Forum Home → Discussion → Other benefit issues → Thread
Appeals against recovery of overpaid CTR
We are currently helping a client appeal a HB overpayment decision in a case where the local authority (Allerdale Borough Council) did not include pension income that our client argues she notified them of. She agrees that she has been overpaid, but feels that this was caused by official error, and that she could not have been expected to realise she was being overpaid. Initially, we wrote to the council to ask that recovery of both HB & CTR be looked at again, and we received 2 separate decisions back, both negative. The HB decision advised that our client could appeal to HMCTS and the CTR decision advised that she could appeal to the Valuation Tribunal. We submitted both appeals. Our client has now received notification from the Valuation Tribunal to advise that the appeal has been struck out, as they have no jurisdiction to hear this type of appeal, being an appeal against a decision to recover underpaid CT after an adjustment to the amount of council tax reduction applied. I appreciate that CTR is no longer a benefit, so generally only an appeal against ‘entitlement’ would be considered, but does this mean that our client has no grounds at all to further challenge recovery? In all other respects regarding calculation etc, the local council have continued to apply the old CTB rules. Any ideas would be appreciated!
Not an expert on this but I think you need to ask for relief of the council tax debt and then appeal any refusal of that (as opposed to appealing recovery of overpayment) - see post here https://www.rightsnet.org.uk/Forums/viewthread/12621/#58732
and a bit in this thread https://www.rightsnet.org.uk/forums/viewthread/12018/
[ Edited: 2 Jan 2019 at 02:14 pm by Daphne ]That’s great thank you, though it would have been helpful if the council had included this option in their decision letter instead of just advising to appeal to the VT!
We are currently helping a client appeal a HB overpayment decision in a case where the local authority (Allerdale Borough Council) did not include pension income that our client argues she notified them of. She agrees that she has been overpaid, but feels that this was caused by official error, and that she could not have been expected to realise she was being overpaid. Initially, we wrote to the council to ask that recovery of both HB & CTR be looked at again, and we received 2 separate decisions back, both negative. The HB decision advised that our client could appeal to HMCTS and the CTR decision advised that she could appeal to the Valuation Tribunal. We submitted both appeals. Our client has now received notification from the Valuation Tribunal to advise that the appeal has been struck out, as they have no jurisdiction to hear this type of appeal, being an appeal against a decision to recover underpaid CT after an adjustment to the amount of council tax reduction applied. I appreciate that CTR is no longer a benefit, so generally only an appeal against ‘entitlement’ would be considered, but does this mean that our client has no grounds at all to further challenge recovery? In all other respects regarding calculation etc, the local council have continued to apply the old CTB rules. Any ideas would be appreciated!
Here’s my understanding. I don’t do a lot of this kind of issue so if I am wrong, I’d be grateful for a correction from any other subscribers.
My understanding is that the VT only has jurisdiction to judge whether the local authority concerned has properly applied its own scheme in awarding CTR. Failing to respond to changes notified might be appealed depending on what the scheme says.
When CTR is “overpaid”, the amount is transferred back to the pot allocated for CTR and becomes a liability in the person’s council tax account (i.e., a debt). Depending on the circumstances, this could be resolved fully or partly if you can persuade the local authority to use Section 13A of the Local Government Finance Act 1992 to reduce or eliminate the liability because their action or inaction. A complaint about maladministration may or may not be a useful way to prompt them to use this provision. Again, it depends on the circumstances.
A complaint of maladministration to the Local Government Ombudsman (LGO), after exhausting the local authority’s complaints procedure, may be another way to get the issue resolved. The LGO can recommend that the local authority compensate the client for a loss. This process can take some time.
Finally, if the local authority goes after the debt there is scope to resist a liability order (Magistrate’s Court) but this is quite complex (proper notices etc). However, where a VT appeal or formal complaints process is anticipated or being pursued, an adjournment can be sought of the liability order hearing until the appeal or complaint is resolved.
It is now clear that an “overpayment” of Council Tax is merely to be seen as an adjustment to the Council Tax account however it occurred and VT will automatically strike them out. I am doubtful if the LGO would accept a complaint because the Council has properly followed the correct process i.e. a local discount not a national benefit. The relevant reference is below.
Applying for a 13A discretionary payment is not (in my view) an effective alternative in this type of case ...although it is definitely under utilised (but that is just my opinion). It is clear from the caselaw (mostly unpublished but a summary of cases is sometimes available from VT) that the applicant should be in a position where they cannot possibly pay the Council Tax. Perhaps because of large debts or medical issues or so.
Council tax reduction appeal: Under / over payment; exercise of discretion. Decision: Appeal struck out.
RE: Liverpool
APPEAL NUMBER: 4310M140277/CTR
Ms. F. Dickie (Vice-President)
These 16 points set out by the former President of VT when making the key decision SC & CW v East Riding of Yorkshire Council [VTE 2014] are very useful I think to highlight in any application. Point 15 is particularly important as many Councils try the “we do not have a budget to do this” approach.
One additional point; the local authority, represented by a barrister at a VT tribunal in a case I helped a claimant with. He argued that the President was “confused” about funding and budgets. I reminded the Tribunal that when Local Authorities were given much more discretion to increase Council Tax (empty properties and reducing allowances etc) the Minister said that he did not want to see this extra monies go on increasing CEO salaries. Instead, it was specifically intended to go on areas such as this type of discretion. Only fair.
researchbriefings.files.parliament.uk/documents/SN02857/SN02857.pdf deals with the rules just on empty properties. A lot of extra cash here that will increase over the next few years.
So for those with large Council Tax bills that they cannot possibly pay, I always put in such an application and include these points in the letter etc. “Where can I see your policy”...point 6…. is usually interesting!
(1) The focus of an appeal as opposed to a review is fundamentally different: full
appeal reaches further and assesses the actual merits of the decision reached.
(2) Some deference should, however, be paid to the view of the original decisionmaker and an effort made to understand how that decision was arrived at, but
that cannot prevent the Tribunal from substituting its view for that of the
authority provided that the Tribunal can articulate cogently why it is doing so
and how it has arrived at its conclusion.
(3) The authority’s decision does not have to be unreasonable in the Wednesbury
sense before it can be set aside, but the Tribunal should intervene only where
there are strong grounds for doing so.
(4) It may not be an exact parallel, but the Court of Appeal will allow an appeal
against sentence only where the sentence is wrong in principle. This suggests
that some restraint should be exhibited by the Tribunal before disturbing a
billing authority’s decision.
(5) Procedural defects may recede in importance, or be completely effaced, since
the Tribunal will be chiefly concerned with the actual merits of the decision.
Earlier defects in process may therefore be cured or superseded by the appeal,
and a decision may be adjudged correct despite defects in process.
(6) Although a scheme or policy is not required by statute, it is difficult to see
how such an open-ended discretion can be satisfactorily exercised in the
absence of one.
(7) Any such policy should be scrutinised by the authority’s lawyers before
promulgation.
(8) Compliance with a formal published policy or scheme, if there is one, cannot
preclude the Tribunal from allowing an appeal.
(9) Any such scheme is not immune from challenge in the Tribunal as, for
example, is a council tax reduction scheme (see para. 13 above). It is not the
Tribunal’s business to impugn any scheme as such but rather that its own
powers cannot be inhibited or circumscribed by a scheme.
(10) Failure to comply with a substantive element of a scheme to the detriment of
the applicant is likely to lead to the overturning of the decision unless there are
good reasons for having departed from it.
(11) However, compliance with a scheme or policy may help in persuading the
Tribunal that the original decision was correct.
(12) The Tribunal should be slow to interfere with a decision that properly flows
from a determination made under section 13A(7).
(13) An authority cannot as a matter of law fetter its discretion and must therefore
consider every application on its merits whatever the policy or scheme says.
(14) Suppose, for example, there is a provision that non-essential expenditure
should be disregarded when calculating legitimate outgoings and determining
disposable income. The Tribunal could conclude that the item was wrongly so
characterised and should be included. Or that on its specific facts it should be
included. Thus, mobile phones might normally be treated as a luxury but
might become a necessity if the appellant is a carer who might need to be
contacted urgently when not at home. Or a subscription to a satellite
television service might have to be accepted if the appellant is locked into a
contract that pre-dates his financial difficulties.
(15) A factor which cannot have any relevance for the Tribunal is an overall budget
created by the authority for the totality of discretionary applications in a given
year so that any application will be considered in relation to the available
budget and once that sum is exhausted no further applications can be granted.
I do not see how in law this can be a cash-limited exercise. The merits of an
appeal cannot be affected by the existence of any such budget. A “budget” is
in any event a somewhat artificial concept in view of the fact that the authority
is forgoing income and not spending existing funds.
(16) Where the Tribunal is minded to allow the appeal and order a recalculation but
is unsure of the actual amount to substitute, the appeal may either be
adjourned for the parties to supply whatever further information is needed to
reach a decision or it may conclude the appeal by quashing the calculation and
ordering the authority to recalculate properly. The former is likely to be the
better course in most cases.
This is the Liverpool case, also discussed in this thread.
The way I read it, it says nothing about the appellant’s prospects of success in a s13A(1)(c) appeal, it is simply concerned with the route by which the issue gets to Tribunal. There are two alternatives:
- if the claimant raises the possibility of a discretionary reduction to offset the “overpayment” at the initial grievance stage and the Council refuses, there is a right of appeal to the Tribunal about that. In the OP case discussed in this thread, the claimant did not do that and the Liverpool case says the Tribunal has no jurisdiction to hear an appeal about something that has not been raised with the Council to start with
- but that isn’t the end of the matter for the OP’s case: the taxpayer can start again with a fresh application for discretionary relief and appeal if it is not granted: that was made clear in the Liverpool case, there is definitely a second bite of the cherry
As for prospects of success, there is a recent thread in which a rather harsh recent VTE decision is mentioned, and it may be that the Tribunal is taking a very cautious line in these cases. But there is nothing in the published decisions by the President/Vice President to discourage people from having a go. None of this is really case law. The VTE will tend to follow its president, but unpublished decisions that didn’t involve the president are, to paraphrase Samuel Goldwyn, not worth the web page they are published on!
I agree…very harsh. T
Here is a better one though Peter!
Discretionary hardship relief
This appeal challenged the BA’s decision over
the amount of relief granted in accordance
with Section 13A(1)c) of the LGFA 1992. The BA
initially refused the appellant’s application;
however, following receipt of additional information, a revised decision was issued on 14 October 2016, in which it granted discretionary relief equal to the outstanding balance on the
appellant’s account as at that date.
The appellant had made regular payments
whilst his application was being considered and
he requested discretionary relief be applied
from the date of his application. But the BA did
not consider it appropriate to grant relief for a
greater amount than the outstanding balance.
Whilst a formal application for relief had been
received by the BA on 22 July 2015, the panel
found that the appellant had initially requested
financial assistance by email on 19 June 2015.
Having considered all the evidence, the panel
allowed the appeal. In arriving at its decision,
the panel made the following findings:
• the appellant had insufficient income to afford all his outgoings;
• when questioned, the BA’s representative
explained that, had the appellant not made
any payments following his application, then
discretionary relief would have been paid
from the date of application;
• the BA had not made any investigations to
clarify how the appellant had afforded to
make those payments.
The panel found in favour of the appellant and
held that full discretionary relief should be applied for the period requested by the appellant.
Appeal no: 2001M168735/254C
It really is a barmy situation.
LA is under an obligation to set up a CTR scheme which it must then rigidly apply to each case. However the LA then has a residual discretion by which it can, at any time, for any reason and in any amount, reduce an individual’s bill (a fact which is essentially kept secret in much of the country).
If an individual is aggrieved with the LA’s decision on CTR then - provided that the scheme has been followed correctly - he has no remedy unless he said the magic words to activate the LA’s obligation to consider this secret discretion.
If, having said the magic words but still aggrieved by the LA’s decision, our man realises that he has a right of appeal - he can exercise it to ask a panel of individuals chosen by reference to their expertise in the law and practice of valuing properties, assessing business rates and the like to exercise that discretion afresh - unfettered by any binding case law or definitive guidance on the subject.
(Such guidance as there is being broad enough to permit one Tribunal to find that an agreed deficit of £70 per week between income and outgoings amounted to about the clearest possible case for a reduction - East Riding para 54 - but another Tribunal to find that an agreed deficit of over £110 per week did not justify a reduction - Nottingham para 13).
Obviously every LA and every adviser knows that there are thousands of people running around who have these sorts of deficits but are not pursuing s13A. I suspect in part due to the fact that there is likely to be a poor return on the amount of energy being put into these cases and because DROs are often going to be a better remedy.
I have an appeal with the VT with a hearing date listed for the end of Jan. The case is an o/p of both HB/CTR as client failed to advise LA of change in father’s SRP at 80 (he is appointee). LA told us we needed to appeal to both HMCTS and VT.
The issue is not one of applying the CTR scheme but the facts of failure to declare and I must admit I am (after reading this thread) somewhat confused about what we should have done in this situation. In this case it is a finding of fact as to whether client did advise LA and could have realised etc rather than on whether LA has applied CTR scheme correctly.
Can anyone clarify please? At what point would the case be thrown out by VT? at hearing or before?
Thanks
I have an appeal with the VT with a hearing date listed for the end of Jan. The case is an o/p of both HB/CTR as client failed to advise LA of change in father’s SRP at 80 (he is appointee). LA told us we needed to appeal to both HMCTS and VT.
The issue is not one of applying the CTR scheme but the facts of failure to declare and I must admit I am (after reading this thread) somewhat confused about what we should have done in this situation. In this case it is a finding of fact as to whether client did advise LA and could have realised etc rather than on whether LA has applied CTR scheme correctly.
Can anyone clarify please? At what point would the case be thrown out by VT? at hearing or before?
Thanks
There’s no such thing as a CTR overpayment - and therefore no rules about when a CTR overpayment can or can’t be recovered. They will just have re-calculated the council tax bill based on the correct CTR level regardless of the reasons for the initial miscalculation - which they are entitled to do. If your client accepts that the re-calculated bill is correct, then they can’t win an appeal against anything to do with CTR.
However, if your client has independently asked for a reduction in their bill under the s13A discretion, then the appeal can consider the merits of whether the council should have exercised that discretion (see the East Riding case). If your client hasn’t asked for the discretion to be exercised, that can’t be raised for the first time as an issue in the appeal (see the Liverpool case).
So if you are saying that the calculation was correct and it is just an issue of the fairness of now recovering the lost monies from your client, then your client will need to ask for a discretionary reduction under s13A if they have not already done so. If they already have, then the appeal will be about whether that discretion should be applied.
Assuming the authority is running the prescribed pensioner CTR scheme without any enhancements, what you have there is a textbook demonstration of what we have just been discussing. There is absolutely no possibility of having the CTR decision overturned by the Tribunal: it is correct. It does not matter what your client did or didn’t report - the concept of non-recoverable “excess” CTR just doesn’t exist.
I would expect the appeal to be struck out on the grounds that it stands no realistic prospect of success - in fact I am surprised it hasn’t already been struck out. It’s exactly what happened in Tom Royston’s Liverpool test case referred to above.
What your client needs to do is ask the local authority to use its discretion to reduce his father’s Council Tax, on the grounds that it wouldn’t be fair/not his fault/couldn’t have known/can’t afford it and so on. If that request is refused, then there is a right of appeal.
I don’t know enough about the detailed facts to make any prediction about the prospects of success in such a request and subsequent appeal, but that is the route to follow. Councils obviously are not going to give a discretionary reduction to everyone who asks, there wouldn’t be any point having a CTR scheme at all in that case. But at least there is a right of appeal.
PS - overlapped with Elliot. There you go - you have it in duplicate now!
[ Edited: 3 Jan 2019 at 12:56 pm by HB Anorak ]I have an appeal with the VT with a hearing date listed for the end of Jan. The case is an o/p of both HB/CTR as client failed to advise LA of change in father’s SRP at 80 (he is appointee). LA told us we needed to appeal to both HMCTS and VT.
The issue is not one of applying the CTR scheme but the facts of failure to declare and I must admit I am (after reading this thread) somewhat confused about what we should have done in this situation. In this case it is a finding of fact as to whether client did advise LA and could have realised etc rather than on whether LA has applied CTR scheme correctly.
Can anyone clarify please? At what point would the case be thrown out by VT? at hearing or before?
Thanks
This case sounds very similar to mine, and it’s interesting that the VT have given a date for the hearing rather than striking it out beforehand. I’m guessing the decision from your local authority was also like ours, advising to appeal to the VT, when this was not appropriate, and no mention at all of the option of asking for a discretionary write off. I don’t know if letters from other local authorities are any better but this seems to be very bad practice, and very misleading for clients.
Yes there is a strong possibility that the VT will hear the case and then just dismiss it as not in jurisdiction which is a waste of time for all.
I liked this comment above:
“he can exercise it to ask a panel of individuals chosen by reference to their expertise in the law and practice of valuing properties”.
Very true! Also experts in whether a fox den in your garden can lead to a decrease in your Council Tax liability.
To be fair, some try their best in a role that they never asked for or wanted.
You might think this system is often costly duplication….I would agree with you!
In Scotland, the equivalent group of valuers turned down this role at the start and I think they should have done so elsewhere.
I liked this comment above:
“he can exercise it to ask a panel of individuals chosen by reference to their expertise in the law and practice of valuing properties”.
VT’s are rather like the experience of the much loved Housing Benefit Review Boards!
We are currently helping a client appeal a HB overpayment decision in a case where the local authority (Allerdale Borough Council) did not include pension income that our client argues she notified them of. She agrees that she has been overpaid, but feels that this was caused by official error, and that she could not have been expected to realise she was being overpaid. Initially, we wrote to the council to ask that recovery of both HB & CTR be looked at again, and we received 2 separate decisions back, both negative. The HB decision advised that our client could appeal to HMCTS and the CTR decision advised that she could appeal to the Valuation Tribunal. We submitted both appeals. Our client has now received notification from the Valuation Tribunal to advise that the appeal has been struck out, as they have no jurisdiction to hear this type of appeal, being an appeal against a decision to recover underpaid CT after an adjustment to the amount of council tax reduction applied. I appreciate that CTR is no longer a benefit, so generally only an appeal against ‘entitlement’ would be considered, but does this mean that our client has no grounds at all to further challenge recovery? In all other respects regarding calculation etc, the local council have continued to apply the old CTB rules. Any ideas would be appreciated!
I have read this is happening quite a lot with different local authorities. The valuation tribunal strike it out.