Topics
Case Overview
1. This document summarises the Court of Appeal’s judgment in L v. London Borough of Hounslow ([2019] EWCA Civ 2206), a case concerning the jurisdiction of the County Court to hear claims for the repayment of allegedly overpaid council tax. The central issue was whether Mr. L could pursue his claim in the County Court, or if the Valuation Tribunal had exclusive jurisdiction.
Key Themes & Issues
Jurisdiction of the County Court
2. Limited Statutory Jurisdiction: The County Court, unlike the High Court, has no inherent jurisdiction. Its jurisdiction is strictly limited to what is granted by statute (specifically, the County Courts Act 1984).
3. Section 15 (Contract & Tort): The County Court has jurisdiction to hear cases “founded on contract or tort.”
4. Section 16 (Statutory Sums): The County Court has jurisdiction to hear actions for the recovery of a sum recoverable by statute, unless that statute stipulates that the sum can only be recovered in the High Court or summarily.
Council Tax and Single Person Discount (SPD)
5. Statutory Duty: Billing authorities (like Hounslow) have a statutory duty to levy and collect council tax under the Local Government Finance Act 1992.
6. SPD Entitlement: A dwelling occupied by a single person is entitled to a 25% Single Person Discount. There is no discretion for the billing authority if the criteria are met.
7. Assumption of Discount: Billing authorities must take reasonable steps to ascertain whether a dwelling is subject to a discount. They must make assumptions based on their findings.
8. Taxpayer’s Duty: Taxpayers must notify the billing authority if they believe an erroneous assumption has been made regarding discounts.
9. Demand Notices and Adjustments: The Council issues demand notices to taxpayers for council tax. If the estimated amount is different from the true charge, adjustments need to be made. The council may repay overpayments if requested, or use the amount as a credit.
Valuation Tribunal Jurisdiction
10. Appeals: Under Section 16 of the Local Government Finance Act 1992, a person can appeal to the Valuation Tribunal if aggrieved by a decision by the billing authority that they are liable to pay council tax or any calculation made of the amount they are liable to pay.
11. Time Limits: Appeals are subject to time limits, as per the Valuation Tribunal for England (Council Tax and Rating Appeals) (Procedure) Regulations 2009.
12. Powers: The Valuation Tribunal can order adjustments to estimates and recalculate the amount due. They can order repayments as an “ancillary” matter.
13. Exclusivity: The core question in this case was whether the Tribunal’s jurisdiction was exclusive.
Mr. L’s Claim
14. Overpayment Claim: Mr. L sought to recover alleged overpayments of council tax due to the failure of the Council to apply a single person discount (SPD). He argued that he was entitled to SPD for certain periods, and thus entitled to a repayment.
15. County Court Claim: He initially launched his claim in the County Court, arguing that he could make his claim for repayment under regulations 31 and 55 of the Council Tax (Administration and Enforcement) Regulations 1992, or alternately, as a restitutionary claim for unjust enrichment.
Key Facts
16. Failure to Submit Forms: The Council argued Mr. L failed to submit the necessary review forms to claim SPD for the periods in dispute.
17. Lower Court Decisions: A Deputy District Judge initially ruled in favour of the initial claimant due to the Council’s failure to submit a Directions Questionnaire, but allowed for the possibility of substituting Mr. L.
18. Judge Hellman overturned this decision on appeal, finding that the County Court had no jurisdiction over Mr. L’s claim.
19. Appeal to the Court of Appeal: Mr. L appealed Judge Hellman’s decision, limited to the jurisdictional issue.
Court of Appeal’s Reasoning and Decision
Section 16 of the 1984 Act (Statutory Sums)
20. Primary Argument: Mr. L argued his claim fell under section 16, as he sought recovery of a sum owed by the 1992 regulations, specifically regulations 31(4) and 55, arguing the council was obliged to repay the overpaid amount and regulation 55 states that sums are recoverable in a court of competent jurisdiction.
21. Court’s Finding: The Court held that the council must make a determination on a person’s liability and decide if there has been an overpayment before a sum is considered “recoverable” under regulation 55, and therefore, a claim must be made under the statutory scheme to appeal the council’s decision.
“The important point about the procedure for determination and for internal and external review is that, pursuant to the authority of primary legislation, the Regulations provide a detailed, self-contained and exhaustive procedure for enforcing the duties of the appropriate local authority in relation to the determination and payment of housing benefits. Until a determination is made under that procedure, there is no duty on the appropriate authority to make a payment of housing benefit either to the claimant entitled to it or to any other person.”
22. Exclusive Jurisdiction: The Court concluded that the statutory scheme for council tax, including the Valuation Tribunal, implied that it had exclusive jurisdiction over disputes regarding council tax liability and discounts. Allowing claims to be made in the County Court could circumvent the procedures, conditions and time limits that apply to an appeal to the Valuation Tribunal.
Section 15 of the 1984 Act (Unjust Enrichment)
23. Alternative Argument: Mr. L argued that if his claim was not under section 16, then he had a claim for unjust enrichment, which was an action “founded on contract” under Section 15.
24. Court’s Finding: While uncertain whether unjust enrichment is “founded on contract”, the Court found that the statutory scheme for council tax, specifically the ability to appeal to the Valuation Tribunal, displaced any common law claim for unjust enrichment.
“…if Parliament creates a right which is inconsistent with a right given by the common law, the latter is displaced. By ‘inconsistent’ I mean that the statutory remedy has some restriction in it which reflects some policy rule of the statute which is a cardinal feature of the statute. In those circumstances the likely implication of the statute, in the absence of contrary provision, is that the statutory remedy is an exclusive one.”
25. Residual Common Law: The Court noted the “common law of restitution in this area… is residual” and “Normally the right to restitution from a public authority… is embodied in a statute.”. The court determined that the statutory scheme provides for resolution of this matter.
Emphasis on Specialist Tribunal
26. The Court highlighted the specialist nature of the Valuation Tribunal and its streamlined process, which is well-suited to litigants in person. The court notes the advantages such as no cost, informal procedures, and no risk of adverse cost orders for taxpayers.
Conclusion
27. The Court of Appeal dismissed Mr. L’s appeal, finding that the County Court lacked jurisdiction to hear his claim for overpaid council tax. The Court held that the statutory scheme for council tax, including the Valuation Tribunal, implied that the Valuation Tribunal held exclusive jurisdiction for determining council tax liability disputes and that any common law claims were displaced by the statutory scheme. The Court stressed the specialist nature of the Valuation Tribunal and the availability of its process for taxpayers.
Implications
28. Taxpayers seeking to challenge their council tax liability or claim a single person discount must follow the statutory scheme by raising the issue with the billing authority and, if unsatisfied, appealing to the Valuation Tribunal.
29. Direct claims for repayment of council tax overpayments cannot be made directly in the County Court, absent a prior decision by the billing authority or an order from the Valuation Tribunal.
30. This decision reinforces the role of specialist tribunals and the limits of County Court jurisdiction in areas governed by specific statutory regimes.