Each year, approx 3.5 million households have a Liability Orders issued against them for council tax and non domestic rate arrears. With forthcoming changes to the benefits system (in particular with the introduction of Universal Credit) it is anticipated that this figure is set to increase significantly in the coming year.
The Summons and Summons Costs
Where an outstanding amount of council tax has not been paid after reminders have been sent, a local authority may apply to the magistrates’ court for authorisation to issue a summons.
Additional costs will be charged for issuing the summons and for obtaining the Liability Order. These typically range from between £85 to £130 for Council Tax to as much as £250 for Business Rates (NNDR).
Do I need to attend the hearing at the Magistrates Court?
You don’t need to attend the hearing. Unless the amount claimed on the summons is wrong or you are not the person named on the summons, the Magistrate must grant a liability order.
If you do attend the hearing you will normally be able to speak with a representative from the local authority. In most cases, an agreement is usually reached for you to settle the debt by way of affordable payments. The Liability Order will still be granted, but it should be possible avoid the debt being passed to bailiffs. If you do consider attending the hearing, it would be helpful to take any evidence with you of financial hardship.
What will happen at the hearing?
To obtain a Liability Order, a representative of the Local Authority will present a spreadsheet to the Magistrates Court consisting of the names, addresses and reference numbers of those debtors in arrears with Council Tax or Non Domestic Rates. This is officially called a Complaint List. Unless there are objections, (which are very rare), the Court will rubber stamp the Complaint List with a court stamp. This has the effect of formally establishing that there is a liability (to the council) and enables the local authority to take a range of enforcement actions to recover the debt.
Will I be sent a copy of the Liability Order?
No, a ‘Liability Order’ is not a prescribed court document. The stamped ‘Compliant List’ gives the legal authority to the relevant council to use a range of enforcement methods (attachment of earnings, attachment against benefits, bailiff enforcement etc) to recover the liability.
Although there had previously been a requirement under Schedule 2 of the The Council Tax (Administration and Enforcement) Regulations 1992 for a form (Form A) of Liability Order to be provided to council tax payers, this requirement was repealed in 2003 under the Council Tax (Administration and Enforcement) (Amendment) (No. 2) (England) Regulations 2003. For the avoidance of doubt, there is no such document as a Liability Order.
Is a Liability Order ‘statute barred’ after 6 years?
No, a Liability Order is not subject to the Statute of Limitations Act .
What will happen after a Liability Order has been granted?
The local authority are not under any obligation to write to you to advise that a Liability Order has been obtained. Iff they wish, they can simply pass the account to a firm of bailiffs.
If bailiff enforcement is to be avoided, it is vital for debtors to contact the local authority at the earliest possible stage to negotiate ways in which to settle the debt. Once the Liability Order has been passed by the council to their bailiffs, it is very rare indeed for the local authority to recall the debt.
Note from Bailiff Advice:If you have any queries about the enforcement of a Liability Order, or are experiencing difficulty in getting a payment agreement accepted, you can email a question to us using our Question page. Alternatively, you can contact Bailiff Advice by phone. Details are on our Contact page.A simple overview of the Taking Control of Goods Regulations 2013 including details of fees that can be charged, notices that must be given by the bailiff and items that are ‘exempt’ can be read here.