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Metropolitan Thames Valley Housing (MTV) (202322956)

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REPORT

COMPLAINT 202322956

Metropolitan Thames Valley Housing (MTV)

17 April 2025


Our approach

The Housing Ombudsman’s approach to investigating and determining complaints is to decide what is fair in all the circumstances of the case. This is set out in the Housing Act 1996 and the Housing Ombudsman Scheme (the Scheme). The Ombudsman considers the evidence and looks to see if there has been any ‘maladministration’, for example, whether the landlord has failed to keep to the law, followed proper procedure, followed good practice, or behaved in a reasonable and competent manner.

Both the resident and the landlord have submitted information to the Ombudsman, and this has been carefully considered. Their accounts of what has happened are summarised below. This report is not an exhaustive description of all the events that have occurred in relation to this case, but an outline of the key issues as a background to the investigation’s findings.

The complaint

  1. This complaint is about:
    1. The landlord’s administration of the resident’s rent and service charge account.
    2. The landlord’s handling of the associated complaint.

Background

  1. The resident is a shared ownership leaseholder under a lease commencing 28 August 2020. The property is a 2-bedroom, third-floor flat.
  2. The landlord is a housing association and freeholder of the building.
  3. Under the terms of the resident’s lease, the resident is obliged to pay rent, which is subject to annual review. He is also obliged to contribute by way of a service charge to the landlord’s costs of providing services to the property.
  4. The landlord’s account year runs from 1 April. In about February each year, the landlord notifies residents of the amount of rent and estimated service charges payable in the forthcoming account year. For convenience, rent and service charges will be referred to collectively in this investigation report as “the charges”.
  5. From the commencement of his lease, the resident paid the charges monthly by direct debit.
  6. In late September 2021, the landlord notified the resident that he was in arrears in respect of the charges and he was asked to clear the debt. The resident queried how he could be in arrears as he had a direct debit payment in place with the landlord. The landlord explained that it had added extra service charges amounts to his account for each month backdated to April 2021. It accepted that the resident had not received a letter notifying him of the increase as he should have done. It apologised for this. It advised that the resident would receive the notification letter shortly. 
  7. The records provided to this Service do not show whether the resident received the notification letter or what, if any, steps were taken to clear the arrears at this stage.
  8. On 18 February 2022, the landlord notified the resident of the new charges for the forthcoming account year from 1 April 2022.
  9. On 19 January 2023, the landlord notified the resident that he was in arrears by over £700.
  10. Following various communications between the resident and the landlord regarding the arrears, the resident raised a formal complaint on 25 January 2023.
  11. In the complaint, the resident questioned the arrears. He noted that he had never missed a payment, that he had always paid the amount stipulated by the landlord in its letters and direct debit paperwork, and that it was responsible for adjusting the direct debits. He referred to service charge letters he had received in the past which stated that residents paying by direct debit did not need to do anything. He noted that the letters he received regarding the charges were apparently different from those the landlord had on its system. He asked that the landlord accept liability and correct its mistakes in the arrears.
  12. On 20 February 2023, the landlord notified the resident of the new charges for the forthcoming account year from 1 April 2023.
  13. On 27 February 2023, the landlord provided its Stage 1 response. In the response:
    1. It confirmed that the amount due in arrears was correct.
    2. It explained that the arrears had accrued due to underpayment of the direct debit amounts. The resident’s direct debit payments did not reflect increases in the monthly charges. It identified the monthly increases as occurring in August 2021, from 1 April 2022 and a balancing charge debited in July 2021.
    3. It accepted that it amended direct debits automatically to assist customers in paying the correct amount in charges. However, it provided customers with a letter stating the correct amount to pay each time the charges increased or decreased. It remained the customer’s responsibility to ensure that he paid the correct charges.
    4. It acknowledged that it had not amended the monthly direct debit as it should have done on three occasions and apologised for this. It awarded compensation of £50 for the service failure and £75 for the resident’s time and trouble. It stated that it would amend the direct debit to the correct amount. It asked that the resident address the arrears and offered to discuss a repayment plan.
  14. On 1 March 2023, the resident emailed the landlord. He informed it that he was dissatisfied with the response. He noted that the landlord had admitted to not carrying out changes to the direct debit three times and that this had also affected his neighbours. He thought there was a fundamental error within the business and asked how this would be addressed going forward. He also stated that he did not remember receiving information about the increase in charges in August 2021.
  15. On 26 March 2023, the landlord acknowledged the resident’s email as a request for escalation to Stage 2. 
  16. There was a delay in the landlord’s Stage 2 response which was issued on 28 May 2023.
  17. In its response, the landlord upheld its Stage 1 decision. It explained that while it did automatically amend direct debits when there were changes, sometimes mistakes were made due to the scale and variation. It reiterated that it remained the resident’s responsibility to ensure payment of the correct amount. It apologised again for its failure to amend the direct debit and stated that it would learn from this and try to improve the process in future. It offered further redress of £50 in respect of poor complaint handling at Stage 2. With regard to the letter notifying the resident of a change in charges in August 2021 (which the resident stated he had not received), the landlord indicated it had asked its relevant officer to provide a copy of the letter to the resident. 
  18. Between 22 June 2023 and 11 July 2023, the resident agreed a repayment schedule with the landlord. He cleared the arrears over 12 months.

Post-complaint events

  1. On 4 October 2023, the resident referred his complaint to this Service. He felt that he and other similarly affected residents on the estate were being made to pay for a fundamental error within the landlord’s business. He felt that he should be reimbursed for the arrears.
  2. In more recent communications with this Service, the landlord advised that it has reviewed the case. It stated that the letters sent to the resident notifying him of changes during this period did not advise him to check the amount of the direct debit, as later letters did. It said that it had not been able to locate a copy of the August 2021 letter which the resident said he had not received. As part of its review, it recognised that the compensation awarded through the complaints process was not in line with its expectations. It offered further redress of £100 in respect of its poor complaints handling; £50 for its service failure in not providing a copy of the August 2021 letter to the resident; and £50 for the resident’s time and trouble and anxiety caused by the matter.  

Assessment and findings

The landlord’s administration of the resident’s rent and service charge account

  1. As acknowledged by the landlord in its complaint responses, it failed to adjust the direct debit on the resident’s account as it should have done on three separate occasions. This was necessary to collect increases in the monthly charges due from the resident. As a result, the resident fell into substantial arrears through no fault of his own.
  2. The landlord’s failing caused detriment to the resident. He was caused inconvenience and distress in receiving letters informing him that he was in arrears which he was unaware existed; by the fact of having accrued a large debt which he had not budgeted for; and in spending time and trouble in communicating with the landlord and bringing a complaint to resolve the matter.
  3. Where there are admitted failings by a landlord, the Ombudsman’s role is to consider whether the redress offered put things right and resolved the resident’s complaint satisfactorily in the circumstances. In considering this, the Ombudsman assesses whether the landlord’s offer of redress was in line with the Ombudsman’s Dispute Resolution Principles: be fair, put things right and learn from outcomes, as well as our guidance on remedies.
  4. The outcome sought by the resident is that he should be reimbursed for the arrears. The landlord did not offer to waive the arrears in its complaint responses, explaining that the charges were correct and remained payable by the resident. This was an appropriate response by the landlord. The resident has an obligation to pay service charges and rent under the lease. Although there is an admitted service failure by the landlord, there is no correlation between the amount of the arrears and the detriment caused by it.
  5. The landlord reasonably sought to put matters right in respect of the failings it identified. It offered redress of an apology to the resident, compensation of £125 and an extended repayment schedule to clear the debt. However, the landlord did not wholly resolve all of the matters raised by the resident in the complaints process.  
  6. Part of the resident’s complaint was that he had not been notified of the adjustment to the charges in August 2021. He raised this issue when escalating the complaint on 1 March 2023. At the time of the Stage 2 complaint response, the landlord indicated that it had instructed its relevant officer to produce the letter to the resident. While this was a reasonable step for the landlord to take, the landlord should have followed up the outstanding action as part of the resolution of the complaint and in accordance with the Housing Ombudsman’s Complaint Handling Code.
  7. The landlord failed to do so and has more recently discovered that it did not in fact send the resident the notification letter in August 2021. This was a service failure by the landlord. The landlord was obliged to provide information of service charges and rent to the resident under the terms of the lease. The landlord’s failing likely contributed to the confusion and uncertainty experienced by the resident in understanding the accrual of arrears on his account.
  8. Moreover, although the landlord accepted in its complaint responses that it had not adjusted the direct debit amount as it should have done, it also maintained that it remained the responsibility of the resident to check and ensure that the direct debit amounts were correct.
  9. This was not an appropriate response from the landlord because the resident was not able to check his account when he did not have all the correct information. Similarly, the landlord’s response did not recognise that its letters to the resident during the period of investigation reassured him that he did not need to take any action regarding the change in charges.
  10. The landlord has since acknowledged both its failure to provide the resident with the relevant information in August 2021 and that the letters sent to the resident at the time did not advise him to check the amounts of the direct debit payments. It has offered further compensation of £100 by way of redress.
  11. In the Ombudsman’s view, the further compensation offered of £100, together with the £125 already awarded, brings the compensation in line with an amount which is proportionate to the failings identified. This amount is within a range that the Ombudsman would recommend where there has been a failing that had an adverse impact on a resident. However, as the complaint was not wholly resolved and the redress was not all awarded as part of the complaints process, a finding of maladministration has been made.

The landlord’s handling of the associated complaint

  1. The landlord operates a two stage complaints policy. Under the policy, complaints are acknowledged within 5 working days. The landlord aims to respond at Stage 1 within 10 working days and at Stage 2 within 20 working days. If it is unable to respond within these timeframes, it undertakes to keep the resident informed and agree new response times.
  2. As outlined above, there were failings by the landlord in its handling of the resident’s complaint.
  3. The landlord appropriately acknowledged the complaint within policy timescales. Although the landlord took longer than 10 working days to issue its Stage 1 response, it informed the resident of this in advance and of the revised issue date. This was appropriate and in line with the landlord’s policy. The Stage 1 response was issued within the revised time.
  4. The resident requested an escalation of the complaint on 1 March 2023. The landlord did not acknowledge or escalate this until 26 March 2023. While the landlord’s policy does not specify a timeframe for escalation, the delay of 25 days was outside reasonable timeframes. The landlord did not provide an explanation or apology to the resident, which would have been appropriate.
  5. The landlord indicated to the resident that it would provide a Stage 2 response by 26 April 2023. However, due to administrative oversight by the landlord, there was a further delay in issuing the Stage 2 response. The landlord extended the time of the investigation on two occasions.
  6. The result of the landlord’s failings was an overall delay of about 2 months in providing the resident with the Stage 2 response.
  7. In addition to delay, as indicated above, the landlord should have followed through the provision of the August 2021 letter as an outstanding action in accordance with the Code. However, as that aspect of the complaint has been addressed above, it will not be duplicated by further findings here.
  8. The resident was caused detriment by the landlord’s delay in that it unnecessarily prolonged the resolution of his complaint. In the circumstances, it was appropriate for the landlord in the Stage 2 response to apologise for the delay, acknowledge that there had been poor complaint handling and offer redress of £50.
  9. The compensation offered is within the range the Ombudsman would expect for service failings of short duration which do not significantly affect the overall outcome for the resident. Together with the apology offered for the delay, the redress was reasonable for the failures identified in the complaints handling.
  10. It is noted here that while poor complaint handling in the management of the Stage 2 complaint was referenced in the Stage 2 response in general terms, it did not specify what the failures were for which the compensation was being awarded – whether the delay in providing the Stage 2 response, the delay in escalating the complaint, or both. It is good practice for the landlord to explain the failures for which compensation is being offered to provide clarity to residents.
  11. The landlord has indicated following conclusion of the complaint that it wishes to award further compensation of £100 to the resident in respect of its complaint handling. While the Ombudsman considers that the redress offered as part of the complaints process was reasonable, it expects the landlord to honour its commitment to pay further compensation to the resident of £100.

Determination (decision)

  1. In accordance with paragraph 52 of the Scheme, there was maladministration in the landlord’s administration of the resident’s rent and service charge account.
  2. In accordance with paragraph 53(b) of the Scheme, the landlord has made an offer of reasonable redress prior to investigation which, in the Ombudsman’s opinion, satisfactorily resolves the complaint about the landlord’s handling of the resident’s complaint.

Orders

  1. Within 4 weeks of the date of this report, the landlord is ordered:
    1. To write to the resident to apologise for the additional failings identified by the Ombudsman in this report.
    2. To pay the resident compensation of £225, comprised of the sum of £125 it offered through its complaints process (if it has not done so already) and the further sum of £100 offered following its case review. This sum is in recognition of the distress and inconvenience caused by the failings in its administration of the resident’s rent and service charge account.
  2. The landlord should contact this Service within 4 weeks of the date of this determination to evidence its compliance with the above orders.

Recommendations

  1. If it has not already done so, the landlord should pay the resident the £150 it has offered for complaint handling. The Ombudsman’s reasonable redress decision is made on the basis that this amount is paid.