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London & Quadrant Housing Trust (202330012)

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REPORT

COMPLAINT 202330012

London & Quadrant Housing Trust (L&Q)

13 August 2025

 

Our approach

The Housing Ombudsman’s approach to investigating and determining complaints is to decide what is fair in all the circumstances of the case. This is set out in the Housing Act 1996 and the Housing Ombudsman Scheme (the Scheme). The Ombudsman considers the evidence and looks to see if there has been any ‘maladministration’, for example whether the landlord has failed to keep to the law, followed proper procedure, followed good practice or behaved in a reasonable and competent manner.

Both the resident and the landlord have submitted information to the Ombudsman and this has been carefully considered. Their accounts of what has happened are summarised below. This report is not an exhaustive description of all the events that have occurred in relation to this case, but an outline of the key issues as a background to the investigation’s findings.

The complaint

The complaint is about the landlord’s handling of:

  1. the resident’s queries about service charges for the financial year 2022/23 and the use of the sinking fund.
  2. the associated complaint.

Background

  1. The resident is the shared owner of a 1-bedroom, 3rd floor flat. The shared ownership agreement began in 2020. The landlord is a housing association and the freeholder of the resident’s building.
  2. The landlord notified the resident about a service charge increase for the previous financial year 2022/2023 on 4 September 2023. There was an £580.98 increase on previously estimated costs.
  3. On 29 September 2023 the resident made a stage 1 complaint about the increase. He was concerned about the value and allocation of the service charges. He felt:
    1. the charge for fire protection maintenance was disproportionate. He asked for a detailed breakdown of the enhancements or changes made to justify the increase.
    2. there was an unjustified rise in the charge for communal repairs. He asked for an explanation of the repairs made.
    3. the water supply pump maintenance charge rise was not explained. He asked for an explanation of the repairs or improvements made.
  4. The landlord acknowledged the complaint on 2 October 2023. On 7 October 2023 the resident told the landlord he wanted to add some additional points to his complaint. He asked why the large, unexpected costs were not paid for using the sinking fund as it was designed to ensure residents did not have to pay huge expenses. He said there was £209,358 in his blocks sinking fund. He asked for a breakdown of costs against the previous year and a final service charge statement for 2022/23.
  5. The landlord gave a stage 1 response on 25 October 2023. It did not uphold his complaint and shared a document showing a breakdown of costs for 2022/23 and the area that the overspend occurred. It said the resident’s neighbourhood service lead would review the charges and confirm if there had been any service delivery failures.
  6. The resident repeated his previous points and escalated his complaint on 31 October 2023. This was acknowledged on 15 November 2023. The resident asked for a response 3 times and contacted this Service on 9 March 2024. The landlord gave a stage 2 response on 12 March 2024. It:
    1. provided information on the sinking fund and its aim to spread the cost of replacing components at the end of life and funding major works.
    2. said the sinking fund was not intended to pay for reactive repairs and use for this purpose may result in a deficit for residents.
    3. answered the resident’s questions about how the landlord held and organised the sinking fund was held and organised.
    4. offered £168 for its delay in providing a complaint response.
  7. The landlord and resident continued to communicate about the issue. In July 2025 the resident told this Service he remained dissatisfied with the landlord’s handling of his concerns about the service charge. He wanted the sinking fund to be used to pay for the increase in service charge.

Assessment and findings

Scope of the investigation

  1. The resident’s complaint concerns the landlord’s handling of, and response to, his request for an explanation for service charges. The Ombudsman may not consider complaints which concern the level of service charge or service charge increase. However, we can assess whether the landlord’s overall communication with, and responses to, the resident were appropriate, fair and in line with policy and procedure.
  2. Complaints that relate to the level, reasonableness, or liability to pay service charges are within the jurisdiction of the First-Tier Tribunal (Property Chamber). The resident may wish to seek independent legal advice or they may contact the Leasehold Advisory Service (LEASE) ( https://www.lease-advice.org/) in relation to how to proceed with a case if they wish.
  3. In correspondence with the Ombudsman, the resident referred to other issues he had raised with the landlord, including a mouse infestation and service charge increases in other financial years. These matters did not form part of the original complaint brought to us and it is unclear whether the resident raised these issues as a separate complaint with the landlord.
  4. The landlord needs to be given a fair opportunity to investigate and respond to any reported dissatisfaction with its actions before the involvement of the Ombudsman. Any new issues that have not been subject to a formal complaint can be addressed directly with the landlord and progressed as a new formal complaint if needed. Accordingly, this investigation will only consider the issues raised in the resident’s complaint to the landlord in Autumn 2023.

The resident’s queries about service charges for the financial year 2022/23 and the use of the sinking fund

  1. The shared ownership agreement states the resident will pay the service charge to the landlord. It states the service charge will consist of:
    1. the estimated costs for next financial year.
    2. an appropriate amount as a reserve.
  2. Under Section 21 and 22 of the Landlord and Tenant Act 1985, leaseholders have the right to request a summary of the service charge costs. Having received the summary, leaseholders can then ask to inspect receipts and accounts from the last accounting year, or where accounts are not kept by accounting years, the past 12 months before the request.
  3. The landlord’s service charge policy states that it usually sets variable service charges for leaseholders. The policy sets out how service charges are calculated and apportioned to residents. If actual cost exceeds the estimated cost, then the landlord states it will issue final invoices to the resident within 6 months of the end of the financial year.
  4. The Ombudsman’s insight report on service charges (which can be found on our website) states that landlords should consider whether the information given about service charges is in clear and simple language. This should be able to be understood by the ordinary person with no specialist knowledge.
  5. The landlord’s website states that sinking funds are long-term plans to enable homeowners to spread the cost of replacing components when they reach the end of their life and major works such as regular decorating. Sinking funds are not intended to be used to pay for repairs or maintenance carried out during the year.
  6. The landlord provided the resident with an actual service charge invoice on 4 September 2023. This included a breakdown of 40 cost codes, the previous estimate given and the actual chargeable amount. This was provided within 6 months of the end of the previous financial year. The information provided was in line with the landlord’s policy and Landlord and Tenant Act obligations.
  7. The resident complained about the service charge increase on 29 September and 7 October 2023. He was concerned about the value and allocation of service charge to fire protection equipment, communal repairs and water supply pump maintenance. The landlord shared a summary of expenditure in its stage 1 response. This included the individual charges to the landlord for fire protection equipment, communal repairs and water supply maintenance. It gave a brief description of individual actions and the suppliers. This was reasonable when assessed against its responsibilities under the Landlord and Tenant Act 1985.
  8. As part of his complaint, the resident asked why large, unexpected costs were not paid for by the sinking fund. He felt this was designed to absorb costs and to ensure residents were not victim to huge expense. Information about the sinking fund was available on the landlord’s website. However, it did not respond to this in its stage 1 response, and this was a missed opportunity to explain its position.
  9. The landlord said it would review the charges and confirm if there had been any service delivery failures. It was unclear why it was taking this action, and it did not give a timeframe for this action. Providing this may have prevented the resident from escalating to stage 2. The landlord did not follow through on this proposed remedy and this was a failure.
  10. The resident asked again about the use of the sinking fund in his complaint escalation. In its response the landlord gave information on how the sinking fund was calculated and its intended use to spread the cost of end-of-life components and major works. It stated it was not intended to pay for reactive repairs, which were the cause of the overspend. The landlord did not provide a definition of reactive repairs and end of life replacements and this likely caused the resident confusion.
  11. While the landlord provided a compliant response when assessed against its policies and obligations under the Landlord and Tenant Act 1985, it did not provide a timely and clear response to the resident’s concerns at the time. As the resident felt most of the charges should not apply to him it was important for the landlord to explain to him how and why the charges were applicable. The landlord’s response lacked an oversight of the residents’ concerns, this included:
    1. not responding to the resident’s queries about the sinking fund at stage 1 of the complaint.
    2. not providing a clear reason or timeframe for the action to review if there were service delivery failures.
    3. not following through its proposed remedy to review the service charges and confirm if there were any service delivery failures.
    4. not clearly explaining how it defined reactive repairs and end of life replacements.
    5. not providing a full response until it issued its stage 2 response on 12 March 2024. This was 6 months after the resident initially complained about the level of service charges.
  12. The delay likely caused the resident time and trouble in chasing for a response. This included that the resident contacted the landlord on 1 December 2023 and 9 March 2024. This was not reasonable as the landlord lacked understanding of the issues the resident faced.
  13. The Ombudsman considers this amounted to maladministration. The landlord did not acknowledge its failings and did not take steps to put it right. Having considered the Ombudsman’s remedies guidance, the landlord is ordered to pay the resident £100 for the time and trouble caused by its handling of the resident’s queries about the service charge and use of the sinking fund.

Complaint handling

  1. A landlord’s complaint handling should aim to resolve issues quickly, effectively, and fairly. The Ombudsman’s Complaint Handling Code sets out what good complaint handling looks like. The Code and further guidance are available on our website.
  2. The landlord’s policy stated stage 1 complaints would be acknowledged within 5 working days and a response within 10 working days of logging the complaint. The resident complained on 29 September 2023. The landlord acknowledged this within its policy timeframe. In its acknowledgement it said it may ‘take a little longer to gather all the information we need’ but it did not provide an extended date by which it would respond. This was not in line with the Code.
  3. The landlord responded 18 working days later. It apologised for the delay in response and said it would investigate any potential service failures further. While it apologised for the delay, the total response time was not in line with the Code and its complaints policy.
  4. Stage 2 complaints would be acknowledged within 5 working days and a final written response provided within 20 working days. The landlord acknowledged the resident’s escalation after 11 working days. This was not in line with its policy. The landlord gave a stage 2 response on 12 March 2024. This was after the resident had asked for a response 3 additional times, contacted the Housing Ombudsman and was 92 days after the resident escalated his complaint. This unreasonably delayed the resident in receiving a response to his queries and in bringing his complaint to this Service for investigation.
  5. The resident was likely caused time and trouble by the delays and having to ask for updates. The landlord apologised for the delay and offered £168 compensation for its late response. Overall, there were failings in the landlord’s complaint handling, however the landlord took steps in line with the Ombudsman’s Dispute Resolution principles: Be Fair, Put Things Rights and Learn from Outcomes.
  6. Considering the Ombudsman’s remedies guidance and the landlord’s compensation policy, we have found reasonable redress in the landlord’s complaint handling. This is made on the understanding that the compensation offered of £168 is paid to the resident within 28 days of this report, if it has not already been paid.

Determination

  1. In accordance with the paragraph 52 of the Scheme, there was maladministration in the landlord’s handling of the resident’s queries about the service charge and use of the sinking fund.
  2. In accordance with 53.b. of the Housing Ombudsman Scheme the landlord made an offer of redress, which in our opinion, resolved errors in its handling of the resident’s complaint.

Orders and recommendation

Orders

  1. Within 28 days of this report the landlord is order to:
    1. apologise in writing to the resident for the failures identified in this report.
    2. pay the resident £100 for the time and trouble likely caused by its failures in handling the resident’s queries about the service charge and use of the sinking fund.
    3. provide documentary evidence of the above to this Service.

Recommendation

  1. If it has not already done so, the landlord is recommended to pay the resident £168 already offered for the landlord’s complaint handling failures.