Havering Council (202220864)

REPORT

COMPLAINT 202220864

Havering Council

30 January 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 the resident’s mutual exchange.
The Ombudsman has also considered the landlord’s complaint handling.

Background

The resident occupied the property under an assured tenancy. The resident’s former landlord, Havering Council, is a local authority. The resident has since moved out of Havering Council’s property under a mutual exchange, and she now has a new landlord. The resident’s new landlord is also a local authority. The landlord has no record of any vulnerabilities associated with the resident.
The property was a 3-bedroom house, and on 5 March 2022 the resident applied to move to a different home under a mutual exchange. The resident moved out of the property in May 2022.
After the resident had swapped homes with the exchangee the landlord decided to reject the mutual exchange, and said it wished to take possession of its property.
On 16 July 2022 the resident complained to the landlord. The resident said:
1. She had moved into a new home after the landlord, and her new landlord, had given her verbal permission to move homes.
2. The landlord wanted the resident and the exchangee to return to their original properties. The resident felt this was unreasonable as she had verbal confirmation from both landlords that both parties could move into their new properties.
3. The landlord had rejected the mutual exchange. She felt it had no valid reason to do so as it had a deadline of 42 days to approve or deny the mutual exchange, and it rejected the exchange after this date elapsed.
4. The resident felt the landlord was unsupportive and had not been proactive in completing the mutual exchange paperwork.
In its stage 1 complaint response on 3 August 2022, the landlord said:
1. The mutual exchange was being investigated by its legal team, so it was unable to provide an update. The legal team would provide the resident with an update after its investigation had concluded.
2. The landlord said its staff were professional and courteous, and it was sure its staff had acted reasonably when it advised the resident and the exchangee to return to their previous properties.
On 8 September 2023 the resident escalated their complaint. The resident said she:
1. Thought the landlord was withholding information.
2. Wanted further information about the legal team’s involvement.
3. Wanted the landlord to look into phone calls where she was given verbal permission to move.
4. Felt the landlord hadn’t considered its obligation to approve or reject a mutual exchange within 42 days.
5. Wanted to know if the matter would go to court.
6. Was struggling to register her child with a school because she didn’t have a tenancy agreement. She felt the landlord should assist with this matter as it had a duty of care for the child.
On 30 January 2023, the landlord re-considered its decision to reject the mutual exchange and it retrospectively approved the mutual exchange.
On 9 June 2023 this Service instructed the landlord to send a stage 2 response to the resident. On 19 July 2023 the landlord sent the resident its stage 2 response, which said:
1. It did not uphold the resident’s complaint about its actions during the mutual exchange process. It said the matter was passed onto the legal team due to the resident moving before it had given her authority to do so.
2. It did not uphold the resident’s complaint about their child’s schooling as the resident was able to successfully enrol their child in school on 26 September 2022.
3. The landlord said the resident had signed a declaration where she agreed to not move until the landlord had given her written consent to do so.
4. The landlord apologised for the delay in producing its stage 2 response. It also apologised as its stage one response did not have sufficient details for the resident to escalate their complaint.
5. It offered the resident £50 in compensation for its complaints handling.

Assessment and findings

Scope of investigation

The resident has expressed concerns around the landlord’s handling of their mutual exchange process. During this process the landlord considered taking legal action to secure possession of its property. The merit or legality of this decision is beyond the scope of the Ombudsman, and would fall under the remit of a court or tribunal. As such, the Ombudsman will exclude any assessment of the landlord’s decision to seek possession proceedings from its assessment of the complaint.

The landlord’s handling of the mutual exchange process

The landlord operates a mutual exchange policy which says the landlord is obligated under Section 92 of the Housing Act 1985 to accept or reject a proposed mutual exchange within 42 days. Any decision to reject a mutual exchange must follow the guidance set out in Schedule 3 of the Housing Act 1985.
Within this 42 day period the landlord is also required to conduct various actions to ensure the property is in a suitable state for an exchange to occur, and that the exchangee is a suitable candidate.
Schedule 3 of the Housing Act outlines that a landlord can withhold consent for a mutual exchange for any of the following reasons:
1. If a tenant is undergoing eviction proceedings, or if they have pending proceedings.
2. If the tenant does not meet the eligibility criteria for the size of a property.
3. If the property is linked to a tenant’s employment.
4. If the property is owned by a charity and the new tenant would be opposed to the charity’s ethos and/or goals.
5. If the property is specially adapted for a person who has special needs and/or is disabled.
The resident applied for a mutual exchange on 5 March 2022. Both the resident and the exchangee were applicable for a 3-bedroom property, at the time neither party were undergoing eviction proceedings, and neither party’s properties had specialised adaptations. From the information provided to this Service, there appeared to be no valid reason under Schedule 3 of the Housing Act 1985 for the landlord to reject the mutual exchange.
The landlord’s paperwork, which the resident signed on 5 March 2022, included a declaration that the resident agreed not to move into the new property until they had received written permission from the landlord and a tenancy agreement had been signed.
The landlord had until 24 May 2022 to reject or to accept the mutual exchange. On 19 April 2022 the landlord conducted several of the actions required to complete the exchange process.
The resident said she had been in telephone contact with the landlord in the weeks commencing 9 May 2022 and 16 May 2022. She said during this time both of the landlords had given her verbal permission to move into the new home, and she was told written permission would follow. The resident said she asked if she could move on 21 May 2022 as she had annual leave on this date, and the landlords agreed to this.
This Service has asked the landlord to provide documents relating to telephone communications from this period, the landlord has not provided such documents or confirmed if any such documents exist.
On 23 May 2022 the resident’s new landlord informed them via email that the mutual exchange was complete, and it said the landlord would be contacting the resident to arrange the signing of the new tenancies. This communication suggested the resident and the new landlord were under the impression the mutual exchange had been completed.
The landlord did not contact the resident to arrange for the new tenancies to be signed. This was inappropriate considering the deadline for it to approve or reject the exchange was 24 May 2022. After the 42 day deadline had elapsed the landlord should have communicated with the resident the status of the exchange and any associated timescales. It was inappropriate for the landlord not to do this considering the landlord’s policy, and its obligations under the Housing Act 1985.
It is likely at this point the resident believed the mutual exchange had been completed as:
1. The resident said she had been given verbal confirmation that she could move into her new property.
2. The resident’s new landlord had told her in writing the mutual exchange was complete.
3. The deadline of 24 May 2022 had passed, and the landlord had not rejected the exchange.
On 8 June 2022 the landlord learned that the resident and the exchangee had already swapped properties. After considering this the landlord decided on 1 July 2022 that the parties actions made the exchange illegal, as it felt both parties had breached their tenancy agreements.
The landlord’s decision to reject the exchange on 1 July 2022 was inappropriate. The decision was made after the 42 day deadline had elapsed. Furthermore, its rationale for rejecting the exchange was not compliant with the circumstances in which a landlord can reject an exchange under the Housing Act 1985.
The resident’s decision to move into her new home before the landlord had provided written permission went go against declarations she had previously signed. However, the resident’s actions had no bearing on the landlord’s actions in not rejecting the mutual exchange within the timescales outlined in the Housing Act 1985. As such it was inappropriate for the landlord to reject the mutual exchange based on the resident and the exchangee swapping homes before obtaining written consent.
The resident first learned of the landlord’s decision to reject the mutual exchange on 15 July 2022, when the landlord told the resident she and the exchangee should return to their old properties. Considering the impact the landlord’s decision to reject the mutual exchange would have had on the resident and her housing situation, the landlord should have communicated this update to the resident in a more expeditious and sensitive manner.
In its stage 1 response, the landlord told the resident they were unable to provide her with an update as its legal team was investigating the mutual exchange. The landlord said the legal team would contact the resident after its investigation had concluded. It did not provide the resident with any details around its timescales or the possible outcomes the landlord was considering. This was inappropriate and would have caused the resident alarm and distress, considering the landlord had told the resident there was an investigation and its legal team was involved.
On 8 September 2022 the resident asked the landlord what its legal team would do, how long the process would take, and if they would go to court. The landlord did not respond to these enquiries, which was inappropriate. The landlord’s lack of communication with the resident likely caused her distress as at this point, she was unaware if the matter would progress to court.
The resident’s distress and concern about her situation is illustrated by steps she took to seek advice from this Service and from a local councillor about the landlord rejecting the mutual exchange.
On 12 January 2023 the two landlords met to discuss the mutual exchange, after this meeting the landlord re-considered its stance, and decided to approve the mutual exchange. It took the landlord 332 days to accept the mutual exchange, this was an inappropriate length of time considering the landlord was required to accept or reject the exchange within 42 days.
The resident has told this service the landlord’s actions have had a significant impact on her and her family. She said:
1. Because she didn’t have a tenancy agreement, she could not enrol her children at school, and the landlord did not support her with this. She said she was only able to rectify this issue by temporarily using a family member’s address.
2. The landlord tried to uproot her and her family, and she considered there to be no valid reason for it to do this.
3. The landlord’s actions caused her financial distress as she wasn’t able to pay rent for her new home as the landlord rejected the exchange. She also said she wasn’t sure what the cost of her new rent would be as she did not have a tenancy agreement.
4. The situation caused her to be stressed and concerned for several months.
In the landlord’s stage 2 response it did not acknowledge any failings during the mutual exchange process. Instead, it said any delays, or issues the resident experienced, were caused by the resident’s decision to move before the exchange had been completed.
The Ombudsman finds maladministration occurred in the landlord’s handling of the mutual exchange process after considering:
1. The landlord was not responsible for the resident’s decision to move prior to obtaining written consent from the landlord.
2. The landlord did not inform the resident if it had approved or rejected the mutual exchange within its required timeframe.
3. The landlord did not communicate a timescale of when it could complete the mutual exchange to the resident.
4. The landlord rejected the mutual exchange when it did not have the right to do so.
5. There is no evidence to suggest the landlord had legitimate grounds to reject the mutual exchange.
6. After the landlord rejected the mutual exchange, it did not provide the resident with adequate or timely updates.
7. The landlord did not acknowledge its poor handling of the mutual exchange process or offer the resident any remedy.
The Ombudsman has made an order for the landlord to pay compensation of £500, after identifying that the resident and her family suffered distress for a significant period, and the landlord failed to address or mitigate this. The landlord was aware of its requirements under the Housing Act 1985, and it failed to meet these. When considering such factors, the Ombudsman believes £500 is appropriate and in line with this Service’s remedies guidance.

The landlord’s handling of the resident’s complaint

The landlord’s complaints policy says when responding to complaints it will address all a resident’s complained of issues, and it will respond in a manner which provides a clear rationale for its decision making.
Under the landlord’s complaints policy, it is required to acknowledge complaints within 3 days. It will then respond to complaints via a stage one response within 7 days. The stage one response time can be extended by an additional 10 days if the resident agrees to an extension. If the resident is unhappy with their stage one response, they can request for their complaint to be escalated. When this occurs, the landlord will respond to the resident with a stage 2 response within 20 days.
The resident complained to the landlord on 18 July 2022, and the landlord acknowledged the complaint on the same day. The landlord sent the resident its stage one response 13 working days after it acknowledged the complaint. The landlord had not requested an extension, and as such it acted outside of its own policies by not responding to the resident within 7 days. This was inappropriate.
The stage one response the landlord sent to the resident was brief, and it declined to provide details around the mutual exchange because the matter was being investigated by the landlord’s legal team.
Under this Service’s Complaint Handling Code (the Code) a landlord can reject a complaint if legal proceedings have begun. In this instance legal proceedings had not been initiated, as the landlord had only asked their legal team to provide advice on the matter. As such the landlord should have treated the resident’s complaint as a standard complaint.
The contents of the stage one response were unreasonable, as the landlord’s policies state it should address all complained of issues and provide clear explanations. It would have been reasonable for the landlord to inform the resident of the legal team’s timescales and what the possible outcomes of the legal team’s review could be.
The landlord’s stage one response did not contain any information around the stage two process, it only detailed how the resident could provide feedback to the landlord. The response did not contain a complaint reference number which the resident could use to request a stage 2 response via a form on the landlord’s website. This was inappropriate.
On 8 September 2022 the resident escalated her complaint. On 15 September 2022 the resident’s housing officer confirmed the resident’s request had been sent to the landlord’s complaints team.
The landlord did not send a stage 2 response to the resident within an appropriate timeframe. The landlord sent the resident its stage 2 response on 19 July 2023, this was 217 working days after the resident escalated her complaint. The landlord only sent the stage 2 response after this Service instructed it on 9 June 2023 to do so. The landlord’s actions were inappropriate, its complaint handling fell far outside the standards outlined in its complaints policy and required intervention from this Service.
In its stage 2 response the landlord apologised for its complaints handling and offered the resident £50 compensation. The landlord said the resident’s escalation request had been sent to the complaints team when it should have gone to the CEO complaints team. The Ombudsman considers the landlord’s explanation for the delay to be unreasonable, as it did not sufficiently account for the significant delay the resident experienced.
The landlord also apologised for its stage one response not containing a reference number which the resident could use to apply for an escalation request via the landlord’s website. This apology was reasonable.
Although the landlord apologised to the resident and made an offer of compensation, the compensation offered was not sufficient. The offer of £50 did not adequately reflect the landlord’s failures, or the distress caused to the resident by the significant period where landlord failed to respond to her complaint or address her concerns around legal proceedings.
The Ombudsman finds maladministration occurred after considering:
1. The landlord did not provide its stage one or stage 2 responses within its required timescales.
2. The stage one response lacked sufficient detail.
3. The landlord did not acknowledge or apologise for its stage one response being late.
4. The landlord did not send its stage 2 response until this Service instructed it to do so.
The Ombudsman has made an order for the landlord to pay compensation of £200, for the landlord’s failure to provide the resident with sufficient and timely complaint responses. The Ombudsman considers £200 compensation to be appropriate and in line with this Service’s remedies guidance.

Determination

In accordance with paragraph 52 of the Scheme, there was maladministration in respect of the landlord’s handling of the resident’s mutual exchange.
In accordance with paragraph 52 of the Scheme, there was maladministration in respect of the landlord’s complaint handling.

Orders

Within 4 weeks of this determination, the landlord is ordered to pay compensation of £700 to the resident. The compensation is broken down as follows:
1. £500 for any distress and inconvenience caused to the resident by the landlord’s failure to complete, and update the resident about, the mutual exchange in a timely manner.
2. £200 for the landlord’s complaint handling failures. The landlord may deduct the £50 it previously offered from this amount, if already paid.

The landlord is to provide this service with evidence of compliance with this order within 4 weeks of the determination date.