Summary: Mr X complained about the actions of enforcement agents working on behalf of the Council. We have found fault. The Council has agreed a satisfactory remedy.

The complaint

1. Mr X complained enforcement agents working on behalf of the Council:
• failed to offer him an instalment arrangement; and
• incorrectly charged him a £760 sale or disposal fee.
2. Mr X said he suffered an injustice as he should not have had to pay £760.

Back to top

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 an injustice, we may suggest a remedy. (Local Government Act 1974, sections 26(1) and 26A(1), as amended)
4. 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)
5. 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)

Back to top

How I considered this complaint

6. I have considered Mr X’s complaint and the supporting information.
7. I have also considered the Council’s response to Mr X and to my enquiries.
8. I have written to Mr X and the Council with my draft decision and considered their comments.

Back to top

What I found

The Law

The Taking Control of Goods Regulations 2013

9. Before taking control of goods (in other words visiting to take goods) an enforcement agent must issue a notice of enforcement on the debtor seven clear days before the agent takes control of goods. This is the compliance stage. Once an agent makes a first visit the compliance stage is over and the enforcement stage has begun.
10. An enforcement agent can take control of goods on property he has the power to enter and re-enter. This is the property the agent reasonably believes the debtor usually lives at or carries on a business at. Entry to property should be by the normal means of entry for example a door or gate and the agent cannot use force.
11. An agent can only take control of goods by securing them on the property or highway, removing the goods or making a controlled goods agreement with the debtor. The agent must give the debtor a notice with details of the agent and say if the agent has entered the property, and/or taken control of goods. If the agent has taken control of goods, he must give the debtor a detailed list of goods he has taken control of. He also needs to say what the debtor owes and how, where and when the debtor can pay the debt to release the goods.
12. If the debtor does not pay or keep to an agreed arrangement the agent can move to the sale or disposal stage. The agent does not have to remove goods to start this stage; just attend intending to remove. But he will have had to have already taken control of the goods.
13. The Government has set standard fees for enforcement agents. These are £75 for the compliance (letter) stage and £235 for the enforcement (visits) stage and £110 for the sale and disposal stage. (The Taking Control of Goods (Fees) Regulations 2014)

The Council enforcement procedure

14. Information on the Council’s website says under the terms of Taking Control of Goods Regulations 2013 the Council will add a compliance fee of £75 after having obtained a Liability Order. It says it will still be possible for debtors to make an arrangement at this stage to clear the debt. However, if they fail to make or keep an arrangement, the debt will be passed to an enforcement agent for collection.
15. It says enforcement agents are instructed to remove and sell the debtor’s goods to the value of the outstanding business rates and costs incurred. It says the enforcement agent will give the debtor the opportunity to make a satisfactory arrangement for payment before considering removing their goods. If an enforcement agent is instructed, a debtor may incur a significant amount in associated costs. It says debtors should be aware that the costs are calculated as a percentage of the outstanding debt.
16. The Council provided details of how the enforcement fees were calculated in Mr X’s case:
• Compliance fees - £75
• Enforcement fee - £885 (calculated at £235 + 7.5% over any debt amount of £1500)
• Sale or Disposal fee - £760 (calculated at £110 + 7.5% over any debt amount of £1500)

What happened

17. Mr X owed the Council approximately £11,000 in unpaid business rates.
18. The Council made a number of attempts to recover the debt. I have seen evidence that it agreed payment plans with Mr X including one-off instalments and monthly repayments. Mr X failed to keep up with the payments.
19. The Council instructed enforcement agents who visited Mr X’s business.
20. Mr X said his representative attempted to negotiate a payment plan with the agents to enable the debt to be discharged. He said the agents said they could not make any arrangements because Mr X had failed to keep to previous arrangements. Mr X said these arrangements were with the Council itself rather than enforcement agents.
21. Mr X said, the agents said if the payment was not made in full within the hour, a locksmith was on standby to change the locks. This would effectively close down Mr X’s business.
22. Mr X asked for time to raise the funds. The enforcement agents remained at Mr X’s business premises for two and a half hours. The Council said the agents gave Mr X time to make the payment but as it was not forthcoming, they progressed the case to the sale or disposal stage.
23. Mr X said the enforcement agents began listing goods for removal. He said whilst they were doing this, a friend/family member paid his debt in full.
24. The Council argued because the agents began to list goods, they had started the process of taking control of the goods. The Council said this constituted moving from the enforcement stage to the sale or disposal stage which justified the agents charging the £760 fee.
25. Because Mr X’s friend/family member paid the debt in full, the Council said there was no need to enter into a controlled goods agreement or remove goods.
26. Mr X said the enforcement agents should not have taken the £760 fees as they had not started the sale or disposal stage.
27. During my investigation, we sent enquiries to the Council. In response to these, the Council said it, and the enforcement agency had reviewed Mr X’s case. It said the enforcement agency considered its agents had acted correctly in charging the sale or disposal fee. However, the Council and the agency agreed, as a gesture of goodwill, to refund Mr X the £760.

The Council’s response to my draft decision

28. The enforcement agency commented on my draft decision. It said it had correctly charged Mr X the £760 as it had progressed to the sale or disposal stage. It said, had the agents not progressed to this stage, Mr X would not have paid the £11,000 of debt. It went on to say, the agents only failure was not maintaining accurate paperwork records of the goods that were seized in readiness for removal. The enforcement agency argued neither it nor the Council were at fault.

My findings

29. Mr X is not disputing he owed the Council £11,000 in unpaid business rates. Nor is he saying the Council was wrong to instruct enforcement agents. He complains the agents should have offered him an option to pay in instalments and should not have charged him £760 in sale or disposal fees.

Instalment payments

30. The enforcement agents did not offer Mr X the opportunity to make repayments in instalments when they visited his business. The Council said the notice sent by the agents seven days ahead of their visit gave Mr X this opportunity. There is no fault here.

Sale or disposal fees

31. The Taking Control of Goods Regulations 2013 states enforcement agents can only start the sale or disposal stage once they have taken control of the goods. Agents can take control of goods by securing them, removing the goods or making a controlled goods agreement with the debtor. Making a list of the goods does not mean the agents have taken control of the goods. Mr X’s debt was paid before a controlled goods agreement was made.
32. I do not accept what the agency says in response to my draft decision. The agents had not secured Mr X’s goods on the premises or highway. It had not removed goods. It had not entered into a controlled goods agreement. The law is clear the agents must give the debtor a detailed inventory of the goods it has taken control of. The agents must give this in writing with information about the agents and when and how the agents took control of the goods. This did not happen. The agency says its only failing was not having accurate paperwork. This failure meant it did not properly take control the goods and so could not have moved to the sale and disposal stage and added a fee for this.
33. There is fault with the enforcement agents for charging Mr X £760. I consider the Council’s offer to return the money as a satisfactory remedy to put Mr X back in the same position if it were not for the fault.

Agreed action

34. When a council commissions another organisation to provide services on its behalf it remains responsible for those services and for the actions of the organisation providing them. So, although I found fault with the actions of the enforcement agents, I have made recommendations to the Council.
35. Within 4 weeks of my final decision, the Council will:
• apologise to Mr X for the actions of the enforcement agents.

Back to top

Final decision

36. The enforcement agents, working on behalf of the Council, were at fault. The Council has agreed to apologise to Mr X in addition to refunding the fees.

Back to top

Investigator's decision on behalf of the Ombudsman