The Ombudsman's final decision
Summary: Mr X complains the bailiff went to collect a debt from him in breach of the Individual Voluntary Arrangement (IVA) he had in place. We find fault with the bailiff acting on behalf of the Council for failing to log to IVA correctly, sending an enforcement letter and sending an agent to collect the debt from Mr X. We have agreed a symbolic payment for the distress caused to Mr X as a result.
The complaint
Mr X complains the bailiff wrongly visited him about a debt while he had an Individual Voluntary Arrangement (IVA) in place.
Mr X would like an apology and compensation for the distress caused.
The Ombudsman’s role and powers
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 significant injustice, or that could cause injustice to others in the future we may suggest a remedy. (Local Government Act 1974, sections 26(1) and 26A(1), as amended) 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)
How I considered this complaint
I spoke with Mr X and considered the information he provided.
I made enquiries with the Council and considered the information it provided.
Mr X and the Council had an opportunity to comment on my draft decision. I considered any comments received before making a final decision.
What I found
Law and guidance Bailiffs Bailiffs are in the Ombudsman’s jurisdiction when recovering local authority tax, business rates and parking or road traffic debts as they act as agents of a local authority, who are the body who holds the court warrant.
Bailiffs may be directly employed by a local authority or work for a private firm which the local authority has contracted to provide services for debt recovery. Either way, the bailiff is acting for the local authority and so the matter is within the Ombudsman’s jurisdiction.
Before taking control of goods (in other words visiting to take goods) a bailiff must issue a notice of enforcement on the debtor seven clear days before the bailiff takes control of goods. ‘Clear days’ do not include the date the notice is issued, received or Sundays and Bank Holidays. This notice can be posted or hand delivered.
Individual voluntary arrangement An individual voluntary arrangement (IVA) is an agreement made with creditors to pay all or parts of a debt owed through regular payments to an insolvency practitioner.
Bailiff complaints policy The policy states it aims to resolve complaints at stage one, two and three of its process within ten working days. If it is unable to do this, an officer will contact to explain why and let people know when they can expect to receive a full response.
What Happened Mr X had outstanding fines from two different Council’s. All his accounts were placed on hold in June 2023 until August 2023 as Mr X had a Breathing Space Moratorium. The Bailiffs had the accounts for both Council’s and noted this on both accounts.
In August the bailiff’s were sent notice that Mr X was on an IVA and recorded it on one of his accounts but not the other.
At the end of August the bailiff’s sent Mr X a letter saying the Breathing Space Moratorium was at an end and it would be continuing enforcement for the debt. Mr X says he did not receive this letter.
In September Mr X was approached by an agent from the bailiff to collect a debt listed on the IVA, which is a breach of the Agreement.
Mr X’s address is his home and work, so he says the visit from the bailiff was stressful and embarrassing for him.
Mr X made a complaint to the bailiffs in November about the breach of the IVA. He said after the agent left he contacted the bailiff’s office and was told the insolvency register had been checked prior to the agent being sent to his home address. He said he did not receive a letter of enforcement and the IVA was entered into in August.
The bailiff responded in mid-November explaining its mistake of not recording the IVA on both of Mr X’s accounts. It apologised for the officer saying the Insolvency Register had been checked before the agent was sent to Mr X’s address as this was not correct. It apologised for the error and distress caused.
Mr X was not happy with this response and wanted compensation for the distress caused. He raised a stage two complaint and the bailiff’s responded at the end of November after completing a thorough investigation of the account. It said it can sympathise errors were made by staff, and this has been addressed with the individuals concerned to prevent it from happening again. It apologised for any upset caused but said the actions did not warrant any compensation.
Mr X then raised his complaint with the Council in December. It responded saying the response from the Bailiffs was appropriate given that no monies was collected, and agreed that no compensation was due.
Mr X sent his complaint to the Ombudsman as he felt the Council had not understood the severity of the breach of the IVA, especially as he is vulnerable and had the Breathing Space Moratorium because of the impact this was having on his mental health.
Analysis The bailiff’s admit it made a mistake when receiving notice of Mr X’s IVA by not putting it on both of the accounts it held for him. The enforcement letter was sent in error (which Mr X did not receive), and the agent was sent to his address in breach of the IVA. This is fault by the bailiff.
I suggest a symbolic payment to Mr X for the distress caused.
Agreed action
Within one month of the final decision the Council should: Write an apology letter to Mr X for the fault identified above; Pay Mr X £100 for the distress caused.
The Council should provide us with evidence it has complied with the above actions.
Final decision
I find the bailiff on behalf of the Council at fault for failing to correctly log the IVA, sending an enforcement letter and sending an agent to collect the debt from Mr X. I have suggested a symbolic payment for the distress caused to Mr X.
Investigator’s final decision on behalf of the Ombudsman
Investigator's decision on behalf of the Ombudsman