Summary: Mr X complained about how the Council pursued him for council tax arears. Mr X said the Council instructed bailiffs without making adequate efforts to contact him first. The Council was at fault. It failed to identify Mr X’s new address on an enquiry form he submitted, and as a result Mr X incurred an avoidable enforcement fee of £235. The Council agreed to reimburse Mr X the £235 enforcement fee. The Council also agreed to apologise to Mr X for the frustration and time and trouble caused to him by its poor handling of his complaint.

The complaint

1. Mr X complained about how the Council pursued him for council tax arrears. Mr X said the Council sent the case to the bailiffs without making proper efforts to contact him first. Mr X said the unnecessary involvement of the bailiffs caused him distress, avoidable financial loss and time and trouble.

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The Ombudsman’s role and powers

2. We investigate complaints about ‘maladministration’ and ‘service failure’. In this statement, I have used the word fault to refer to these. We must also consider whether any fault has had an adverse impact on the person making the complaint. I refer to this as ‘injustice’. If there has been fault which has caused an injustice, we may suggest a remedy. (Local Government Act 1974, sections 26(1) and 26A(1), as amended)
3. If we are satisfied with a council’s actions or proposed actions, we can complete our investigation and issue a decision statement. (Local Government Act 1974, section 30(1B) and 34H(i), as amended)

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How I considered this complaint

4. I considered Mr X’s complaint correspondence.
5. I considered the Council’s response to my enquiries.
6. Mr X and the Council had an opportunity to comment on my draft decision. I considered the comments before I made my final decision.

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What I found

Council Tax

7. The Council Tax (Administration and Enforcement) Regulations cover both the way councils collect payments of council tax and the way councils can recover council tax debt.
8. The council tax bill for the year is due on the 1st April. The Council will usually collect payment through ten monthly instalments. If any instalment is missed the Council will send a reminder to the resident. If a payment is still not made or a further payment missed, then the entire outstanding balance will be due (i.e. the full amount for the rest of the year).
9. To use the various powers available to it to recover unpaid council tax, the Council has to apply to the Magistrates Court for a liability order against the person or persons it believes should have paid the bill.
10. Once the Council has obtained a Liability Order it can begin legal recovery action. A liability order obtained through a Magistrates Court is not the same as a County Court judgement and so is unlikely to affect a person’s credit rating score. 
11. Recovery action can take many different forms. The Council may instruct bailiffs to recover the debt by arranging payments or goods can be seized and sold to pay off the debt. In rare cases where a person has ‘wilfully refused’ to pay their council tax bill the Council can apply to have someone committed to prison.

Enforcement Agents (Bailiffs)

12. Councils will often use bailiffs to recover debt. The law sets out the fees a bailiff can charge when recovering debt and the three stages they must follow:
• The Compliance Stage - a bailiff must issue a notice of enforcement seven clear days before they take control of the goods. The fee for this stage is £75.
• The Enforcement Stage- this stage starts once a bailiff has made a first visit. At this visit they can take control of the goods. Once they have secured goods they must give the debtor a notice. A bailiff cannot take control of a vehicle essential for work purposes and valued at under £1350. The fee for this stage is £235.
• The Sale or Disposal Stage- this stage starts once a bailiff has taken control of the goods. A bailiff must leave a vehicle for at least two hours after securing it before removing it to storage. They must then allow seven clear days between the removal of goods and their sale. In this time a bailiff must value the goods and send a copy to the debtor. The fee for this stage is £110.
13. The government has published guidance entitled ‘Guidance to local councils on good practice in the collection of council tax arrears’. The guidance says councils should take all reasonable steps to exhaust other recovery options available to them prior to obtaining a liability order.
14. The guidance says councils must ensure bailiffs provide clear and accurate information about costs to the bill payer, including a breakdown of costs, outlining how much has been charged for bailiff action.

What happened

15. Mr X owns property A which he rents to tenants. The tenants are liable for the council tax at property A for the duration of the tenancy. In September 2017, the tenants at property A told the Council their tenancy had ended and they had vacated the property. The tenants told the Council that Mr X owned the property but did not know his address. Based on that information the Council opened a new council tax account for property A in Mr X’s name. In October 2017, the Council sent the bill to property B, which was the last known address it had for Mr X.
16. The Council received no payments from Mr X for the council tax bill it sent him in October 2017. In December 2017 the Council sent Mr X a council tax reminder to property B. The bill warned that if Mr X did not pay the outstanding instalments, the Council may begin court proceedings which would incur court costs. Mr X would also lose the right to pay the bill in instalments.
17. The Council received no payments or correspondence from Mr X so in January 2018 it wrote to Mr X at property B with a court summons. The court summons ordered Mr X to appear at the magistrates’ court in February 2018. The letter informed Mr X he needed to pay the full amount before the court date to stop the Council applying for a liability order.
18. At the end of January 2018, the new owners at property A informed the Council they bought the property and had started living there. Therefore, the Council closed Mr X’s council tax account. The Council sent a new bill to Mr X at property B which informed him of the outstanding amount of £448.35. That amount included the Council’s court costs of £77.
19. The Council received no payment or correspondence from Mr X and in February 2018 the magistrates court issued a liability order in respect of the debt.
20. In August 2018, the Council transferred Mr X’s case and liability order to its contracted bailiffs. The bailiffs wrote to Mr X at property B in September 2018 with a notice of enforcement. The notice told Mr X he was liable for the sum of £523.35 for council tax arrears at property A between September 2017 and January 2019. The sum included the bailiffs’ £75 compliance fee.
21. The bailiffs had Mr X’s mobile telephone number so in September 2018, they sent Mr X a text message. The message told Mr X the Council had instructed the bailiffs to pursue him for non-payment of council tax and asked him to contact the bailiffs’ office immediately. The bailiffs sent a further letter to Mr X in September 2018 at property B which told him to pay the outstanding amount within 7 days or it would enforce the liability order. The letter said enforcement would result in a further fee of £235.
22. In September 2018, Mr X submitted an enquiry form on the Council’s website which it referred to the council tax department. The enquiry form included Mr X’s personal details including a new address, property C. Mr X said on the form he had received a demand for money from bailiffs that he did not owe. The Council said the contents of Mr X’s enquiry warranted no further action.
23. In November 2018, the bailiffs progressed Mr X’s case to the enforcement stage, and an agent attended property B. There were no persons present at property B when the agent attended so they left a further letter which said the balance was now £758.35 which included the enforcement stage fee of £235.
24. In November 2018, the new owners of property B called the bailiffs and told them Mr X was the previous tenant of the property. Following that information, the bailiffs carried out further investigation and found Mr X now lived at property C.
25. In December 2018 the bailiffs wrote to Mr X at property C. The letter told him the amount of £758.35 due to council tax was payable immediately in order to prevent further action or removal of goods. The bailiffs also sent Mr X another text message asking him to contact them to pay the balance. Mr X called the Council for an explanation about the bailiff letters and offered to pay the bill in full. However, the Council told him to contact the bailiffs directly instead.
26. Mr X contacted the bailiffs in December 2018. He disputed the enforcement fees and said he was unaware of the debt until he received the recent letter. However, Mr X paid the balance in full and the bailiffs closed the case and sent Mr X a statement which detailed the full breakdown of the debt.
27. Mr X complained to the Council in December 2018. Mr X said he was unaware he owed council tax from property B because he did not receive any bills. He said he only became aware of the debt when the bailiffs wrote to him at property C. Mr X complained that letter did not show a breakdown of the debt and enforcement fees and gave him the impression that the full amount was for council tax arrears. Mr X said the Council had his telephone number and email address so it should have used that information to contact him earlier, rather than pass the debt to the bailiffs. Mr X said he had spent a significant amount of time on the telephone trying to speak with someone at the Council about the matter. Mr X said the matter caused him upset, stress and time and trouble and asked the Council to refund the bailiff fees.
28. The Council responded to Mr X in December 2018 at stage 1. It said as the owner of property A, Mr X was liable for the council tax during the period it was vacant. The Council said property B was the most recent address it had on record for Mr X, therefore it sent all associated correspondence to that address. The Council said none of the correspondence was returned to it as undelivered. The Council said it referred the case to the bailiffs as it received no payments. The Council said it was satisfied it progressed Mr X’s case in line with the relevant law and guidelines.
29. Mr X remained unhappy and asked the Council to escalate his complaint to stage 2. The Council responded in February 2019. The Council said it followed all the options open to it but was unable to establish a different address for Mr X. It said the only option open to it was to pass the case to the bailiffs.
30. Mr X remained unhappy and complained to the Ombudsman.

My findings

31. As the owner of property A, Mr X was responsible for paying council tax during the period September 2017 to January 2018 when the previous tenants vacated it. As the owner it was Mr X’s responsibility to update the Council about the change in circumstances of property A. The Council correctly sent the bill to property B which was the most recent address it held for him, and was an address previously provided by Mr X as a forwarding address. The Council is not at fault for sending the bills to property B.
32. The bills sent to Mr X at property B were not returned as undelivered and there was no evidence anybody contacted the Council about the bills. Mr X no longer lived in the Council area, so it had no alternative addresses to send the bills to. The Council followed a process set out in law when it applied to the court for a liability order. Therefore, there was no fault in the Council’s decision to obtain the liability order and pass the case to the bailiffs.
33. The bailiff’s sent Mr X a letter to property B at the compliance stage and sent him a text message which incurred the £75 fee. Rather than contact the bailiffs in response to the text message Mr X sent a website enquiry form to the Council. The evidence showed the website enquiry contained Mr X’s new address of property C, however the Council did not notice that and filed the enquiry without taking any further action. Had the Council dealt with the enquiry form properly it could have passed Mr X’s new address to the bailiffs at that stage. That may have prevented the case from escalating to the enforcement stage. That was fault and resulted in a bailiff visiting property B and Mr X incurred the enforcement fee of £235. In its response to my enquiry letter, the Council acknowledged that fault and offered to reimburse the £235 enforcement fee which is a satisfactory remedy.
34. Following the unsuccessful enforcement visit to property B, the bailiffs found Mr X’s new address at property C and sent him a letter informing him of the outstanding debt of £758.35. Government guidance says bailiffs must provide clear and accurate information to the bill payer, including a breakdown of the costs. The bailiff’s letter to Mr X did not contain a breakdown of costs or outline how much of the debt related to bailiff costs. It gave Mr X the impression the whole debt was for council tax arrears which caused him frustration and uncertainty. As the bailiffs were acting on behalf of the Council, the Council was at fault.
35. The Council’s handling of Mr X’s complaint was not very good. In its stage 2 response it implied to Mr X that it had followed all options open to it to establish Mr X’s new address. However, in response to my enquiry letter the Council conceded that comment was incorrect, and it had in fact taken no extra steps to establish Mr X’s new address. That was fault. While there was no fault in the Council not taking further steps to establish Mr X’s address, its misleading response to the complaint caused Mr X frustration.
36. In response to my enquiry letter the Council conceded that it should have identified Mr X’s property C address when reviewed his website enquiry in September 2018. I see no reason why the Council could not have reached that conclusion when it handled Mr X’s complaint at stage 1 in December 2018. That was fault and caused Mr X the frustration and time and trouble in bringing his complaint to the Ombudsman.

Agreed action

37. The Council agreed within one month of the final decision to:
• refund Mr X the £235 enforcement fee after it failed to record Mr X’s new address when he submitted a website enquiry form in September 2018.
• apologise to Mr X for the frustration and time and trouble caused by its poor complaint handling.
• remind all bailiff’s that act on behalf of the Council to provide a breakdown of fees in all correspondence sent to bill payers in line with government guidance.

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Final decision

38. I have completed my investigation. I found fault leading to injustice and the Council agreed to my recommendations to remedy that injustice.

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Investigator's decision on behalf of the Ombudsman