Summary: Mr X complains the Council was wrong to pursue him for business rates that he doesn’t owe. We find fault with the Council for failing to respond to Mr X, causing him frustration and distress. We have suggested remedies for the injustice Mr X suffered as a result.

The complaint

1. Mr X complains the Council was wrong to pursue him for six years of backdated business rates that he doesn’t owe.
2. Mr X was subject to unnecessary court actions, and he paid over £5000 he believes he doesn’t owe in order to stop recovery action he was finding stressful.
3. Mr X would like the Council to recalculate the rates and refund what he has overpaid.

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The Ombudsman’s role and powers

4. 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)
5. We cannot investigate a complaint about the start of court action or what happened in court. (Local Government Act 1974, Schedule 5/5A, paragraph 1/3, as amended)
6. 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

7. I considered the complaint correspondence between Mr X and the Council, and I spoke to Mr X about his complaint.
8. Mr X and the Council had an opportunity to comment on my draft decision. I considered any comments received before making a final decision.

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What I found

Relevant legislation

Business rates

9. Business rates is a local tax on business premises. The Valuation Office Agency (VOA) keeps the business rating list and decides if a property should be rated. The VOA also decides the rateable value of the premises, and the date each premises should enter and leave the list. Local authorities are responsible for collecting business rates.
10. A local authority can get a liability order from the Magistrates Court for non-payment of business rates. A liability order gives a local authority legal powers to take enforcement action to collect the money owed.

What happened

11. In May 2019 Mr X received a final statement from the Council showing he owed nothing. In April and December 2020 he got a demand for six years of backdated business rates.
12. Mr X sent a detailed response to the Council by letter and email at the end of December but got no response.
13. The Council sent Mr X a notice to appear at Birmingham Magistrates Court in June 2021 for the arrears amount which was just under £6000.
14. Mr X was going to be abroad for the date of the hearing so he emailed the Council to request the hearing be adjourned for a later date.
15. Mr X got an email in September saying the hearing went ahead in his absence and a liability order was made saying Mr X owed the rates to the Council. The Council asked Mr X for evidence that he did not owe the business rates which he sent again the next day.
16. As the Council had been awarded a liability order bailiff’s contacted Mr X to obtain the outstanding amount.
17. Mr X says he is in poor health and his wife is disabled. They are both in their 70’s and the bailiff calls caused distress.
18. Mr X therefore paid the bailiff in full (including the £75 compliance fee) without admission in November, and brought a complaint to the Council and the bailiff company.
19. The bailiff company apologised for the conduct of their enforcement agent, and closed the case as it had been settled in full.
20. Mr X got no response from the Council, so brought his complaint to the Ombudsman.

Analysis

21. Mr X has provided evidence of why he does not owe the business rates as claimed by the Council on more than one occasion. He has never received a response.
22. Mr X brought a complaint to the Council and again, did not get any response.
23. This is fault by the Council causing frustration and distress to Mr X.
24. I cannot comment on the Council’s failure to respond to Mr X’s request for an adjournment of the Court Hearing as that is out of our jurisdiction (see paragraph 5 above).
25. I cannot comment as to whether Mr X does owe the business rates the Council have calculated, but he has suffered injustice in the Council failing to consider his evidence and respond, and also the distress of having contact with bailiffs.
26. I have suggested remedies below for the injustice suffered by Mr X, and also a service improvement to ensure this does not happen again.

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Recommended action

27. Within one month of the final decision the Council should:
• write to Mr X and apologise for the frustration, distress and time and trouble caused by the identified faults;
• consider the evidence Mr X has supplied and respond. If Mr X has overpaid he should be refunded.
• pay Mr X £100 in recognition of the time and trouble he has spent contacting the Council and pursuing his complaint.
28. The Council should also ensure all correspondence on a case is properly responded to before any legal steps are taken to recover local taxation debts.
29. The Council should provide evidence of this in the next three months.

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Final decision

30. I find fault with the Council for failing to respond to Mr X, causing frustration and distress. I have suggested remedies for this injustice.

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Investigator's decision on behalf of the Ombudsman