Notting Hill Genesis (202007768)

REPORT

COMPLAINT 202007768

Notting Hill Genesis

17 August 2021

Our approach

What we can and cannot consider is called the Ombudsman’s jurisdiction and is governed by the Housing Ombudsman Scheme. The Ombudsman must determine whether a complaint comes within their jurisdiction. The Ombudsman seeks to resolve disputes wherever possible but cannot investigate complaints that fall outside of this.

In deciding whether a complaint falls within their jurisdiction, the Ombudsman will carefully consider all the evidence provided by the parties and the circumstances of the case.

The complaint

The residents complain about:
1. How the landlord managed the replacement of the communal boiler in the building, including:
  1. How it responded to residents’ suggestions and comments in relation to the specification of works and how this has impacted the current proposed works and level of service charges.
  2. The landlord’s management of the reserve fund, specifically the amount charged by the landlord over several years towards this.
  3. How the landlord handled a leak into the boiler room and other potential hazards in the boiler room including the proximity of electricity and meters to water pipes, live wires and a corroded cable, and the impact of this on the proposed works and level of service charges.

Determination (jurisdictional decision)

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.
After carefully considering all the evidence, I have determined that the complaint, as set out above, is not within the Ombudsman’s jurisdiction.

Summary of events

The residents are a group of leaseholders who own flats within a Grade II listed building (the building) to which the landlord is the freeholder. There are two communal boilers which provide the hot water and heating to the building within a communal basement room.
In around 2010, the landlord considered that the communal heating system in the building required replacement. On 6 July 2011, the landlord issued a Notice of Intention under section 20 of the Landlord and Tenant Act 1985 in relation to boiler replacement works. However, some of the residents to the building commissioned their own expert report which advised that the boilers were still serviceable. Following this, it was agreed between the landlord and the residents that the boilers would not be replaced at this time.
On 24 July 2017, the landlord issued a further Notice of Intention in relation to the replacement of the gas central heating boiler which invited leaseholder observations by 24 August 2017. On 11 May 2018, the landlord served a revised Notice of Intention. On 11 May 2018, the landlord issued a further Notice of Intention including for removing asbestos in the boiler room, levelling the boiler room floor and replacing the gas central heating boiler.
In response to the consultation documents, the residents raised various observations and questions in relation to the proposed works.
In June 2019, the landlord advised the residents that the walls within the plantroom were contaminated with asbestos and this contamination was preventing work being carried out to replace the boilers. It suggested re-locating the electrical meters. The residents raised queries about the proposed works. They asked why the boilers needed to be moved and requested certain works be included in the specification.
On 11 August 2019, the residents complained to the landlord about the handling of the boiler replacement works. They complained that the landlord had ignored their observations and failed to answer their questions and that there had been a lack of long-term planning and responsible management. They also complained that the landlord had not made adequate provision for the boiler replacement in terms of the reserve fund. They complained that the landlord’s poor management of works costs had led to higher costs to the leaseholders.
They also complained that several residents had previously reported to the landlord that the stairs at the front of the building were allowing water to leak into the boiler room. They complained that it took the landlord several months to take action and then it had only completed a patch repair. They had since been informed that the steel beams were corroding because of the water ingress and that the beams had not been sealed correctly. The residents complained that they had also recently been shown:
1. Exposed live wires.
2. Electricity cables and meters in close proximity to water pipes which was a fire hazard.
3. The hot water boiler installed in 2013 did not meet current regulations.
4. The main electrical cable was corroded from water damage.
The residents queried why these issues had not been identified previously, complained that these issues should have been known to the landlord previously and said that the landlord’s negligence had now led to increased expenditure. The residents said that the items that required replacement or repair as a result of the landlord’s mismanagement should be paid for by the landlord.
The landlord responded to the complaint stating it had responded to their observations and considered their concerns historically. It acknowledged a mistake in reducing the reserve fund contribution in the year 2017/18 and offered a reduction in the management fee for that year. The landlord said that the water ingress had been addressed and the boilers were being replaced due to their age not due to the water ingress. It agreed to follow up in relation to the position of the electricity meters and cables, and said it was seeking information about a visit from UKPN in relation to the electricity cable. In conclusion, the landlord disagreed that any work had become necessary as a result of its mismanagement so disagreed it should pay for any of the works.
The residents escalated the complaint repeating their assertion that the landlord’s handling of the repairs had led to increased costs and that the landlord should pay for the additional works to the boiler room that had been recently identified. They requested an increased refund to take into account the reduction in service charge for the year 2017/18. The residents challenged the appropriateness of the repair to the front steps and said the landlord had failed to complete the repair correctly in the past. The residents said that works including the damage caused to the boiler room structure and corrosion to the main electricity supply were a result of the landlord’s poor handling of the leak and they did not agree to paying these costs. They also disagreed that the boilers needed moving and that the floors needed levelling including the costs of this.
The residents asked whether there was a hazard in relation to the live wires and corrosion of the electrical cable. The residents concluded that they were not arguing about the necessity of replacing the boilers but that the replacement had become more complicated and costly due to the landlord’s negligence.
The landlord provided a final response to the complaint on 5 November 2019. The landlord upheld the earlier complaint response. The landlord agreed to vary the specification of work to reflect the opinion of the residents’ consultant and agreed to pay the costs of their expert report. The landlord did not agree that previous works had led to additional costs. The landlord confirmed that it was recommended that the electricity meters and cables be moved as they represented a “serious fire hazard”. Further that UKPN would provide a quote for remedial works in relation to any risks in connection with the electricity cable.
The landlord concluded that it would apply for a determination from the First Tier Tribunal (Property Chamber) in relation to the liability to pay and reasonableness of the service charges once a final account was prepared.
Following further discussions with the residents, the landlord agreed to revise the specification of works and restarted the section 20 consultation process in February 2020. The landlord responded to observations on 22 July 2020. Discussions between the residents and the landlord are ongoing and the works have yet to be scheduled. In recent correspondence, the residents have disputed the details of the landlord’s proposals in relation to asbestos removal and electrical works relating to the boiler replacement.
The Ombudsman understands that despite the consultation process being initiated multiple times over recent years, the works to replace the boiler and associated works have not proceeded to date as the parties have not been able to agree either the scope or costs of the works. The parties were still disputing these issues in recent months.

Reasons

Under paragraph 39 (i) of the Scheme, the Ombudsman will not investigate complaints which, in the Ombudsman’s 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.
While there are several aspects to the complaint, the main focus of the complaint is that the landlord’s management of the boiler replacement process and other works has increased the costs which the leaseholders will ultimately be liable for. The complaint about the reserve fund is directly about the level of service charges levied by the landlord. The reason the works have stalled is that the residents do not agree with the specification and associated costs of the works the landlord is proposing. While the Ombudsman can consider whether a landlord’s response to a complaint was fair and reasonable, the First Tier Tribunal (Property Chamber) has the expertise and process to consider the service charge accounts and form an opinion as to the reasonableness of the costs of the works. The Ombudsman is of the view that determining this complaint requires a determination as to the reasonableness of the proposed charges and works, which is a matter which would be more appropriately determined by the First Tier Tribunal (Property Chamber). Such a decision is not within the remit of this service.
The Ombudsman is therefore of the opinion that this complaint would be more effectively dealt with by the tribunal and is therefore outside of the scope of the Ombudsman’s jurisdiction.
The residents have also asked the Ombudsman for various remedies including to ensure that their consultant is brought on board to manage the project and for an independent asbestos expert to be appointed. It is noted that remedies such as appointing a new project manager and a new asbestos expert are not outcomes this service can provide.