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By demanding a police report, the council is limiting the ground by changing it from
taken without the owner's consent
to
taking it in the course of theft
which restriction they are not allowed to place on it, which amounts to procedural impropriety.
The online taken without consent ground clearly limits to theft:
At the time the alleged contravention or failure took place the person who was in control of the vehicle was in control of the vehicle without the consent of the owner (please provide a copy of the police crime report or insurance claim).
I would pay the first and make reps on the second saying you've paid the first and would they kindly exercise discretion on the second owing to the close timing and difficulty in navigating the area to a hospital appointment.
That is unless Hippo has something.