Summary: The Council wrongly changed Council Tax liability to Mr X’s company. It wrongly took enforcement action against Mr X and his company for Business Rates. Mr X incurred costs providing evidence to the Council. The Council has poor records and did not give the Ombudsman information we asked for. The Council should apologise to Mr X and pay him £1,080 for time, trouble, distress and his expenses.

The complaint

1. Mr X complains the Council wrongly held him responsible for the Council Tax and Business Rates arrears of a company he has no connection with. He says it then failed to offer him a reasonable remedy for the time, trouble, distress and expense its actions caused him.

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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. We investigate complaints about councils and certain other bodies. Where an individual, organisation or private company is providing services on behalf of a council, we can investigate complaints about the actions of these providers. (Local Government Act 1974, section 25(7), as amended)
4. 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

5. I considered the complaint Mr X made and discussed it with him. I asked the Council for information and considered what it provided.
6. I gave Mr X and the Council the opportunity to comment on a draft version of my decision. I considered what they said before I made a final decision.

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What I found

7. Mr X owns a company (Company1) registered with Companies House. There is another company with the same name except for one word (Company 2). Company 2 is registered in the British Virgin Isles. Mr X has no connection to Company 2. Company 2 owns a flat (property A) and a business property (property B).
8. The Council had the correct name for Company 2 for Council Tax at property A. The Council’s Business Rates property occupation list also has the correct name for Company 2 for property B.

Council Tax

9. At some point in 2018 the Council changed the liable person for property A to Company 1. The Council originally said it has no idea who did this or when. It said it assumed an officer carried out a search on the Companies House website. It now says it has established it was a Council Tax Officer who has since left the Council. It says the Officer did not make a note of his reasons.
10. The Council originally told me it does not keep copies of Council Tax bills, reminders or summonses. It said it records the date it sent the bill or notice, the correspondence address and any change in the correspondence address. It now says this is wrong. It has now sent me copies of the Council Tax bills it sent to Mr X for property A. It sent Council Tax bills for 2017/2018 on 7 June 2018 and 14 August 2018. It sent Council Tax bills for the year 2018/2019 on 6 June 2018 and 14 August 2018. It says it sent no other reminders or notices to Mr X.
11. On 24 August 2018 Mr X telephoned the Council as he had received another Council Tax bill for property A. He told the Council he had nothing to do with the flat or Company 2. The Council told him to write in.
12. Mr X wrote the same day. He said he had made several telephone calls to the Council and written to it in February 2018. He said the Council had sent him several threatening letters and demands. He said he had received telephone calls from an enforcement agent despite telling the Council he had nothing to do with Company 2. He wanted the Council to remove his company name and address from the records for property A.
13. The Council Tax Department replied on 5 September 2018. It said it had deleted the account in his name and withdrawn “all recovery action”.

Business rates

14. In 2017 the Council obtained a liability order against Company 2 for non-payment of Business Rates for property B. It referred the debt to enforcement agents (Agent 1). The Council gave Company 2’s address for enforcement but it missed a word from the Company 2’s name so gave Company 1’s name instead.
15. In October 2017 Agent 1 changed the enforcement address to Company 1 to match the company name. Agent 1 began to send letters to Mr X. Mr X contacted the Council.
16. In May 2008 Agent 1 changed the enforcement address back to Company 2. However, in June 2018 Agent 1 changed the address back to Company 1 and wrote to Mr X again. Mr X contacted Agent 1 and said it had the wrong company.
17. The Council’s Business Rates records say: “as per call this is registered abroad, it is not [Company 1] registered in the UK.” In August 2018 Agent 1 returned the account to the Council.
18. The Council obtained a liability order against Company 2 for unpaid business rates for 2018/2019 at property B. In September 2018 it sent both liability orders to a different enforcement agent (Agent 2) for enforcement. Agent 2 says the Council gave it the enforcement address as Company 1. The Council has provided its referral form which gives Company 2’s address but again it gave Company 1’s name.
19. On 11 September 2018 Agent 2 sent an enforcement notice to Company 1. This said Company 1 owed £2,074 to the Council and £75 to Agents 2. It said Company 1 must arrange to pay this by 23 September, otherwise an agent would visit and might seize goods. Mr X’s accountant sent this to Mr X.
20. On 24 September Mr X contacted Agent 2 and the Council. He said the Council had told him it had withdrawn recovery action but now he had received an enforcement notice. He told Agent 2 it was a case of mistaken identity.
21. Agent 2 contacted the Council to tell it what Mr X said. Agent 2’s records say the Council told them the account was open and it had no other contact details for Company 1. The Council’s records say it started to check liability.
22. Agent 2 carried out searches on Mr X and Company 1 and found Mr X’s home address.
23. On 25 September Agent 2 sent an enforcement notice for property B to Company 1 and another to Mr X at his home address.

Mr X’s complaint to the Council

24. On 25 September Mr X complained to the Council and attached a copy of the enforcement notice. On 28 September the Complaints Department asked Revenues to put the account for property B on hold and investigate the recovery action. Because Mr X had been in touch with Council Tax Department, this Department dealt with the complaint. The Council says this was a mistake and it should have realised the enforcement notice related to business rates. It says the Officer assumed Agent 2 was enforcing for Council Tax and so asked agent 2 to cancel the account. The Council did not ask the Business Rates Department to investigate.
25. The Council Tax Department responded to Mr X. It apologised for the letter from Agent 2. The writer said she had contacted Agent 2 to ensure they returned the case.
26. On 28 September Mr X contacted his solicitor and accountant and asked for advice. He asked his accountant to provide proof neither he nor Company 1 had any connection with Company 2.
27. On the same day Mr X emailed the Council to again tell it he had nothing to do with Company 2 or properties A and B. He said he had told the Council this for over 18 months. He asked the Council to contact his solicitor and accountant for confirmation. He said he might have confused issues by using the reference for property A. He said Council Tax confirmed it had corrected the account for property B and he expected the Council to realise it had made the same mistake for property B. He wanted confirmation that Business Rates has also corrected the mistake.
28. The Council says Mr X only copied the Council into this email and it was addressed to his solicitor. However, the Council provided me with its copy of the email. It is addressed “Westminster NNDR”.
29. Mr X telephoned Agent 2 to say his company had nothing to do with property B and the Council had accepted this and said he was not liable. Agent 2 asked Mr X for proof of this which Mr X emailed. Agent 2 then contacted the Council. The Council said it had put the account on hold for 2 weeks.
30. On 8 October the Complaints Department emailed Mr X to say Council Tax had responded. It had deleted the account and cancelled all recovery action. It asked if Mr X still wanted to make a formal complaint about Council Tax and Business Rates. Mr X replied he wanted to continue the complaint as he had no response about Business Rates, despite several conversations. All it had told him was the account was on hold while it investigated. The Council has no record of the telephone calls with Mr X.
31. On 10 October the Revenues Department decided to close the account as the Company name was wrong.
32. On 10 October Revenues responded to Mr X’s complaint about Business Rates. It said it had sent nothing to Mr X, it had sent everything to Company 2 so did not need to amend its records. It said it had not asked Agent 2 to serve demands on Company 1 and had now advised Agent 2 not to do this. It said it advised him to accept Council Tax’s confirmation it had updated its records.
33. Mr X immediately responded. He said

• The Council and its agents had sent notices to him.
• The Council had lost his correspondence.
• The Council had not confirmed it had told Agent 2 not to proceed and had not apologised to him.

34. The Council treated Mr X’s email as a stage 2 complaint. Mr X’s accountant also wrote to the Council. Mr X sent further details of his complaint on 16 October. He said the problem had gone on for 18 months and he had made numerous telephone calls to the Council.
35. On 16 October the Council asked Agent 2 to return the account to it as the company involved was a foreign company.
36. On 27 November 2018 the Council responded to Mr X’s stage 2 complaint. It upheld his complaint. It said

“It is clear that you contacted both the Council’s Council Tax and Business Rates teams on numerous occasions via our capita call centre. I do not intend to provide an exhaustive list of those dates here but I am satisfied that you made every attempt possible to make us aware that you were receiving both business rates and council tax demands in error for a different company/address. You have provided extensive evidence of correspondence with both these teams and copies of the debt collection correspondence you received from (Agent 2) in error. I can also confirm that you were advised by the business rates department that they had, at no time, issued any demands in the name of your company (but to a company with a similar name in the British Virgin Islands, but you have provided evidence which demonstrates this is incorrect”.

37. The Council apologised and offered Mr X £300.
38. The Council now says the writer took what Mr X said at face value and did not investigate previous contact.
39. Mr X’s accountant charged him £250 for dealing with the Council. His solicitor charged him £230 for advice.

Analysis

40. The Council uses a private company to administer Council Tax and Business Rates. It uses Enforcement Agents to collect Council Tax and Business Rates debts. The company and Enforcement Agents act for the Council and it is responsible for the actions they take.
41. The Council wrongly made Mr X liable for Council Tax for property A. The Council has no record of who changed Council Tax liability from Company 2 to Company 1, when they did this or why they did this. This is fault. It caused Mr X injustice as he received Council Tax bills for a property he had no connection with.
42. When the Council sent the Business Rates accounts for property B to enforcement agents, on both occasions it missed a word out of Company 2’s name. It gave the name of Mr X’s Company. It did this even though it had the correct name on the property occupation list. This is fault.
43. Agents 1 checked the address for Company 1 and started to send enforcement notices to Mr X in 2017. It sent more in 2018. Mr X also says Agent 1 telephoned him. This is fault. It caused injustice as Mr X received notices telling him Agent 1 would take his goods. Mr X contacted Agent 1 and said he had nothing to do with property B. Mr X says he also contacted the Council. Although the Council has no record of this, I accept what Mr X says. It is logical Mr X would want to speak to the Council about the mistake.
44. When Agent 1 returned the case to the Council, I have seen no evidence the Council investigated how the mistake happened. If it had investigated it would have realised it had given the wrong company name.
45. The Council made the same error when it sent the account to Agent 2. It again gave Company 1’s name. The same thing happened, and Agent 2 sent enforcement notices to Company 1. This time Agent 2 traced Mr X’s home address and sent an enforcement notice to his home; increasing the injustice.
46. The Council accepts it should have investigated the Business Rates account when Mr X complained in September 2018. It caused confusion when it told Mr X it had withdrawn the Council Tax account from the Agent. The Council Tax account was not with the Agent. On 28 September 2018 Mr X made it clear he wanted action on the Business Rates account as well.
47. The response from Business Rates to Mr X on 10 October 2018 was dismissive and shows no evidence it had investigated what Mr X told it. The Council had given both Agents 1 and 2 Mr X’s Company name for enforcement. It did not tell Mr X it had already realised it had the wrong company name and had decided to cancel the account. It did not address Mr X’s complaint about action by Agent 2, the Council is responsible for any action taken by the Agents acting for it.
48. The Council has no record of telephone calls from Mr X about Business Rates. Mr X often mentions his telephone calls with Business Rates in his emails to the Council. I accept Mr X telephoned Business Rates and it should have made some record of this.
49. The Council’s complaint response to Mr X of 28 November 2018 says the writer had seen evidence Mr X contacted the capita call centre “numerous” times. The writer said she would not give an “exhaustive” list of dates. The Council now say the writer did not investigate Mr X’s contact with the Council but accepted what he said. Mr X did not give any dates he telephoned the Council. The writer says she has seen evidence of the calls but would not give a list of the dates. The writer either misled Mr X and had not seen any evidence because she had not looked; or the Council has withheld information I asked for; or it has lost records. This is fault.
50. I recognise and welcome that the Council upheld Mr X’s complaint and offered him a remedy. However, I do not consider the £300 it offered him enough to remedy his complaint. We provide guidance on remedies. £300 is within our guidelines for time and trouble. However, as well as time and trouble Mr X suffered distress resulting from the Council’s disregard for proper procedures. He was contacted by Enforcement Agents threatening to take goods at both his business and home address. We would recommend a payment of £300 for this level of distress. Mr X also has bills for £480 from his solicitor and accountant for helping him deal with the Council’s error.

Agreed action

51. To put matters right for Mr X within one month of my final decision the Council will apologise to Mr X and pay him £1,080.

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Final decision

52. The Council is at fault and has caused injustice. The Council has agreed to provide the remedy I recommended. I have completed my investigation and closed the complaint.

Investigator’s decision on behalf of the Ombudsman

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Investigator's decision on behalf of the Ombudsman