Auckland Council rates crackdown: Man faces losing Howick home over rates debt

Auckland's biggest outstanding rates bill is a whopping $217,000.

Auckland Council has gone to court to force the sale of a Howick resident's home after his failure to pay thousands of dollars in outstanding rates.

But the man says he has been "wiped out" financially after an acrimonious relationship split and has no way of repaying the money from his weekly dole.

The former builder and self-styled jailhouse bush lawyer has also questioned the council's legal right to levy rates and is vowing to stay put if officials try to force him out.

"They're going to evict me from my own house? That's just ruthless. That's not fair."

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If the council is successful, the man - who estimates his rates bill is now about $25,000 - would become just the second super city homeowner to lose his property in a forced rating sale.

But his bill pales in comparison to the city's biggest outstanding rates debt - more than $200,000 for a property in Freemans Bay.

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The court action, which commenced in 2017, comes as the council hikes rates to help address a $750 million revenue hit from Covid-19 and Auckland's water crisis.

The council has offered deferment for ratepayers struggling financially as a result of the pandemic.

But there are fears that more ratepayers will default as job losses kick in when the Government's wage subsidy ends and mortgage holidays dry up later this year.

The Herald can reveal that errant ratepayers owe the council more than $35m in overdue rates, with dozen of homeowners facing court action to force them to comply with their financial obligations.

In total, 28,435 ratepayers are behind or refusing to pay. But the council is refusing to provide details about all but a handful of cases, citing ratepayer privacy and fears publication could "cause shame and further hardship".

Information obtained by the Herald under the Official Information Act show the biggest bill is a whopping $217,000 for a Freemans Bay mixed use property, followed by $188,000 for a Takapuna business, $179,000 for a Wade Head residential property and $161,000 for a Mangere home.

A Beachlands property owner recently paid a massive $204,000 rates bill, avoiding further enforcement action.

There are three active rates recovery cases before the courts.

Under the Local Government (Ratings) Act, councils can charge property owners rates to fund council services and infrastructure.

Failure to pay rates can see property owners taken to court and in extreme cases councils can apply for High Court charging orders to force ratepayers to comply, or ask the court to order the forced sale of homes.

The Herald has fought for months for information on the rates arrears cases. A judge finally granted access to the High Court files earlier this month but suppressed the defendants' identities.

The Howick matter involves a three-bedroom property valued by the council at just under $1m.

Auckland Council obtained a court charging order for $14,004.73 in July 2018 but the homeowner has failed to comply.

The council is refusing to say how much the man now owes, only that "the sum involved in this action is considerably higher".

It has now asked the High Court to order a rating sale to recoup the outstanding money.

The Herald visited the man's house yesterday, which was cluttered with cars, rubbish, bikes and guarded by a dog.

He confirmed he was aware of "rates owning" and had received letters from the council but not read them.

The man said he'd been "cleaned out" by his ex partner and also lost three neighbouring properties in recent years through mortgagee sales taken by banks.

He had been unable to work for several years due to ill health and losing his driver's licence through disqualification.

"I'm anti the system because of what the system has done to me.

"I can't see how I'm going to pay [the council] when the lawyers have taken all the money. There's nothing left."

The council confirmed three other sale applications had been resolved after ratepayers paid up "in full" or agreed to rates postponements.

Another 13 cases now qualify for court-ordered sales, though most are expected to settle.

Auckland's longest overdue rates debt dates from 2004 and now totals nearly $110,000.

Auckland Council's group treasurer John Bishop says about 100 cases have been referred to the courts. Photo / Supplied

Auckland Council's group treasurer John Bishop said ratepayers who failed to pay by instalment due dates received automated phone calls and two reminder letters requesting payment.

"In addition to these measures the credit control team sends manual emails and makes phone calls to customers whose rates are in arrears for hands-on collection. Rates unpaid at the end of each financial year (rate arrears) are referred to our in-house legal team for further recovery action."

Bishop confirmed about 850 rates collection matters were currently with the council's legal department. About 100 of these cases had been referred to the District Court, with only a handful being defended.

He confirmed the current forced sale process would be the first since Manurewa pensioner Charlotte Marsh lost her home in 2015 in a court-ordered sale after failing to pay more than $12,000 in rates and penalties.

She had refused to recognise the authority of Auckland Council and claimed to have paid her rates instead to the "rightful land owner" – an unregistered Māori authority.

Activist Penny Bright nearly lost her Kingsland house in 2018 after refusing to pay $34,000.

But a compromise was reached when Bright applied for a rates postponement application, resolving the debt and stopping the mandatory sale process.

She died a few months later.