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Summaries of cases concerning both housing benefit and council tax benefit are listed only under housing benefit Council tax benefit 1 case summary - 1 NEW March 2008 Housing benefit 3 case summaries Wolverhampton City Council (06/B/16600) NEW Maladministration causing injustice Wolverhampton City Council made a man bankrupt over non-payment of his council tax debt, without fully considering all the alternatives. The Ombudsman said that the Council failed to consider the possibility of making a charging order against the man’s home. It also gave him inadequate warning of the consequences of bankruptcy before commencing proceedings. The man now faces costs of £38,000 for a debt of £1,105. The Ombudsman said: “The Council cannot, it seems to me, turn a blind eye to the consequences to the debtor of any recovery option it pursues. … The dire and punitive consequences of bankruptcy, involving a multiplication of the original debt many times over and frequently incurring the loss of the debtor’s home, must be a factor to be taken into account in deciding that the ‘last resort’ is indeed appropriate. I have seen no evidence that this relevant consideration was taken into account.” ‘Mr Ford’ (not his real name) complained at the actions of the Council in making him bankrupt for council tax arrears in June 2005. Mr Ford sought to argue that he owed less than £750 at the time of the bankruptcy, but the Ombudsman found no grounds to support this. Mr Ford had arrears of £1,105 at the time bankruptcy proceedings commenced, but ended facing costs of some £38,000. The Ombudsman considered the evidence that Mr Ford was on a low income and would appear to have had an entitlement to council tax benefit that could have significantly reduced these arrears. But the Ombudsman considered that no fault could be attached to the Council for not paying that benefit, which arose from Mr Ford’s failure to co-operate with the claim process. The Ombudsman accepted the right of the Council to collect its council tax arrears and the limited options available to it in Mr Ford’s circumstances. He noted in particular that the Council was not able to apply to the Department for Work and Pensions for a deduction of Mr Ford’s Incapacity Benefit to repay arrears, as this benefit is not one where such a method of recovery is allowed. He noted also that the Council used bailiffs to try and collect the debt from Mr Ford, without success. However, despite all of the above, the Ombudsman does not consider the Council followed due process in making Mr Ford bankrupt. First, he found that the Council gave Mr Ford inadequate warning of the consequences of bankruptcy before commencing proceedings, in breach of its usual practice. Second, he found that the Council failed to properly consider the alternative of seeking a charging order against Mr Ford’s home. The Ombudsman considered that, on the balance of probabilities, had such failings not occurred, then Mr Ford would have made an offer of repayment to the Council prior to the commencement of proceedings. In order to put Mr Ford in the position that he would have been in had no maladministration occurred, the Ombudsman considered Mr Ford’s bankruptcy should be annulled and that the Council should pay for this by arrangement with the trustee in his bankruptcy. However, the Ombudsman considered that it would not be right for Mr Ford to avoid liability for his debt. So, he makes the recommendation conditional that the Council should not make any payment that will lead to annulment of the bankruptcy until Mr Ford has first entered into a binding arrangement with the Council to repay £1,105 of the costs that it will incur and to clear that debt as soon as is reasonably practicable (that debt may be secured by way of a charge on his property at the Council’s request). In addition, the Ombudsman recommended the Council to review its collection policy and procedures for local tax arrears in the light of this report in order to avoid a repeat of the maladministration found in this case. 31 March 2008 Northampton Borough Council (05/B/16773) Maladministration causing injustice Northampton Borough Council wrongly took repossession action through the courts and instructed bailiffs to collect council tax arrears from a woman while her benefits entitlement was unresolved. The Ombudsman upheld the woman’s complaints, saying they highlighted “serious failings in the Council’s administration of housing and council tax benefit and in the recovery of rent and council tax arrears.” He welcomed the Council’s agreement to his proposed remedy, and its commitment to improve its procedures to avoid the recurrence of these failings. ‘Ms Adams’ (not her real name) complained about the Council’s handling of her housing and council tax benefit claims between November 2004 and March 2006. She said that the Council:
The Ombudsman upheld these complaints, and the Council agreed to:
The Ombudsman also welcomed commitments that the Council gave to improve its procedures so as to avoid a repeat of the failings highlighted during this investigation. 27 June 2007 London Borough of Ealing (06/A/15371) Maladministration causing injustice After a resident won her appeal at tribunal against Ealing Council’s refusal of her housing benefit claim, the Council delayed 14 months in making payment. The Ombudsman found that the Council failed to take action for 10 months, and then an administrative error led to a further four-month wait. ‘Mrs Nawal’ (not her real name) complained that the Council failed to pay her housing benefit, even though it had decided not to challenge further her entitlement to benefit after the Appeals Tribunal had decided in her favour. The Ombudsman found that the Council was at fault for taking no action to put Mrs Nawal’s claim into payment for 10 months after it lost its appeal, and did so then only after she had complained to the Ombudsman. There was a further delay of four months in carrying out a full assessment, following the provision of additional information in support of her claim that was not linked to the correct case reference number. Mrs Nawal’s complaint also revealed that the Council was not monitoring its performance against targets agreed as a result of previous complaints to the Ombudsman from people in similar circumstances to Mrs Nawal. The Ombudsman said: “The failure to monitor what was going on, despite the fact that Mrs Nawal’s complaint was subject to an investigation by my office, suggests a level of carelessness which goes beyond the initial error.” To remedy the injustice from the delay in paying Mrs Nawal’s claim, the Ombudsman recommended the Council to:
6 December 2007 London Borough of Haringey (07/A/4966) Maladministration causing injustice Haringey Council’s failure to consider his concerns cost a landlord £700 in lost rent. The Ombudsman said that the Council knew that the landlord had been advised by the police not to have direct contact with his tenant without a police escort, so would have found it difficult to obtain his rent from her. But the Council did not take this into account when, for four weeks, it paid the rent directly to the tenant instead of to the landlord. He never received the money. The Ombudsman said, “I am not persuaded that [the landlord] was treated fairly”, and asked the Council to pay the complainant £700 compensation, plus £150 for his time and trouble in pursuing his complaint. ‘Mr Oak’ (not his real name) complained that the Council failed to consider evidence he submitted regarding his tenant. The tenant had a conviction for violence, was harassing Mr Oak, and had threatened to stop paying her rent. Prior to this, the tenant’s housing benefit had been paid direct to Mr Oak. Mr Oak told the Council that his tenant was under notice of eviction, and provided evidence from the police. Mr Oak warned the Council that his tenant might ask for the housing benefit to be paid direct to her and, soon after, the tenant did so. The Council failed to consider the evidence provided by Mr Oak, and decided to pay the benefit direct to the tenant. The tenant received the housing benefit for four weeks but did not use it to pay her rent. She was later evicted, but Mr Oak never received the £700 due for the four weeks when benefit was paid to the tenant. The Ombudsman found that the Council was at fault for failing to consider the evidence provided by Mr Oak. He also criticised the Council for failing to suspend benefit pending an investigation into who should receive the payment. 30 January 2008 |
