Summary: Mr X complained about how the Council recovered outstanding council tax from him. There was fault in how the Council managed Mr X’s council tax debt. This meant Mr X missed the opportunity to include the debt in insolvency proceedings and suffered avoidable distress. The Council agreed to write off the debt, refund what Mr X has paid, apologise and pay him a financial remedy. It also agreed to review its process for when someone closes their council tax account.

The complaint

1. Mr X complains about how the Council recovered a council tax debt by using enforcement agents in 2024. He says the Council:
• failed to contact him about the debt between 2019 and 2024;
• failed to update his address in its records when he told them he had moved;
• wrongly told him that his account was clear in 2022;
• failed to tell him it would use enforcement agents before they attended his former property; and
• gave him conflicting information about how much he owed.
2. As a result, Mr X says he has experienced avoidable distress and worry, and he was not able to include the debt in insolvency proceedings. He wants the Council to explain how much he owes and why, and withdraw the debt from its enforcement agents.

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The Ombudsman’s role and powers

3. 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 significant injustice, or that could cause injustice to others in the future we may suggest a remedy. (Local Government Act 1974, sections 26(1) and 26A(1), as amended)
4. When considering complaints we make findings based on the balance of probabilities. This means that we look at the available relevant evidence and decide what was more likely to have happened.
5. If we are satisfied with an organisation’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

6. I considered:
• the information Mr X provided and discussed the complaint with him; and
• the Council’s comments on the complaint and the supporting information it provided
7. Mr X and the Council had an opportunity to comment on my draft decision. I considered their comments before making a final decision.

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What I found

Council tax recovery

8. The Council Tax (Administration and Enforcement) Regulations 1992 cover both the way councils collect payments of council tax and the way councils can recover council tax debt. The Tribunals, Courts and Enforcement Act 2007 and associated regulations cover the way enforcement agents may recover debts.
9. The council tax bill for the year is due on 1 April. A council will usually collect payment through monthly instalments. If the liable person misses any instalment, the council will send them a reminder. If a payment is still not made or a further payment missed, then the entire outstanding balance will be due (that is the full amount for the rest of the year).
10. To use the various powers available to it to recover unpaid council tax, a council must apply to a magistrate’s court for a liability order against those it believes are liable. Once a council has a liability order it can take recovery action.
11. A liability order gives a council the legal power to take enforcement action to collect the council tax and court costs owed. The most commonly used powers are asking for deductions from benefits, getting an attachment of earnings (this means deductions are taken directly from earnings by an employer and passed to the council) or using enforcement agents. The council can decide which recovery method to use but it can only use one method for one liability order at one time.

Our principles of good administrative practice

12. We publish Principles of Good Administrative Practice to help council understand the founding principles of good administration. This guidance sets out what we consider to be key principles for how councils should run services and made decisions.
13. We expect council to be open and accountable. This includes:
• being open and clear about policies and procedures and ensuring information, and any advice provided, is clear, accurate and complete;
• stating the criteria for decision making and giving reasons for decisions;
• handling information properly and appropriately;
• keeping proper and appropriate records; and
• taking responsibility for actions
14. We also expect council to put things right when they go wrong. This includes:
• acknowledging mistakes and apologising where appropriate;
• putting mistakes right quickly and effectively;
• providing clear and timely information on how and when to appeal or complain; and
• operating an effective complaints procedure, which includes offering a fair and appropriate remedy when a complaint is upheld.

What happened

15. Mr X lived in two properties in the Council’s area for several years until mid-2022. Mr X first lived in Property A, then moved to Property B. He shared Property A with a partner, and the two also lived at Property B for a time. Mr X then lived in Property B alone, before he left the Council’s area.
16. The Council set up a joint council tax account for Mr X and his partner which covered their time at both Property A and Property B. When Mr X lived in Property B alone, the Council set up a sole council tax account for Mr X, with a different account number.
17. While they lived together at Property B, Mr X and his partner fell behind with their council tax. The Council agreed a repayment plan with Mr X for these arrears in late 2019. However, Mr X did not make the agreed payments and so the Council went to court for a liability order.
18. By the time the Council got the liability order, the COVID-19 pandemic had stopped recovery action by enforcement agents. Because of this, the Council did not take any action against Mr X to recover the debt.
19. In 2022, Mr X planned to leave the Council’s area. He contacted the Council to close his council tax account and pay any outstanding balance. When he contacted the Council, he used his current (sole) account number. The Council told Mr X he was in credit and had nothing to pay. The Council also updated Mr X’s sole account with his forwarding address.
20. However, the Council did not remind Mr X about the outstanding balance from 2019. It says it did not do this because Mr X did not ask about the joint account number when he called to close his account.
21. After the pause in enforcement action due to COVID-19 ended, the Council passed the joint outstanding balance to enforcement agents in early 2024. Enforcement agents tried to contact Mr X by post to Property B. However, Mr X no longer lived there so he did not receive these letters.
22. After enforcement agents visited Property B, the current occupant told Mr X about this. Mr X complained to the Council that he had heard nothing about the debt for several years, the Council had told him his was account was clear in 2022, and he had had no opportunity to resolve the debt before the Council passed the account to enforcement agents.
23. In its stage one response to Mr X’s complaint, the Council wrongly told him that the debt was for Property A and a much earlier period of time. It explained the delays in using enforcement agents were due to the COVID-19 pandemic but it still considered Mr X should pay the debt, and asked him to make an offer to repay the debt.
24. Mr X complained further about the conflicting details of the debt, and again raising his concern that the Council had told him, when he moved, that he was in credit.
25. In its stage two response to Mr X’s complaint, the Council did not address either of the points Mr X raised. Instead, it told Mr X it still considered the debt to be payable.
26. After Mr X made further representations to the Council, it agreed to recall the debt from its enforcement agents, removed the fees charged and agreed affordable payments with Mr X.

My findings

27. I am satisfied there was fault on the part of the Council in how it managed Mr X’s council tax debt.
28. When Mr X contacted the Council in 2022 to check on his balance, the Council failed to tell Mr X about the outstanding balance on the joint account with his former partner.
29. On the balance of probabilities, I am satisfied Mr X contacted the Council to settle his council tax debt before moving from the Council’s area. He gave the Council the reference number on the bills he had received for the past several years.
30. However, on the balance of probabilities, I am satisfied the Council failed to provide Mr X with the correct information at that time. It failed to tell him he owed a separate amount for the same property, even though the Council has recorded this under a different reference number. There is no evidence the Council checked whether Mr X owed any other amounts, for either the same or other properties. There is also no evidence the Council asked Mr X if he had any other accounts with the Council.
31. I consider it was unreasonable to expect Mr X to individually list all the council tax account numbers the Council had assigned him, or even to understand that the Council had assigned different account numbers for same property for different periods while Mr X was living there.
32. I do not accept the Council’s explanation it could not search for other debts for data protection reasons. The data the Council would have been searching for related to the same person (Mr X), and the same address (Property B).
33. The Council also failed to update the joint account with Mr X’s forwarding address. This meant he did not have the opportunity to dispute the debt before enforcement agents visited his former home.
34. Had the Council given Mr X accurate information in 2022, I am satisfied he:
• would likely have included any outstanding balance in the insolvency proceedings he went through in 2023, and these would have been written off; and
• would not have experienced any enforcement action or needed to contact the Council to complain about this.
35. Therefore, I consider the Council should:
• write-off the outstanding balance;
• repay Mr X the sums he has paid towards the debt since the start of 2024; and
• pay Mr X a symbolic remedy to recognise the avoidable distress caused by him being contacted by enforcement agents.
36. I am also satisfied the evidence shows the Council failed to property investigate Mr X’s complaint in 2024. It gave him an inaccurate explanation in its stage one response (which it failed to correct) and failed to address the points he made about being given misleading information in 2022. I am satisfied that was fault which caused Mr X further avoidable time and trouble.

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Action

37. Within one month of my final decision the Council will:
• write off the outstanding council tax owed by Mr X;
• refund to Mr X the payment he has made towards the debt since January 2024;
• apologise to Mr X for the avoidable distress, time and trouble caused by the fault I have set out above; and
• pay Mr X £200 to recognise that avoidable distress, time and trouble.
38. Within three months of my final decision the Council will:
• review its process for when someone wishes to close their council tax account. The Council should ensure it checks for any other outstanding amounts owed by the person and provides them with accurate information about how much they owe; and
• remind staff responsible for responding to complaints about council tax that they should proportionately investigate the issues raised in the complaint, particularly where someone raises concerns about a stage one response.
39. We publish guidance on remedies which sets out our expectations for how organisations should apologise effectively to remedy injustice. The organisation should consider this guidance in making the apology I have recommended in my findings.
40. The Council should provide us with evidence it has complied with the above actions.

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Decision

41. I have completed my investigation. There was fault in how the Council managed Mr X’s council tax debt. This meant Mr X missed the opportunity to include the debt in insolvency proceedings and suffered avoidable distress. The Council agreed to write off the debt, refund what Mr X has paid, apologise and pay him a financial remedy. It also agreed to review its process for when someone closes their council tax account.

Investigator’s decision on behalf of the Ombudsman

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Investigator's decision on behalf of the Ombudsman