Summary: Mr X complained about the Council’s handling of his Council tax arrears. The Council was at fault. It failed to tell the bailiffs to put his account on hold while it investigated errors Mr X brought to its attention. This meant the bailiffs carried out an enforcement visit before the Council finished investigating the errors. As a result, Mr X incurred an avoidable enforcement fee. The Council agreed to deduct the enforcement fee from Mr X’s outstanding arrears and issues him with a new bill. The Council also agreed to pay Mr X £100 to acknowledge the frustration and time and trouble he experienced pursuing his complaint.

The complaint

1. Mr X complained about the Council’s handling of his council tax arrears. Mr X said the debt included unnecessary bailiff enforcement fees after the Council refused to put the debt on hold while it investigated errors he brought to its attention. Mr X said the matter has caused him stress, time and trouble and will cause avoidable financial hardship should he have to pay the fees.

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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 spoke to Mr X about his complaint.
5. I considered the Council’s response to my enquiry letter.
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

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 goods. Once they have secured goods they must give the debtor a notice. The fee for this stage is £235. If outstanding debts are more than £1500, bailiffs can charge a further 7.5% of the amount outstanding over £1500.
• The Sale or Disposal Stage - this stage starts once a bailiff has taken control of goods. 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 remain prepared to deal directly with individuals at any point. It says Councils can ‘call action back from the bailiffs at anytime and where there is a case to do so they should consider such action’.

What happened

14. Between 2012 and 2018 Mr X lived in and owned various different properties, and as such was liable to pay the Council Tax at each property. Between 2012 and 2018 Mr X accrued Council Tax arrears at each property. Records show Mr X paid various amounts of Council Tax, however in 2014 the Council referred the case to the bailiffs due to the amount outstanding. The bailiffs returned the case to the Council in 2017 as they were unsuccessful in collecting the debt.
15. In 2018, the Council passed Mr X’s case to a different bailiff. The bailiffs wrote to Mr X on 11 April 2018 at the compliance stage. The total debt was £3010 and related to two of the properties Mr X had lived in. The bailiffs charged the £75 compliance fee for each property.
16. Mr X wrote to the Council on 24 April 2018 following receipt of the bailiffs’ letters. Mr X acknowledged the outstanding debt was for two properties he previously owned. Mr X apologised and said he had buried his head in the sand and had not addressed the matter. Mr X said he wanted to resolve the matter and settle the accounts. Mr X however said the amounts stated in the bailiffs’ letters were not correct. Mr X gave periods where he did not actually live at one of the properties and said the Council had not applied the 25% single person discount. Mr X said he had previously informed the Council that only he had lived in the properties.
    Mr X said that would significantly reduce the amount he owed. Mr X asked the Council to put further bailiff action on hold while it investigated his concerns so it could issue a revised bill.
17. On 3 May 2019 the bailiffs carried out an enforcement visit on Mr X for the debt. The visit accrued an enforcement fee of £349 which included a surcharge because the total debt was over £1500. The bailiffs did not make contact with
    Mr X but left notices of enforcement at the address.
18. The Council wrote to Mr X on 4 May 2018 in response to his letter from
    April 2018. The letter told Mr X it would pass Mr X’s enquiry to its billing team who would then issue a revised notice to confirm any discounts applied. The Council said it would inform the bailiffs accordingly. The Council said it would not place a hold on the account. The records show the Council sent revised amounts for
    Mr X’s debts to the bailiffs on 9 May 2019 which reduced Mr X’s balance by £398. The bailiffs wrote to Mr X with the revised balance.
19. Mr X complained to the Council in August 2018. Mr X said he had paid off some of the debt but disputed that he should have to pay the enforcement fees. Mr X said if the Council had put the case on hold while it investigated the errors he had pointed out then the enforcement fees would have been avoided. Mr X said the enforcement fees were unnecessary.
20. The Council responded to Mr X in August 2018. It provided Mr X with a breakdown of the outstanding debt and confirmed the enforcement fees were still outstanding. The Council said the total still outstanding was £759.66.
21. Mr X was dissatisfied with the Council’s response and asked to escalate the complaint to stage 2. The Council responded to Mr X. The Council confirmed the enforcement fees related to the bailiffs visit on 3 May. The Council said it looks at each case on its merits and it was up to individual officers to decide whether to place accounts on hold.
22. Mr X remained unhappy and complained to the Ombudsman. Mr X has a total of £709.99 outstanding, but Mr X said he should not have to pay the £349 enforcement fee. Mr X’s account was on hold while the Ombudsman investigated his complaint.

My findings

23. There is no dispute that Mr X had significant Council Tax arrears and only responded to the Council following the bailiff’s compliance stage letter in
    April 2018. Mr X fully accepted in his letter to the Council following the bailiff letter that he had ‘buried his head in the sand’ over the matter. Therefore, the Council was not at fault for sending the case to the bailiffs.
24. Government guidance says councils should remain prepared to deal with individuals at any point and should consider calling action back from the bailiffs at any time. Mr X said he was willing to settle his bill but asked the Council to put the account on hold while it investigated his queries around the single person discount. The Council said in response to my enquiries that it would usually put accounts on hold, but a temporary member of staff made the decision not to. I have seen no records to show the rationale for that decision. The Council was at fault for going against its normal practice without any recorded reasons.
25. The Council investigated Mr X’s queries which resulted in a reduction in the outstanding amount. The Council was at fault to have allowed the enforcement stage to proceed while there was a query over the level of debt. Had the Council put Mr X’s account on hold while it investigated, in accordance with normal practice, Mr X would have had an opportunity to agree the debt owed and pay it before the enforcement stage. The Council’s fault caused Mr X to incur avoidable enforcement fees.
26. Following my enquiries, the bailiffs confirmed, due to an administrative error, they charged Mr X £109.46 in enforcement fees and not the full £349 they were entitled to charge as an enforcement fee. The remaining £239.54 was not added on to the debt Mr X owes. I have examined the bailiffs’ statements and am satisfied Mr X was not charged the full £349 enforcement fee, and only the amount of £109.46 is included in his outstanding balance.
27. Mr X has spent a significant amount of time pursuing his complaint with the Council and the bringing it to the Ombudsman. The Council was unaware of the bailiffs administrative error when dealing with Mr X’s complaint which has added to the time taken and has caused Mr X frustration.

Agreed action

28. The Council agreed within one month of the final decision to:
• remove the £109.46 enforcement fee from the outstanding amount and issue Mr X with a new bill to reflect that deduction; and
• pay Mr X £100 to acknowledge the frustration and time and trouble he was put to in pursuing his complaint. The Council is entitled to offset this against the outstanding debt if it chooses to do so.

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Final decision

29. 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