London & Quadrant Housing Trust (202017193)

REPORT

COMPLAINT 202017193

London & Quadrant Housing Trust

8 April 2022

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 requests for information relating to service charges.
The complaint is also about the landlord’s associated handling of the complaint.

Background and summary of events

The resident is a leaseholder of the landlord, at the property. The original lease is provided although the duration of the resident’s lease agreement is not known.
The landlord has a two-stage complaints procedure whereby it aims to investigate and respond to a complaint within 10 working days at stage one. Where a complainant is dissatisfied with the complaint response at stage one, they may request escalation of the complaint to stage two. The landlord aims to respond to a complaint at stage two, within 20 working days. Where the landlord requires longer to respond to a complaint, it will contact the complaint to advise this and provide a revised timeframe.
On or around 29 August 2020, having received the final statement for service charges from the landlord, the resident said she requested invoices for service charges. Shortly thereafter the landlord sent the resident some information in a spreadsheet, setting out the charges levied.
On 9 September 2020, the resident specifically requested invoices for all of the charges on the statement it had sent, adding that the spreadsheet it sent did not include them all; she also asked the landlord to highlight which charges on the spreadsheet related to which charges on the service charge statement.
The landlord’s response of the same date, explained that often invoices are contract wide and do not contain specific detail and that the previously provided invoices provided as much detail as is possible. It said it would be happy to look into specific issues if the resident could provide further detail, but added that due to the pandemic and working from home, the collation of all invoices was very manual and would be in excess of 350 pages and so asked the resident to be specific about her queries. The landlord said that due to the aforementioned circumstances, it could not provide a timeframe within which it would be able to respond to any such queries.
The resident responded, again on 9 September 2020, making the following requests:
1. Clarity as to works carried out on other blocks that appeared on the invoice for her block;
2. All environmental charges;
3. Receipts for all playground charges and works carried out;
4. All work from two particular named companies on the invoices;
5. All work relating to the landlord’s maintenance;
6. All credit card payments to an unknown named contractor;
7. All payments to a telecoms provider;
8. A breakdown of the £5000 cost for emergency lights and clarity as to whether this related to one building or several.
On 10 and 22 September 2020, the resident chased the landlord again for information and further detail.
On 1 October 2020, the resident emailed the landlord asking what its timeframe was for response to her request for invoices and queried the cost of works relating to emergency lights.
On 9 October 2020, there were several emails from the resident regarding queries about communal lights.
On the same date, in an email from the landlord, it apologised for the delay in answering the queries the resident had previously raised and provided written explanations in respect of the communal heating, extractor fans, play equipment, cleaning supplies, electricity consumption, telecoms and emergency lighting charges.
Two days later, on 11 October 2020, the resident emailed the landlord requesting disclosure of receipts in respect of service charges for the 2019/2020 financial year, in accordance with section 22 of the Landlord and Tenant Act 1985.
The following day, on 12 October 2020, the resident submitted a complaint to the landlord about the delay in receiving invoices she had requested.
Between 16 and 17 October 2020 there was correspondence between the landlord and resident, with the landlord again explaining it would take time to collate the invoices and would do this as quickly as possible but reiterated it could not give an exact timeframe as to when it could do this and the resident querying why this was the case. The resident also asked for clarity regarding the expense of lightbulbs and why the money was not taken from the sinking fund.
On 9 December 2020, the resident wrote to the landlord, requesting it carry out a full independent audit of all service charges over the past five years, put any errors right and put measures in place to help prevent a recurrence, noting that she had made a section 22 request, in accordance with the Landlord and Tenant Act 1985 on 29 August 2020 which remained unanswered.
On 14 December 2020, the landlord emailed the resident, providing copies of account invoices. Correspondence continued with the resident stating she had not been provided with all of the information or clarity and the landlord advised that it would be in a position to do this by the end of December 2020.
In the new year, the resident continued to chase the landlord as to copies of receipts or invoices and clarity as to information regarding charges, including on 3 February 2021 and the landlord responded on 5 February 2021, in response to her email of 9 December 2020.
On 5 February 2021, the landlord responded to the resident’s request of 9 December 2020. It explained that it was already subject to regular independent audits and had measures in place to monitor, prevent and correct any errors, identify and remove dishonesty and reconcile accounts. It noted that the resident had been provided with the specific account detail she requested, on 14 December 2020.
On 12 February 2021, the resident emailed the landlord, complaining about the landlord having still not provided the information she had requested, asking when it would provide clarification as to her questions about service charges. Specifically, she referred to unclear charges, duplicated charges and missing information and attached a document with her precise queries on.
On 15 February 2021, the landlord said it had received her complaint and would be in touch in due course, explaining that service charge complaints can take longer, due to their complexity.
The resident emailed the landlord again on 27 February 2021 and again on 7 March 2021.
On 11 March 2021, the resident emailed the landlord once again, asking for a response to her complaint, reiterating that it had not provided her with the information she requested on 29 August 2021, despite her making multiple contacts with it since that time, seeking the information and clarity. The resident was seeking an explanation and refund for any overcharges, as well as £500 compensation for stress, worry and what she referred to as the landlord’s negligence.
The resident sent a further email on 16 March 2021, stating that she was considering approaching the First Tier Tribunal (Property Chamber).
On 17 March 2021, the landlord responded to the complaint at stage one of the complaints process. It made the following findings:
1. In respect of its customer service, it apologised for delays the resident had experienced in the provision of supporting documents and in response to her complaint. The landlord said it had learned from its failings and would put measures in place to improve things in future.
2. It explained that to help the resident going forwards, it had allocated her a single point of contact, so that she would not have to navigate various teams and departments in order to ask for what she needed.
3. It was working across teams and departments and with residents and their representatives to ensure proper scrutiny and checks in respect of service charges and would endeavour to provide as much transparency as possible.
4. With regards to a request for 2019/2020 accounts information, the landlord noted it had provided the information electronically to the resident on 14 December 2020.
5. It explained that due to Covid-19 and home working environments, it had had to change the way it dealt with information requests and that meant completing them electronically only, which was very time consuming; it had employed additional staff to help deal with this and was looking at improved technology for the future.
6. It explained how costs were calculated and that it could find no duplication or error. It explained that some services will appear “at one or more levels”, such as play equipment, which features “at both estate and scheme” and attached a breakdown of the resident’s estimate with comment as to which each service covered.
7. It explained that it received “bulk” invoices for larger contracts, “and for those contractors who cover more than one component, the item will appear on the same invoice, for example [its] fire servicing is carried out alongside [its] emergency lighting maintenance servicing, and so this is billed on the same invoice, with a breakdown of the individual cost provided by the contractor for each block they cover and then each component that was serviced”.
8. It explained that it therefore did not receive specific and bespoke invoices for each service to [the resident’s] block each year and invoices may reference all or some of the other properties included on the contract. It said that this approach is common practice and had been tested in front of the First Tier Tribunal (FTT) (Property Chamber) and deemed to be a reasonable approach.
9. It concluded that if the resident could direct it to specific issues in the accounts it would be happy to look into it and provide further clarity for her.
10. If the resident was dissatisfied with the outcome of her complaint, she could take the matter to the Housing Ombudsman Service.
The resident sent further emails to the landlord on 29 and 31 March 2021, on 15 and 21 April 2021 and on 6 May 2021, chasing the information and asking it to provide a final response to her complaint.
On 3 June 2021, the resident re-sent her email to the landlord of 11 March 2021.
The resident emailed the landlord again on 2, 6 and 10 May 2021 and 13 July 2021.
On 5 August 2021, the resident emailed the landlord again, expressing her dissatisfaction in the length of time the matter was going on for and now requested disclosure of the 2020-2021 invoices also.
On 12 August 2021, following contact from this Service, the landlord emailed the resident, repeating its stage one complaint response of 17 March 2021.
The resident responded, asking for further clarification, stating that there were several items she had not received receipts or clarifications for. Specifically, she stated that the charges for “play area equipment/maintenance” did not add up. The resident asked the landlord to look into this charge first and she would come back at a later date with the other queries.
The following day, on 13 August 2021, the resident also asked for clarification of communal repair charges, referencing particular payees and costs.
On 16 August 2021, the landlord provided a breakdown of what the resident had been charged in the 2020-2021 period for service charge costs and said it would be happy to look into specific invoices in detail if the resident wished.
On 17 August 2021, the resident emailed the landlord about water testing charges and CCTV maintenance charges, stating the CCTV at the block had not been in use for a number of years and so she should not be charged for its maintenance.
On 3 and 17 September 2021, the resident chased the landlord as to a response to her emails.
On 21 October 2021, the landlord issued its stage two response to the complaint, apologising for its delay. The landlord advised that it had previously fully responded to the complaint and the queries the resident was raising were new. It said it would contact the resident to gather further information with regards to her queries and provide her with an update.

Assessment and findings

Scope of investigation

Section 22 of the Landlord and Tenant Act (1985) gives lessees the right to inspect “accounts, receipts and other documents” supporting a summary of service charge expenditure. A request must be made by the lessee within six months of receiving the summary of relevant costs, with the landlord having one month to provide the information. Failure for the landlord to provide this information within that time, without reasonable excuse, is a summary offence and can attract a fine of £2500.
Part of the resident’s complaint relates to her reports that the landlord failed to provide accounts information that she requested in or around August or September 2020, following receipt of the final statement for service charges by it in August 2020, within one month.
The landlord has given reasons for delay pertaining to Covid-19 and the associated homeworking, technology and staffing issues, however, the Ombudsman, as an alternative dispute resolution service, is unable to assess whether those reasons constitute a ‘reasonable excuse’, in law; this would be a matter for the courts.
Paragraph 39(i) of the Housing Ombudsman Scheme states that “The Ombudsman will not investigate complaints which, in its opinion, concern matters where the Ombudsman considers it quicker, fairer, more reasonable or more effective to seek a remedy through the courts, a designated person, other tribunal or procedure”. As such, this aspect of the complaint is not within the remit of this investigation, which will focus on the landlord’s overall handling of the resident’s request for information and its associated complaint handling.

Handling of requests for information and clarity

In responding to the request for information pertaining to the service charge account, having provided an initial overview spreadsheet of the charges, it was appropriate that the landlord thereafter explained that providing specific invoices and further clarity would take time. It was appropriate because in doing so, it was transparent about the process of collating and providing the information requested and the detail the resident wanted, explaining that the process was labour-intensive, compounded by the impact of the pandemic and national lock-down, which meant it had to consider and implement different ways of working.
Sometimes responding to an issue or complaint takes longer than would be desirable and longer than any target timeframes articulated in policy or procedural documents or otherwise, due to reasons of complexity and density, for example and this is understandable. It is not appropriate, however, to provide no timeframe whatsoever, as this does not manage expectations or contain an issue or complaint, leaving it open for a resident to reasonably check-in, chase or otherwise contact the landlord, in the interim time, which has no boundary or end date in site.
Where it is not possible to provide a precise timeframe, it is important nonetheless, for a landlord to provide an estimate or at least a point in time at which the landlord will make contact to either respond to the substantive issue or update the resident as to what action it has been taking to address matters and an approximation as to how much longer it will take.
This point underscores this complaint, in that the landlord predominantly did not provide timeframes, leaving the matter open and with a sense that nothing was being done, creating frustration and contributing detriment to the landlord-resident relationship. This undoubtedly facilitated the repeated contact from the resident insofar as there was no clear point at which she could expect the landlord to respond and so as and when new queries arose for her, she sent them off to the landlord, without it having satisfactorily dealt with the first one.
This created a situation whereby the landlord, faced with the difficulty of the initial task and the complications of working at home through the pandemic, with various additional emails with queries and requests for other specific information and documentation which served to add further complication to its attempts to achieve a resolution on the case. This is without the resident’s understandable chasing emails to the landlord, as to what was going on with her requests – and later complaint, which are considered in further detail below.
On the matter of chasers to the landlord, the landlord is entitled to a reasonable amount of time to respond to any request and the resident’s chasing emails were frequent and at points, followed one another closely, not allowing sufficient gap for the landlord to reasonably be able to respond. However, this was in the wider context of the landlord’s lack of expectation management as to timeframe, as discussed above, as well as its failure to provide the information requested and clarity as to her questions about charges, combined with significant delay overall. Notwithstanding any legal issue regarding timeliness, as set out in the scoping section of this report, the landlord took an inappropriately lengthy time to respond to the request.
The landlord took one month from 9 September 2020, providing explanations to her of the charges, on 9 October 2020, however, the information provided was inadequate, namely, it consisted of explanations of charges, rather than the specific documents evidencing them and did not address all of the charges she had asked about. The landlord’s response was unsatisfactory in these ways and left the resident understandably dissatisfied and frustrated at the length of time it was taking to obtain the information she had requested and unheard in her request.
This became an ongoing pattern, whereby the resident would ask for documents and clarity and the landlord would either not respond or respond by providing part of the information or part-clarity, which amplified the resident’s frustration over time. The landlord’s explanations were largely generic, failing to address the specifics raised by the resident and requested documentation was missing. The resident also queried duplication in payments which were unsatisfactorily addressed.
Despite the landlord’s assertion in its complaint response and other correspondence, that should the resident have further specific queries she should get back to it and ask these, it then did not follow up with specific responses. It is the case that itemised billing down to individual properties may not be possible, given large contracts which span hundreds of properties and many blocks of flats and housing estates.
However, the landlord remains accountable to the resident in respect of the money it spends on service charges and must be able to explain this, in accordance with its obligation under section 22 of the Landlord and Tenant Act 1985. It cannot be the case that it is not possible to separate out on any level, any of the service charges, or that charges are not at all explainable in terms of specific contractors, for instance. The resident also asked for clarity in respect of CCTV which was broken at her block but she was still being charged for it, as well as clarity as to lightbulbs and the sinking fund, neither of which were answered.
In all the circumstances of the case, therefore, there was a significant service failure in the landlord’s overall handling of the resident’s reports about the service charge. The landlord delayed in providing information, did not address specific issues the resident raised and was unable to provide itemised figures pertaining to individual properties, as had been requested. The Ombudsman is unable to make findings about the level of service charges, an issue more appropriately handled by the tribunal, however, given the failings identified here, an order of compensation to reflect the resident’s frustration and inconvenience in progressing her case is considered appropriate.

Complaints handling

The landlord’s response to the complaint at both stages one and two were significantly delayed, without explanation. Although it emailed the resident on 15 February 2021, acknowledging her complaint of 12 February 2021, the resident had actually complained to the landlord four months earlier, on 12 October 2020, which inappropriately went without acknowledgement or response. Further, its inappropriately delayed stage one response, referred the resident to the Ombudsman if she should wish to escalate the complaint, which was incorrect, as it had not yet exhausted the landlord’s complaints procedure, thereby causing confusion and adding to further delay.
Whilst the matter was complicated by the level of correspondence from the resident and a combination of informal and formal requests for information and clarity from her, the landlord had a responsibility to oversee the management of the complaint and it did not do this.
Moreover, while the landlord acknowledged its delay in complaint handling, it did not do anything to put this right. It said in its stage one response that it had learned from its mistakes and would do things differently in the future, however, it then took many months and intervention from this Service, to provide a stage two response which simply repeated its stage one response and did not review the complaint as would have been appropriate. The landlord failed too, to recognise this in its stage two response or to reasonably make an offer of compensation in recognition of these failings, as it had discretion to do; this would have demonstrated that it had taken this seriously and would have assisted in rebuilding the landlord-resident relationship.
Responding to a complaint is an opportunity for the landlord to demonstrate that it has heard and understood the complainant’s concerns and a chance to put things right, which it did not do, as described above. Additionally, the complaints process at stage one is to investigate matters and at stage two, to review the initial response to the complaint. There is no evidence of the landlord carrying out an appropriately thorough investigation and review of the complaint, at either stage.
Although a landlord may maintain its position at stage two, it is important to explain why this is the case and to offer understanding and empathy as appropriate, even where this is the case; the resident was justifiably frustrated and upset about not knowing where her money was going to and seeking to understand this, as was also her right. The landlord did not acknowledge this. Nor did the landlord resolve the complaint in any way, with the resident having still not been provided with the information or clarity requested or the fact that she hadn’t, appropriately addressed in itself and with no way forward.
The situation was such that due to the passage of time, the resident began requesting documentation and clarity as to the service charge accounts for the following year (2020-2021) and the landlord responded in the same manner as previously; a new complaint has ensued about the same thing, one year later, in respect of a different year of accounts, with no line drawn.

Determination (decision)

In accordance with paragraph 54 of the Housing Ombudsman Scheme, there was maladministration by the landlord in respect of the resident’s reports about the service charge.
In accordance with paragraph 54 of the Housing Ombudsman Scheme, there was maladministration by the landlord in respect of its complaints handling.

Reasons

There was maladministration by the landlord in respect of its handling of the information requests insofar as it failed to provide the information requested, as well as clarity as to the resident’s queries, nor was there sufficient explanation as to why some individual charges could not be separated out. The issue which remains unresolved in its entirety at the point of complaint closure. There was extensive overall delay in responding to the requests and no overall management of the situation by the landlord.
There was maladministration by the landlord in respect of its complaints handling insofar as the complaints handling was inappropriately handled by the landlord, with a lack of evidence of sufficient investigation or review of the complaint, significant delay, as well as an inappropriate early referral to the Ombudsman. The landlord failed to effectively engage with and respond to the complaint overall.

Orders and Recommendations

Order

The landlord to pay the resident £400 compensation, comprised of:
1. £250 for the service failures identified with its handling of the resident’s information requests about the service charge.
2. £150 for the service failures identified with its complaints handling.
The landlord to evidence compliance with the above order within four weeks of this determination.