London Borough of Ealing (202341180)

Background

1. The resident pays her rent by standing order in the first week of each month. She raised concerns when a payment did not show on her rent account, which led the landlord to arrears and warning letters in between November 2023 and December 2023. She contacted the landlord to raise concerns. The resident has since moved to another property owned by the landlord.

What the complaint is about

2. The complaint is about the landlord’s:
   1. Response to the resident’s concerns about her rent account.
   2. Complaint handling.

Our decision (determination)

3. We found:
   1. Service failure in the landlord’s response to the resident’s concerns about her rent account.
   2. Reasonable redress in the landlord’s complaint handling.

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

Summary of reasons

The landlord’s response to the resident’s concerns about her rent account

4. While the landlord’s actions (rent arrears letters and warning letter) were in line with its Rent Service Standard, the landlord did not respond to ongoing contact or provide updates, which led to avoidable uncertainty for the resident. While it later apologised for the impact, this did not fully put right the communication failing.

The complaint handling

5. The landlord delayed its stage 1 response and did not address all parts of the complaint. At stage 2, the landlord accepted the delay and its earlier misleading communication. It then offered compensation, which we consider proportionate to the failings we identified.

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.

Our investigation

The complaint procedure

What we found and why

The circumstances of this complaint are well known by the parties involved, so it is not necessary to detail everything that’s happened or comment on all the information we’ve reviewed. We’ve only included the key information that forms the basis of our decision of whether the landlord is responsible for maladministration.

What we have not investigated

6. The resident told her landlord that the rent account issues caused she and her family distress and anxiety. It would be fairer, more reasonable and more effective for the resident to make a personal injury claim for any injury caused. The courts are best placed to deal with this type of dispute as they will have the benefit of independent medical advice to decide on the cause of any injury and how long it will last. We’ve not investigated this further. We can decide if a landlord should pay compensation for distress and inconvenience.

What we have investigated

7. On 21 November 2023, the landlord sent an automated arrears letter for £370.47. The weekly rent was £125.13, means the outstanding balance was over 2 weeks’ rent. This was in line with the landlord’s Rent Service Standard, which says it will arrears letter if you are 2 weeks in arrears.
8. Between 24 and 30 November 2023, the resident contacted the landlord several times. She said her payment from 2 November 2023 was not on her rent account. She gave evidence and asked the landlord to check all accounts. As this placed her at risk of arrears action, it was understandable for her to seek a quick response.
9. On 30 November 2023, the landlord told the resident it had received the payment. It sent a screenshot to show the payment went to the wrong account. It said an IT issue delayed the transfer and gave an apology. It asked the resident to check the payment reference and confirm the correct bank details. This was reasonable as it gave clear evidence and set out steps to prevent further errors.
10. On 3 December 2023, the resident contacted the landlord. She repeated that she had given full evidence and said her bank had confirmed no issue. She said she had paid this way for years and believed the fault was with the landlord. She also asked why the November 2023 payment had not yet been transferred.
11. On 4 December 2023, the landlord sent a warning of a notice seeking possession for arrears of £620.73. This followed its Rent Service Standard. However, it was not appropriate in the circumstances. The landlord already knew there was a dispute about the November 2023 payment from its contact on 30 November 2023.
12. It would have been reasonable for the landlord to place a stop code on the rent account while it resolved the November 2023 payment. This could have prevented further arrears letters and escalation.
13. The tenancy agreement says the resident must pay rent and any charges weekly in advance. The landlord provided a range of rent payment methods including direct debit, standing order, online payments, swipe cards and a 24-hour payment line.
14. The resident chose to pay rent by standing order, which is set up and controlled by the account holder. This means responsibility for ensuring the correct payment details rests with the account holder and any changes must be made by them. Unlike a direct debit, which allows the landlord to manage and adjust payments, a standing order can only be changed by the account holder. It is unclear why the resident did not amend the December 2023 payment at that time.
15. On 5 December 2023, the landlord found the payments had gone to a service charge account and asked for them to be transferred. It again told the resident to update her reference and correct her standing order details. The resident then contacted the landlord and said the possession warning caused her distress.
16. The resident raised her complaint on 11 December 2023 about her rent. Between 3 and 9 January 2024, the landlord checked the account and found no payments had been applied to the residents rent account. It is unclear if the landlord updated the resident during this time.
17. On 8 January 2024, the landlord transferred the 2 November 2023 payment of £550.68 to the rent account. This was over 2 months after payment and weeks after it knew of the issue. It made further transfers of £1,101.36 on 15 January 2024 and £550.68 on 8 February 2024.
18. The landlord in its stage 1 response explained that the arrears letters were automatically generated and that payments had been made to a leaseholder service charge account due to incorrect standing order details. It also explained that responsibility for setting up and amending a standing order rest with the resident and asked her to update the payment details. This was a reasonable position, as the landlord is unable to amend a standing order on the resident’s behalf.
19. The stage 2 response explained that on 24 February 2022 the landlord had asked the resident to update her bank details, as payments were being made into a leaseholder service charge account. While the landlord has not provided a copy of this specific correspondence, which would have been helpful to evidence its position, we have seen communication dated 14 April 2022 in which it asked the resident to update the sort code and advised that payments were going into a suspense account.
20. In its stage 2 response, the landlord said its bank details had not changed. It would have been helpful for the landlord to provide evidence to support this. We also noted that the landlord’s website contained the same bank details for standing order payments, and the webpage content was created in 2011.
21. However, the issues giving rise to the complaint concerned the resident’s November and December 2023 rent payments and the arrears letters that followed. The resident’s standing order had been in place for several years before these events. Given the time that has passed and the limited historical evidence available, it is not possible to determine with certainty whether there were any changes to the information held by the resident or her bank before the disputed payments. Therefore, we have not investigated this issue in detail and have referred to the landlord’s comments and the information available on its website for context only.
22. The landlord said IT issues delayed the transfer because payments were not identified automatically. It said the issue would have been resolved sooner without this problem. This was reasonable and consistent with its previous advice in November 2023.
23. While the landlord acted in line with its Rent Service Standard when issuing arrears and warning letters, once it became aware of the disputed payment on 30 November 2023, it would have been reasonable to place a stop code on the account pending resolution to avoid further escalation. This is supported by the landlord’s stage 2 response, which accepted that automated arrears letters should not have been sent once the issue was known. However, it did not apologise after acknowledging this failing. In line with the Ombudsman’s dispute resolution principles, landlords should acknowledge where things have gone wrong and take responsibility for their failings. We note, however, that the landlord apologised for the impact the matter had on the resident, including the effect on her Christmas break.
24. There is also no evidence the landlord responded to the resident’s ongoing contact or kept her updated between December 2023 and its stage 1 response in March 2024. This was a missed opportunity to manage the resident’s expectations and provide reassurance while it investigated the disputed payment. The lack of communication left the resident having to repeatedly pursue the matter and contributed to the avoidable time and trouble she experienced.
25. The landlord’s compensation policy allows it to consider the impact on the resident, including distress, frustration and uncertainty, when deciding appropriate redress. However, it did not offer redress to recognise the impact of its communication failings.
26. In line with our compensation guidance, we have made an award that reflects the distress and inconvenience caused by the landlord in its response to the concerns about the rent account.
27. Following the complaint, the resident informed us that the issue remains ongoing and that she received further arrears letters in November 2024. The landlord said that between May 2024 and December 2024, the resident has not updated the standing order and payments continues to be made to the incorrect account, requiring manual transfer to the rent account. We have not assessed this further as part of this investigation, but we have made recommendations to support a lasting resolution.

28. The complaint handling code (the Code) sets out when and how a landlord should respond to complaints. The relevant Code in this case was the 2022 edition. The landlord’s complaint policy was not compliant with the Code at the time of the complaint. However, the current policy is compliant.
29. The landlord’s complaints policy at the time said it would acknowledge stage 1 complaints within 4 working days. Its policy does not mention acknowledging complaints at stage 2. It says it will provide its response within 20 working days at both stages.
30. The resident submitted her complaint by email on 11 December 2023. The landlord responded by advising her to log the complaint through its online “My Account” portal and provided links to the portal and its complaints webpage for further information.
31. While the landlord’s response was not totally incorrect, it lacked clarity and gave the impression that the complaint could only be submitted online. This was misleading in its effect and did not make it easy for the resident to access the complaints process. In line with the Code on accessibility, landlords should ensure that complaints can be raised through a range of channels and that residents are not discouraged from using their preferred method.
32. The landlord acknowledged the complaint 14 working days later and provided its stage 1 response 49 working days from its acknowledgment. There is no evidence it contacted the resident to agree an extension. This was not in line with its policy and the Code.
33. As part of her complaint, the resident raised other concerns including concerns that the arrears on her account could affect her housing application and bidding status and asked the landlord to confirm that her housing status was not affected. The landlord’s stage 1 response did not address this part of the complaint. In line with the Code, which requires landlords to respond to all elements of a complaint, the landlord’s response was not in line with the Code.
34. The resident escalated her complaint on 7 April 2024 and the landlord issued its stage 2 response 20 working days later and in line with its Policy and the Code.
35. The stage 2 response addressed all other concerns the residents raised in her original complaint, it apologised and offered compensation of £150 for the delay in providing its stage 1 response, its failure to address all elements of the residents complaint at stage 1 and for the miscommunication when the resident first logged her complaint.
36. Our compensation guidance suggests redress of up to £100 when we find maladministration in the landlord’s complaint handling. The landlord has offered more in its complaint response, which was reasonable. We recommend the landlord makes this payment to the resident if it has not already done so.

Learning

37. The landlord should ensure its approach supports fair access to the complaints process, so residents feel their concerns are recognised and progressed regardless of how they are raised.

Knowledge information management (record keeping)

38. The landlord’s record keeping was not always sufficient. It was unable to provide evidence to support some of the explanations it gave to the resident, which would have been helpful. Good record keeping helps landlords provide clear information and reassurance to residents that issues are being appropriately managed.

Communication

39. To help manage the resident’s expectations, the landlord would be expected to provide clear and consistent updates while the issue was being resolved.