Council tax - should monies I've paid be assigned to earliest debts owing to Council?

[braddo]

Hi,

I'm hoping someone can advise me on this situation. I'll try to summarise situation as succinctly as possible. Our Merton Council Council Tax year ended 31/3/13.

On 7/3, we received a council tax Bill, outlining the council tax charge for the coming year (1/4/13-31/3/14), and a list of the instalments that would be due on 1/5, 1/6, 1/7 etc.

There was also a line that specified that £128 was still outstanding from the almost completed year ending 31/3/13.

I didn’t see that line. I filed the bill and forgot about it.

I have just been paying the 2013/14 instalments each month (some late by a few weeks) but by and large have kept up with all payments. I have paid a total of £512.12 in the five months to date. I’ve received 2 reminder notices since April; one in May, one in July – only reminding me to pay the current year’s payments – no mention whatsoever of the £128 outstanding from the previous Ctax year.

Today, I receive a court summons, saying that because I’ve ignored 3 reminder notices to pay that outstanding £128, I now owe £128 + £110 court costs.

Here are my issues:

1. I didn’t receive any of the 3 reminder notices. Probably a mailbox problem, due to our shared mailbox, but the summons specifically excludes this as a reason, saying that the council does not need to prove that I have received the reminders.
2. Despite it being Council policy not to mention outstanding amounts of prior years, on current year statements, this seems to defy common sense and logic. When a company sends you a bill telling you what payments you still owe them, you tend to assume that if you pay that bill in full, you’re up to date. I would have thought that my paying £512.12 over the last few months, evidences the fact that I'm not ignoring my financial commitments. I have no cashflow problems. My bank accounts can attest to that.
3. (the most compelling argument I think) I’ve made £512.12 worth of payments to the council via internet banking in the last 5 months. Does it not make legal sense, that monies paid, are automatically assigned to paying the earliest debts owed to that organisation? Ie. Can I not argue that the first £128 out of the £512.12 I’ve paid in the last 5 months, was payment of that debt? I mean – I just make transfers to the Council bank account, with my council tax number as the reference. Each payment has the same reference. No payment has any special reference. How can the Council tell me that I didn’t pay the £128 owing from last year, when I’ve made £512.12 worth of payments? None of the payment amounts were exactly £128, but 3 of the amounts were £127, which happened to be the exact amounts of this year’s instalments.

Are there any legal precedents about whether the money I paid should have been assigned to the earliest debt?

Any advice would be hugely appreciated!

Thanks

Brad

[outlawlgo]

Re: Council tax - should monies I've paid be assigned to earliest debts owing to Coun

Ignore....

[outlawlgo]

Re: Council tax - should monies I've paid be assigned to earliest debts owing to Coun

Have a look at this post (#3) from the thread, "Paying Ctax online".

[braddo]

Re: Council tax - should monies I've paid be assigned to earliest debts owing to Coun

Thanks Outlaw. Very helpful, but I'm still a bit unclear.

It would appear that because my payments exactly match this current year's instalments, that they will have been "hard allocated".

Is it too late for me to express my wish that the previous payments I made, be soft allocated against my prior debt?

Surely I can't just ignore a Summons?

[braddo]

Re: Council tax - should monies I've paid be assigned to earliest debts owing to Coun

Actually - it's a "Summons" on a Merton Council letterhead. Does this bear any legal weight at all?

[outlawlgo]

Re: Council tax - should monies I've paid be assigned to earliest debts owing to Coun

Actually - it's a "Summons" on a Merton Council letterhead. Does this bear any legal weight at all?

There have been several responses from the Ministry of (in)Justice to Freedom of Information requests which says it's permitted.

I'd say on the summons score, you've got probably a more arguable point to make about the summons costs being unreasonable at £110.

Statistics show that Merton Borough Council issued 14,333 summonses with a value of £1.58 million in 2011-12. The law says councils can not profit from these, but they're rubber stamped in their thousands in respect of a single court hearing.

The law also states that costs must relate to the amount of work done by the council in court applications, for example if you pay the outstanding debt after receiving a summons but before the case is heard, only costs relating to that work is payable. I notice Merton front load all cost to the summons, i.e., the portion of costs normally incurred in obtaining the liability order are paid by the debtor whether or not the liability order is granted.

Councils attribute much of the costs to staff hours monitoring the application process. As you've found out, there is no monitoring, their computers dictate when these summonses are issued in line with how parameters are set on the system.

[braddo]

Re: Council tax - should monies I've paid be assigned to earliest debts owing to Coun

Thanks mate. Interesting.