In England and Wales where a magistrates' court has made a liability order against a the debtor the creditor concerned may make an order (an attachment of earnings order) to secure the payment of any outstanding sum which is or forms part of the amount in respect of which the liability order was made; such an order shall be expressed to be directed to a person who has the debtor in his employment, and shall operate as an instruction to such a person to make deductions from the debtor's earnings and to pay the amounts deducted to the authority; the debtor shall from time to time notify the authority concerned, in a prescribed manner and within a prescribed period, of each occasion when he leaves any employment or becomes employed or re-employed, and shall include in such a notification a statement of his earnings and expected earnings from the employment concerned and of such other matters as may be prescribed.
Arrestment
Arrestment in Scotland (as distinct from earning arrestment) is the diligence used against moveable property of the debtor that is not in his possession. In addition to the debtor and creditor, it involves a third party who owes a debt to the debtor and who is known as the ÒarresteeÓ. By arresting in the hands of the arrestee, the creditor prevents him from making payment or returning property to the debtor. The action of arresting in the hands of the arrestee is incomplete (or inchoate) diligence and to secure title to the arrested funds or goods, the creditor needs to raise an action of furthcoming (see below) although in practice, a more informal arrangement is made among the parties concerned.
Action of furthcoming
In order to complete the diligence and secure title, in Scotland, to arrested funds or goods, the creditor must raise an action of furthcoming in the sheriff court where the arrestee or debtor is resident; or the arrested property is situated. The procedure involves the creditor petitioning the court requesting decree that the arrested funds or goods be released to him in satisfaction of his debt, expenses of the arrestment and expenses of the furthcoming. In practice, actions of furthcoming are avoided where the debtor gives written authority to the arrestee to release the arrested funds or goods to the arresting creditor.
Billing authority
In England and Wales, a local authority empowered to set and collect council taxes, and manage the Collection Fund, on behalf of itself and local authorities in its area. In England, shire and metropolitan districts, the Council of the Isles of Scilly, the Isle of Wight unitary authority, London Boroughs and the City of London are billing authorities. The same authorities were charging authorities under the community charge system.
Charging Order
In England and Wales this is a method of enforcement usually made against land or property but also against stocks, shares, money in court and certain other forms of security. It seeks to place the authority in the same position as a mortgagee of land; for example, debts will be paid out of the proceeds of selling the property. If payment is required before the defendant chooses to dispose of the asset, a separate action must be taken to enforce the sale.
Committal to Prison
Where a Billing Authority has sought to levy an amount against an individual by distress under the liability order, and it appears to the person making distress that he was unable (for whatever reason) to find any or sufficient goods of the debtor on which to levy the amount, the Authority may apply to the MagistratesÕ Court for the issue of a warrant of commitment Community charge
A personal local charge (or charges) which in Scotland was set by the former regional or islands councils and district councils, to meet the cost of providing services after taking into account government grants and income. In England and Wales, the charging authority and precepting authorities set the charges to collect sufficient revenue to meet their demands on the collection fund. The charge was introduced in place of the domestic rates on 1 April 1989 and was replaced by the council tax on 1 April 1993. In England and Wales, the charges were brought in a year later.
Community Charge Benefit (rebate)
People with low income were helped to meet their remaining community charge liability through a rebate of up to 80% of the charge under the provisions of the community charge benefit scheme. Community charge benefit replaced rate rebates on 1 April 1989 (1990 in England and Wales and was itself replaced by Council Tax Benefit on the introduction of the new tax in 1993.
Council Tax
A local property tax (which replaced the community charge on 1 April 1993) based on the value of the property and the number of residents. In Scotland the regional and islands councils levied and collected the tax set by them and the district councils within their area until 1 April 1996 when re-organisation took place. The local Assessor assesses the properties in each district area and assigns each property to one of eight valuation bands; A to H. The tax is set on the bases of the number of Band D equivalent properties. Tax levels for dwellings in other bands are set relative to the Band D baseline. In England and Wales council tax is set by the charging authority and the precepting authority in order to collect sufficient revenue to meet their demand on the Collection Fund while the banding of dwellings is carried out by the Inland Revenue Valuation Office Agency.
Council Tax Benefit (rebate)
Financial help given by a council to council taxpayers to help them meet their council tax bill. Such help is based on need and takes into account income, family circumstances and the amount of the council tax. Central government finances 95% of the cost of these benefits.
Most local authorities operate 'local schemes' whereby they finance allowances in excess of the standard UK scheme.
Debtor
For the purpose of this survey, in Scotland, the person whose name appears on the annex to the application to the Sheriff for Summary Warrant or is the person whose name appears on the summons as the defender in a debt action.
Defender
The person against whom an action is raised.
Decree
The judgement or order of a court.
Diligence
The procedures (such as poindings and warrant sales and arrestments) by which debt decrees are enforced in Scotland.
Distress
In England and Wales where a liability order has been made, the Billing Authority which applied for the liability order may levy the appropriate amount by distress and sale of goods of the debtor against whom the order was made. The appropriate amount for levy shall be the aggregate of an amount equal to any outstanding sum covered by the liability order, and a sum in respect of charges in connection with distress.
Earnings Arrestment
The diligence whereby a creditor in Scotland may secure funds from wages belonging to the debtor which is in the hands of a third party the debtor's employer). On the creditor's instructions the sheriff officer serves a schedule of arrestment on the employer which requires the employer to withhold a part of the debtor's wages on the next pay day.
Generic Working
A term applied to staff who as a result of training are capable of dealing with a wide range of enquiries on council tax as opposed to those staff who specialise in one particular facet of administration for example dealing with liability to council tax.
Heritable property
Legal term for property consisting of land or buildings as contrasted with moveable property.
Equivalent to the English term 'real property'.
Housing benefit (rebate)
Financial help given to local authority or private tenants whose income falls below prescribed amounts. Central Government finances approximately 95% of the cost of rebates awarded to tenants. Some local authorities operate 'local schemes' whereby they finance allowances in excess of the standard payments.
Inhibition
Inhibition prevents the owner of heritable property in Scotland from conveying (passing with valid title) any of that property to any other person. In itself inhibition is an incomplete diligence its effect being merely prohibitory and preventative. In relation to Council Tax, it is a prerequisite of obtaining Letters of Inhibition that a sheriff court decree has been granted;
inhibition cannot proceed on the strength of a summary warrant (Commissioners of Customs
& Excise [Applicants] 1992). Inhibition is effected through the Court of Session by the creditor presenting a Bill for Letters of Inhibition together with the decree granted in the action for payment. A copy of the Letters is served on the debtor and the execution is registered in the Register of Inhibitions and Adjudications. Inhibition lasts for 5 years from registration. The inhibition applies to all heritable property owned by the debtor, not just that in respect of which the Council Tax is due. Adjudication is the appropriate diligence to attach
Liability Order
In England and Wales if the Magistrates' Court is satisfied that the sum in question has become payable by the debtor and it has not been paid, then it is required to make a liability order in respect of an amount equal to the aggregate of the sum payable and the costs reasonably incurred by the applicant in obtaining the order. The making of the liability order against the debtor provides the Billing Authority with the power to obtain the monies by applying any of the remedies conferred by the order.
Magistrates' Court
In England and Wales the MagistratesÕ Court will be composed of lay justices of the peace for a Commission Area within which the Billing Authority lies. Subject to any other enactment authorising a stipendiary magistrate or other person to act by himself, a MagistratesÕ Court may not hear a summons, entertain an application for a warrant or hold an inquiry as to means except where composed of at least two justices
Means Enquiry
On the application for the issue of a warrant of commitment, the justices must make inquiry in the defendantÕs presence as to whether his failure to make payment was due to willful refusal or culpable neglect. If the Court makes such a finding it can issue a warrant of commitment) for the debtor to be imprisoned for a period not exceeding 3 months; fix a term of imprisonment and postpone the issue of the warrant until such time and on such conditions as the Court shall think fit; refuse to issue a warrant or to fix a term of imprisonment.
Poinding (pronounced 'pinding')
In Scotland the stage in the diligence of poinding and warrant sale whereby the moveable goods of a debtor are secured to the creditor and brought within the protection and control of the court until they can be realised at a warrant sale. The sheriff officer inventories and values sufficient of the debtor's goods to cover the debt plus expenses. A legal document (called a poinding schedule) is delivered to the debtor (or other person having possession of the goods) specifying the poinded goods, which thereafter must not be removed or disposed of by the debtor.
Sequestration
A creditor in Scotland is entitled to apply to the Court under the Bankruptcy (Scotland) Act 1985, for the sequestration of a debtor's assets, provided that the debt exceeds £1,500 (£750 in England and Wales). Sequestration is the process whereby all a debtor's assets, both movable and heritable, are seized by the court and placed in trust.
Sheriff Court
The only local court in Scotland having civil (as well as criminal) jurisdiction. The judge is called the sheriff.
Sheriff Officer
In Scotland, an Officer appointed by the sheriff principal of each sheriffdom to enforce sheriff court decrees by diligence. Sheriff officers are both public officers and independent contractors whose fees are regulated by rules of court.
Summary warrant
In Scotland, a warrant for diligence to recover rates or taxes granted by the sheriff, not in a debt action, but on application, by a local authority for recovery of council tax, or the
collector for the Inland Revenue or Customs and Excise, containing a certificate of arrears. In the case of council tax, the certificate states that the collector has given each council tax defaulter concerned a notice requiring payment of the unpaid amount within a period of 14 days, that the period has expired, and that the amount is still due and unpaid.
Warrant sale
In Scotland a sale by public auction in which poinded goods belonging to the debtor are realised and the debt satisfied in whole or part out of the proceeds of sale. The sheriff officer (subject to certain statutory time limits) arranges the time, place and public notice of the sale.
BIBLIOGRAPHY
Statutes
The Local Government Scotland Act 1947;
The Representation of the People Act 1983 as amended by Schedule 13(130) of the Local Government (Scotland) Act 1994;
The Debtors (Scotland) Act 1987, London: HMSO;
The Abolition of Domestic Rates Etc. (Scotland) Act 1987;
The Local Government Finance Act 1988;
The Act of Sederunt (Proceedings in the Sheriff Court under the Debtors (Scotland) Act 1987) 1988 as amended;
The Local Government Finance Act 1992;
The Local Government etc (Scotland) Act 1994.
Cases
Peter v Anderson (1814);
ClaytonÕs Case: Devaynes v Noble 1816;
Roberts v. Hopwood 1925 A.C. 578;
Albermarle Supply Co Ltd v Hind and Co. (1928);
Stepney Corporation v Osofsky (1937);
R v Miskin Lower Justices (1953);
R. v Newcastle-under-Lyme Justices ex parte Massey (1993).
Publications
Implementing The Council Tax by Pat Kneen and Tony Travers sponsored by both the Joseph Rowntree Foundation and Local Government Chronicle - published by LGC Communications 1994;
Council Tax: Your Guide: Farrington, F. and Lee, M. (1993) London, IRRV Services Ltd.;
Local Finance in Scotland: C.S.Page published by Hodge & Co. Glasgow - now out of print;
Implementing the Council Tax by Pat Kneen and Tony Travers - LGC Communication 1994;
The Legal System of Scotland: Manson -Smith, D. (1995) Edinburgh, HMSO;
The Debtors (Scotland) Act 1987: Nichols, D., (1987) Edinburgh, W. Green and Son;
The Commercial Law in Scotland -W.D.Esslemont -William Hodge & Co. Ltd;
The Community Charge in Scotland - Peter John- Joseph Rowntree Foundation 1991;
Credit and Debt - PSI Report -Richard Berthoud and Elaine Kempson -- Joseph Rowntree Foundation 1992.
Reports
Accounts Commission for Scotland (1997) Council tax collection: Edinburgh;
Audit Commission's Annual Council Tax Collection figures for 1998/99;
Research Report for the Scottish Law Commission - Scottish Office, Central Research Unit Papers - No.5 1981;
Evaluation of the Debtors (Scotland) Act 1987: Study of Debtors, Whyte, D (1999), Scottish Office Central Research Unit;
Evaluation of Debtors (Scotland) Act 1987: Study of commercial Creditors, Platts, A (1999), Scottish Office Central Research Unit;
Evaluation of the Debtors (Scotland) Act 1987 - Executive Summary -The Scottish Office Central Research Unit -1999;
Direct Payments from Income Support, Mannion, R., Hutton, S. and Sainsbury, R. (1994) Department of Social Security Research Report No.33, London: HMSO;
Managing Housing Benefit- Accounts Commission Report 1993;
It Pays to Collect - A Consultative Document by the Joint Scottish Office/Cosla Working Group on Council Tax Collection;
Response by The Scottish Branch of the Institute of Revenues, Rating and Valuation to "It Pays To Collect" Consultative Paper.
Regulations and Orders
Social Security: The Community Charge Benefits (Transitional) Order 1989;
Social Security: The Council Tax Benefit (Transitional) Order 1992;
Submissions in response to the Department of the Environment consultation paper, ÔA New Tax for Local GovernmentÕ- 1991;
The Council Tax (Administration and Enforcement) (Scotland) Regulations 1992;
The Council Tax (Administration and Enforcement) Regulations 1992 as amended;
The Council Tax (Liability of Owners) (Scotland) Regulations 1992 as amended by The Council Tax (Liability of Owners) (Scotland) Amendment Regulations 1993;
The Council Tax (Liability of Owners) Regulations 1992 No. 551 as amended by SI 1993 No. 151;
The Local Authorities (Calculation of Council Tax Base) Regulations 1992 as amended;
The Water Services Charges (Billing and Collection) (Scotland) Order 1997 No. 362 (S.27);
The Water Services Charges (Billing and Collection) (Scotland) Order 1997 SI No 362 (s27).
Sources
Benefit figures DSS Housing Benefit and Council Tax Benefit Management Information System - 1% sample taken on 2/05/98;
Hansard H.C. Vol.III, col.1067;
Reported at June 1999 meeting of Institute of Revenues, Rating and Valuation Scottish Branch;
IRRV Scottish Revenues Forum Meeting in June 1999;
Scottish Office Annual Returns of Council Tax;
Scottish Office Finance Statistics for March 1998;
Scottish Office Grant Aided Expenditure 1999Ð00 Report;
Scottish Office Statistical Unit;
Scottish Water and Sewerage Customers Council;
Source for Number of Dwellings from Scottish Office Statistical Returns; DETR;
Source for Number of Dwellings from Scottish Office Statistical Returns; DETR; Welsh Office.
Source of Benefit figures DSS Housing Benefit and Council Tax Benefit Management Information System - 1 % sample taken on 2/05/98;
Welsh Local Government Financial Statistics;
DETR Local Government Finance Statistics Unit.
ANNEX 1 ARTICLES EXEMPT FROM POINDING AND WARRANT