Home Group Limited (202009773)

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REPORT

COMPLAINT 202009773

Home Group Limited

8 December 2021

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:
1. Handling of the resident’s staircasing application.
2. Response to the resident’s concerns regarding service charges levied against the property.
3. Response to the resident’s concerns that it failed to provide her with a copy of the building insurance policy in place for the property.
4. Response to the resident’s concerns regarding rent increases.
5. Complaint handling.

Background and summary of events

Background

The resident was the shared-owner of the property (the property) which the complaint concerns. The landlord was the freeholder.
The resident purchased the remaining shares in the property end of March 2020, in addition to the property’s freehold.
The property is a house.

Summary of events

On 14 August 2019 the resident contacted the landlord to enquire about the staircasing process.
On 21 August 2019 the landlord responded to the resident confirming that there were “no costs to staircase” and to ask if she would like a copy of its “staircasing pack”. Later on the same day, the landlord clarified that staircasing had “no fee” but the resident would incur costs in relation to the RICS valuation and the shares purchased. The landlord added that the staircasing pack detailed “everything” the resident would need to know about the process.
On 23 August 2019 the landlord formally wrote to the resident about “buying more shares” following confirmation that she would like to proceed. The landlord confirmed that the resident must obtain a RCIS valuation, which would only be valid for a period of three months. The landlord included a copy of the “intention to staircase form”.
On 30 August 2019 the resident asked the landlord why she needed to instruct a RCIS survey to determine the value of the property. The resident suggested that a local estate agent could do this. The Ombudsman has not identified a response to the resident.
On 9 October 2019 the resident provided the landlord with her completed intention to staircase form and a RCIS valuation for the property. Within her cover letter the resident noted that she believed that the valuation was “a bit high” and confirmed that she was unable to provide a mortgage reference number until the valuation had been agreed by the landlord.
On 15 October 2019:
1. The landlord wrote to the resident to confirm that it accepted the RCIS valuation. The landlord confirmed that to start the legal process of staircasing the resident needed to provide identification documents, original or certificated, proof of funds and to complete the “acceptance form” which was enclosed. Within its letter the landlord confirmed that the RCIS valuation would expire on 8 January 2020.
2. The resident responded confirming that as house prices were falling the landlord should consider accepting a lower offer on the property. The resident noted that she had been told by a landlord officer that the property price was “negotiable”.
3. The landlord replied confirming that the “only valuation” it was able to accept was a RCIS valuation. The landlord confirmed that if the resident was not happy with the price she should query this with the surveyor who completed the valuation.
4. The resident responded questioning why she had previously been advised that the property price was negotiable.
On 16 October 2020:
1. The landlord apolgoised for any misinformation given regarding negotiating on the property’s price. The landlord stated that it did “not know why [the resident] was given this information”. The landlord stated that it had a process to follow which it did not deviate from “under any circumstance”.
2. The resident asked the landlord to provide her with “the correct information on the staircasing process”, in addition to information on its policy on the retention of personal information as it was asking for photographic ID.
On 17 October 2020:
1. The landlord apolgoised that the resident had “been through such a process” and confirmed that it would await the required information from her to progress her staircasing application. The landlord confirmed that if a new RCIS valuation was required due to not completing by 8 January 2021 it would accept the new valuation figure.
2. The resident reiterated her request for a copy of the landlord’s “staircasing process” stating that she had not previously been provided with it.
On 18 October 2020 the landlord confirmed that next steps in the staircasing process were set out in its offer letter dated 15 October 2020. The landlord advised that the resident should complete the acceptance form and provide the relevant documents for the conveyancing process to start. The landlord also provided the resident with a link to its privacy policy.
On 5 November 2020 the landlord wrote to the resident regarding her staircasing application. The landlord reiterated the content of its communication dated 15 October, as set out in paragraph 10(a).
On 8 November 2020:
1. The resident confirmed receipt of the landlord’s letter dated 5 November 2020. Within her correspondence the resident reiterated that she was waiting for a hardcopy of the landlord’s staircasing policy and its retention policy.
2. The landlord replied confirming that the resident should have received a copy of the acceptance form which was required to progress her staircasing application. The landlord reiterated that next steps were detailed within its letter dated 15 October 2020 however it was also on hand to respond to any queries directly. The landlord noted that it had provided a link to its privacy policy on 18 October 2020.
On 13 November 2020 the landlord posted the resident a copy of its retention guide.
On 19 November 2020 the resident wrote to the landlord confirming that she was still not in receipt of a hard copy of its staircasing policy.
On 27 November 2020 the submitted her completed staircasing acceptance form and identification documents. Within her correspondence the resident noted that she was submitting her application “despite having no knowledge of the staircasing procedure entailed”. The resident stated that she had requested a hard copy of its staircasing procedure on 16 October 2020 however was yet to receive it. The resident suggested that the landlord had wasted five weeks.
On 28 November 2020 the landlord confirmed receipt of the resident’s staircasing application, however advised that her identification documents were not acceptable as they were not originals or certified. Within its correspondence the landlord noted that the last day for property sales completion prior to Christmas was 19 December 2019 and the earliest date for completion after was 6 January 2020 due to a reduced service. The landlord therefore suggested that the resident may wish to seek an update to her RCIS valuation as it was due to expire on 8 January 2020.
On 5 December 2019 the landlord confirmed that following receipt of the resident’s signed staircasing acceptance form and identification documents it had instructed its legal department who would liaise with the resident’s solicitor. The landlord reiterated that the resident may wish to seek an updated RCIS valuation as the current one was due to expire on 8 January 2020. After 5 December 2019 the Ombudsman has not identified any additional correspondence in December 2019 relating to the purchase.
On 14 January 2020 the landlord wrote to the resident to confirm that her updated valuation was not acceptable as it was a mortgage valuation. The landlord explained that the updated valuation must be from a RCIS surveyor.
On 22 January 2020 the resident responded confirming that she did not understand why the landlord would not accept the mortgage valuation. The resident stated that she did not see why she should pay for an update to the RCIS valuation as the landlord was “responsible for at least six weeks of delays”.
On 23 January 2020:
1. The landlord replied confirming that the RCIS valuation had expired on 8 January 2020 and in order to proceed with the staircasing process it required an update. The landlord noted that the update could be an email from the surveyor confirming that the original RCIS valuation remained valid.
2. The resident responded stating that the RCIS surveyor would “not just send” an email. The resident stated she was also unclear why the mortgage valuation was not acceptable.
On 28 January 2020 the landlord wrote to the resident. In summary the landlord confirmed:
1. From experience RCIS surveyors did not charge for providing an email confirming that a valuation remained valid.
2. The mortgage valuation did not meet the requirements of its staircasing policy or the property’s lease. The landlord added that the mortgage valuation appeared to value the “leasehold interest rather than the freehold interest” and therefore may be incorrect.
3. The resident had signed that she agreed to the staircasing terms and conditions thus acknowledging that she understood that the transaction must complete within three months from the date on the RCIS valuation.
4. It received the RCIS valuation on 15 October 2019 and issued the resident with an offer notice on the same day, noting that the valuation expired on 8 January 2020. The landlord confirmed that the resident then submitted some enquiries (no further details provided) which it acknowledged it took time to provide a satisfactory response to.
5. The resident did not provide acceptable identification until 4 December 2019.
6. On 6 December 2019 it issued the resident’s solicitor with the conveyancing documents. The landlord set out that it was waiting for the TR1 form from the resident’s solicitor to move forward.
An internal note by the landlord dated 3 February 2020 confirmed that it was in receipt of an updated RCIS valuation. The landlord confirmed that it had therefore issued a revised memorandum of sale to the resident’s solicitor as the value of the property had changed.
On 25 March 2020 the resident wrote to the landlord to raise concerns regarding its handling of her staircasing application, which was due to complete shortly. In summary the resident said:
1. The landlord had caused delays in the staircasing process, specifically the provision of information. The resident stated that the landlord had significantly delayed in providing her with a hard copy of its staircasing policy. The resident confirmed that as a result she had to obtain an updated RICS valuation on the property and pay an additional three months rent to the landlord.
2. The landlord had provided misinformation in respect of the staircasing process including:
  1. “Staircasing was free”.
  2. The price of the property could be negotiated.
  3. There would be no charge to purchase the property’s freehold.
3. It was unsatisfactory that the property required a RICS valuation as part of the staircasing process to confirm its price. The resident suggested that a valuation from a local estate agent would have been sufficient.
4. In response to an earlier complaint regarding delays and misinformation in respect of the staircasing process the landlord had not upheld her complaint. The resident stated that despite challenging the landlord’s response she had not received a reply.
5. The landlord’s response to her subject access request in relation to her staircasing application highlighted poor recording keeping as not all her communication with it was documented. The resident stated that the landlord should self-report to the Information Commissioner’s Officer (the ICO).
6. As part of the staircasing process the landlord had provided a breakdown of service charges. The resident noted that she should not be charged a management fee as she had not received this service.
Within her correspondence the resident also raised the following historic issues:
1. The landlord’s failure to provide her with details of the building insurance cover in place for the property so that she could make a claim.
2. Rent increases.
The resident concluded by confirming that she would like the landlord to confirm “how the matters [could] be resolved”.
On 30 March 2020 the landlord acknowledged the resident’s correspondence confirming that it would carry out an investigation.
On 12 May 2020 the landlord provided its response to the resident’s correspondence dated 25 March 2020. In summary the landlord said:
1. In respect of delays with the staircasing transaction:
  1. The sales pack set out that the staircasing process should generally complete with three months – the period which the RICS valuation remained valid.
  2. Its records showed that the resident enquired about staircasing on 21 August 2019 and a sales pack was issued on 23 August 2019.
  3. On 15 October 2019 it received the resident’s identification documents and RICS valuation report. The landlord set out that on receipt it wrote to the resident to confirm that the valuation met its requirements which would expire on 8 January 2020. The landlord added that within its letter it informed the resident that her identification documents were not valid as they were not originals or certified copies.
  4. The identification documents which the resident re-submitted on 28 November 2019 were not acceptable. The landlord confirmed that it reminded the resident at that time that the RICS valuation would expire on 8 January 2020.
  5. On 4 December 2019 the resident provided identification documents which were acceptable and it therefore instructed its legal team to proceed with conveyancing. The landlord confirmed that documentation was issued to the resident’s solicitor on the same day.
  6. It did not hear back from the resident’s solicitor until 10 January 2020, when it advised that they were in receipt of her mortgage application.
  7. The RICS valuation was updated with a new expiry date of 30 April 2020 and work ensued on the transaction, which completed on 31 March 2020.
  8. The staircasing process completed in “just over three months from the date all acceptable identification documents were received”.
2. In respect of fees in relation to the staircasing process:
  1. There was no administration fee charged for a staircasing transaction, however there would always be associated legal fees for the buyer to pay, in addition to the cost of the shares being purchased. The landlord confirmed that this “should be made clearer from the outset”.
  2. It would usually expect a buyer’s solicitor to set out all the charges and costs that may apply, however it had, following the resident’s concerns, developed an advisory note confirming the costs which may be incurred as part of the staircasing process.
  3. There was no charge for the acquisition of the freehold, however a legal freehold reversion fee was always charged to cover the cost of approval for and sealing of the transfer. The landlord confirmed that it had waived this fee for the resident.
1. In respect of the requirement for the RICS valuation and negotiation on the property’s price:
  1. Under the terms of the property’s lease a RICS valuation was required to determine the current market value of the property for the purpose of the staircasing process.
  2. The price of the property was determined by the RICS valuation and was a “fixed price”. The landlord confirmed that this was to ensure that the price was fair.
  3. It was common for valuers to apply a charge for an extension to a valuation. The landlord noted that the extension to the resident’s RICS valuation was provided “at no additional cost” by the valuer.
1. In respect of delays:
  1. A PDF of its staircasing guide was issued to the resident via email on request. As the resident confirmed that she was unable to open the PDF a hard copy should have been posted to the resident. The landlord apologised that it failed to do so within a reasonable period of time.
  2. It was apparent in early December 2019 that it may struggle to complete the staircasing process by 8 January 2020, due to the delay in receiving the resident’s identification documents. The landlord confirmed that it therefore advised the resident, “as a precaution”, to request an extension to the RICS valuation so as to not impact upon the purchase.
1. In respect of the resident’s SAR:
  1. It had supplied all correspondence to the resident which it held relating to the staircasing transaction.
  2. It noted the resident’s comments regarding missing records detailing communication with her. The landlord confirmed that it had reminded its officers to ensure all details were recorded appropriately.
1. In respect of service charges:
  1. It had previously responded to the resident’s concerns regarding service received under its complaint procedure.

Within its response the landlord explained that it had fully complied with the legislation in relation to rent increases, noting that no rent increase has been applied in the last few years in line with Government guidance. The landlord confirmed that a rent increase would be applied however for financial year 2020/21. The landlord also confirmed that insurance claims should be made to its insurance team.
The landlord concluded by confirming that its review of the resident’s concerns had highlighted that certain aspects of the staircasing process could be made clearer, particularly in relation to charges and fees which applied. The landlord confirmed that it had therefore reviewed the information it provided within its sales pack.
On the same day the resident responded. The resident stated that the landlord’s response was inaccurate as:
1. The “sales process information” was not issued in August 2019. The resident stated that it took over six weeks to receive the information.
2. In August 2019 she was informed that “staircasing was free” and she may negotiate the price of the property.
3. She started the staircasing process before she received the sales process information.
4. Her solicitor was involved “well before 10 January 2020”. The resident stated that the landlord’s records were “incomplete”.
5. She did have to pay £75 for an updated RICS valuation.
6. The landlord had failed to explain why it had failed to provide her with details of the building insurance policy for the property despite requesting this information on many occasions.
7. The landlord had applied a rent increase despite a rent freeze across the social housing sector.
8. The landlord had not previously responded to her concerns regarding service charges under its complaint procedure.
The resident concluded by asking that the landlord provide a “proper response” to the concerns which she had raised.
On 27 July 2020 the resident chased the landlord for a response to her correspondence. The landlord’s internal records document that in response it acknowledged the resident’s correspondence, confirming that it would investigate her concerns under its complaint procedure.
On 5 August 2020 the landlord spoke with the resident regarding her complaint. The landlord’s record of the conversation noted:
1. The resident confirmed that she had longstanding concerns about the landlord’s communication.
2. The resident reported that ten years ago the landlord had failed to provide her with details of the building insurance cover for the property and as a result she was unable to make a claim for remedial works to her patio costing approximately £3000. The resident confirmed that it was only part of the staircasing process that she received a copy of the policy.
3. The resident stated that despite the landlord committing to refund her £75 for the updated RCIS valuation and £90 to cover the administration fee for the freehold transfer she had received neither.
4. The resident stated that the landlord’s response to her SAR request supported that it had not kept appropriate records and as not all her communication was documented.
On 18 September 2020 the landlord provided its stage one response. In summary the landlord:
1. Reiterated its reply dated 12 May 2020 in respect of the following points:
  1. Delays in completing the staircasing process.
  2. The requirement for a RICS valuation and the fee for extending it.
  3. Fees in relation to the staircasing process.
  4. The resident’s SAR. The landlord added that some calls were recorded, and when this happened the recording was held for a period of three months.
  5. Rent increase.
2. Apologised that it failed to respond to the resident’s historic request for details of the building insurance policy in place for the property. The landlord suggested that this was likely due to the request being picked up by the wrong team.
The landlord concluded by confirming that should the resident remain unhappy with its response she should refer to its complaint procedure for next steps.
On 27 September 2020 the resident responded setting out that she disagreed with the landlord’s stage one response. In summary the resident said:
1. She did not believe that the landlord had taken her concerns about inaccurate records seriously “as little had been done”.
2. The landlord had not responded to her concerns regarding “overpayment of service charges”.
3. The landlord had not acknowledged “the six week delay in providing information requested” or the “perpetuation of misinformation”.
On 2 November 2020 the landlord provided its final response. In summary the landlord said:
1. It was sorry for the resident’s “initial experience” relating to the staircasing process and that she felt that its previous responses to her concerns relating to the same had not been satisfactory.
2. While its review of the resident’s complaint supported the timeline it had previously provided, it agreed that there was room for improvement in the way it had handled her staircasing application.
3. It was “regrettable” that its records did not match the resident’s and it was sorry if any entries were missing. The landlord confirmed that it was in the process of launching some “revised case tracker tools for the team” to improve record keeping. The landlord noted that this was an interim improvement ahead of a full customer relationship management system being introduced in April 2021.
4. It had updated its customer information pack on staircasing to provide clarity on the process and fees. The landlord confirmed that it had also addressed “resourcing gaps in the team” to allow more time to be spent on each staircasing transaction.
5. Going forwards it was taking a more proactive approach in respect of reviewing valuation expiry dates to help customers.
6. It was sorry that the resident had not received a response to her request for a copy of the building insurance policy for the property and it had delayed in providing her with a hard copy of its staircasing policy.
7. As the resident’s RCIS valuation expired ahead of completion she had to obtain an extension. The landlord confirmed that it was not party to whether fees were agreed for the extension. The landlord apologised that it had assumed that the resident did not have to pay a fee for the extension.
8. A formal complaint investigation took place in December 2019 in relation to service charges which fell under the category of “management charges”. The landlord set out that within its response it advised that it was unable to provide a specific breakdown of the £11.50 charge as this was fixed, and therefore the information provided was “a general overview of the types of fees which may be included”. The landlord stated that it acknowledged that this was not ideal as many of the services listed were not applicable to the property. The landlord set out that it had discussed the service charge with its leasehold team who had confirmed that the correct management fee of £138 per year (£11.50 per month) had correctly been applied to the resident’s account. The landlord explained that all houses paid a fixed rate of £138 per year, even where there was only insurance provided. The landlord noted that the charge also covered the “annual budget and accounts, administration of the insurance policy and any claims plus general management”. The landlord apolgoised if this was not made clear previously.
9. From review of its complaint handling it had identified that its stage one response was delayed. The landlord therefore apologised.
The landlord concluded by apologising for the failures which the resident had experienced. The landlord confirmed that it would like to offer £325 compensation comprising:
1. £100 for its handling of the resident’s staircasing application and record keeping.
2. £75 for the delay in providing the resident with information – building insurance policy and staircasing policy.
3. £75 to cover the RICS valuation extension fee.
4. £75 for complaint handling.
The landlord set out that the resident may refer her complaint to this Service if she was unhappy with its response.
On 6 November 2020 the resident responded to the landlord advising that she did not feel that its response addressed all issues.
On 9 November 2020 the landlord replied confirming that while its complaint procedure had been exhausted it would be happy to discuss the resident’s outstanding concerns.
On 19 November 2020 the landlord provided an addendum to its stage two response, following a phone call with the resident on 11 November 2020. In summary the landlord said:
1. During the call the resident stated that she was upset by its wording as it implied that she had not paid £75 to extend the RICS valuation. The landlord apologised that its wording had upset the resident and confirmed that its offer of £75 compensation still stood.
2. During the call the resident pointed out that it had not addressed the administration fee, £90, she had paid to acquire the property’s freehold. The landlord confirmed that it would be happy to offer reimbursement for this.
3. During the call it provided further details regarding the improvements it was putting in place to enhance its customer service in relation to staircasing and service charges. The landlord confirmed that this included increased resources, enhanced training, improved systems and improved guides and forms.
As the resident was not happy with the landlord’s response she referred he complaint to this Service for adjudication.

Assessment and findings

The landlord’s handling of the resident’s staircasing application

The landlord’s guide on staircasing sets out the following steps to staircase:
1. “Get in touch with us” – to chat through options and to issue an intention to staircase form.
2. “Check your financial position” – resident to seek financial advice from mortgage provide or independent advisor to understand the costs and to check affordability.
3. “Instruct a surveyor” – resident to obtain a RCIS valuation to determine value of the property and price of shares to be purchased. The surveyor must not be employed by any bank or building society. The valuation will be valid for three months and the resident will be responsible for any costs to extend.
4. “Fill in the intention to staircase form” – to be returned with a copy of the RCIS valuation.
5. “Verify your identify” – to confirm the resident’s identify and source of funds, as required by law.
6. “Fill in the response form” – following issuing of offer to staircase, detailing costs, the resident to complete the form detailing the amount of shares to be purchased and solicitors information.
7. “The legal bit” – to work with the resident’s solicitor to complete conveyancing.
8. “Completion”.
From review of the chronology of the resident’s staircasing application overall the Ombudsman is satisfied with the landlord’s handling of the application. This is because while there were some shortfalls by the landlord, discussed below, the Ombudsman is satisfied that the landlord did follow its staircasing procedure in progressing the resident’s application. This includes:
1. Promptly issuing the resident with an intention to staircase form following her enquiry.
2. Promptly issuing the resident with an offer and acceptance form following receipt of her intention to staircase form and RCIS valuation.
3. Promptly engaging with the resident’s solicitor following receipt of the resident’s completed acceptance form and identification documents.
4. Informing the resident in early November and December 2019 that the RCIS valuation may need updating in order to complete as the current valuation was due to expire on 8 January 2020.
5. Completing within three months of the resident’s updated RCIS valuation.
While the resident’s staircasing application was live the Ombudsman can see that the landlord did not respond to the resident’s request for a hard copy of its staircasing or retention policies within a timely manner, with the resident making multiple requests for the information. While this is unsatisfactory, as a landlord should seek to respond to a request for information within a timely manner, the Ombudsman does not consider that the landlord’s omission adversely impacted on the progression of the resident’s staircasing application. This is because the Ombudsman can see that the landlord did provide the resident with correct information on the staircasing process and next steps within its formal staircasing letters dated 23 August 2019 and 15 October 2019 and therefore she did have accurate information on which to make informed decisions.
As part of her complaint, the resident raised concerns regarding the provision of misinformation in relation to staircasing fees by the landlord. The evidence shows that on 21 August 2019 the landlord advised the resident “no costs to staircase”. While the Ombudsman appreciates that this could have been interpreted to mean that staircasing was free, the Ombudsman notes that the landlord clarified later on the same day that although the resident would not incur a fee to staircase she would incur other costs as part of the process. As the landlord quickly provided clarification, the Ombudsman has not identified any adverse impact on the resident. Further the Ombudsman notes that the resident will have had access to the landlord’s website which sets out “costs for staircasing” including evaluation fees, legal expenses and stamp duty.
The resident also raised concern that the landlord had incorrectly informed her that the price of shares could be negotiated and no fee was applicable in respect of the purchase of the property’s freehold. In response to the resident’s concerns the landlord explained why the price of the shares could not be negotiated, as detailed in paragraph 11, and apologised where its responses to her initial enquiries had not been satisfactory. In the Ombudsman’s opinion the landlord’s response was appropriate. This is because a landlord should provide adequate reason and explanation to support its action and to acknowledge that the resident felt that she had been misled regarding the purchase of the freehold.
Finally, the resident raised concerns regarding the landlord’s record keeping, suggesting that its records were not complete as not all communication was documented. As the Ombudsman was not party to the communication (verbal or written) between the parties while the resident’s staircasing application was live, the Ombudsman is unable to make an assessment on the accuracy of the landlord’s records. However, in the Ombudsman’s opinion it was reasonable for the landlord to respond to the resident’s complaint based on the information it held on file. It was also appropriate that the landlord acknowledged and apologised in respect of the resident’s concerns regarding its record keeping and to explain how it was making improvements going forwards.
In responding to the resident’s complaint, the landlord acknowledged that there had been some shortfalls in its overall handling of the resident’s staircasing application. It was therefore appropriate that the landlord apologised for these omissions, as noted above, and awarded some compensation. In the Ombudsman’s opinion the compensation awarded by the landlord, £340 comprising £250 within its final response and £90 offered post end of complaint procedure, was proportionate to the errors it had identified to take into account the distress and inconvenience the resident said she had experienced as a result of its actions and the failings it had identified. The landlord’s offer also falls within the Ombudsman’s suggested remedy for cases where a resident has experienced “considerable service failure or maladministration”.

The landlord’s response to the resident’s concerns regarding service charges levied against the property

The evidence shows that the landlord responded to concerns which the resident raised in 2019 regarding the management fee in late 2019, informally and formally under its complaint procedure. The resident complained that she was paying for a service which she did not receive. The landlord responded by confirming:
1. The scope of the management service it provided fell under three key areas which were “general management”, “building management” and “financial management”. The landlord provided examples of duties covered under each area, adding that “some may be relevant to [the resident] and some may not”.
2. It was unable to provide a more detailed breakdown of the service received by the resident under the management fee. The landlord confirmed that this was because the charge was “fixed” and only increased based on the “annual rate of inflation”.
Within the landlord’s final response dated 2 November 2020 it provided further clarity on the management fee payable by the resident as part of the service charge; explaining that all leasehold houses were subject to the same management fee of £138 per year, regardless of the services received.
In the Ombudsman’s opinion the landlord’s response, given in both November 2019 and November 2020, to the resident’s concerns was reasonable as it provided clarity on the charge by explaining that it was a fixed charge applied to all leaseholder properties which were houses and what services the resident may receive as part of the charge.
Where a leaseholder does not consider that a service charge is reasonable they may refer their concerns to the First Tier Tribunal Property Tribunal (the FTT). The FTT can make determinations on all aspects of liability to pay a service charge and/ or administration charge, including by whom, to who, how much and when a service charge is payable. In order to decide liability the FTT also decides whether service charge costs have been reasonably incurred and if so whether the standard of any services or works for which the costs are charged is reasonable. It was therefore open for the resident to make a referral to the FTT if she was not satisfied by the landlord’s response. The Ombudsman cannot see that the landlord informed the resident of her right to referral to the FTT within its complaint responses. While it would have been best practice for the landlord to have done so, in the Ombudsman’s opinion this however does not amount to a service failure. This takes into account that the landlord’s complaint procedure sets out a resident’s right of referral to the FTT and that it did provide clarification on the charge.

The landlord’s response to the resident’s concerns that it failed to provide her with a copy of the building insurance policy in place for the property

As set out in the summary of events above, the resident’s concerns regarding the landlord’s failure to provide her with details of the building insurance cover for the property are historic.
The Ombudsman encourages residents to raise complaints with their landlords in a timely manner, so that a landlord has a reasonable opportunity to consider the issues while they are still live, and while the evidence is readily available to reach an informed conclusion on the events which occurred. This is in accordance with paragraph 39(e) of the Housing Ombudsman Scheme which sets out that the Ombudsman expects a resident to make a complaint within a reasonable period of time which would normally be within six months of the matters arising.
As the landlord responded to this aspect of the resident’s complaint despite more than six months having elapsed since she made the request for a copy of the policy, the Ombudsman will consider whether its response to the matter was reasonable or not. In considering this, the Ombudsman will not seek to carry out a review of the landlord’s actions at that time, however.
In responding to the resident’s concerns regarding the provision of the property’s building policy the landlord apologised that it had not responded to her request and considered its failing in calculating its offer of £75 compensation for delay in providing the resident with information. In the Ombudsman’s opinion this was a reasonable response considering the time period which had passed since the request was made and to express regret that the resident had reported that it had not provided a reasonable level of service.
The Ombudsman notes that the resident reported that she had requested a copy of the building insurance policy in order to make a claim for damages sustained to the property’s patio. The Ombudsman is unable to comment on the likelihood of any insurance claim had the resident pursued a claim as the Ombudsman cannot determine liability.

The landlord’s response to the resident’s concerns regarding rent increases

In response to the resident’s concerns regarding rent increases the landlord confirmed that no rent increase had been applied for the previous years in line with Government guidance. In the Ombudsman’s opinion the landlord’s response was appropriate as it addressed the specific concern which the resident had raised and to set out its position on the matter.
Paragraph 39(g) of the Housing Ombudsman Scheme sets out that the Ombudsman will not consider complaint which concern the level of rent or the amount of the rent increase. In accordance with this provision the Ombudsman is not able to comment on whether the rent paid by the resident was reasonable or not. This would fall under the jurisdiction of the FTT.

The landlord’s complaint handling

In the Ombudsman’s opinion the landlord’s handling of the resident’s complaint was not satisfactory. The evidence shows that the landlord did not respond to the complaint in a timely manner, taking approximately 33 days to provide its informal response dated, 12 May 2020, approximately four and a half months to provide its stage one response and approximately 26 working days to provide its final response. This is unsatisfactory as a complaint process exists in order to ensure a complainant’s concerns are addressed within a specified timeframe and that this timeframe assures the complainant that their complaint will be addressed without undue delay.
While the landlord acknowledged that it had significantly delayed in providing its stage one response within its final response, and therefore awarded a proportionate sum of compensation to address this omission (£75), it was unsatisfactory that the landlord failed to acknowledge that its other responses were also provided more than 20 working days after they were requested.

Determination (decision)

In accordance with paragraph 55b of the Housing Ombudsman Scheme, in the Ombudsman’s opinion, the landlord has made an offer of redress in respect of its:
1. Handling of the resident’s staircasing application.
2. Response to the resident’s concerns that it failed to provide her with a copy of the building insurance in place for the property.
In accordance with paragraph 54 of the Housing Ombudsman Scheme there was:
1. No maladministration by the landlord in respect of its response to the resident’s concerns regarding service charges levied against the property.
2. No maladministration by the landlord in respect of its response to the resident’s concerns regarding rent increases.
3. Service failure by the landlord in respect of its complaint handling.

Reasons

The landlord’s handling of the resident’s staircasing application

The landlord progressed the resident’s staircasing application in accordance with its staircasing procedure and made an offer of reasonable redress through its apology and offer of compensation in respect of the shortfalls it identified in respect of misinformation, provision of information and recording keeping. The Ombudsman will not make a finding of maladministration where a landlord has offered suitable redress to resolve a complaint.

The landlord’s response to the resident’s concerns regarding service charges levied against the property

The landlord’s response to the resident’s concerns regarding service charges was reasonable as it provided clarity on the charge. This included by explaining that it was a fixed charge applied to all leasehold properties which were houses and what services the resident may receive as part of the charge.

The landlord’s response to the resident’s concerns that it failed to provide her with a copy of the building insurance policy in place for the property

The landlord’s apology was appropriate to express regret that the resident had reported that it had not provided a reasonable level of service by failing to provide her with a copy of building insurance policy for the property historically.

The landlord’s response to the resident’s concerns regarding rent increases

The landlord’s response to the resident’s concerns regarding rent increases was appropriate as it clearly set out its position on the matter, including by explaining that no rent increase had been applied in the preceding years.

The landlord’s complaint handling

While the landlord acknowledged that it had significantly delayed in providing its stage one response, and therefore awarded a proportionate sum of compensation, it was unsatisfactory that it failed to acknowledge that its other responses were also provided more than 20 working days after they were requested, which amounts to an unreasonable amount of time.

Orders and recommendations

Orders

The landlord should pay the resident an additional £75 compensation in respect of its complaint handling within four weeks of the date of this determination.

Recommendations

The landlord should pay the resident the compensation which it awarded her in consideration of her complaint (£415) if it has not already done so.
The landlord should share the Ombudsman’s complaint handling code with its officers who respond to complaints to ensure that complaints are responded to in accordance with best practice.