Hyde Housing Association Limited (202416890)

Background

1. The resident complained after receiving the cost evidence pack for his property for 2020/2021 and 2021/2022. He queried the grounds maintenance charge for 2020/2021 and the responsive maintenance charge. He said he had overpaid these charges, and the landlord had not justified them. He said the landlord had not provided evidence or documentation to support the service charges. The resident also raised a further query about a discrepancy in the balance of his sinking fund, which the landlord treated as a complaint. As the resident remained dissatisfied with the landlord’s responses, he asked us to investigate.

What the complaint is about

2. The complaint is about the landlord’s:
   1. Handling of the resident’s service charge queries, specifically about grounds maintenance charges and a discrepancy in the sinking fund balance.
   2. Complaint handling.

Our decision (determination)

3. We have found:
   1. There was a service failure by the landlord in its handling of the resident’s service charge queries.
   2. The landlord made an offer of redress in recognition of its handling of the complaint, which, in our opinion, resolved the complaint satisfactorily.

We have made orders for the landlord to put things right.

Reasons

What we did not investigate

4. The resident has raised concerns about communal electricity costs. We will consider this issue under another case already open with our Service, with the reference 20234739.

What we did investigate

5. The resident made his first formal complaint on 2 July 2024. The evidence shows he raised a further concern about his service charges on 31 July 2024. As the complaints were linked and the landlord issued its responses close together, we have considered the matters under the same case.
6. The resident raised his complaint on 2 July 2024, after receiving the service charge estimates and cost evidence pack from the landlord. As part of his complaint, the resident said the cost evidence pack did not include relevant documentation to justify the charges. He requested a breakdown of the charges for the responsive repair charges for the 2021/2022 financial year.
7. Following the complaint, the landlord recorded internally that it had reviewed the original 2020/2021 statement and cost evidence pack. The landlord noted that it had not provided the document correctly in relation to the ground’s maintenance and responsive maintenance charges. It said the header page splitting the estate and block costs had been left out. It confirmed that the correct apportionment had been applied to the ground’s maintenance and responsive maintenance charges.
8. The evidence shows the landlord telephoned the resident on 8 July 2024 to discuss his complaint. This was a positive action as it allowed the landlord to discuss the complaint directly and clarify the resident’s concerns. The landlord’s internal notes record that the resident said 2 elements of the 2020/2021 costs were too high. These related to the ground’s maintenance and responsive maintenance charges. The resident said the landlord charged the full gardening costs to his block, and those costs should have been shared across all blocks. In relation to the 2021/2022 charges, he queried the lack of justification or paperwork for costs of £1500 and asked what this charge related to.
9. The landlord continued its internal investigation into the resident’s complaint. It said the resident may have been undercharged for the ground’s maintenance and responsive maintenance costs. The landlord recorded that the resident had been charged £2198, but the correct charge should have been £2418. The evidence shows the landlord was chasing for internal assistance on 10, 15 and 16 July 2024. This was reasonable, as it demonstrates that it was regularly chasing for the information it needed to respond to the resident.
10. On 26 July 2024, the landlord recorded internally that for the 2021/2022 responsive maintenance charge, it had provided evidence that the costs were incurred and capped at £1500, which equated to £250 per property. In relation to the 2020/2021 grounds maintenance charge, it recorded that the costs should have been charged to the estate. This meant a refund of £146.55 would be arranged to the resident. This shows the landlord carried out reasonable investigations into the service charges and reasonably identified that corrections were required.
11. We note that the landlord recorded a further complaint from the resident on 31 July 2024 about the explanation of service charges. It recorded that, in June 2024, the resident queried a discrepancy in tree work costs. The query related to differences in figures shown in a letter dated 23 May 2024 and the 2022/2023 service charge figures. The recorded figures showed a difference between £3925 and £4137. The resident was dissatisfied that the landlord had not explained the reason for the discrepancy. It is unclear why the landlord did not link this issue to the resident’s earlier complaint.
12. In response to this complaint, the landlord carried out internal investigations and noted that the resident’s query related to a possible duplication of costs within the service charge. It reviewed its 2022/2023 actual costs and found that its contractor completed some tree works to the value of £4095.26, which were covered by the sinking fund.
13. The landlord issued its first stage 1 complaint response on 5 August 2024, addressing the resident’s queries about grounds maintenance and the responsive maintenance charges. It confirmed it had arranged a refund of £146.55 for the 2020/2021 grounds maintenance costs. The landlord accepted that it should have taken greater care to ensure the charges passed to the resident were correct. It found the resident’s block had been incorrectly charged for the maintenance costs, which should have been charged to the whole estate.
14. In relation to the responsive maintenance charge, the landlord confirmed the costs were capped at £1500, which equated to £250 per property. It said the works involved replacing fences, which was completed in March 2023. In the complaint response, it provided a breakdown of the fencing works included within the charge, which was reasonable.
15. For the 2020/2021 responsive maintenance costs, the resident had said the total price was £1628, which had been charged at £271 per property for the block. The resident had queried why estate costs were shown as £162 per property in the cost evidence pack. In its complaint response, the landlord said the costs had been correctly charged at block level, rather than estate level. It explained that a header separating estate and block costs was missing from the cost evidence pack and the figures shown on the service charge statement were correct. It apologised for the inconvenience caused and accepted it should have checked over the charges to ensure they were correct. The landlord provided reasonable explanations and took accountability for its errors.
16. The landlord issued its second stage 1 response on 30 August 2024, which addressed the resident’s concerns about the sinking fund discrepancy. It accepted that it had let the resident down. It confirmed the discrepancy arose because completed tree works were incorrectly included in the 2022/2023 annual statement. It said £4095.26 had been duplicated and would be refunded through the resident’s rent account.
17. The landlord noted there had been further confusion and the resident had said the amount to be refunded should be £4137. It explained this amount included tree inspection costs of £41.41, which would not be refunded. It was reasonable that it explained what the additional cost referred to. However, it may have been reasonable to explain why this would not be refunded.
18. The landlord’s complaint response also addressed the difference between the figures £3925 and £4137. It explained that the figures related to sinking fund costs and the initial costs given to the resident. The landlord explained that a Section 20 process applied, which resulted in a 15% management fee being added. The management fee totalled £511.90, bringing the overall figure to £3925. The landlord explained this does not include VAT due to a mathematical error in its system. It apologised that it had not explained the situation and for the distress or inconvenience this may have caused. The landlord also set out how it had learned from the complaint. It said it had fed back to relevant teams about keeping residents updated on queries they raise.
19. The resident was dissatisfied with the landlord’s stage 1 response. He queried why the responsive maintenance charge was £1500 for 2021/2022, when the fencing works were carried out in March 2023. He questioned why he had been charged again for the works after their completion in March 2023. He also said the 2021 cost evidence pack did not state that the £1628 responsive maintenance costs related specifically to his block. He remained dissatisfied that the landlord had not provided evidence explaining what the works were for.
20. The landlord issued its stage 2 responses on 7 and 10 October 2024. It explained that there were two responsive maintenance charges of £1500. It said the first £1500 charge, for 2020/2021, related to renewing storm-damaged fencing and a brick boundary wall. The landlord said these works were subject to a £1500 cap. The second £1500 charge, for 2021/2022, related to a work order to rebuild a boundary wall. The landlord confirmed it had included incorrect information at stage 1 about the completion date of the wall and fencing works. It said these were completed in March 2021. The landlord explained that all service charges are based on actual costs incurred and recovered in arrears. It said charges included in the 2022 actual statement were incurred in the 2021/2022 financial year. It was satisfied that it had demonstrated that the works it had charged for were not duplicated, all charges were correct and had been charged at the correct time.
21. In its second stage 2 response, the landlord explained it had incorrectly described how the tree works would be charged. It said it had stated the costs would be charged directly to residents rather than funded through the sinking fund. The landlord explained it had used incorrect figures when issuing the final account and it identified this error when it closed the stage 1 complaint. The landlord reviewed the costs and confirmed it used the correct figures from the original section 20 estimates, which were issued before the work was carried out. It also provided a table to show the difference between the incorrect and correct costs, which was reasonable to help explain where the error happened and why the final charge was correct.
22. Based on the evidence, we are satisfied that the landlord acted reasonably in investigating the resident’s concerns promptly. It also took accountability in its complaint responses for the errors it made and confirmed how it had learnt from the feedback. We are satisfied that the landlord provided reasonable responses to the resident’s queries. However, it may have been more reasonable for it to have provided more detailed explanations sooner. We note the landlord has provided a total of £175 compensation during the complaint process. This amount aligns with what we would order for the failings identified.
23. Despite this, we have found service failure by the landlord as we consider that it could have gone further to resolve all concerns raised by the resident. These concerns include an explanation of why it did not refund the tree inspection costs and an explanation for the difference between the figures of £3925 and £4137.

Complaint handling

24. The resident raised his first complaint on 2 July 2024 and raised a further query on 31 July 2024. We note the landlord treated this as a separate complaint. However, it may have been more appropriate to treat this as a query or add it to the initial complaint. This is because the issues were linked and may have led to a quicker resolution for the resident.

Complaint raised on 2 July 2024

25. The landlord acknowledged the resident’s complaint on 8 July 2024, which was within the timescales set out in the Service’s Complaint Handling Code (“the Code”). The landlord sent an update to the resident on 25 July 2024, it said it was hoping to provide a response by 22 July 2024 but needed more time. It said it hoped to provide its full response by 5 August 2024. The Code states that landlords should issue stage 1 responses within 10 working days of acknowledgement, or an extension must be agreed before the deadline. The landlord should have issued its stage 1 response by 22 July 2024 or provided an update by this date. It was unreasonable that it did not update the resident in line with the required timescales.
26. The landlord issued its stage 1 complaint response on 5 August 2024, which was in line with the deadline it had set. It is unclear when the resident escalated his complaint, but the landlord acknowledged this on 23 August 2024. The landlord provided its stage 2 complaint response on 7 October 2024, which was a delay of 11 working days. We have not seen any evidence that it sought to manage the resident’s expectations.

Complaint raised on 31 July 2024

27. The landlord treated the resident’s second query on 31 July 2024 as a complaint and acknowledged this on 5 August 2024. This was within the required timescales. It provided an update to the resident on 20 August 2024, stating that it needed more time and hoped to provide its full response by 4 September 2024.
28. It subsequently issued its stage 1 response on 30 August 2024, which was in line with the deadline it had set. The resident escalated his complaint to stage 2 of the complaint process on 11 September 2024, which the landlord acknowledged on 13 September 2024. This was reasonable.
29. The landlord updated the resident on 23 September 2024, stating that it needed more time and aimed to respond by 7 October 2024. This was reasonable and in line with the required timescales. It issued its stage 2 complaint response on 10 October 2024. This was later than the date it had given to the resident. However, the Code allowed it until 21 October 2024 to provide its response. Despite this, the landlord mismanaged the resident’s expectations by not meeting the timescale it had set. It is important for landlords to meet the timescales they communicate to residents.

Summary

30. Based on the evidence, the landlord caused some delays to the resident during its internal complaint process. We note the landlord offered £50 for the delays. As the landlord has admitted its failings and provided this compensation, we think it has taken reasonable steps to put things right and made an offer of redress which satisfactorily resolves this element of the complaint.

Putting things right

Where we find service failure, maladministration or severe maladministration we can make orders for the landlord to put things right. We have the discretion to make recommendations in all other cases within our jurisdiction.

Orders

Landlords must comply with our orders in the manner and timescales we specify. The landlord must provide documentary evidence of compliance with our orders by the due date set.

Recommendations

Our recommendations are not binding, and a landlord may decide not to follow them.