COMPLAINT TO THE LOCAL GOVERNMENT

OMBUDSMAN

Part III of the Local Government Act 1974

21 March 2016

AGAINST
NORTH EAST LINCOLNSHIRE COUNCIL

List of Annexes:
Annex A

Councils 14 March 2016 final response

Annex B

10 November 2015 email query to Council

Annex C

17 December 2015 formal complaint letter to Council

Annex D

Councils 21 December 2015 cover letter

Annex E

Councils 13 November 2015 response

Annex F

25 December 2015 second formal complaint letter to Council

Annex G

Councils 19 January 2016 first stage formal complaint response

Annex H

26 January 2016 third formal complaint letter to Council

WHAT DO YOU THINK THE BODY DID WRONG?

The complaint surrounds North East Lincolnshire Council (the Council) engineering
default in circumstances where payments were made in sufficient amount to meet the legal
obligation I was under to pay the sums set out on the demand notice relating to my 2015/16
Council Tax liability.
The Council misallocated payments to a previous years balance, thus leaving a shortfall in
respect of the current years account (that which the payment was intended). The presumed
cause being that an instalment was met from two transactions, and with neither payment

matching the instalment amount set for the current council tax year the system automatically
posted it to the oldest balance. Payment however at least covered the amount owed at all
times and was for part of the period in credit.
The Councils right to appropriate payment did not arise on account of the transaction not
matching an instalment amount (not if doing so put the current year's liability in arrears).
According to established appropriation laws, a debtors election may take an implied form, as
well as expressed. Therefore, where payment is unspecified, it would be implied that the
payment was intended for the account most beneficial to the debtor to reduce, which would
clearly be the current year's, if allocating monies to another balance would put the current
years account in arrears.
R v Miskin Lower Justices (1953) held that where an amount so obviously relates to a specific
liability, it would be an unwarranted assumption to allocate the payment elsewhere. Billing
Authorities are able to set parameters in their revenue system so when payment amounts are
not recognised, monies are allocated to the current year. The anomalies caused by automation
are largely eliminated because of this since it ensures debtors do not incur additional costs
through subsequent recovery applications. This is in agreement with the judgment in R v
Miskin Lower justices, as it would be an unwarranted assumption to allocate monies to a sum
in arrears if it is likely to also put the current year's liability in arrears.
Note:
A process that relies on automation such as the council tax payments system, will inevitably
present a flexibilityefficiency tradeoff. Having the system set so unmatched payments are
posted to the most recent account has to achieve greater compliance with the general
principles which allow for implied payments, simply because the authority could not
reasonably assume that the debtor would elect the oldest balance, knowing his current due
payment was deficient and incur further expense. This approach would, for reasons selfevident, require less manual adjustment with respect to reallocating unmatched payments
rendering the automated aspect of the process more compliant with the judgment in R v
Miskin Lower justices.
It is apparently standard practice, whichever way their systems are set, for billing authorities
to regularly check unmatched payments to ascertain which account payment is intended, if
there are arrears outstanding. However, what fundamentally matters (after initial payment

allocation) is for the appropriation of those unmatched to the current year's liability if
allocating payment to the oldest debt would put the current year's liability also in arrears.
Balance suspended from enforcement
The balance to which monies were misallocated by the council was in any event suspended
from enforcement. Therefore, notwithstanding that the councils right to appropriate payment
did not arise, even if it had for whatever reason, it should have become immediately obvious
from the account notes that the sum was subject to court proceedings. As there has been no
outcome yet to the proceedings the suspension has not been lifted and the sum remains
suspended. It was clear from my current council tax bill alone that the suspension had not
been lifted as it was itemised separately and described as a sum subject to court
proceedings. The relevant part of the council tax bill states under the header Memorandum
Note as follows:
Your instalments for 2015/16 do not include your 2014/15 account balance
As at 27-FEB-2015 your 2014/15 Council Tax account balance is 60.00
60.00 of the total is subject to court proceedings
Linking matter of complaint to court proceedings
The Council has refused to address the complaint with the justification being that it raises
matters about a Liability Order and so falls outside the scope of the complaints process.
It has been reiterated over the course of the complaint that the matter concerns payment
misallocation. The council has taken it upon itself to redefine the matter so it appears to
concern court proceedings for the obvious reason that it can deny me the opportunity of a just
outcome to the formal complaint. Moreover, there is evidence this has been done in
anticipating that the matter will be escalated to the LGO in the hope that its handiwork will
fall in the hands of an acquiescent officer assigned to preliminary assess the complaint.
The summons charge, to which no further sum is added on being granted the liability order,
was applied to my account on or around the 15 September 2015, approximately two weeks
before the application for a liability order was made to the Magistrates court. Therefore, the
summons charge, which the council is claiming to be the matter of complaint, even if it was,
concerned solely its actions, as the court has no jurisdiction over costs until the case is
brought before the court.

Other matters
It would be negligent if I omitted to point out the disingenuous claim by the council which
implies that its failure in responding within a reasonable time-frame is a rarity. I have from
the same department had to wait four weeks for a reply in relation to a previous matter and
even after the council had made the claim in its first stage response, the final response
exceeded its own deadline by a week.
The matter regarding my election for all payments to be allocated to the current year's
liability, whether or not a sum matches an instalment amount, which was improperly
addressed in the first stage response (and contended), was entirely ignored in the final
response.

HOW HAS THIS AFFECTED YOU?

The error has caused the inconvenience of having to dispute the council's actions and the
subsequent refusal to cooperate has caused the need to escalate the matter via the councils
formal complaints mechanism and of course enter into a complaint with the LGO. These
actions alone have taken a significant amount of time and caused gross inconvenience.
However the further consequences, which I would be prudent not to refer to in this complaint,
have added substantially to that gross inconvenience.

WHATDO YOU THINK THE BODY SHOULD DO TO PUT THINGS RIGHT?

The council was not entitled to allocate payment to the balance it did and therefore it should
be reallocated to the account to which it was intended.
According to the council, there is an outstanding sum of 211 in respect of my 2015/16
council tax liability. If the effects of the error were put right, it would require that the
misallocated payment of 60 is reallocated to the 2015/16 account (restoring the previous
outstanding balance); the 60 penalty added September 2015 would have been invalid and so
require removing from my account. The remaining sum outstanding would be 91 which I
would then be able to settle without fear of further maladministration attributable to the
council allocating it wrongly.
The council has implied in its 13 November 2015 letter that it does not intend allocating all

future payments in accordance with my election. In order to clarify this I instructed the
council, as I am lawfully entitled, that unless there were express instructions (in writing) to
the contrary, payment should be allocated to the current year's liability, whether or not a sum
matches an instalment amount.
The seriousness of the failure to take these measures can not be over stated. Prompt action is
required to ensure that the immediate consequences of the error are remedied and also to
prevent unwarranted enforcement measures that may otherwise follow. Should the error not
be remedied it is likely a constant cycle of recovery action will result, incurring additional
costs which will accumulate over time to be sufficient in amount that the council will achieve
its clearly vindictive aim of justifying taking action such as bankruptcy or imposing a
custodial sentence.
It would be reasonable to expect the council offer payment of a suitable amount firstly as
compensation for the error, and secondly for its intransigence by refusing to cooperate,
causing the added inconvenience I'm being put to.

Annex A

14th March 2016

PRIVATE AND CONFIDENTIAL
Mr Xxxx Yyyyy
XY Xxxxxxx Yyyyy
Grimsby
North East Lincolnshire
AB12 3XY

www.nelincs.gov.uk
Chief Executive
Rob Walsh

Dear Mr Yyyyy,
I refer to the letter dated 03 February 2016 in which it was confirmed that your complaint
had been escalated to the final stage of the Council's complaints procedure. The issues
you have raised have been investigated which has included a review of the stage 1
response. This investigation has been undertaken independently of the officers that have
previously handled your complaint.
The enclosed investigating officer's report details the findings of this investigation which I
consider has been correctly and fairly carried out in accordance with the Council's
Feedback Policy. Please accept our apologies for the element of your complaint which
was found to be upheld.
If you are not satisfied with this response and the outcome of your complaint, you have the
right to take the matter to the Local Government Ombudsman, whose contact details are
as follows:
LGO Advice Team
The Local Government Ombudsman
PO Box 4771
Coventry CV40EH
Tel: 0845 602 1983
Fax: 024 7682 0001
I would like to thank you for bringing these issues to the Council's attention. This has been,
of necessity, a formal response driven by our Feedback Policy and procedures, designed
to ensure full, fair and impartial examination of concerns which arise. I am personally
always very keen to see how we can improve our services and learning from complaints is
one way of achieving this. Although you may not be happy about all aspects of my
conclusions, I am hoping you will accept that this matter has had proper consideration.
5

Yours sincerely

Rob Walsh
Chief Executive
North East Lincolnshire Council
Stage 2 Corporate Complaint Investigation
PRIVATE AND CONFIDENTIAL
Assistant Director:

Sally Jack (Assistant Director Joint Delivery)

Service Area:

Council Tax

Investigating Officer:

Susan Harrison (Customer Management Service Manager)

Complaint Reference:

NEL/1172/1516

Final decision of Investigating Officer:

The complaint is partially upheld with respect to the delays in receiving a response to
correspondence.
Summary of complaint:
Mr Yyyyys formal complaint dated 26th January 2016 is summarised below:
1. The Councils 6 week delay in responding to his correspondence dated 10th November
2015
2. The Council asserts that the concerns raised about the Liability Order falls outside the
scope of the complaints process
How the complaint was considered:
Susan Harrison, Investigating Officer, considered the complaint by conducting:
A full review of the documents provided in relation to all stages of Mr Yyyyys complaint:

Allocation of Payments letter dated 13th November 2015

Allocation of Payments cover letter dated 13th November 2015

Formal complaint letter dated 25th December 2015

Formal complaint Response dated 19th January 2016

Request to escalate to Stage 2 letter dated 26th January 2016

Susan Harrison interviewed:

th

Debt Management Manager on Monday, 8 February 2016

Court Enforcement Manager on Monday, 8 February 2016

Information Governance and Complaints Officer, Monday, 8 February 2016

th

th

The Council's Corporate Feedback Policy V032, Section B:3

th

The Local Government Ombudsman (LGO) Decision Statement, Ref No 15016673 dated 24
February 2016.
It was not considered necessary to meet the complainant as the letters of complaint and
background information provided enough detail to ensure full consideration of the issues.
Findings:

1. The Councils 6 week delay in responding to his correspondence dated 10th November 2015.
Mr N Smith responded to Mr Yyyyy by letter offering an apology dated 21st December 2015.
Furthermore this was upheld at stage 1 of the complaints process and communicated to Mr
Yyyyy in a formal letter dated 29th January 2016. The Council did fall below its high standards
for responding to correspondence in this matter and for that the Council apologises again.
This complaint remains upheld.
2. The Council asserts that the concerns raised about the Liability Order falls outside the scope
of the complaints process. The Council's Corporate Feedback Policy V032, Appendix B:3
states that "a complaint that is being dealt with or was previously dealt with by legal
proceedings is outside the scope of the Council's complaints process. As a result of Mr
Yyyyy prematurely lodging a complaint with the LGO prior to the findings of the Council's
investigations, the Council finds the same as the LGO in its Decision Statement, Ref No
15016673 dated 24th February 2016. The Ombudsman may not consider matters which
are subject to the commencement of court proceedings, regardless of the outcome.
The Council considers that Mr Yyyyys complaints have been appropriately dealt with by the
LGO and therefore the Council fully agrees with the Ombudsmans final decision.
This complaint is not upheld
Details of final recommendations:
This investigation has found that the Council acted in accordance with the Regulations and
Guidance at all times.
The recommendation is that, wherever it is possible, for teams to share deadlines where they are
likely to occur during periods of absence. It is acknowledged, however, that where absence is
unexpected this may not always be met.
Mr Yyyyy has asked that complaints be responded to within prescribed deadlines and the Council
will strive to achieve this, wherever possible. Mr Yyyyy has been given an apology for the delay in
responding to his initial communication on 10th November 2015. It should also be highlighted that

although this delay should not have happened it has had no detrimental impact on the complainant.
Mr Yyyyy has asked for his concerns raised in relation to the Liability Order to be considered within
the Councils complaint process. The Council is in agreement with the LGO that they may not
consider matters which are subject to the commencement of court proceedings, regardless of the
outcome.
Investigators decision on behalf of the Chief Executive:
Susan Harrison
Assistant Director:
Sally Jack

Annex B
From: Xxxxx
To: counciltax@nelincs.gov.uk
Sent: Tuesday, November 10, 2015 3:54 PM
Subject: Appropriation of Payments
Dear Sir/Madam
Re: Council Tax Account 550xxxxxxx
I have two instalments remaining of 91.00 (182.00 in total) in respect of my 2015/16 council tax liability.
It is noted from viewing NELC's website that my account shows a total sum of 302.00.
120.00 therefore does not relate to my current year's council tax liability. 60.00 of that sum relates to
summons costs from November 2012 which are suspended pending a high court appeal; the remaining
60.00 relates to a sum which NELC obtained in an attached claim of costs in a fraudulent application for
liability order.
I am writing to make it categorically clear that any payment I make on my account (whether that sum
matches an instalment amount) my express election is for that payment to be allocated to the current year's
liability. This applies also to future year's, unless there are express instructions (in writing) to the contrary.
Also for the avoidance of doubt, should NELC decide upon instructing its bailiff contractor to attempt
collecting any of the fraudulently obtained summons costs, NELC does not have my permission to allocate
any element of payment I make on my account in respect of sums accruing in fees and charges.
I require acknowledgement that NELC fully understands these instructions.

Yours sincerely

Annex C
North East Lincolnshire Council
Finance Department
Civic Offices Knoll Street
Cleethorpes
North East Lincolnshire
DN35 8LN

XY Xxxxxxx Yyyyy
Grimsby
North East Lincolnshire
AB12 3XY

17 December 2015
Dear Sir/Madam

Re: Council tax Ref: 550xxxxxxx Formal Complaint

Firstly I wish to bring it to the Councils attention that the time responding to correspondence
regarding my council tax account is unacceptable. I sent an email on 10 November 2015 and over 5
weeks later, the council has still not responded.
I thought a record had been set for the longest response time when on 16 October 2014 I emailed
the same department and had to wait until 12 November to receive a reply. In which time a number
of council tax recovery steps had been taken which would have been obvious were unnecessary had
the council attended to the query sooner and corrected its error.
The second issue I am raising concerns the e-mails content. If you locate the query I sent on
10.11.15 it will be clear I have alleged that the council fraudulently obtained a liability order from
Grimsby Magistrates court by committing perjury, and did so in order to enforce a sum which, if it
had conducted its affairs lawfully, and not the unscrupulous way it has become accustomed, would
not be entitled.
I expect by now the council has had sufficient time to consider its actions and will (notwithstanding
the criminal implications) attend to my account by removing the fraudulent costs and offer an
appropriate sum of compensation. I suggest in the first matter, it do this by applying under the
relevant legislation to have the Magistrates court quash the liability order.
I also expect a response to the email regarding the allocation of monies to the years account which
I specify.

10

Annex D
Chief Executive & Strategic Director Of Resources
Rob Walsh

www.nelincs.gov.uk
Mr Xxxx Yyyyy
XY Xxxxxxx Yyyyy
Grimsby
North East Lincolnshire
AB12 3XY

21st December 2015

Dear Mr Yyyyy
RE: Council Tax Account - 550xxxxxxx
Thank you for your correspondence received 17th December 2015 the content of which
has been noted.
Firstly may I apologise that you have not received an answer to your correspondence
received 10th November 2015.
On the 13th November 2015 a reply to your correspondence was ready to send to you. I
enclose this letter for your perusal.
Unfortunately I was taken ill and did not return to the office until the 14th December
2015.
Due to this the letter enclosed was not posted and I apologise that you did not receive it.
At this stage the Council has not taken your correspondence as a formal complaint for the
following reasons:
11

This first part of your complaint relates to the late reply to your correspondence which I
have explained above.
The second part of your complaint relates to the Council allegedly obtaining a
fraudulent liability order against you. This part of your complaint does not fall within the
scope of the Councils Corporate Complaints procedure as the Liability Order was
granted by the Grimsby Magistrates Court at a hearing that you were present at.
Once again I apologise for the lateness of the reply and if the above and enclosed is
not satisfactory then the Council will commence with a Stage 1 complaint. However, it
should be noted that the main aspects of your complaint cannot and will not be
addressed through the Corporate Feedback Policy for the reasons above.
I hope that the above clarifies matters for you.
If you have any further queries regards the above then please do not hesitate to contact
me on 01472 325790.
Your sincerely

Neil Smith
Debt Management Manager

12

Annex E
Chief Executive & Strategic Director Of Resources
Rob Walsh

www.nelincs.gov.uk
Mr Xxxx Yyyyy
XY Xxxxxxx Yyyyy
Grimsby
North East Lincolnshire
AB12 3XY

13th November 2015

Dear Mr Yyyyy
RE: Council Tax Account - 550xxxxxxx
Thank you for your correspondence received 10th November 2015 the content of which
has been noted.
You correctly note that at present the balance of your Council Tax Account is 302.00.
You state the following in your correspondence;
'120.00 therefore does not relate to my current year's council tax liability. 60.00 of
that sum relates to summons costs from November 2012 which are suspended
pending a high court appeal; the remaining 60.00 relates to a sum which NELC
obtained in an attached claim of costs in a fraudulent application for liability order. '
With regards to the above statement I can confirm the following:
The 60.00 which you state relates to cost incurred in November 2012 has already
13

been paid by you. This was made categorically clear to you at your Liability Hearing on
the 30th October 2015. This means that the 60.00 amount is for your current years
liability and is an amount outstanding that needs to be paid to clear your 2015 / 2016
liability.
The further 60.00 was for cost incurred in obtaining the Liability order on the 30th
October 2015 for non-payment of your current years Council Tax. Again this amount
relates to your current years liability.
Given the information above it would indicate that the full 302.00 relates to your
2015/2016 Council Tax Liability and the reasonable costs incurred in obtaining the
Liability for the period of the 01st April 2015 to the 31st March 2016.
You further state in your correspondence;
'I am writing to make it categorically clear that any payment I make on my account
(whether that sum matches an instalment amount) my express election is for that
payment to be allocated to the current year's liability. This applies also to future year's,
unless there are express instructions (in writing) to the contrary.
The previous explanation above details the amounts outstanding for your 2015/ 2016
liability and cost incurred.
You express your election that you wish for your payments to be made to your current
years liability.
As outlined above there are two parts to your indebtedness to the Council.
Firstly the Liability outstanding, it has been proved in Court and a liability order granted
that you had not made payment to your Current years Council tax as per the statutory
instalments and as per the explanation above, it can be clearly seen that your liability
still outstanding for this year is 242.00. This would be the amount needed to clear the
actual liability.
Secondly, as per the explanation above 60.00 of the 302.00 is that of reasonable
cost incurred in obtaining the liability order on the 30th October 2015.
I note that you make your election that any payment made is put towards your current
years liability.
In answer to your election I can confirm the following, as there is only the 2015/ 2016
plus cost outstanding the allocation /appropriation of the 2 payments you highlight in
your correspondence will be made according to your election.
However as these payments will not clear the 2015 / 2016 liability including costs you
may incur further costs if North East Lincolnshire Council wish to pursue further
avenues to recover the outstanding amount due.
With regards to next years and further years Council Tax payments it is your
responsibility to pay as per the statutory instalments outlined on your bill.
14

At this point there may be more than one liable period outstanding so you will have to
make your election at the time of payment as per the case authorities relied upon in
your Liability Hearing on the 30th October 2015.
If you fail to do so then statutory notices will be served in accordance with the relevant
Council Tax legislation. However I must advise that if you do contact the Council on
receipt of the notice then we will be pleased to action any election you make at the
time.
I am aware at this point that you have been sent a Special Arrangement Letter (I have
enclosed a copy for your perusal) outlining payments to be made to your outstanding
liability and costs and hope that you find the arrangement an amicable solution to
clearing your outstanding liability.
If you require any further clarity regards the above then please do not hesitate to
contact me on 01472 25790.

Your sincerely

Neil Smith
Debt Management Manager

15

Annex F
North East Lincolnshire Council
Finance Department
Civic Offices Knoll Street
Cleethorpes
North East Lincolnshire
DN35 8LN

XY Xxxxxxx Yyyyy
Grimsby
North East Lincolnshire
AB12 3XY

25 December 2015
Dear Mr Smith

Re: Council tax Ref: 550xxxxxxx Formal Complaint

I am writing in response to your correspondence of 21 December 2015 and wish to escalate this
matter to a Stage 1 formal complaint.
I dont accept that the councils affairs are run so poorly that if somebody is off sick there are no
contingency measures in place for that persons work to be dealt with. Its almost as if the months
delay in conveying the information was deliberate to secure additional payment(s) that the council
knew would not have been made until the following year had I known the council would allocate
monies to the fraudulent costs.
As you have made your position clear which is that you intend to continue using your position
(presumably unsupervised) to defraud me, I will not be making any more payments in respect of my
2015/16 liability until this situation is resolved. Moreover, concerning my December payment,
which would not have been made had your 13.11.15 letter been sent informing me of your intended
shenanigans, this can be either refunded to me, or if preferred, allocated in respect of my 2016/17
liability.
Turning to the fraudulent liability order application. The council appears to be relying on being
absolved of any wrongdoing on account of it being the court which granted the order. Please
remember that no matter how negligent the court was in granting the order, the Council must take
responsibility for making a decision to submit a false statement in its application to the court in
order to defraud me. The allegation directed at the Council is a distinct matter from the court's
determination and needs to be resolved as such.

16

The Council applied for a liability order for non-payment of council tax which it had engineered by
misallocating monies to a sum that had arisen from a previous years summons costs which were
disputed and appealed to the High Court. The council suspended that disputed sum pending a court
decision; therefore no payments in respect of the current liability were ever overdue. The case (High
Court) is yet to be determined so the costs still suspended; therefore, under no circumstances was it
a sum to which the Claimant could legitimately allocate payment.
Regarding the application, and specifically in relation to the court hearing of 30 October 2015, the
Council made a statement (material in the proceedings) which it knew to be false, to the effect that
the appeal challenging the costs had been withdrawn. Indisputable evidence was submitted by
myself to support why the statement was untrue and why the Council could not have believed it to
have been true.
In any event, it was so clear to the Council from my demand notice that the suspension had not been
lifted due to the sum appearing on it as a separate balance from the current liability, described as a
sum subject to court proceedings. The Council had even submitted a copy of my current council
tax bill as one of the exhibits (NELC1) to support its witness statement for the court hearing. It is
inexcusable that at the same time as claiming to have no reason to believe that the costs were being
disputed, the council submit an item of evidence to the court that states they are. The relevant part
of the council tax bill states as follows:
Memorandum Note
Your instalments for 2015/16 do not include your 2014/15 account balance
As at 27-FEB-2015 your 2014/15 Council Tax account balance is 60.00
60.00 of the total is subject to court proceedings
It is clear that the Council is not willing to comply with the laws of appropriation by rejecting my
express instructions which are for payment in any sum to be allocated to my current year's liability
unless there are express instructions (in writing) to the contrary. You have referred to the case
authorities relied upon in the hearing on 30.10.15 in respect of making my election at the time of
payment implying that the way I have expressly elected to allocate payment is not lawful.
Without going into detail that was set out in my supplementary representations for the hearing, it is
worth at least noting the following with regards the law of appropriation (Debtors rights) which are
set out in Chitty on Contracts (31st Edition) Volume 1 at Para 21-061:

17

It is not essential that the debtor should expressly specify at the time of the payment
which debt or account he intended the payment to be applied to. His intention may be
collected from other circumstances showing that he intended at the time of the payment to
appropriate it to a specific debt or account...
There is really nothing more needs saying. However, if the Council deems the Northgate systems
inflexibility would make allocating payments the way I elect unmanageable, it seems that York City
Council is able to accommodate such flexibility within the same automated system. This is evident
in its reply to queries made on the subject of its systems capabilities (see below):
The system is set up to allocate funds to the appropriate period where payments received
match to instalment plans or special arrangements.
Additionally to this a suite of exception reports are provided to the specialist Recovery
Team and Cashiers Team each morning to review cases of "soft cash" and suspense account
cases. Where a customer contacts the council to request re-allocation of a payment made, or
to advise the period that a future payment should be allocated to then this is recorded on the
notes of the account and manual allocation or re-allocation takes place.
Whilst on this particular subject, it would seem that the Northgate system ought to be set so a nonspecified payment is in any event posted by default to the most current debt, not as the Councils
system is set to post those payments to the oldest. This engineers more indebtedness for the
taxpayer from the irresponsible and excessive use of the court; something more associated with
unscrupulous fly-by-night companies than a local authority. It is with incredulity that the authorities
have allowed such exploitation of the court system for so long.
It should be noted that the case, Devaynes v Noble 1816, in which the Council seeks authority to
support its assertion that unspecified payments are posted correctly (oldest debt) cannot apply in a
system whereby the accounts relate, as they do in council tax, to distinct insulated debts, between
which a plain line of separation could be drawn.
A more recent case, R v Miskin Lower Justices (1953), held that where an amount so obviously
relates to a specific liability, it would be an unwarranted assumption to allocate the payment
elsewhere. It could be drawn from this that where the purpose for which a payment is made is
unspecified it must be carried to that account which it is most beneficial to the debtor to reduce1.
The fact that it would be to the taxpayers detriment if allocated to the oldest debt is sufficient to
infer that the payment is intended to reduce his current years liability. The 1953 case law, clearly
1

Walter Pereira's Laws of Ceylon at page 722

18

serves, in these circumstances, to protect the taxpayer from the right of appropriation falling on the
Council when its election may be to the taxpayers detriment. It can be concluded that billing
authorities which have their systems set so non-specified payments are posted by default to the most
current debt is because it would be an unwarranted assumption to allocate monies to a sum in
arrears if it is likely to also put the current year's liability in arrears.
It is not a satisfactory arrangement for the Council to rely on statutory notices being served to alert
the taxpayer that payment has been misallocated. These notices form the necessary steps after
which enforcement may be actionable to the taxpayers detriment. The simplest way to prevent this
occurring and save on unnecessary expenditure would be by setting the system to allocate payments
which do not match a debt instalment to the current year's liability. That is unless the Council have
targets to meet for generating a certain level of court costs income through engineering default.
The Council should recall the numerous communications regarding the disputed outstanding costs,
to which payment was fraudulently diverted, in which it had stated that it had made no decision on
how it would enforce the debt. For example the Council referred to making no decision to enforce
the sum in a response to a letter (14.7.14) but gave an undertaking to give ample notice of any
action it decided on (see below):
With regards to the 60.00 outstanding on your account I can make you aware that it is for
North East Lincolnshire Council to decide on any course of action.
Any action that is taken will of course be relayed to you, giving you ample notice.

Similarly in response to a formal complaint (15.9.14) the investigating officer recommended that
the Council consider the options available to them to recover the outstanding sum and decide on
what would be the appropriate course of action to take but ensure that the Council duly informed
me of any action that is to be taken.
The Council has never given me any notification that it had taken a decision to enforce the sum let
alone what steps it would take. A liability order empowers the Council to recover arrears by such
methods as Attachment of Earnings/Benefits or instructing bailiffs to seize goods. There is nothing
likely to be set out in legislation allowing the Council to adopt a system of deception, as appears to
have happened in this case. In any event, the High Court has not yet made a decision and if it had,
there is no logical reason why it would not have found the liability order to enforce the summons
costs had been obtained unlawfully, because like in R (Nicolson) v Tottenham Magistrates [2015]
19

EWHC 1252 (Admin), the court had insufficient information to determine the reasonableness of
costs claimed.
It goes without saying that financial redress for the maladministration would have better been
considered at the earliest opportunity and not continued to cause gross inconvenience over such a
protracted period of time without remedy. The Council has a responsibility to put right its error and
pay an appropriate amount to compensate for it, especially as it is to such an extent as this. It should
not be necessary to be constantly having to coerce the Council to take the appropriate action; it
should routinely consider this in an attempt to rectify the maladministration.
The council will now hopefully be in a better position to consider its actions and will attend to my
account by removing the costs and offer a significant sum of compensation to reflect the protracted
period of gross inconvenience. As I suggested in my first letter, the Council might want to have the
liability order quashed by making an application to the Magistrates court.
I also expect a reviewed response to the allocation of monies to the years account which I specify.

Yours sincerely

20

Annex G
Our Ref:
Enquiries:
Direct Dial:
E-mail:

NEL/1172/1516
Alan French
01472 323767
Alan.French@nelincs.gov.uk

19th January 2016

Mr Xxxx Yyyyy
XY Xxxxxxx Yyyyy
Grimsby
North East Lincolnshire
AB12 3XY
Private and Confidential

Dear Mr Yyyyy
I am writing in response to your stage 1 complaint received on 29 December 2015. As my role of
investigating officer it is my responsibility to investigate your complaint and seek to resolve matters.
I have spoken to relevant personnel and read the supporting documentation as part of the
investigation process. I will now attempt to address each of your concerns in turn.
You will be aware that much of the content of your letter falls outside the scope of the complaints
process as it relates to your recent Liability order. Consequently there are only 2 points raised
within your complaint that can be addressed
1) The late response to your correspondence received 10th November 2015
2) Your election that all payments and future payments are to be made to current years
council tax liability
Complaint 1: The late response to your correspondence received 10th November 2015
Whilst I have found no evidence of your allegation that the delay was a deliberate act designed to
secure additional payments I do find that the council has fallen below its high standards for
responding to correspondence in this matter. The situation is as Mr Smith detailed in his letter 21st
December 2015.
The response had been prepared however it had not yet been sent. I agree that this should have
been picked up before Mr Smith's return from illness
Outcome:
I do uphold this part of your complaint.
Complaint 2: Your election that all payments and future payments are to be made to current
years council tax liability
As you know from the liability hearing 30th October 2015, the research you have undertaken in to
allocation of payments case law and other information on the internet and freedom of information

21

requests the allocation of payments is made upon payment.

Therefore election to payments may only take place when those payments are made or at any time
from the payment being made until the Council takes legal action to establish the debt.
You are aware that the easiest method of making that election is to pay the correct amount at the
th
correct time. As Mr Smith has said in the letter dated 13 November 2015 should you make
payments that will not automatically be allocated to your current year we will be pleased to allocate
those payments to which ever year you elect if made at a suitable time.
As regards your December payment this has been used to reduce your current years liability.
Outcome:
I do uphold this part of your complaint
As part of our efforts to continually improve services we consider learning from complaints to be an
important part of developing our services to the community. Should you feel that your complaint
has not been satisfactorily resolved, you can escalate to stage 2 of our complaints process where
it will be reviewed by a senior officer. Please contact the complaints team should you wish to take
your complaint to the next stage at the address below, by telephone on (01472) 326426 or email
res-customerservices@nelincs.gov.uk.
Yours sincerely

Alan French
North East Lincolnshire Council

Information, Governance and Complaints Team

Municipal Offices, Town Hall Square, Grimsby, North East Lincolnshire. DN31 1HU

22

Annex H
North East Lincolnshire Council
Finance Department
Civic Offices Knoll Street
Cleethorpes
North East Lincolnshire
DN35 8LN

XY Xxxxxxx Yyyyy
Grimsby
North East Lincolnshire
AB12 3XY

26 January 2016
Dear Mr French
Re: Council tax Ref: 550xxxxxxx Formal Complaint (NEL/1172/1516)
Your response dated 19 January 2016 to my stage 1 complaint has not satisfactorily addressed my
issues and therefore I wish to escalate the matter to the final stage of the formal complaints
procedure.
Regarding my instructions that all payments I make in future are allocated to the current years
liability, Im assuming from the context of your response that you did not uphold this element, even
though your declaration is to the contrary. In any event, I disagree with the councils decision not to
consider these instructions acceptable but do not intend reiterating the points I have already made.
In that matter Im at a loss to know how your perception is that my representations conclude that
the debtor may only elect the account to which payment is allocated at the time it is made.
Turning to the councils 6 weeks delay in responding to my November correspondence. Though this
element has been upheld, my December payment, which I have expressly elected to be allocated to
my 2016-17 account, has been allocated to reduce this years liability. Given that I would never
have made this payment had the information received been sent sooner, then it is reasonable that the
council, which was at fault, should make amends by reallocating the payment or refunding it. The
council must be aware that I intended and intend making no payment to the 60 costs which are
subject to the High Court appeal from 2012/13 nor the fraudulently 60 costs obtained in respect of
the 2015-16 tax year.
Whilst you imply that the issue is a rarity, re falling below its high standards for responding, dont
forget that the response time for dealing with an almost identical issue in October 2014 was 4
weeks.

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Liability order
Lastly there is no reason why the council should assert that the concerns raised about the Liability
order falls outside the scope of the complaints process.
The Local Government Act 2003 introduced into the Local Government Finance Act 1992 the
provision enabling the secretary of state to make regulations giving magistrates' courts powers to
quash a liability order if it was satisfied that one should not have been made. The explanatory notes
to the 2003 Act describes the only avenue available for this before the provision which is as
follows:
At present, this can only be achieved on application to a higher court. The cost involved is
unwarranted where there is no dispute about the facts.
I understand the above means a defendant may only appeal a decision to the High Court either by
way of a case stated or judicial review. As implied, both are unreasonable procedures for an
ordinary person to have to embark upon with it likely taking years (if ever) to succeed in having the
case brought before the court. There is no dispute either about the facts in this case.
The application was made because the council had misallocated monies to a sum subject to appeal
on the basis that it believed the case had been withdrawn and the sum no longer suspended. The
appeal had never been withdrawn and the simple fact is that the council could not have believed it
had by the incriminating evidence in the form of Exhibits which supported its witness statement. It
has the minimum duty to apply to the Magistrates to have the liability order quashed as it has been
brought to the councils attention that the application should never have been made.
Moreover, the same can be done with respect to the 2012-13 liability order because it has been
confirmed in the May 2015 High Court ruling, R (Nicolson) v Tottenham Magistrates [2015]
EWHC 1252 (Admin), that the liability order was obtained unlawfully.
It should be emphasised that the granting of costs without sufficient relevant information to support
them, did not become unlawful on account of the High Court judgment. Even before 6 May 2015, it
will have been required that the court had before it that information to enable reaching a proper
judicial determination. The position had merely been confirmed in the Tottenham Magistrates case.

Yours sincerely
24