Can bailiffs levy for their fees alone? Council Tax FOI

[outlawla]

Just come accross an interesting FOI made to Manchester City Council on the website What do they Know.

 

FOI:

 

In cases allocated to bailiffs for collection of council tax; do Manchester City Council pay the bailiff their fees for work carried out by them when the debtor does not because of direct settlement of the account with the authority?

 

If compensation to bailiffs is paid by the council due to debtors not paying bailiffs their fees; what are the annual figures for the years 2002 to date with respect to this payment?

 

Council's reply:

 

No sums are payable to bailiff companies in respect of uncollected fees in cases where debtors pay outstanding sums to MCC . Neither is any compensation paid in cases where debtors do not pay bailiffs their fees.

 

Under normal circumstances, in both these scenarios, bailiff companies will continue to proceed against debtors for amounts of unpaid fees outstanding on their accounts.

 

So in scenarios where debtors have paid off their liability to the council direct but have outstanding bailiff fees they state in their reply that their "bailiff companies will continue to proceed against debtors for amounts unpaid......."

 

Does anyone know how this is viewed in the eyes of the law?

 

Is it likely the council have any idea what the law states? or in fact are they bothered?

 

Can the bailiff lawfully take goods which are levied with respect to the council tax liability order if only bailiff fees are outstanding?

 

 

[hallowitch]

Can the bailiff lawfully take goods which are levied with respect to the council tax liability order if only bailiff fees are outstanding?

 

 

IMHO i would say if the bailiff levied goods prior to full payment of the liability order then yes as the regulations state

Distress

 

45.—(1) Where a liability order has been made, the authority which applied for the order may levy the appropriate amount by distress and sale of the goods of the debtor against whom the order was made.

(2) The appropriate amount for the purposes of paragraph (1) is the aggregate of—

(a)an amount equal to any outstanding sum which is or forms part of the amount in respect of which the liability order was made, and

(b)a sum determined in accordance with Schedule 5 in respect of charges connected with the distress.

(3) If, before any goods are seized, the appropriate amount (including charges arising up to the time of the payment or tender) is paid or tendered to the authority, the authority shall accept the amount and the levy shall not be proceeded with.

[outlawla]

......IMHO i would say if the bailiff levied goods prior to full payment of the liability order then yes as the regulations state

Distress

 

45.—(1) Where a liability order has been made, the authority.......

 

Thanks HW, I agree. No matter how many times you read the distress notes 45.–(1–3) you can't seem to interpret them to be in the favour of the debtor.

 

Having said that, it could be argued that although item 3 states the authority shall accept the amount "including charges"; the "council accepting the amount" could be irrelevant in circumstances where the debtor pays regardless of whether the council formally accepts.

 

This in effect would lead to a completely different scenario; one in which the liability with the council is completely paid regardless of the council's acceptance of it. I'm only aware of councils "SAYING" they will not accept payment; what they say and what they do are two entirely different things.

 

(3) If, before any goods are seized, the appropriate amount (including charges arising up to the time of the payment or tender) is paid or tendered to the authority, the authority shall accept the amount and the levy shall not be proceeded with.

 

I wonder how this situation changes with payment made direct to the authority before a levy takes place?

[brassnecked]

I would have thought only a first visit fee is payable, BUT only if they visit before monies are paid into the account, problem here is bailiffs would argue it takes 5 days to clear even by an electronic transfer, so would say that if you paid on the first of the month, you were fair game for a levy and associated fees until the 6th working day. Tomtubby will likely know something more definitive on this

[outlawla]

I would have thought only a first visit fee is payable, BUT only if they visit before monies are paid into the account, problem here is bailiffs would argue it takes 5 days to clear even by an electronic transfer, so would say that if you paid on the first of the month, you were fair game for a levy and associated fees until the 6th working day. Tomtubby will likely know something more definitive on this

 

I think what I'm trying to get at is not so much what fees they are entitled to but more specifically whether they can legitimately use the original council tax liability order to remove goods when full payment (less bailiff fees) have been paid to the council. Of course the opinion expressed by HW brings into question a distinction as to whether a levy is made proir to, or after the council receives full payment.

 

Supposing the bailiff can't under any circumstances use the CT liability order to enforce payment of their fees alone; what legitimate means are available for them to do this?

[brassnecked]

I think what I'm trying to get at is not so much what fees they are entitled to but more specifically whether they can legitimately use the original council tax liability order to remove goods when full payment (less bailiff fees) have been paid to the council. Of course the opinion expressed by HW brings into question a distinction as to whether a levy is made proir to, or after the council receives full payment.

 

Supposing the bailiff can't under any circumstances use the CT liability order to enforce payment of their fees alone; what legitimate means are available for them to do this?

 

I think they would have to initiate an action against the debtor, as they cannot then rely on the discharged liability order, and swear that all their fees are valid, and comply with the relevant regulations. As we know they are creative with fees, and any anomaly would get their backsides kicked and the claim chucked out of court, imho, but others will know more

[Thegreenpimpernel]

I stand by my often repeated opinion that a bailiff enforcing CT or NNDR can continue to enforce for his legitimate fees, so long as:

 

a) there is a LO outstanding

 

and

 

b) he still has authority from the council to do so i.e. a warrant backed up by the LO.

 

If the council screw up and mark the LO settled before the bailiff gets paid, then tough luck for Mr bailiff!

[brassnecked]

I stand by my often repeated opinion that a bailiff enforcing CT or NNDR can continue to enforce for his legitimate fees, so long as:

 

a) there is a LO outstanding

 

and

 

b) he still has authority from the council to do so i.e. a warrant backed up by the LO.

 

If the council screw up and mark the LO settled before the bailiff gets paid, then tough luck for Mr bailiff!

 

That's how i see it, if Mr X pays council, what they say is due, and mark the account settled, after the first bailiff visit then first visit fee is it, especially if there is no levy, how can they attend to remove if no levied goods are there to remove?, so how can they then add £100s to the bill? but they do.

[outlawla]

This same FOI request has been put to a number of councils, and all those that have answered so far state that they don't pay the bailiffs their fees when payment by-passes them. This arguably means that the game is up for the bailiff once the council receive full liability from the debtor unless they take the matter up as a separate case. But like brassnecked said they would have to swear that all their fees were valid; what chance is there of that?

 

Further clarification has been requested regarding Manchester City Council's statement (What do they know MCC FOI) which if they don't evade the issue will hopefully throw more light on it.

[brassnecked]

The problem is that we need some casde precedents to look at to see what direction an appeal court would take, i.e. support bailiff or debtor, as the action would purely be for fees.

[tomtubby]

It is important to remember, that the bailiff is NOT enforcing for his fees. I have mentioned this many times. With council tax, the regualtions are clear in that bailiff fees must first be deducted from any payment made with the remainder going towards the Liability Order. It is for this reason that there is always a problem if a payment is made direct to the council.

 

For instance, assuming that a Liability Order has been issued against you for £200 and the bailiff has made one visit where he was unable to levy because you were not at home. His fees would be £24.50 for "attending to levy (where no levy was made)". On your return home, you find a hand delivered letter and immediately make a payment of £200 to the council to clear the Liability Order.

 

From this £200 payment, the local authority MUST account to the bailiff company fees of their fees of £24.50 and the BALANCE of £175.50 is then applied towards the Liability Order. Therefore, you have a balance under the Liability Order of £24.50 and the bailiff can ...and will... visit again to collect this balance. He is NOT collecting his fees.

 

I have seen the FOI and it is clear that the question AND the answer are most confusing.

[brassnecked]

It is important to remember, that the bailiff is NOT enforcing for his fees. I have mentioned this many times. With council tax, the regualtions are clear in that bailiff fees must first be deducted from any payment made with the remainder going towards the Liability Order. It is for this reason that there is always a problem if a payment is made direct to the council.

 

For instance, assuming that a Liability Order has been issued against you for £200 and the bailiff has made one visit where he was unable to levy because you were not at home. His fees would be £24.50 for "attending to levy (where no levy was made)". On your return home, you find a hand delivered letter and immediately make a payment of £200 to the council to clear the Liability Order.

 

From this £200 payment, the local authority MUST account to the bailiff company fees of their fees of £24.50 and the BALANCE of £175.50 is then applied towards the Liability Order. Therefore, you have a balance under the Liability Order of £24.50 and the bailiff can ...and will... visit again to collect this balance. He is NOT collecting his fees.

 

I have seen the FOI and it is clear that the question AND the answer are most confusing.

 

Thanks TT that clarifies things in my mind, so if debtor pays the £24.50, on top of the £200, in your example, the bailiff fees are covered and the LO is then completely satisfied.

So as long as the correct fees are added to the payment, it will be OK, and if a bailiff tries it on for extras after that point they are either greedy, stupid, or both.

[outlawla]

It is important to remember, that the bailiff is NOT enforcing for his fees. I have mentioned this many times. With council tax, the regualtions are clear in that bailiff fees must first be deducted from any payment made with the remainder going towards the Liability Order. It is for this reason that there is always a problem if a payment is made direct to the council.

 

From this then it would appear that if bailiff fees must first be deducted from any payment made, then the overriding issue should be that the majority of councils have opened themselves up to legal challenge. I say majority because coincidently a reply just received to the same FOI from Oldham Council reveals that when they use external bailiffs, they do allocate funds to the bailiffs as a priority.

 

Oldham Council FOI reply

 

Oldham Council use, in the majority of cases internal bailiffs employed by Oldham Council.

 

However when external bailiff companies are used payment is made directly to the council, we will forward part of the payment to the bailiff company to cover the costs of any fees that have been legally incurred. Legislation dictates that fees should be paid before the debt and therefore we are legally obliged to pay the bailiff company their fees first from any direct payments.

 

The council has not paid any compensation to bailiff companies for debtors not paying their bailiff fees.

 

 

I don't know if it is just me but does the fact that their response states: They will forward to the bailiffs the costs of any feess that have been LEGALLY incurred, and that they have not paid any compensation to bailiffs for debtors not paying fees, indicate anything?

 

Despite this one council "so far" stating that they abide by the legislation it seems that most councils don't and in the circumstances being discussed you could reasonably argue that bailiffs would effectively be enforcing for their fees if like most councils imply (by not allocating to them their fees) that the liability has been settled.

 

For instance, assuming that a Liability Order has been issued against you for £200 and the bailiff has made one visit where he was unable to levy because you were not at home. His fees would be £24.50 for "attending to levy (where no levy was made)". On your return home, you find a hand delivered letter and immediately make a payment of £200 to the council to clear the Liability Order.

 

From this £200 payment, the local authority MUST account to the bailiff company fees of their fees of £24.50 and the BALANCE of £175.50 is then applied towards the Liability Order. Therefore, you have a balance under the Liability Order of £24.50 and the bailiff can ...and will... visit again to collect this balance. He is NOT collecting his fees.

 

 

Presumably the above example would only be relevant to those councils that DO carry out their legal obligation when proportioning monies due to their bailiffs with regards direct payment; for example in minority cases such as Oldham council.

 

If this example was used for the majority of councils that DO NOT carry out their legal obligation when proportioning monies due to their bailiffs, the full balance of £200 would settle the liability and the bailiff would effectively be enforcing for his (£24.50) fees.

 

I have seen the FOI and it is clear that the question AND the answer are most confusing.

 

 

I think the FOI request has been worded in such a way to remove any possible ambiguity that would inevitably lead to the councils taking advantage and evading the question.

 

EDIT:

 

Could it be possible that the majority of councils who have answered this FOI request be giving out misleading responses because of the way the FOI is worded, especially given that they are legally required to allocate to the bailiffs their fees as a priority over the liability?

Edited May 17, 2011 by outlawla

[Tingy]

I have always believed that if an account with the council is settled, but bailiffs fees are outstanding, the bailiffs have every right to pursue the debtor for their legitimate fees, but cannot do so using the council's original LO. They must take independent action to recover their fees. I also believed that if you have paid the council everything you owe them, you have every right to demand that they mark the account as settled which it is. The fact that bailff fees are outstanding is nothing to do with it, hence it has to be pursued by the bailiffs which they obviously have every right to do. What they can't do anymore though, as stated already, is claim they are now representing the council as they are not.

[brassnecked]

I have always believed that if an account with the council is settled, but bailiffs fees are outstanding, the bailiffs have every right to pursue the debtor for their legitimate fees, but cannot do so using the council's original LO. They must take independent action to recover their fees. I also believed that if you have paid the council everything you owe them, you have every right to demand that they mark the account as settled which it is. The fact that bailff fees are outstanding is nothing to do with it, hence it has to be pursued by the bailiffs which they obviously have every right to do. What they can't do anymore though, as stated already, is claim they are now representing the council as they are not.

 

So it looks like as tomtubby says, the bailiff fees come first, so a first visit fee is payable and debtor settles up to include this, then the council marks it satisfied, bailiff has no course of action, but if they have loaded other fees and called before the council calls them off, they have to take THEIR OWN action in the county court against the debtor for their fees, BUT they have to verify and swear all these other fees have been correctly applied.

 

Looks to me that as per Tingy, there is a lot of scope for the bailiff to hang himself and have the fees declared void, due to their less than scrupulpus application of the correct procedure.

 

This is illustrative of how each OP needs advice on their particular problem,

[Tingy]

Also, if you pay the council direct when the bailiffs have been appointed their fees get by-passed. This is just one reason why I always advise this course of action, and then settle the legitimate bailiff fees later. I feel if you take the line TomTubby advises, and no disrespect to her whatsoever, she is superb, the bailiffs can and do abuse the system and keep big chunks for their supposed legitimate fees and pass the remainder to the council who then pay them their legitimate fees. It's just doing it a different way round.

 

I always try to keep bailiffs out, get the CT settled, then address lawful bailiff fees. In reality I usually find so many unlawful levies, fees, actions etc... they usually stop all pursuit as if they did take to court they would lose.

[brassnecked]

Yes Tingy i can see the merits in your approach, and also tomtubby's which is in strict accordance with the law. however, as you rightly point out the bailiffs trip themselves up with their greed, so which approach you use will depend on the individuals situation. I thing that is as clear as it will get.

Edited May 17, 2011 by brassnecked

[Transparency]

Agree with Brassnecked

[fork-it]

Does anyone know how this is viewed in the eyes of the law?

 

 

 

JBW Enforcement Ltd v City of Westminster [2009] EWHC 2697 (QB), the Judge, Mr Justice Jack said:

 

Thus the bailiff gets paid only through the process of execution: if he becomes entitled to charge fees, but does not continue with the execution process, he will not recover them and he cannot sue the debtor for them.

 

Source http://www.bailii.org/ew/cases/EWHC/QB/2009/2697.html

[brassnecked]

JBW Enforcement Ltd v City of Westminster [2009] EWHC 2697 (QB), the Judge, Mr Justice Jack said:

 

 

 

Source http://www.bailii.org/ew/cases/EWHC/QB/2009/2697.html

 

Fork-it, as this was a case dealing with collection of PCN penalty fines/charges would this case stand as precedent for council tax, also, or would tomtubby's interpretation of those particular regulations for collecting CTax allow a bailiff to sue for their fees? I think this case clears it up for decriminalised parking, but it is still grey with regard to CTax.

[Tingy]

I believe bailiffs can pursue honestly earned fees legally. Much as I despise bailiffs I think is quite right too as they are doing their job. However, if they act dishonestly and charge unlawful fees of which you have evidence, they trip themselves up as they cannot then realistically pursue the debt. If they were honest, as some are, then fair enough - if they've done the work they should be paid.

 

As said above there are two different approaches outlined above, mine and TomTubby's. Hers follows the letter of the law and mine doesn't. I'm sure TT can quote similar statistics, but last year I fought on behalf of others 45 council tax + bailiff battles. All 45 were won so something in my approach works. I work on the principle gove a bailiff enough rope and they'll hang themselves!

[fork-it]

Fork-it, as this was a case dealing with collection of PCN penalty fines/charges would this case stand as precedent for council tax, also, or would tomtubby's interpretation of those particular regulations for collecting CTax allow a bailiff to sue for their fees? I think this case clears it up for decriminalised parking, but it is still grey with regard to CTax.

 

The Judge did not differentiate what kind of debt so the precedent applies to bailiffs fees.

[brassnecked]

The Judge did not differentiate what kind of debt so the precedent applies to bailiffs fees.

 

Well there is another case as precedent to put in the armoury then.

[outlawla]

Just come accross an interesting FOI made to Manchester City Council on the website What do they Know.

 

FOI:

 

In cases allocated to bailiffs for collection of council tax; do Manchester City Council pay the bailiff their fees for work carried out by them when the debtor does not because of direct settlement of the account with the authority?

 

If compensation to bailiffs is paid by the council due to debtors not paying bailiffs their fees; what are the annual figures for the years 2002 to date with respect to this payment?

 

 

Council's reply:

 

No sums are payable to bailiff companies in respect of uncollected fees in cases where debtors pay outstanding sums to MCC . Neither is any compensation paid in cases where debtors do not pay bailiffs their fees.

 

Under normal circumstances, in both these scenarios, bailiff companies will continue to proceed against debtors for amounts of unpaid fees outstanding on their accounts.

 

 

So in scenarios where debtors have paid off their liability to the council direct but have outstanding bailiff fees they state in their reply that their "bailiff companies will continue to proceed against debtors for amounts unpaid......."

 

 

Manchester City Council have just responded to further questions about this FOI, though I suspect it's guesswork.

 

Additional questions

 

Could you please explain upon what grounds the bailiff company could continue to proceed against debtors for amounts of unpaid fees outstanding on their accounts, with attention to the following:

 

1) Whether the bailiff can legitimately remove goods for only his charges using the original council tax Liability Order, taking into consideration the following distinctions:

 

i) A levy made prior to the council receiving full payment (less bailiff fees), where no goods have yet been removed?

 

ii) A levy made after full payment (less bailiff fees) is made to the council?

 

2) If levying with the council tax liability order is not a legitimate option for MCC's appointed bailiffs to retrieve their fees; what legitimate means is available for them to accomplish this?

 

MCC's Answer

 

In both the instances that you mention I believe that our "Regulation 45" covers cases where bailiffs continue to levy distress for fees outstanding...it states:

 

Where a liability order has been made, the authority may levy the appropriate amount by distress and sale of goods.

 

The appropriate amount for levy is the aggregate of an amount equal to any outstanding sum covered by the liability order and a sum in respect of charges in connection with distress.

 

So yes I am perfectly satisfied that the rules governing the levying of distress for Council Tax permit goods to be removed in cases where amounts of Council Tax are paid directly to the local authority but additional amounts of enforcement fees incurred are not paid.

 

 

I suspect whoever is dealing with this FOI request does not really know for sure and is only clutching at straws by using regulation 45 to justify his response. I've a feeling there will be further questions to MCC to get a more definitive answer, i.e. one that goes beyond being perfectly satisfied.

Edited May 18, 2011 by outlawla

[Tingy]

I think they're talking ball works! Their own union http://www.acea.org.uk/faq/ seem to contradict Manchester as well. They say bailiffs can pursue the debt in the same way as the original debt was pursued -ie- by getting their own liability order through the courts and then pursuing payment, which is pretty much what we've been saying all along. They cannot do it using the council's LO and the council cannot use a clause in a policy document as though it were law when it isn't. If they could I'd produce my own Policy Document stating that under Clause 45 my house is totally exempt of Council Tax!