Storage Fees What is Reasonable?

[brassnecked]

Apart from other upfront known fees and charges, Storage Fees are another issue, as in what is reasonable? They can add significantly more to a debt than the fees laid down in the Regulations.

 

Here is an example of what Newlyn wanted to charge a third party whilst they had his car subject to Interpleader from another thread

 

"We anticipate that the goods will sell for £1600.00 which is considered the value amount, with the addition of £40.00 per day storage charges. "

If a sealed Court Order is not received within 48 hours of this email, the vehicle will be entered into public auction to discharge the Warrant of Control"

 

(http://www.consumeractiongroup.co.uk/forum/showthread.php?455139-I-ve-received-a-letter-from-Newlyn-they-want-to-sell-my-car!%281-Viewing%29-nbsp)

 

If a vehicle is removed and held for 14 days so @ £40/day before auction then £560 in storage will be added to the debt along with the other fees, so a car going under the hammer for £2000 may not even clear an original debt of say £700

 

Storage is of itself a flexible concept, so is it an open field like one bailiff allegedly used, a secure compound, or under cover. For household chattels, then it must be undercover, but for a motor vehicle a compound would seem to be the usual.

 

 

Thoughts ?

Edited November 9, 2015 by brassnecked
putting the u in compound

[Bailiff Advice]

An excellent thread and one that I will welcome contributing to later today.

[brassnecked]

Thanks BA, one issue with Storage fees is unlike the other Statutory fees within the 2014 Regulations, there is no standard fee or cap, so these are a backdoor cash cow the Enforcement companies may well use increasingly to pull in more cash from a debtor.

[Peterbard]

Yes a subject worthy of debate.

[ploddertom]

In itself car parking charges at airports can be contentious but some of the figures quoted by Newlyn above I find beyond belief - no doubt abject greed has a part to play.

[brassnecked]

More than greed PT, they must be looking at it as a possible revenue stream. If a third party vehicle is taken, and the claim is successful will they try to make the innocent pay the storage before they will release the vehicle? It makes you wonder.

[GrumpyToSayTheLeast]

More than greed PT, they must be looking at it as a possible revenue stream. If a third party vehicle is taken, and the claim is successful will they try to make the innocent pay the storage before they will release the vehicle? It makes you wonder.

 

As a general rule, the third party would only be liable for storage charges if they fail to collect the vehicle after the agreed release date.

[GrumpyToSayTheLeast]

Regarding high storage fees, please bare in mind that the compound, auction house or any other secure storage must be:

Secure(fencing, gates, lighting, safes) so there are the costs of securing it.

Have a minimum of cctv and alarm system but usually, in the case of vehicle storage, be manned 24/7.

Have the relevant insurance cover.

Be prepared to store high risk items(high risk as compounds are routinely assaulted by debtors to get their goods back).

 

Its not as easy as you might think to find somewhere capable of storing goods like that. That said, I fully agree that some are taking the micky, having seen one recently where a small selection(3 TV's and 3 or four small items) of household goods were stored @ £50 per day in a normal auctions.

 

A normal figure for storage is between 10-20 per day for normal household goods(1 7.5 lorry full) and up to 35 per day for a car. Anything more, with some exceptions, is imho excessive.

[Bailiff Advice]

Apart from other upfront known fees and charges, Storage Fees are another issue, as in what is reasonable?

 

To provide a simple answer, a reasonable charge should be £10 per day (or less). This figure is the same on various vehicle auction websites. On example is below (see the last paragraph)

 

http://webcache.googleusercontent.com/search?q=cache:0803GXsr5kwJ:https://www.silverstoneauctions.com/buying+&cd=9&hl=en&ct=clnk&gl=uk&client=safari

 

The highest level of 'storage fee' must surely be from 'One Source'. This is the in-house bailiff operation for London Borough of Newham. Their daily charge is £50. It simply beggars belief. A complaint is ongoing with the council.

[Bailiff Advice]

 

A normal figure for storage is between 10-20 per day for normal household goods(1 7.5 lorry full) and up to 35 per day for a car. Anything more, with some exceptions, is imho excessive.

 

There have been two recent findings from the Local Government Ombudsman on the amount of storage and their response is that the debtor should challenge the fees by way of detailed assessment. I have highlighted 'storage fees' under the response to the One Year review and provided evidence of some astonishingly high charges.

[GrumpyToSayTheLeast]

The standard storage rate for most auctions for NON bailiff storage ranges from £6-30 per day. Most car auctions charge 15-25 per day storage. Google the auctions yourself ba.

While some ea companies are ripping people off at £50+ per day, a storage charge of £30 per day is quite normal.

And they are certainly not going to offer discounts for bailiffs.

There is NO WAY that £10 per day is reasonable.

The fee is set by the auctions themselves and that is what gave the basis for the max £50 per day storage fee.

Good luck storing a car in a London auction for less than £20 a day. The cheapest o have seen car storage for sale is £15 and that is outside London(in wales).

[GrumpyToSayTheLeast]

A detailed assement of storage fees for a private auction house will just result in the bailiff producing the invoice from the auction house for storage.

The only time that may work is where bailiffs store the assets themselves.

[brassnecked]

Thanks for the input Grumpy, Storage is indeed a contentious area. on the information you have provided then Newlyn are overcharging. Storage has the potential in a long winded case with of exceeding all other fees, and even be more than the value of removed Controlled Goods in extremis.

 

Presumably a sale takes place within 14 days or so of removal for sale to minimise the Storage fees accrued?

[GrumpyToSayTheLeast]

Yes, sale should take place as quickly as possible as we have no financial interest un keeping goods longer. Indeed, the quicker they are sold, the more we raise for our fee and for the claimant.

[Bailiff Advice]

The standard storage rate for most auctions for NON bailiff storage ranges from £6-30 per day. Most car auctions charge 15-25 per day storage. Google the auctions yourself ba.

 

While some ea companies are ripping people off at £50+ per day, a storage charge of £30 per day is quite normal.

 

And they are certainly not going to offer discounts for bailiffs.

 

There is NO WAY that £10 per day is reasonable.

 

The fee is set by the auctions themselves and that is what gave the basis for the max £50 per day storage fee.

 

Good luck storing a car in a London auction for less than £20 a day. The cheapest I have seen car storage for sale is £15 and that is outside London(in wales).

 

In my above post I provided a link to a large car auction house called Silverstone. At the foor of the page (under the heading of motor vehicles) you will see that they charge a 'storage fee' of £10 per day (plus VAT).

 

In reference to your comment that £30 per day is normal, if you mean that this is a 'normal' amount charged by enforcement agents then I would agree that you are correct. However, that does not mean that £30 per day is 'reasonable' . There is a significant difference between the two.

 

Last week I had a meeting in London and normally I use the train (or more recently; the coach ). On this occasion I travelled into the city by car and parked in a car park within walking distance of the Houses of Parliament, Petty France and the London Eye. From memory the car park was Q Parking and the daily charge was around £35. Enforcement agents do not have car pounds in London. Instead, they store (or sell) vehicles quite some distance from the City where storage fees should be substantially less.

[Bailiff Advice]

Yes, sale should take place as quickly as possible as we have no financial interest un keeping goods longer. Indeed, the quicker they are sold, the more we raise for our fee and for the claimant.

 

And herein lays yet another problem.

 

Once a vehicle is taken, there is a legal obligation on the enforcement agent to provide the debtor with a statutory Notice of Sale. That document (like the Notice of Enforcement) must give the debtor a statutory notice period of not less than 7 clear days that his car will be sold (Paragraphs 39 and 40 of Schedule 12).

 

As well all know, to ensure that there is no ambiguity in the notice period, it is usually the case that a period of 14 days in given. Accordingly, all enforcment agents removing vehicles can almost guarantee that they can safely charge 14 days storage for each vehicle taken. If we take the normal fee of £30 per day that adds an additional amount of £420 to the debt. At £50 per days that amount rises steeply to £700 !!!

[GrumpyToSayTheLeast]

Yes, I understand what you are saying ba, and I support your argument that certain companies are taking the p***. But what we cannot do is limit storage to £10 per day.

There are too many circumstances where that is just not possible to do.

I believe that the £50 is reasonable in CERTAIN circumstances but anyone taking the mickey should be pulled up on it and told to explain their process for doing so.

 

For instance, taking a car for a 500 debt and incuring £700 charges is, to my eyes, ridiculous.

But what about if it a 70000 debt and we take 25 cars from a forecourt?

[Peterbard]

The EA should nor be making any net profit from storage costs in any case, the regulation says that fees are recoverable, not fees can be charged. The only way and i did not say legitimate way is to come to arrangement with the storage provided in that he raises his usual charges and cuts the EA in for a split of the inflated cost. This is surely illegal under quite a few causes of action not least section 66 of the TCE

 

Disbursements recoverable from the debtor

8.—(1) The enforcement agent may recover disbursements from the debtor only in accordance with this regulation and regulations 9, 10 and 11.

(2) The following disbursements are recoverable provided that they are reasonably and actually incurred—

(a)the cost of storing goods which have been taken into control and removed from the premises or highway

[outlawla]

There's a sense from the quote below (James Mckillop, Rossendales Executive) that the overall heist can be enhanced with the disbursements ect. which are over and above the normal costs.

 

Quoted from the Institute of Revenues, Rating & Valuation (IRRV) Insight magazine, August 2015 edition

 

It is worth pointing out that some respondents to the original MoJ consultation in 2012 voiced concerns that the sale stage included the removal of goods and transportation to the place of sale as well as a number of required actions, including obtaining a valuation. It would be naïve to assume that the not so insignificant costs of actual removal, insurances and costs of sale could adequately be covered by the core activities included within the £110 sale fee. However, there is the buffer of the disbursements and exceptional costs process built into the Taking Control of Goods (Fees) Regulations 2014 (regs 8,9 and 10) – over and above the normal costs such as dealing with specialist or high value goods.