Notting Hill Genesis (202002298)

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REPORT

COMPLAINT 202002298

Notting Hill Genesis

03 February 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 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. The complaint is about:
    1. The landlord’s handling of credits and compensation payments due to the resident following a substantial leak at the property in July 2018 and its overall administration of her rent account; and
    2. The landlord’s handling of the resident’s request for copies of insurance documents relating to the leak.

Jurisdiction

  1. What we can and cannot consider is called the Ombudsman’s jurisdiction. This is governed by the Housing Ombudsman Scheme. When a complaint is brought to the Ombudsman, we must consider all the circumstances of the case as there are sometimes reasons why a complaint will not be investigated.
  2. Paragraph 39(g) of the Housing Ombudsman Scheme states that the Ombudsman will not investigate complaints concerning the level of rent or service charge or the amount of the rent or service charge increase.
  3. In the course of the complaint the resident has stated that the landlord failed to apply a 1% rent reduction, which she believes she is entitled to following changes to legislation, which came into effect from 1 April 2019. This aspect of the complaint is outside the Ombudsman’s jurisdiction, in accordance with paragraph 39(g) as it concerns the level of rent charged to the resident.
  4. The resident is advised to seek independent legal advice on this issue and may consider making an application to the First Tier Tribunal (Property Chamber) (FTT) for a binding determination on this aspect of the complaint. Further information about the role of the FTT can be found at the link below:

First-tier Tribunal (Property Chamber) – GOV.UK (www.gov.uk)

  1. The Ombudsman can, however, consider the landlord’s administration of the resident’s rent account, including whether it took appropriate action to investigate and respond to her complaint that it had failed to apply compensation payments and rent reductions, and to address any errors identified.

Background and summary of events

Background

  1. The resident has occupied the property under an assured shorthold tenancy agreement with the landlord since 17 May 2018. The tenancy was initially for a period of 1 year, after which it continued on a rolling month to month basis.
  2. The landlord completed a programme of works to replace the roof of the resident’s building on 23 March 2018. On 13 July 2018 residents reported considerable water ingress into their properties. On 20 July 2018, following investigations, the landlord confirmed that the leak had been caused by recent heavy rainfall within a short period and issues with a drainage outlet, a small blockage and loose flashing. The landlord anticipated that the issues would be resolved by 23 July 2018.
  3. The resident was decanted to a hotel for a period of 2 months from 13 July 2018 until 10 September 2019. During this period, her local councillor wrote to the landlord on her behalf requesting an update on the remedial works and compensation for all affected residents. This was logged by the landlord as a member’s enquiry on 23 July 2018. 
  4. The remedial works were delayed due to issues with access and adverse weather conditions. On 30 July 2018 a response was sent to the resident’s local councillor providing an update on the repairs and advising that it would cover the cost of the resident’s hotel accommodation if she provided it with receipts. The resident was decanted for a further period until September 2018.

Summary of Events

  1. Following completion of the works the landlord applied a credit of £2,109.88 to the resident’s rent account in respect of the time during which she was decanted from the property. The resident emailed the landlord on 2 August 2019, stating that, according to her calculations, the amount of the credit should have been £2,298.09. She asked the landlord to apply the difference of £188.21 as a credit to her rent account. She also noted that she had still not received £190 compensation for a bookshelf damaged by the leak.
  2. The landlord responded on 13 August 2019, asking the resident to clarify some of the amounts referred to in her email. It confirmed that if any further credit was due, this would be arranged. The resident provided the necessary clarification that day and the landlord confirmed on 15 August 2019 that it had investigated the issue and would be applying the additional credit to the resident’s account. The resident chased the landlord on 1 October 2019, as the credit did not appear to have been applied to her account. She also queried the charges the landlord had applied for September 2019 and the balance showing on her account.
  3. Sometime around March or April 2010 the landlord logged a formal complaint by the resident about its failure to apply the credit to her rent account as agreed and its failure to apply a 1% rent reduction that she believed she was entitled to following changes to legislation.
  4. The landlord provided a response to the resident at stage 1 of its formal complaints process on 4 April 2020. It confirmed that compensation in the sum of £273.68 had been applied to the resident’s rent account on 27 September 2019 as agreed. The landlord suggested that the resident was referring to changes brought in by an amendment to Regulations made under the Welfare Reform and Work Act 2016. These changes required registered providers of social housing in England to reduce social housing rents by 1% per year for 4 years. This change did not apply to the resident’s tenancy, as she was a ‘market rent’ tenant, and the landlord provided a link where she could access further information. The response also advised the resident that her rent account was currently in arrears by in excess of £2,000.
  5. The resident was dissatisfied with the landlord’s response and requested that her complaint be escalated to stage 2 on 13 April 2019. She stated that the credit of £273.68 applied on 27 September 2019 was in respect of an overpayment for the month of September and not the additional compensation owed for the period of the decant. In addition, she was owed a further £36.83 for the September rent overpayment. She asked that the landlord either apply the £188.21 credit for the decant as previously agreed, plus the £36.83 to her rent account. Or, if it continued to assert that the £273.68 was credited as compensation, credit her account with an additional £310.51 in respect of the September overpayment.
  6. The resident stated that she was frustrated by the landlord’s poor communication and that it had failed to provide a calculation as requested. She also noted that the landlord had not compensated her £190 for a bookshelf damaged during the flood. The resident requested copies of insurance documents relating to any claim made for the damage caused by the leak. She also reiterated that she believed she was entitled to the statutory 1% rent reduction and asked the landlord to backdate this to April 2019 and credit her account accordingly.
  7. During its investigation into the stage 2 complaint, the landlord confirmed that credit was applied to the resident’s rent account between 13 July 2018 and 10 September 2018, for the period during which she was decanted, with a further credit of £273.68 applied on 27 September 2018. The landlord noted that the resident’s rent was incorrectly reduced from 1 April 2019 until 31 August 2019. It also noted that due to a discrepancy when the account was recently transferred to a new system, the resident was incorrectly charged for 1 week’s rent. The landlord confirmed that an insurance claim was not made following the flood, although at the time the resident may have received a text message referring to her accommodation being provided via insurance. This may have led the resident to believe that the landlord had pursued a claim via its insurers.
  8. The landlord provided a response at stage 2 of its complaints process on 13 May 2020. It confirmed the advice given in the stage 1 response that the resident was not entitled to a 1% rent reduction. The landlord acknowledged that there had been an error in billing when it changed systems, resulting in an overcharge of £310.51 for 8 days from 1 September 2019. The landlord confirmed that this would be credited to the resident’s rent account. The landlord offered a further £240 compensation, consisting of £190 for the damaged bookcase and £50 for its failure to follow-up. It stated that this could be paid to the resident directly or off-set against her rent arrears. The landlord confirmed that her rent account was now in arrears of £1521.41. The landlord stated that there were no insurance documents to provide, as it had not pursued a claim in relation to the leak.
  9. The resident notified the landlord on 14 May 2020 that she accepted the offer of £240 compensation for the bookcase and provided her bank details. She also accepted the credit of £310.51 to her rent account. The resident stated that she would discuss her entitlement to the 1% rent reduction and her request for insurance documents with her solicitor.
  10. On 9 June 2020 the resident advised the landlord that £240 had been debited from her rent account and that the credit of £310.51 had not been applied. She had also not received the £240 compensation for the bookcase directly into her bank account as requested. The resident advised the landlord that she would be withholding her rent until this was resolved. The landlord confirmed that it would investigate. The landlord responded the same day, apologising and confirming that:

‘we raised a request for you to receive compensation of £240.00 and it appears that this has incorrectly been taken from your rent account. We will of course ensure that this is credited back and that the compensation is paid to you correctly’.

  1. The resident followed up on 11 June 2020 and the landlord stated that it was working to rectify the error. It apologised that an incorrect balance was currently showing in the resident’s rent account but advised her to continue to make her rent payments.
  2. The resident sent further emails chasing a response on 12 June 2020 and 15 June 2020. She stated that the error was preventing her from making her weekly payments to her rent account and later clarified that this was because she did not trust the landlord’s systems and that the payment would be registered. The landlord responded on 16 June 2020, stating that the matter was still being investigated. The landlord acknowledged that its finance team had treated the compensation payment as a rent refund and debited this from the resident’s rent account. The landlord advised that this did not prevent the resident from continuing to make her rent payments.
  3. The resident chased again on 17 and 18 June 2020 and was again advised that the finance team were working to rectify the error. The landlord advised on 19Jun 2020 that its finance team were currently dealing with a backlog, which was leading to a delay in payments and adjustments. It assured the resident that it was taking steps to adjust the account.
  4. On 23 June 2020 the resident informed the landlord that she had referred the issue to this Service and to her local councillor, as she considered that the landlord was refusing to resolve it. The landlord responded to confirm that it was not refusing to resolve the problem but that it was still working to rectify it.
  5. The resident emailed the landlord again on 24 June 2020, complaining about the unreasonable delay in resolving a straightforward issue and noting that although the £240 debit had not been reversed, the landlord had applied the recently accrued arrears to her rent account. The resident asked the landlord to confirm that it would be amending the charge incorrectly applied, paying her £240 compensation directly into her bank account and crediting her rent account with £310.51 as offered at stage 2 of the complaints process.
  6. The resident sent further emails chasing a resolution on 29 June 2020 and 6 July 2020 and, following contact from this Service on 21 August 2020, the issue was finally resolved on 28 August 2020.
  7. Owing to the delay in identifying the double rent payment and the failings in dealing with the reimbursement, the landlord awarded the resident an additional £150 compensation. The landlord has confirmed to this Service that no insurance claim was made in relation to the leak and has stated that this was explained to the resident via email around the time of the decant. The landlord has also confirmed that it provided accurate advice to the resident that no rent reduction is due to ‘market rent’ tenants. It has suggested that the resident may have

Assessment and findings

  1. Following the leak that resulted in the resident’s decant from the property in July 2018, the landlord agreed that rent would not be payable for the period during which the property was uninhabitable. Accordingly, a credit was applied to the resident’s rent account. When the resident raised a query about the amount credited, the landlord responded promptly to confirm that it would investigate, it reasonably sought clarification from the resident, and concluded that an additional credit was owed. The resident had suggested that this should be in the sum of £188.21. It would have been helpful if the landlord had provided its calculations and detailed the amount owed when it confirmed to the resident that a further credit would be applied to her account. Its failure to do so resulted in confusion as to what the £273.68 credited on 27 September 2019 related to.
  2. It would again have been helpful if the landlord had included details of its calculations in its stage 1 response. Its failure to confirm why £273.68 had been credited instead of the £188.21 requested by the resident led the resident to believe that the amount had instead been applied in respect of the rent overcharge for September 2019, adding to her frustration. The landlord’s communication could have been better, and it therefore missed an opportunity to resolve the complaint at an earlier stage.
  3. At stage 2 the landlord conducted a review of the resident’s rent account, to ensure that it had provided an accurate response at stage 1 and to address the outstanding issues. It confirmed that, as the resident had indicated, she was due £310.51 in credit for an overcharge in September 2019. At this point, the landlord provided a clear description of the amounts owed and identified and apologised for errors made previously.
  4. The landlord has been clear that a decrease in rent in April 2019 was incorrectly applied and the rent account was subsequently adjusted to reflect the amount payable under the resident’s tenancy agreement. In acknowledgment of the error, the landlord confirmed it would not seek to recover the shortfall of £113.15. The landlord therefore accepted responsibility for the error and made an offer of redress to the resident in recognition of its service failure. The Ombudsman will not make a finding of maladministration where a landlord has identified failings during the complaints process and taken reasonable steps to put things right for the resident.
  5. The landlord has also clearly set out its position as to why it believes the resident is not entitled to a 1% rent reduction. It has explained its position regarding the legislation and provided a link to further information that may be helpful to the resident. The landlord’s Residential Rent Policy reflects the advice provided by the landlord, as paragraph 4.1 indicates that the rent reduction will only apply to social and affordable rent tenancies. Should the resident continue to dispute this, she may wish to take independent legal advice. The Ombudsman is satisfied that the landlord has taken reasonable steps to investigate and respond to this aspect of the complaint.
  6. The resident accepted the landlord’s offer of compensation and its decision to credit her rent account with an additional £310.51. The Ombudsman agrees that there were unreasonable delays in applying this to the resident’s rent account, however, the landlord has explained that this was due to a backlog of work, which meant its finance team experienced delays in arranging payments and applying amendments. The landlord has also noted that the coronavirus pandemic has impacted its services due to the strain on its resources. The landlord has offered the resident an additional £150 compensation in recognition of the delays in processing the compensation payment and credit which, in the Ombudsman’s opinion, amounts to reasonable redress for its service failure.
  7. The landlord has confirmed to this Service, and to the resident during the complaints process, that it did not make an insurance claim following the leak. The landlord also explained why the resident may have previously been led to believe that it had done so, due to automated messages sent to her at the time. The landlord has conducted a reasonable and appropriate investigation into this aspect of the complaint and clearly set out its response. There was therefore no maladministration by the landlord in its handling of the resident’s request for insurance documents.
  8. The landlord has informed this Service that as a result of the complaint it has reviewed the information it provides to residents at the time of a decant and considered developing a fact sheet to provide clearer information. This suggestion has been referred to the landlord’s policy team to take forward.
  9. The landlord has identified areas for improvement in its record keeping, noting that some correspondence has not been saved on the resident’s file and that there is a period of time between July 2018 and April 2020 where little information is recorded. The landlord is considering ways to improve its processes, including additional complaints training and encouraging increased use of its systems to send and log communications, rather than the use of direct email addresses.

Determination (decision)

  1. In accordance with paragraph 55(c) of the Housing Ombudsman Scheme, the Ombudsman considers that, following this Service’s intervention, the landlord has made an offer of redress to the resident which satisfactorily resolves the complaint about its administration of her rent account.
  2. In accordance with paragraph 54 of the Housing Ombudsman Scheme, there was no maladministration by the landlord in its handling of the resident’s request for copies of insurance documents.

Reasons

  1. On receipt of the resident’s formal complaint the landlord took appropriate steps to review her rent account to determine whether compensation payments and rent reductions had been correctly applied. Although the landlord’s complaint response could have been clearer at stage 1, the stage 2 response provided a detailed explanation of the amounts owed and acknowledged where the landlord’s service had fallen short of the required standard. In total the landlord has offered the resident £200 in respect of the errors made in the application of credit to her rent account and the delays in processing her compensation payment. It has also confirmed that it will not seek to recover the £113.15, which accrued due to it incorrectly reducing her rent in April 2019. In the Ombudsman’s opinion, this offer is reasonable and proportionate to the service failure identified and the offer of redress satisfactorily resolves this aspect of the complaint.
  2. Following its investigations, the landlord confirmed that it did not make an insurance claim following the leak and so is unable to provide the requested documents. This has been clearly explained to the resident and so the Ombudsman considers that there was no maladministration in respect of this aspect of the complaint.