Enfield Borough Council has collected £500,000 in unpaid council tax in the last year by putting charging orders on the property of reluctant payers.

The strategy was suggested and implemented by Incasso LLP, the Leeds-based debt collection arm of the top 50 law firm, Cobbetts.

The thinking behind the initiative was simple, as Geoff Waterton, Enfield’s Head of Collection explained. “Some people were living in valuable properties but they were resisting all our attempts to persuade them to pay their arrears, which often ran into thousands of pounds. “We decided to target particularly difficult cases, where it was clear that people were not unable but fundamentally unwilling to pay.”

The process leading up to a possible order for sale is one which needs to be followed to the letter. First there is an application to the county court for an interim Charging Order. The application contains information on the debtor, their current address, copies of outstanding liability orders and office copies of HM Land Registry documents as evidence that the property is owned by the debtor.

In most cases, after an Interim Order has been granted, there is a further hearing to ask the court to make a final or absolute order. In theory, this doesn’t compel the debtor to pay, unless they sell or remortgage. “But, in practice,” said Geoff, “the imposition of a charging order has been shown to have an important psychological effect. People who haven’t paid us anything for years have started to pay off their arrears.”

In the last year alone, Incasso LLP has handled 320 of these cases, prompting payments of unpaid council tax of £500,000. “If we had simply stayed with the bailiff route, I don’t think we would have brought in more than £200,000,” said Geoff. “By obtaining a charge, we were securing the debt against the property and, for those cases where Incasso LLP have applied for a forced sale, I’m delighted to say that the county court gave Judgment in our favour each time and we haven’t had to sell a single property. The threat of the enforced sale was enough to get people to pay in full, including all our costs as well.”

Among the cases that Incasso LLP has pursued was one involving a £500,000 property where the owner had racked up £12,000 in unpaid council tax. The property was finally remortgaged and the debt - and costs - paid.

These methods have proved so successful that Enfield is now lowering the bar when it seeks orders for sale. This has dropped to £5,000 in unpaid council tax - but the formula continues to be a winning one.