Summary: Mr X complained that the Council wrongly held his company liable for a business rates debt and failed to send invoices, denying him the opportunity to dispute the debt. He says the Council wrongly instructed enforcement agents to recover the debt and the agent who visited the premises acted in an aggressive manner. We found the Council wrongly held Mr X’s company liable for the debt but we did not uphold his other complaints. The Council has already provided an adequate remedy for the injustice caused to Mr X. It has now agreed to send an apology to his employee for the distress caused by the enforcement agent’s visit.

The complaint

1. Mr X complains that the Council wrongly held his company liable for a business rates debt and failed to send invoices to the company, denying him the opportunity to dispute the debt. He says the Council wrongly instructed enforcement agents to recover the debt and the agent who visited his premises acted in an aggressive manner towards a member of his staff. Mr X says that, although the Council has now cancelled the debt, he has been put to time and trouble in resolving the matter and his staff member suffered distress because of the enforcement agent’s behaviour.

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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 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

4. I have considered all the information provided by Mr X, made enquiries of the Council and considered its comments and the documents it provided.
5. 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

Legal and administrative background

6. Business rates is a local tax on business premises. The Valuation Office Agency (VOA) keeps the business rating list. It decides if a property should be rated, the rateable value and the date each property enters and leaves the list. If someone wishes to challenge the VOA’s decisions they have a right of appeal to the Valuation Tribunal. The Ombudsman has no jurisdiction to investigate the VOA.
7. Local authorities are responsible for collecting business rates, the amount of which is determined by the rateable value of the premises set by the VOA.
8. Liability to pay the rates is decided in the Magistrates’ Court. After issuing reminders, the Council can apply to the court for a liability order for non-payment of business rates. A liability order gives the local authority legal powers to take enforcement action to collect the money owed. The Council decide which recovery method it wishes to use. This can include asking bailiffs/enforcement agents to visit the premises and seize goods to the value of the debt. As the bailiffs are acting on behalf of the Council, it retains responsibility for their actions.
9. The government has issued minimum standards for bailiffs and enforcement agents, “Taking control of goods: National standards” 2014. This document states that enforcement agents must carry out their duties in a professional, calm and dignified manner. They must not act in a threatening manner when visiting the debtor by making gestures or taking actions which could reasonably be construed as suggesting harm or risk of harm to debtors, their families or property.

Key facts

10. Mr X is the owner of business premises. The current rating list began in 2017. The Council says that, at that time, there were two separate assessments at the premises: Unit 1 occupied by Mr X’s company (‘the company’) and Unit 2 occupied by another party. Units 1 and 2 were merged from 31 May 2018. However, in 2021, the VOA corrected the date of the merger to 1 March 2019 and temporarily created Unit 2A which was in the valuation list from 31 May 2018 to 1 March 2019. Accordingly, business rates were payable for Unit 2A for this period.
11. Following instruction from the VOA, in June 2021 the Council set up a business rates account for Unit 2A and issued an invoice for the amount due. It sent the invoice to the Company at Unit 1.
12. In July 2021 the Council sent a reminder notice to the Company. It then issued a final notice in August 2021 stating that a summons would be issued if payment was not received.
13. In September 2021 a summons was issued by the Magistrates Court for non-payment of business rates. The Court later granted a liability order. The Council then wrote to the Company stating that, if the account was not paid, recovery action would continue and this may include the use of enforcement agents.
14. In July 2022 the Council again wrote to the Company stating that, if the debt was not paid, it would pursue enforcement action.
15. In August 2022 the Council instructed enforcement agents to collect the outstanding debt. The enforcement agents wrote to the Company advising of the debt and pending enforcement action.
16. On 20 September an enforcement agent visited the Company’s premises. There was only one member of staff present. She telephoned Mr X who was abroad. He spoke to the enforcement agent and explained the company was not liable for the debt and asked the agent to leave the premises.
17. Mr X complained to the Council. It accepted that, because of a misunderstanding, the Company was wrongly charged business rates for unit 2A. It accepted another party was the occupier of Unit 2A and was responsible for the business rates. The Council corrected its records and withdrew all charges and costs for Unit 2A in the Company’s name. It also withdrew the case from the enforcement agents. The Council apologised for any distress and inconvenience caused. It also referred Mr X’s comments about the actions of the enforcement agent to the agency for investigation.

Analysis

The business rates debt

18. I appreciate Mr X disagrees with the VOA’s decision to create Unit 2A and place it on the rating list. However, I cannot investigate the actions of the VOA. Mr X has a right of appeal to the Valuation Tribunal against the VOA’s decision.
19. There are no grounds to criticise the Council for relying on the assessment carried out by the VOA and issuing invoices for business rates for Unit 2A. But the Council accepts it wrongly identified the Company as being responsible for payment of business rates on Unit 2A. This was fault.
20. Mr X says he did not receive any correspondence about business rates at Unit 2A and so was denied the opportunity to dispute liability. The Council has provided copies of the invoices which were addressed to the Company at its address at Unit 1 but stated that the address for which business rates were payable was Unit 2A. The Council also sent reminders. It says none of the correspondence was returned by Royal Mail as undelivered even though a return address was on the envelope. I cannot reach a view on why Mr X did not receive the correspondence.
21. The Council was entitled to apply for a liability order when the debt remained unpaid. It acted appropriately by sending a copy of the liability order and notification of pending enforcement action to the Company before instructing enforcement agents. Again, I cannot reach a view on why Mr X did not receive this correspondence. There are no grounds to criticise the Council for passing the debt to enforcement agents to recover.

The enforcement agent’s visit

22. Mr X says the enforcement agent deliberately arrived at the premises after 5pm when most staff had gone home and only Ms Y was on the premises. He says the agent acted in an aggressive and threatening manner towards her. He says Ms Y told the agent she felt threatened and vulnerable, but he refused to leave. Ms Y telephoned Mr X and he spoke to the agent on loudspeaker. During the telephone conversation Ms Y was distressed and repeatedly said to Mr X “please ask him to leave”.
23. The Council acted appropriately by referring Mr X’s complaint about the enforcement agent to his employer for investigation. The agent had not switched his body worn camera on so the enforcement agency was unable to provide any video footage of the visit to the Council. However, it provided a statement from the agent setting out his version of events. The Council found this contradicted Mr X’s version.
24. The enforcement agent said he entered the company building just after 5 pm. There was a female inside the office. He showed her his ID and asked to speak to a manager or owner. When she said she was the only person on the premises he advised her to see if she could contact someone by telephone. She telephoned Mr X who was abroad. Mr X disputed that he owed any money to the Council and said he had received no correspondence about the matter. The agent said Mr X began shouting at him to leave the premises. He said the employee became upset as she was alone and told him she felt threatened and vulnerable. The agent agreed to leave and return in 24 hours.
25. There is a clear difference between the enforcement agent’s version of events and that of Mr X. In these circumstances, I could not reach a safe conclusion about precisely what happened in the absence of tangible evidence. Unfortunately, there is no independent evidence such as CCTV footage or video evidence. Accordingly, I cannot reach a view on whether the enforcement agent acted in an aggressive and threatening manner as alleged. However, it is clear from both versions of events that Ms Y was distressed by the enforcement agent’s visit.

Injustice

26. I find that, because of the fault identified, Mr X was put to time and trouble in resolving the matter and Ms Y suffered distress by the mere fact of the enforcement agent’s visit regardless of his behaviour.
27. In response to Mr X’s complaint, the Council accepted fault in that it incorrectly held his company liable for business rates for Unit 2A. It cancelled all enforcement action and made the correct party liable for the debt. It also apologised to Mr X and his employee. In addition, the Council has changed its procedures so that, in future, all customers will be contacted by telephone before it instructs enforcement agents to secure payment.
28. I consider this to be an adequate remedy for the injustice caused to Mr X. I have considered whether the Council should also make a payment to him, but he has specifically stated that he does not want a financial remedy.
29. I consider Ms Y is entitled to a personal remedy for the injustice she suffered, so I have made a recommendation below that the Council should apologise to her directly.

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Agreed action

30. The Council has agreed that, within one month, it will send a letter of apology to Ms Y for the distress caused by the enforcement agent’s visit.
31. The Council should provide us with evidence that it has complied with the above recommendations.

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Final decision

32. I find the Council was at fault in that it wrongly held Mr X’s company liable for business rates at Unit 2A.
33. I do not uphold the remainder of Mr X’s complaint.
34. I have completed my investigation on the basis that I am satisfied with the Council’s actions.

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Investigator's decision on behalf of the Ombudsman