Summary: Miss C complains the Council incorrectly took enforcement action against her and failed to deal with her complaint effectively. The Ombudsman finds fault with the Council and it has agreed to remedy the injustice by providing Miss C with a payment of £250 for the avoidable distress it caused. The Council has also agreed to take the relevant steps to put Miss C back in the position she would have been in if the fault had not occurred.

The complaint

1. The complainant, who I refer to here as Miss C, complains the council incorrectly took enforcement action against her in relation to an unpaid council tax debt she did not owe. Miss C works in the financial sector and has concerns the liability order obtained by the Council will affect her career prospects and future employment. Miss C also complains a council officer terminated her phone call when she was feeling suicidal and the Council failed to properly address all of the points in her complaint.

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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 Miss C’s complaint and the information she provided.
5. I considered the Council’s response to Miss C’s complaint.
6. Miss C and the Council had an opportunity to comment on an earlier draft of this decision statement.
7. I considered the relevant legislation and statutory guidance set out below.

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What I found

Council Tax

8. 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.
9. 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).
10. 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.
11. 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. 
12. 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 ‘willfully refused’ to pay their council tax bill the Council can apply to have someone committed to prison.
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.

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What happened

14. In December 2018, Miss C moved from Property A to Property B. Miss C advised the Council of the date she moved out of Property A and provided it with her new address (Property B). The Council sent to Miss C a refund for the overpayment of council tax and it corresponded with Miss C at Property B a second time in July 2019 to provide her with copies of council tax bills that she had requested.
15. In July 2020, Miss C received a Notice of Enforcement (the Notice) from the Council’s enforcement agents. The Notice advised Miss C a liability order was issued in the Magistrates Court in relation to unpaid council tax for Property A. The Notice did not provide any liability dates but it stated the amount owed was £278.72 in addition to a compliance stage fee of £75. The Notice also advised that if Miss C did not pay or agree a payment arrangement within a week then an enforcement agent would visit her home address and her belongings may be seized.
16. Miss C was shocked and distressed to receive the Notice as she had not received any notification of unpaid council tax prior to this. She contacted the enforcement agents and then the Council.
17. Miss C called the Council’s Contact Centre at 8.45am as per its website but the phonelines did not open until 9am. She eventually got through to a council officer (Officer A) and explained she had received the Notice without any prior notification of unpaid council tax. Officer A advised Miss C the council tax account was not in her name so she could not discuss it with her. Miss C explained that upon receiving the Notice she was distressed and having suicidal thoughts. Officer A terminated the call.
18. Miss C called the Council a second time and it was answered by Officer A again. Miss C explained there had been a mistake, the matter was causing significant distress and she needed to know what steps she could take to rectify the mistake. Officer A refused to provide Miss C with her name and transferred the call to Recovery.
19. Miss C was transferred to Officer B in the Recovery Team. Officer B looked into the matter and confirmed there had been a mistake and rectified the matter.
20. Miss C submitted a complaint to the Council and requested an investigation into how the error occurred and why she did not receive notification sooner when the Council had her new address. Miss C also complained about the customer service she received from Officer A.
21. The Council confirmed it had mistakenly made Miss C liable for the council tax at Property A due to an administrative error and this led to enforcement action. It apologised for the error and the distress it caused.
22. The Council also apologised for the way Officer A handled Miss C’s telephone call and said it would work with Officer A to improve her skills when dealing with customers with mental health issues.
23. The Council also explained Officer A refused to discuss the council tax account with her due to data protection reasons because the account holders name was inputted as ‘Mr C’.
24. In her complaint, Miss C made the Council aware she worked in the financial sector and she was concerned the liability order issued by the Magistrates Court would affect her career prospects and future employment as she would need to disclose the liability.
25. The Council advised Miss C that council tax is not registered with any credit referencing agencies so it does not appear on credit files even if they have had bailiff or court action.
26. Miss C had requested a financial payment to remedy the distress the Council’s actions caused. The Council did not address this in its complaint response.
27. Miss C contacted the Council and asked what it was doing to reverse the liability order. The Council’s response failed to address the liability order itself but it confirmed the summons and liability order costs had been cancelled.
28. Miss C remained unhappy with the Council’s response and brought her complaint to the Ombudsman.

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Analysis

29. It was Miss C’s responsibility to update the Council about her change of address and she did this in a timely manner. The Council were aware of Miss C’s new address as it sent correspondence to her at Property B on two occasions. Despite this, the Council proceeded to make her liable for council tax at her old address, a property it had previously given Miss C a refund of overpayment of council tax on. The Council has acknowledged that it was at fault and says it was due to an administrative error.
30. As a result of this fault, the Council’s system followed a standard process that resulted in enforcement agents trying to recover a debt from Miss C that she did not owe. Miss C only became aware of this in July 2020 when she received a letter from the enforcement agents advising her the Council had obtained a liability order from the Magistrates Court. The Council should have identified the error sooner.
31. The letter from the enforcement agents came as a shock to Miss C and caused her significant distress, particularly because of the potential impact on her career in finance. The distress was further compounded by the poor customer service she received when she contacted the Council and it’s failure to properly address her concerns about the impact on her career. The Council also failed to address her request for a financial remedy.

Agreed action

32. The Ombudsman has published guidance to explain how we recommend remedies for people who have suffered injustice as a result of fault by a council. Our primary aim is to put people back in the position they would have been in if the fault by the Council had not occurred. Miss C has concerns about the potential impact the liability order may have on her career in finance. Therefore, the Council has agreed to take the necessary steps to have the liability order set aside. The Council agrees to start the process to have the liability order set aside as soon as possible, and within one month of this decision.
33. An injustice such as distress is unlikely to be remedied by a payment, so we often seek a symbolic amount to acknowledge the impact of fault on a complainant. The Ombudsman’s remedy guidance says that any remedy should reflect the circumstances of the case, including the severity of the distress and the length of time involved. It says payments are often between £100 and £300.
34. In this case, I consider that Miss C suffered a significant amount of distress when wrongly pursued by enforcement agents and the poor treatment she received when she raised the matter. For these reasons, I recommended the Council pay Miss C £250. The Council has agreed to make this payment to Miss C within 4 weeks of this decision.
35. The Council has agreed to investigate why it did not identify sooner an administrative error had occurred and why it was not rectified before it sought court orders and took enforcement action. The Council has agreed to implement suitable measures to prevent the fault from occurring again. The Council will provide the Ombudsman evidence of this within three months of this decision.
36. The Council has agreed to ensure its officers are provided with suitable training and guidance on how to deal with vulnerable customers and those with mental health problems. The Council will provide the Ombudsman evidence of this within three months of this decision.

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Final decision

I have completed my investigation and found fault which caused injustice to Miss C. The Council has agreed to my recommendations to remedy the injustice caused.

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Investigator's decision on behalf of the Ombudsman