Summary: Mr Y complained about the way the Council dealt with his request that it recall two outstanding penalty charge notice debts from its enforcement agents because he is a vulnerable person. We found fault in how the Council considered his request. But this fault did not cause Mr Y an injustice and so we have completed our investigation.

The complaint

1. Mr Y complains about the Council’s handling of his request that it recall two outstanding Penalty Charge Notice debts from its enforcement agents and remove any recovery fees because he is a vulnerable person.

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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)

• 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)

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 the details of Mr Y’s complaint and invited him to contact me.
5. I have considered the information the Council has provided in response to my enquiries and the relevant guidance and legislation.
6. I set out my initial thoughts on the complaint in a draft decision statement and I invited Mr Y and the Council to comment.

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What I found

7. The Council enforces parking restrictions and takes recovery action using procedures set out in the Traffic Management Act 2004 and associated Regulations. Councils and motorists must follow these procedures although councils have discretion to stop enforcement or recovery action if they believe there are good reasons to do so.
8. Where a council believes a parking contravention has occurred, they may serve a Penalty Charge Notice (PCN) on the registered keeper of the vehicle.
9. The vehicle owner can appeal to the Council and if unsuccessful, to the Traffic Enforcement Centre (TEC).
10. The vehicle owner must appeal to the TEC within 28 days of receiving the Council’s decision but can ask for more time under certain circumstances. These include where the owner claims they were contacted about a PCN they did not know about. These are called ‘out of time’ challenges and they must be made to the TEC.
11. Councils will often use an enforcement agent to recover debt. Enforcement agents can charge fees for each stage of the enforcement process.

Enforcement fees

12. Enforcement agents may charge fees when carrying out enforcement action. To charge the compliance stage fee of £75 an enforcement agent must send a notice of enforcement seven days before trying to take control of goods. An enforcement agent may charge £235 at the enforcement stage, this stage starts once an agent has made a first visit to recover a debt. (Taking Control of Goods (Fees) Regulations 2014)

Taking Control of Goods: National Standards 2014, paragraph 16

13. This says if a debtor is found to be vulnerable creditors should be prepared to take back the case, if necessary.

The Council’s Corporate Income Collection Rules, Section 13

14. This policy explains how the Council handles cases where a person with an outstanding debt to the Council is vulnerable. It says it will act to find out the circumstances of the case.
15. It says that vulnerability does not mean the debt is not due but may mean the debtor can get help such as a short-term arrangement to help overcome imminent financial problems.

Company Z’s Vulnerable Persons Policy and Summary Process

16. This explains how the company will handle debtors who say they are vulnerable. It says it will send all relevant information about a customer’s case to the client so it can consider what action to take.

What happened

PCN1

17. A vehicle registered to Mr Y was parked in a resident’s or shared use parking place without a valid permit on 8 August 2019. The Council issued a Penalty Charge Notice (PCN) for the offence to Mr Y as the registered keeper of the vehicle. The PCN fee was £130 or £65, if paid within 14 days of the date of the offence.
18. The Council did not receive payment for the PCN. It issued Mr Y with a notice to owner but received no response.
19. The Council issued a charge certificate to Mr Y because it had not received payment or any representations challenging the PCN. The PCN fee increased to £195.
20. The Council issued an order of recovery on 1 September 2020 because it had not received a response to the charge certificate. It explained the fee had increased to £203.
21. The PCN remained unpaid and so the Council transferred the debt to its enforcement agents, Company Z, on 15 April 2021. A notice of enforcement was sent to Mr Y and a compliance fee of £75 added.
22. Payment was not received and so an agent from Company Z visited Mr Y’s home on 5 May 2021. The agent could not contact Mr Y but left a letter. An enforcement fee of £235 was added.
23. Mr Y wrote to Company Z on 21 June 2021 explain he was a vulnerable debtor because he has anxiety and is on medication. He wanted the debt returned to the Council and said he did not want the matter considered by Company Z’s welfare department. He also sent the letter to the Council.
24. Mr Y sent a further letter on 4 August 2021 reiterating that he did not want his case passed to Company Z’s welfare team. Company Z replied saying it has a process to assess vulnerability before deciding if it was right to return the case to the Council.
25. Company Z tried to contact Mr Y between August 2021 and March 2022 without success.
26. On 31 March a Company Z agent visited Mr Y’s home. The agent could not contact Mr Y and he left a letter.
27. Mr Y replied on 1 April 2022 reiterating that he was vulnerable. He said he did not want his case considered by Company Z’s welfare team and he wanted the debt returned to the Council.
28. Company Z replied repeating that it had a process to establish vulnerability before returning a debt to the Council. It asked Mr Y to confirm that he did not want his case passed to the welfare team.
29. Mr Y wrote to Company Z on 22 April 2022 saying that he would only provide evidence of his vulnerability to the courts or the Council.
30. Company Z explained it trains its welfare team so it can assess vulnerability. It said it needed evidence of Mr Y’s vulnerability to assess his case. It also offered Mr Y the opportunity to set up a payment plan for the debt.

PCN 2

31. A vehicle registered to Mr Y was parked in a resident’s or shared use parking place without a valid permit on 16 October 2020. The Council issued a Penalty Charge Notice (PCN) for the offence to Mr Y as the registered keeper of the vehicle. The PCN fee was £130 or £65, if paid within 14 days of the date of the offence.
32. The Council issued Mr Y with a notice to owner on 1 December 2020 because it had not received any representations challenging the PCN or payment.
33. Mr Y did not respond to the notice to owner and so the Council issued Mr Y with a charge certificate on 6 January 2021. The fee for the PCN increased to £195
34. The Council issued an order of recovery to Mr Y on 28 April 2021 because it received no response to the notice to owner. The order included information about how to challenge the PCN with the TEC and explained the fee had increased to £203
35. Mr Y made a statutory declaration on 9 June 2021. The Council issued a new notice to owner on 9 July 2021.
36. Mr Y made a representation against the PCN on 3 August 2021. The Council responded on 7 September 2021 by sending Mr Y a notice of rejection, which included an explanation for the rejection. The Council offered Mr Y the chance to pay the PCN at the reduced amount.
37. Mr Y made an appeal to London Tribunals on 30 September 2021. The tribunal rejected the appeal on 9 November 2021.
38. The Council received no payment and so it sent Mr Y a new charge certificate on 15 December 2021.
39. Payment was not received and the Council issued a new order of recovery to Mr Y on 25 January 2022.
40. The PCN remained unpaid and so the Council transferred the debt to Company Z on 18 March 2022. It sent a notice of enforcement to Mr Y and added a compliance fee of £75.
41. Mr Y told Company Z his position on PCN 1 also applied to PCN 2.
42. Mr Y made an out of time statutory declaration to the TEC on 16 May 2022 and recovery of the debt put on hold.
43. The TEC issued a revoking order on 8 July 2022 requiring the Council to cancel the charge certificate and order for recovery.
44. The revoking order did not cancel the PCN and so the Council issued a new notice to owner on 26 July 2022 offering Mr Y the opportunity to settle the debt. The Council removed the £75 compliance fee.
45. Payment was not received and the Council issued a new charge certificate on 1 September 2022.
46. Payment was not made and the Council issued a new order for recovery on 22 September 2022. The debt is £203 and remains unpaid.

Complaint to the Council

47. On 1 April 2022 Mr Y made complaint to the Council about its handling of both PCNs. He said the debt being with Company Z was adding to his difficult mental state. The Council replied saying it had followed the correct recovery process for both PCNs and the debt remained due.
48. Unhappy with the response Mr Y escalated his complaint to stage two of the Council’s complaints process. He said that wanted the debts returned from Company Z to the Council because he is a vulnerable person.
49. The Council response reiterated that both PCN’s had followed the correct recovery process. It said recovery of PCN 2 was hold as the TEC was considering Mr Y’s Out of Time Statutory Declaration. It did not address Mr Y’s report that he was vulnerable.
50. Mr Y remained dissatisfied and complained to us.
51. We asked the Council how it had considered Mr Y’s request that it recall his debts from Company Z. It said no evidence of vulnerability had been received from Mr Y nor had he provided evidence to Company Z. It said it needed evidence to support debtors reports of vulnerability and it cannot act until it receives this.

Finding

52. I have considered the way the Council responded when Mr Y raised concerns that he was a vulnerable debtor. Mr Y’s stage two complaint raised this issue. However, the Council’s complaint response did not address this matter. It does not ask Mr Y to provide evidence about his vulnerabilities. Its Corporate Income Collections Rules says that if a debtor alleges vulnerability it should act to find out the facts of the case. I have seen nothing to suggest the Council asked Mr Y to provide evidence or took any other measures to find out the facts of his case. This is fault.
53. Mr Y plainly asks the Council to recall his debts from Company Z. Again, the Council did not address this matter in its response to his complaint nor have I seen any other correspondence addressing this request. The Council should ask for the evidence it needs to decide if it should recall Mr Y’s case from Company Z. It did not and so I consider its decision not to recall to the debts was made arbitrarily. This is fault.
54. The Standards say the Council should be prepared to take back control of a case at any time if the debtor is identified as vulnerable. However, it does not place a duty on the Council to do so. Therefore, it is not the case the Council should automatically recall the debt as asserted by Mr Y in his correspondence.
55. I note the Council says Company Z requested evidence, but Mr Y has not provided this. I have seen evidence which supports this. However, I have seen nothing demonstrating Company Z advised the Council that Mr Y said he was vulnerable. Furthermore, it did not tell the Council that Mr Y said he would only provide evidence of his vulnerability to the courts or the local authority as per his email 22 April 2022. It should have done so. The failure to do so means an opportunity for the Council to request evidence from Mr Y was missed.
56. However, I am aware that in subsequent communications with the Council Mr Y says he will only provide evidence of his vulnerability to courts or medical professionals. Therefore, it seems Mr Y would not have provided the information if the Council had sought it in response to either his complaint or his communications with Company Z.
57. Also, I note that Company Z offered Mr Y the opportunity to set up a payment plan to repay his debt but he did not act on this. The Council and Company Z would likely have used such a plan to recover the debt if Mr Y had provided evidence of his vulnerability. This is because being recognised as a vulnerable debtor does not mean the debt is cancelled or reduced, simply that it needs to be recovered in a manner that considers the debtor’s vulnerabilities. Therefore, I do not consider Mr Y has suffered a significant injustice because of the identified fault as he was offered a payment plan and choose not to accept it.

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Agreed action

58. Within in one month of our final decision the Council agreed to write to Mr Y inviting him to provide evidence supporting that he is vulnerable debtor. If Mr Y does so it agreed to consider the evidence and write to Mr Y explaining its view on the evidence and what action, if any, it will take.
59. Within in three months of my final decision the Council agreed to:

• issue a memo reminding all staff handling PCN complaints and recovery of PCN debts that any reference to the debtor being vulnerable should be followed up; and
• remind Company Z that where a debtor says they are vulnerable the Council should be informed so that it can consider the circumstances of the case to see if it should become involved.

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Final decision

60. I have found fault with the Council for failing to follow its debt collection policy. However, I do not consider Mr Y has suffered any significant injustice because of this fault.

Investigator’s final decision on behalf of the Ombudsman

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Investigator's decision on behalf of the Ombudsman