Council Tax and house repossession help!

[sjw]

i thought that even if a debt came up after br it would still be included.x

[jane.l]

I can see where they are coming from because the date of the bankruptcy order was 30 August 2007, the Class C exemption on the house ran out on 1 October, NR did not enforce possession order until 12 March 2008 so I am being billed for the period 1 October 2007-12 March 2008,

the way I see it, I thought once bankrupt, the house comes under the OR's control?????

Obviously, I am wrong[:(]

[sjw]

thats the impression i got from previouse post on this site, as many have said that any shortfall from repossesion or sale of a house would then be including in br so surely this is the same thing isnt it, sue x

[jane.l]

I think the shortfall is included, but until the house is actually repossessed or sold, I am the legal owner and so are liable for council tax

[zoe]

no Jane a class q applies from the date you left the property until nrock repossessed it
you need to call back and advise that you want to speak to someone higher - which council is it?

[ianmillington]

Dear Jane

The more this thread goes on the more irritated I become about what is happening to you. I believe you either have an examiner who doesn't know what to do or doesn't care.

You need to have someone on your side here or you will continue to get the run around. I have taken the liberty of speaking to Gill Hankey MBE of the Bankruptcy Advisory Service about this thread. She too does not believe you should be enduring this nightmare, which is a travesty and defeats the whole bankruptcy process. She will be happy to make representations to the OR and Council on your behalf, should you so wish, although I think she will want to charge you a small sum. If you would like me to put her in touch with you, let me know.

To respond to your most recent post, when you were made Bankrupt the Official Receiver became the legal owner of the house.

Ian

[chris.g]

Bravo Ian, (clap, clap).
I too am becoming very frustrated at the way Jane has been treat during her br. It seems as if the OR dealing with the case has had no idea.
Could it be that because br is on the increase that the OR's office are having to employ inexperienced and inept people to cover all the cases???? It certainly seems that way!!
Good news for you Jane, you might start to get somewhere now, your head must be very sore from banging it against the wall for so long.....
xx

[jane.l]

Well, many thanks to Ian but I am not sure we can afford to fork out any more money at the moment!

I actually got the courage today and rang hubby’s OR. I am discharged but I rang my office on Monday. Hubby is not discharged but he has been passed to RTLU so is at a different office, so I rang there BUT I have been given the same advice, categorically, we ARE liable for this council tax debt, the OR is not the legal owner of a house when a person goes bankrupt and apparently the council tax is a bit like the CSA, they can still chase a person when bankrupt so yes, we do have to pay!

The reason I rang was that this new debt obviously will affect our I&E and the OR is looking for an IPA, the lady today said they have written to us, but she would not say what the letter was about but did not seem interested in the fact that our expenditure is now rising AGAIN, so I am worried now, I don’t know what this letter will say!

We had about £20 surplus, now if they are wanting the IPA, AND now with this new council tax debt, our I&E shows a deficit of about £60 per month![:0]

[chris.g]

Oh Jane, I cannot understand this. I must admit I'm still waiting for my OR to get back in touch but will ring the Halifax again tomorrow to check on their progress on tracing the keys and forms.
It's unfair that if there had been any equity in your property the OR would have broke your fingers for it but because there wasn't they didn't want it. NR wasted time and because of that you are liable for the C/Tax.
I will say again, this proves that br is not always the quick and easy option.
Keep smiling hun,
xx

[MelanieGiles]

At the risk of entering quite a lively debate - I do not feel that the OR is liable for post-bankruptcy council tax - but I do feel that there may be some argument that Northern Rock might be!

[ianmillington]

I don't think the OR can be found liable for CT either Mel - I'm not sure that you or I would enjoy the same comfortable position if we had been appointed Trustee though, as IIRC there are time limits imposed on us.

The point I have been making, which directly conflicts with what the OR is telling Jane, is that I don't believe she can in any way be responsible for post BR Council Tax, on the following grounds:

1. Some time prior to the bankruptcy she handed the keys to the mortgagee effectively surrendering her interest. At that point she ceased to be the occupier and has since occupied another property (where I assume she has registered for Council Tax?)

2. Pursuant to S306IA 1986 by virtue of the vesting process the OR became the legal owner upon his appointment as Trustee i.e upon his decision not to convene a creditors meeting. My argument is that vesting actually means legal ownership.

The OR clearly has his own exemptions but the facts are clear that Jane was neither the owner nor the occupier of the property post-bankruptcy.

So far as Gill Hankey is concerned, I didn't want to go into the financial details here, but recall that what she charges is a subscription of £25. Not a lot of money, although it is relative - if you've got nothing at all to spare then it is a lot of money.

I note the response from the OR in Jane's most recent post. I think it is priceless. I would be very interested to learn who the OR thinks is the legal owner, given Section 306.

Jane, I do genuinely feel that if the right person has a word in the right ear the ORs response might be different. However, if you can't afford the £25, I would write to the Official Receiver to ask about his understanding of the effect of Section 306 of the Insolvency Act 1986 under which all your assets vested in him and why he views you to have retained the legal ownership post bankruptcy.

The statement you attribute to the OR about the Council's rights to pursue you is somewhat sweeping. There is action they can take post-bankruptcy to collect pre-bankruptcy Council Tax, but they need to get a liability order first. However, this is not the issue. We are talking about a liability accruing during a period in which you had neither access to nor control nor legal ownership of the property. Why should you be liable?

Rant over, there's not much more I can say on the subject.

Ian

[MelanieGiles]

Agreed - which is why I am pinning my money on Northern Rock being liable as mortgagee in possession. I don't believe it can be Jane, because she was not in possession of the property, nor the occupier at the time the debt arose, and although of course I accept your vesting argument, that does not constitute responsibilty for Council Tax under Local Authority legislation - but I would not profess to be an expert on that particular minefield of the law!

It's an interesting topic, and one which requires expert legal advice and I am not sure paying £25 to the BAS is going to get that - and I am also a great supporter of Gill as well by the way!

How about you and I both asking an experienced solicitor of our choice, who I am sure probably owes us a few favours and would welcome a bit of PR on the forum, giving some initial advice as a freebie, and then we compare notes! I'm going to Mark Davies - so you can't pinch him!!

Worth a thought, and I have been following this ladies plight for nearly a year and a half now, and she does not deserve this one iota!

[zoe]

Guys the fact remains that an exemption can be claimed for the period anyway! i am not sure why there is a reluctance to do this and to just pay the debt???

[chris.g]

Probably because it's money!
Sometimes I feel as if that these departments don't class people as real, only cases/accounts and when there's money owed, they've got more chance getting it from a member of the public than a bank like NR.......

I hope the solicitor's come back with some solid advice indicating that Jane is not responsible.
This could happen to anyone who files br and owns a property that the OR isn't interested in. The advice we got from our OR was simply 'hand the keys back'. Now I'm concerned that a similar scenario could take place....

[MelanieGiles]

But I thought she had claimed her exemption for that year, and you were only allowed to claim one lot of six months each year, Zoe?