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M&G UK Shared Ownership Limited (202333069)

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REPORT

COMPLAINT 202333069

M&G UK Shared Ownership Limited

20 June 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

  1. The complaint is about the landlord’s handling of repairs to the district heating system.

Background

  1. The resident is a shared ownership leaseholder of a 1 bedroom flat. She purchased her flat on 24 October 2019. The resident’s lease was originally between the resident and the freeholder of the property. However, the freeholder sold its leasehold interest in the property to the landlord on 31 March 2021.
  2. The landlord has appointed a managing agent to deal with all aspects of its leaseholder services. In cases such as this, where the landlord has no direct involvement with the management of the property, we will consider the actions of the managing agent to be the actions of the landlord. In this case, the appointed managing agent is also the freeholder of the property.
  3. The resident’s flat is connected to a district heating system for the supply of heating and hot water. Under the terms of the head lease, the freeholder is responsible for the repairs and maintenance of the district heating system. In December 2022, following an increase in energy prices, the resident noticed she was using a significant amount of energy when her heating was on. She also noticed she was still using energy when her heating was switched off. This had not been apparent previously due to the significantly lower cost of energy.
  4. The resident turned her heating off on 19 December 2022 as she could not afford to continue to heat her home. The resident said it was costing her around £20 per day. She reported her concerns to the managing agent on 4 January 2023. The managing agent arranged for a heating engineer to attend the resident’s property. The appointment took place on or around 31 January 2023.
  5. The resident raised a formal complaint with the managing agent on 24 February 2023. She said she had noticed her energy usage was too high when using her heating. She said various engineers had checked the heating system but had not found or fixed the problem. She asked the landlord to resolve the matter as a priority.
  6. The managing agent sent the resident a stage 1 complaint response on 16 March 2023. It said it had arranged for a heating contractor to undertake inspections to find the cause of the problem. It acknowledged that it had taken too long to resolve and it apologised for the delay. It offered the resident £200 compensation. This was made up of £50 for complaint handling failures and £150 for poor communication, time and trouble, delays and distress and inconvenience.
  7. The contractors resolved the issue with the district heating system on 16 June 2023. The resident asked the managing agent whether it could reimburse her for the cost of the excessive energy usage from the date she purchased the property.
  8. Following escalation to stage 2, the managing agent sent the resident a compensation review letter on 30 October 2023. It said it had reviewed its stage 1 response and considered the amount of compensation it had awarded. It offered increased compensation of £650. This was made up of £600 for the delays, customer effort and distress and inconvenience. It also offered £50 compensation for a minor delay in the acknowledgement letter at stage 1 of the complaints process. However, this matter has not been investigated further as it did not form part of the resident’s complaint to us.
  9. The managing agent sent the resident a stage 2 complaint response on 10 November 2023 as she did not accept the increased compensation. It said it would not change the decision made at stage 1 as it believed it had given the resident a fair response. It said the resident had not provided any new information for it to consider.
  10. The resident was dissatisfied with the landlord’s response, so referred her complaint to the Ombudsman.

Assessment and findings

Jurisdiction and scope of investigation

  1. Under the terms of the lease, the resident is required to pay ‘a fair proportion’ of the costs of the district heating consumed at the property (Schedule 10 of the lease). If the resident believes she was overcharged for the heating charge, she can make a claim to the relevant tribunal under s.27A of the Landlord and Tenant Act 1985 – to determine whether the charge is payable and the reasonableness of it. Under the Scheme, the Ombudsman does not investigate complaints about the level of rent or service charge or their increases, or where it would be fairer, more reasonable and more effective to seek a remedy via another procedure, such as the Tribunal, in this case.
  2. Under the terms of the head lease, the responsibility for the repair and maintenance of the district heating system sits with the freeholder of the property. We are only able to consider the actions of the landlord in this investigation. Some reference may be made within this report to the actions of the freeholder to provide overall context to the case. However, these actions will not be considered as part of the assessment. If the resident wishes to challenge the actions and response of the freeholder in relation to its obligations, she may wish to seek independent advice.
  3. The resident has expressed concerns about the impact the situation has had on her health following an injury sustained after fainting. We are unable to draw conclusions relating to impact on health and wellbeing. Claims for personal injury are matters for a court to decide, as the court can consider medical evidence to arrive at findings. Where there has been a failing by the landlord, we may consider any general distress and inconvenience which the situation may have caused the resident.

The landlord’s handling of repairs to the district heating system

  1. As the freeholder of the property and the managing agent are the same organisation, there has been some overlap in each of its specific roles. In some instances, during the management of the case, it is unclear from the evidence provided whether the actions taken were the actions of the managing agent on behalf of the landlord, or the actions of the freeholder.
  2. We have therefore assumed that any actions taken in relation to the repair and maintenance of the district heating system, were the actions of the freeholder. This is because the head lease clearly states the landlord (as head leaseholder) agrees “not at any time to repair or maintain or in any way interfere with the meters and the heat interface unit or pipes (including those under the floor of the premises) or other apparatus within the premises that are used in connection with or otherwise relate to the district heating plant room or the district heating systems or the provision of the district heating services”.
  3. This means the landlord’s role in this matter, via its managing agent, was to facilitate contact with the freeholder to ensure the freeholder upheld its obligations within the head lease. The landlord was also responsible for managing the complaints process and supporting the resident to get the issues resolved via its managing agent.
  4. The resident contacted the managing agent on 4 January 2023 to report a problem with the district heating system as she was using an excessive amount of energy when her heating was on. The managing agent arranged for a heating engineer to attend the resident’s property. The evidence shows the appointment took place on or around 31 January 2023. It is unclear as to what priority the repair was given, however, the contractors attended the appointment within the freeholder’s timeframe of 20 working days for routine repairs.
  5. The engineer found no issues with the heat interface unit (HIU), so he suggested the energy supplier check the meter for faults. The managing agent arranged for the energy supplier to attend the resident’s property on 14 February 2023. The engineer found that the water temperature was set too high, which he believed would increase the resident’s energy usage. He adjusted the water temperature control. The engineer acknowledged that the resident’s historical energy usage did appear to be excessive.
  6. The adjustment in the water temperature did not resolve the excess energy usage, so the managing agent arranged a further repairs appointment. This was reasonable in the circumstances and in line with its responsibilities as the managing agent.
  7. The resident contacted the managing agent on 20 February 2023. She said she was not happy to wait until 7 March 2023 for another repair appointment as she had been without heating since 19 December 2023. She said her flat was very cold, only 11 degrees, and she had fainted and hit her head due to the stress caused by the ongoing issues. She told the managing agent the last engineer had turned her HIU off, which meant she was no longer paying for usage whilst her heating was off.
  8. There is no evidence to show the managing agent responded to the resident’s email. This was unreasonable in the circumstances, as she was clearly distressed and frustrated by the ongoing issues.
  9. Although the landlord is not responsible for repairing the district heating system, it would have been reasonable in the circumstances to consider providing a temporary heating solution (or via its managing agent) while the repairs were carried out. Had it done this, it would have improved the living conditions of the resident and reduced some of the distress and discomfort caused by her cold flat.
  10. The resident raised a formal complaint with the managing agent on 24 February 2023. She said:
    1. She had noticed her energy usage was excessive after an increase in the energy prices. Her meter was also charging her for energy when her heating was off. After speaking to neighbours, she realised this was not normal.
    2. Engineers had attended but could not find the fault.
    3. Her flat was very cold as she had turned her heating off due to the excessive costs.
    4. She had compared her energy usage with her neighbours and hers was significantly higher, although she was only using her heating for a similar amount of time. She realised this had been an issue since she moved into her property in 2019.
    5. The situation was very stressful and had caused her to faint, requiring hospital treatment.
    6. She was waiting for another engineer to attend but she did not have a firm appointment date. She wanted the matter resolved as a priority.
  11. The resident contacted the managing agent on 4 March 2023, 6 March 2023 and 7 March 2023 asking for help. She said she had consulted an independent specialist, who thought the valve was at fault, as water was constantly flowing through the pipes. Which she said explained the energy usage when the heating was off. The managing agent responded to the resident on 8 March 2023. It said it would arrange an appointment to replace the heat meter and faulty valve. This was a reasonable response within a reasonable amount of time as the resident’s first contact was over the weekend.
  12. The resident asked the managing agent on 8 March 2023 to reimburse her for the excess charges she had paid since she moved into the property. However, as this would be a matter for the freeholder to consider, rather than the landlord, we have not been able to consider the freeholders response within this assessment.
  13. The managing agent contacted the resident on 9 March 2023. It said it had arranged for an engineer to attend on 24 March 2023. It said it had asked for a £50 credit to be added to the resident’s meter as a gesture of goodwill. The gesture of goodwill was a positive response, which went some way towards helping the resident with her heating costs.
  14. The managing agent sent the resident a stage 1 complaint response on 16 March 2023. It apologised for the distress and inconvenience caused to the resident. It said it had arranged for an engineer to inspect the resident’s meter and HIU on 24 March 2023. It acknowledged it had taken too long to resolve the issues and it offered the resident compensation of £150. This was made up of £50 for poor communication and time and trouble, £50 for the delays, and £50 for distress and inconvenience.
  15. The resident contacted the managing agent by email on 3 April 2023, 11 April 2023 and 12 April 2023 asking for an update following the repairs visit on 24 March 2023. The managing agent responded on 13 April 2023. It said the engineer had found the problem and ordered the parts to complete the repair. It said the contractors would arrange a further appointment directly with her once the parts were available.
  16. However, the resident had to chase the managing agent on 12 May 2023 for an update as, although the engineer had attended the resident’s property again, the issue remained unresolved.
  17. It is unclear from the evidence provided why the resident had to continue chasing the managing agent for updates and responses. The managing agent had already acknowledged its poor communication in its stage 1 response, yet its communication had not improved. This was unfair to the resident, particularly as the matter had been ongoing for some time and it was causing her frustration and distress. Had the managing agent proactively communicated with the resident, she would have had a clearer understanding of the reasons for the delays in resolving the problem.
  18. The freeholders engineer attended the resident’s property again on 16 June 2023 and resolved the issue by replacing the valves to the underfloor heating, which had not been in operation. The resident asked the managing agent to go back through her bills and reimburse her for the excessive energy charges.
  19. The managing agent responded on 16 August 2023. It said it had contacted a member of the freeholder’s energy team and asked it to look into the resident’s request. It also gave the resident the contact details for the freeholder’s insurance team, should she wish to make a claim for personal injury or damage to possessions. Whilst the referral to the energy team and the information provided to the resident was helpful, it had taken the managing agent over 2 months to respond. This was an unreasonable delay.
  20. In September 2023 the freeholder commissioned an independent report to compare the resident’s energy consumption to her neighbours. The report concluded it was unlikely that there had been a significant and measurable increase in the heat consumption due to the under floor heating not being in operation.
  21. The resident escalated her complaint to stage 2 on 6 October 2023. The managing agent sent the resident a compensation review letter on 30 October 2023. It said it had reviewed the original offer of compensation and increased it to £600. This was made up of £200 for the delays, £200 for the customer’s effort, and £200 for distress and inconvenience.
  22. The managing agent said it believed the increased compensation award recognised the further impact of the delays and the distress and inconvenience caused to the resident. It acknowledged it should have kept the resident up to date, along with taking more time to support and empathise with her situation.
  23. The evidence shows the resident responded to the managing agent’s increased offer of compensation. However, we have not seen a copy of this email.
  24. The managing agent sent a stage 2 complaint response to the resident on 10 November 2023. The managing agent confirmed, within the response, that the resident had refused the increased offer of compensation. It said it had reviewed its decision at stage 1, checked all the details of the complaint thoroughly and it had responded to all the points made. It confirmed it had not changed its decision and would not offer any further compensation.
  25. Where there are admitted failings by a landlord, our role is to consider whether the redress offered put things right and resolved the resident’s complaint satisfactorily in the circumstances. In this case the landlord’s apology, its acknowledgement of its failings, and its offer of £600 compensation represents reasonable redress for the identified failings. In our opinion, the landlord has been able to show it made reasonable and proactive efforts to resolve the complaint and “put things right” in accordance with the Ombudsman’s Dispute Resolution Principles.
  26. In summary, although there were some delays in the managing agent arranging repair appointments and poor communication at times, the landlord attempted to put things right through its complaints process. The redress offered by the landlord was reasonable in the circumstances. It was in line with the managing agent’s compensation procedure which says it can offer a maximum of £500 for major impact associated with delays, up to £500 for significant distress and inconvenience and £50 for time and trouble. The compensation offered was also in line with the remedies guidance provided by the Ombudsman for cases where there was a significant impact on the resident. The landlord is therefore to pay the overall compensation of £600 to the resident if it has not already done so.

Determination

  1. In accordance with paragraph 53(b) of the Housing Ombudsman Scheme, there was reasonable redress by the landlord in its handling of the repairs to the district heating system.

Orders and recommendations

Recommendations

  1. It is recommended that the landlord:
    1. pay the resident the £600 it offered in its stage 2 response. The finding of reasonable redress has been made on this basis.
    2. consider if it overcharged the resident in respect of the district heating in accordance with Schedule 10. It should write to the resident and set this out.
    3. reply to this Service within four weeks of the date of this report to advise of its intentions regarding the above recommendations.