £298. The Council issued Ms X a revised bill on 5 April 2007. This was for £1133.62 for the 2007/08 council tax plus £298.99 for the arrears from 2006/07.

 

The Council continued to correspond with Ms X requesting information so it could determine her housing benefit and council tax benefit claim. It sent a letter to Ms X on 8 May 2007 which was returned by the Royal Mail as “gone away”. On 22 May 2007 the Council sent Ms X a letter explaining she was not entitled to housing benefit or council tax benefit as she had failed to provide sufficient evidence or information for the Council to assess the claim. This letter was returned by the Royal Mail as “gone away”.

 

On 23 May 2007 the Council received a letter from Ms X dated 4 May 2007 with details of her self employed earnings. However it did not include copies of bank statements or details of her rent arrears. The Council wrote to Ms X on 31 May 2007 to advise that her claim had already been made ineligible as she had failed to provide all the information requested. The letter advised “if you wish your claim to be reconsidered, please provide all the evidence requested in our original letter”.

 

Ms X did not pay her council tax and so the Council obtained a liability order from the Magistrates’ Court in June 2007, adding £45 costs to the debt. In July 2007 it passed the debt to the bailiffs for recovery action.

 

In August 2007 Ms X’s landlord wrote to the Council to advise that Ms X had left the property in June. The Council closed the account in October 2007 and issued a revised bill to an address the Council had for Ms X. The bill was for £483.09 comprising arrears of £298.99 from 2006/07 and £184.10 owed from 2007/08. The Royal Mail returned the bill to the Council as “gone away”.

 

The bailiffs returned the account to the Council in January 2009 as they could not locate Ms X.

 

In November 2012 the Council passed the account to its tracing agents who located an address for Ms X. The Council passed the account to the bailiffs in January 2013 for collection.

 

On 25 June 2013 the bailiffs sent Ms X a 14 day letter. Ms X says she never received this and the bailiff told her the 14 day letter was not sent. The bailiff received no response. The bailiffs visited Ms X on 25 October 2013 and levied on a vehicle. Ms X telephoned the Council to query the debt. She advised she had not received the 14 day letter. The Council placed recovery action on hold.

 

Ms X submitted a complaint to the Council as she believed she was on benefits at the time. The Council responded to the complaint. Ms X was unhappy with the response and so complained to the Ombudsman.

 

Findings

 

From the evidence I have seen I am satisfied that the Council has evidence that Ms X owes the council tax debt. Ms X did receive council tax benefit up until 10 December 2006 but there is no evidence of a successful claim after this date. It was open to Ms X, at that time, to appeal the decision not to award her council tax benefit and she did not do so.

 

Once the Council closed the council tax account in October 2007, it sent a bill to the address it had for Ms X. The Royal Mail returned this letter to the Council as “gone away”. Ms X did not receive this bill but I cannot be critical of the Council for this as Ms X failed to provide it with a forwarding address.

 

Section 9(2) of the Limitation Act 1980 says you cannot recover a debt more than 6 years from the date on which it was accrued. However, case law suggests that once a liability order has been granted the statute of limitations does not apply and there is no time limit to taking action. The Council is therefore entitled to pursue old council tax debts and I cannot be critical of it for doing so.

 

There was a delay in the Council

pursuing the debt.

Ms X contributed to the delay as she did not provide the Council with a forwarding address

and the bailiffs were initially unable to locate her. The Council had to use a tracing agent to establish Ms X’s address.

 

A liability order gives a council legal powers to take enforcement action to collect the money owed. This can include taking deductions from benefits, getting an attachment of earnings order or using bailiffs. A council can decide which recovery method it wishes to use.

 

When a council has not pursued a debt for a significant period of time we would expect a council to write to the debtor advising the debt is outstanding and providing an opportunity to pay before bailiffs action commences.

 

In this case the bailiffs, on behalf of the Council, issued a 14 day letter. This gives the debtor 14 days to contact them before further recovery action is taken. Ms X says she did not receive this letter. The bailiffs records show the letter was sent. The Council says it has spoken with the bailiffs who confirm it was sent. It is unfortunate Ms X did not receive this but I cannot be critical of the Council for this as it is likely the letter was sent.

 

Ms X says the bailiffs cannot have levied as she was not left a levy notice. Any vehicles at the address do not belong to her and so could not have been levied on. Also the bailiffs issued her with a 24 hour before action notice on that date so any levy would have been in breach of the notice.

 

A bailiff can levy on a vehicle where there is a reasonable belief the car belongs to the debtor. However, as the car did not belong to Ms X it could not have been seized and in such circumstances, the Ombudsman expects councils to remove a levy fee and any associated costs. The Council has advised that all bailiffs’ costs have been removed from the account and the account is now back with the Council. As the bailiffs’ charges have been removed there is no outstanding injustice to Ms X.

 

Ms X is also dissatisfied with the Council’s responses to her complaint. In its response to Ms X of 22 November 2013 the Council provided the wrong figures for the money owed. It later apologised for this and corrected the error.

 

http://www.lgo.org.uk/decisions/benefits-and-tax/council-tax/14-000-238

[Peterbard]

This relates to the claim that the LGO can support a claim for maladministration on a delayed enforcement.

 

"However, case law suggests that once a liability order has been granted the statute of limitations does not apply and there is no time limit to taking action. The Council is therefore entitled to pursue old council tax debts and I cannot be critical of it for doing so."

[lookinforinfo]

I am surprised that the LGO while noting that the tenant contributed to the delay in dealing with the arrears no mention was made that the Council took almost 3 years before using a Tracing Agency.