Notting Hill Genesis (202100607)

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REPORT

COMPLAINT 202100607

Notting Hill Genesis

14 December 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 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:
1. Response to the resident’s request to provide form EWS1 for the building which she owns a property in.
2. Complaint handling.

Background and summary of events

Background

The resident is the shared-owner of the property (the property) which the complaint concerns. The landlord is the freeholder.
The property is a flat situated in a purpose-built building (the building). The building has 5 storeys (ground and above).
Advice Note 14 (AN14) was issued by the Government in December 2018 as part of its Building Safety Programme. In summary the advice was for owners of high-rise leaseholder buildings where the external wall system of the building did not incorporate Aluminium Composite Material (ACM). The advice set out checks which owners could carry out to satisfy themselves, and their leaseholders, that their building was safe. This guidance was consolidated in ‘Building Safety Advice for Building Owners’ (BSA), issued in January 2020. Paragraph 1.4 of this guidance states “for the avoidance of doubt, building owners should follow the steps in this advice as soon as possible to ensure the safety of residents and not await further advice or information to act”. Paragraph 1.5 of the guidance states that “the need to assess and manage the risk of external fire spread applies to buildings of any height”.
In response to the guidance some lenders took the view that, if certification could not be provided to demonstrate compliance with the Government’s guidance on fire safety, they would be unwilling to offer a mortgage on properties within these buildings as they would have a value of £0.
In December 2019 the Royal Institution of Chartered Surveyors (RICS), The Building Societies Association (BSA), and UK Finance agreed a new industry-wide valuation process to help people buy and sell homes and re-mortgage in buildings above 18 metres (six storeys). Form EWS1 was introduced to prove to lenders that external cladding had been assessed by an expert.

Summary of events

On 8 July 2020 the resident wrote to the landlord regarding “lack of [form] EWS1” for the building. The resident set out that her current mortgage rate was due to expire in January 2021 and she was concerned that she would be unable to re-mortgage without form EWS1. The resident requested an update.
On the same day the landlord responded. The landlord provided a copy of its briefing note to residents from March 2020 on the cladding situation, adding that it would provide a further update as soon as it was available. The landlord noted that it understood that the lack of form EWS1 was causing difficulties for leaseholders.
On 19 October 2020 the resident wrote to the landlord to raise a “formal complaint”. The resident set out that she was complaining because she had not received an update from the landlord regarding form EWS1 for the building since July 2020. Within her correspondence the resident reiterated that she was due to re-mortgage the property in January 2021 and was concerned that she would be unable to get a good rate without form EWS1. The resident stated that the landlord was putting leaseholders “in a very difficult position with additional financial risk”. The resident concluded by asking the landlord to provide an update, in addition to confirming “what mitigants and support” it was providing to leaseholders.
On 9 and 27 November 2020 the resident wrote to the landlord to chase for a response to her complaint as she had not heard from it.
On 27 November 2020 the landlord replied to the resident apologising that it had failed to respond to her complaint dated 19 October 2020 or her chaser. The landlord set out that it had “a very similar complaint” from another leaseholder within the building and it thought it had responded. The landlord confirmed that it had logged the resident’s correspondence as a complaint and a formal response would be provided within 10 working days. Within its response the landlord provided the resident with a link to its website with the “most up to date” information on form EWS1.
On the same day the resident confirmed that she would like the landlord to consider its delay in responding to her complaint within its stage one response. The landlord replied confirming that its complaint handling would be investigated.
On 11 December 2020 the landlord provided its stage one response. In summary the landlord said:
1. In respect of its complaint handling:
  1. It acknowledged that it had failed to respond to the resident’s complaint dated 19 October 2020 and chaser dated 9 November 2020. The landlord noted that it had apologised for this service failure on 27 November 2020 following the resident’s second chaser.
  2. It would like to repeat its apology for failing to respond to the complaint on receipt as it represented “a significant service failure”.
  3. It would like to offer the resident £50 as a good will gesture.
2. In respect of form EWS1 for the building:
  1. As set out in its Building Safety briefing dated July 2020 it was aware that some lenders were requesting form EWS1 as evidence of a building’s compliance with the Government’s advice notes as part of a mortgage application process.
  1. Form EWS1 was only issued by “approved fire engineers” following an intrusive survey.
  2. It was prioritising investigation of its buildings using a risk-based matrix considering “height, construction material, type of cladding and existing fire mitigation measures”.
  3. Considering the building’s risk factors, it had been scheduled for an intrusive inspection in financial year 2022/23.
  4. It appreciated that lack of form EWS1 was causing difficulties for leaseholders and shared-owners. The landlord confirmed that where they were unable to sell their properties it would consider granting permission to sub-let.
  5. It believed that it was working “methodically and responsibly” in responding to the Government’s guidance in respect of the buildings which it owned. The landlord confirmed that “at present, there [was] nothing further that [could] be done to amend this timeframe”.
On 29 December 2020 the resident requested to escalate her complaint. In summary the resident said:
1. In respect of complaint handling:
  1. While she appreciated the landlord’s apology for failing to respond to her complaint on receipt it had failed to address why it had mixed up her complaint with another leaseholder’s.
  2. The landlord had failed provided reassurances on the steps it would take to ensure the same situation would not arise again in the future.
2. In respect of form EWS1 for the building:
  1. The landlord had failed to address her concerns that its failure to provide form EWS1 was leaving leaseholders in a “very difficult position with additional financial risk of not being [able to obtain] the best mortgage rates and the inability to staircase”.
  1. The landlord had “side-stepped” her question requesting details on what mitigants and support it could provide to leaseholders while form EWS1 was outstanding. The resident noted that the landlord had referred to sub-letting, however she had “not asked about this”.
  2. She had been unable to change lender when re-mortgaging the property due to there being no form EWS1 and had therefore been unable to gain the best rate on the market.
On 6 January 2021 the landlord acknowledged the resident’s escalation request confirming that her complaint would be responded to at stage two of its process, within 20 working days.
On 10 February 2021 the landlord provided its stage two, final, response following a conversation with the resident on 18 January 2021. In summary the landlord said:
1. In respect of complaint handling:
  1. Following review of its stage one response it could have done more to acknowledge the impact that the resident experienced as a result of its failure to respond to her complaint on receipt. The landlord added that it could also have included an explanation detailing what measures it had put in place to ensure customer enquiries were not missed.
  2. It had discussed the resident’s complaint with the officer who had failed to respond.
  3. To improve its service delivery it had carried out a restructure and review of its leasehold team which included more staff and a new customer relationship management tool – my account. The landlord explained that my account would allow residents to report issues directly through the system and would allow officers, and their managers, to track their workload.
  4. It would like to increase its offer of compensation to £100.
2. In respect of form EWS1 for the building:
  1. It had a dedicated team who manged all building safety projects, which included fire safety.
  1. It was unable to progress projects relating to fire safety as quickly as it would like.
  2. It was working with its technical consultants and sharing information with other housing associations to ensure that it explored all avenues to expedite intrusive surveys to obtain form EWS1. The landlord confirmed that in doing so it had managed to significantly reduce the timeframe for the building’s intrusive inspection and bring it forward to March 2021. The landlord advised that form EWS1 should be available for the building by end of April 2021.
  3. It was sorry for the impact that the outstanding form EWS1 was having on leaseholders. The landlord confirmed that it would continue to issue regular briefing notes on progress to obtain form EWS1 while it was outstanding.
  4. It understood that the lack of form EWS1 did not impact on the mortgage rates available to the resident from her existing lender, however it acknowledged that she may have been refused by other lenders.
  5. It had adopted a risk-based approach to prioritising the intrusive inspections to obtain form EWS1 for the buildings which it owned. The landlord noted that this was a similar approach adopted by other housing associations. The landlord reiterated that it considered that its approach was “methodical and responsible”.
  6. It had attached a copy of its project plan which illustrated the “whole process” for obtaining form EWS1.
  7. It would issue a bi-monthly newsletter to the building’s occupants to provide regular updates in relation to form EWS1.
The landlord concluded by confirming that the resident may refer her complaint to this Service if she was not happy with its response.
In an update to this Service dated May 2021 the landlord confirmed that following the intrusive inspection in spring 2021 form EWS1 was issued with B2 rating confirming that remedial works were required to address the combustible materials present in the external walls. The landlord confirmed that it was therefore evaluating next steps taking into account new guidance by RICS dated 5 April 2021.

Assessment and findings

The landlord’s response to the resident’s request to provide form EWS1 for the building which she owns a property in

The Ombudsman notes that the resident’s current situation is difficult and that she is in this position through no fault of her own.
The Ombudsman can see that the landlord has taken and is taking steps to comply with the Government’s guidance in respect of the building, as it has completed an intrusive inspection (March 2021) and has committed to acting on the recommendations. This is appropriate, as while the guidance is not a legal requirement, it has been established as best practice in relation to building safety.
While the Ombudsman notes that the intrusive inspection took place approximately 15 months after the Building Safety Advice for Building Owners (BSA) was introduced, the Ombudsman does not consider this to be a failing. This is because, as set out above, the Government’s expectations in relation to cladding and fire safety were only detailed in guidance and therefore there was an element of discretion for the landlord as to how and when it chose to comply with it. In responding to the complaint the landlord also explained why the building had not been prioritised for an inspection, as detailed in paragraphs 13(b) and 16(b). This was appropriate as a landlord should be able to provide adequate reason and explanation to support its decisions and actions. The Ombudsman also recognises that following issuing of the BSA there was a shortage of experts within the industry to complete the inspections.
Following the introduction of the BSA, and while the complaint was live the Ombudsman can see that the landlord provided newsletters to leaseholders regarding its response to the Government’s guidance on fire safety and cladding, including in March 2020, July 2020 and December 2020. The newsletters also detailed information on “selling your home, re-mortgaging or staircasing”, form EWS1, funding, fire safety and prioritisation of buildings. In the Ombudsman’s opinion the landlord’s newsletters were appropriate to demonstrate transparency and in order for leaseholders and shared-owners to be able to make informed decisions in respect of their properties.
While the Ombudsman acknowledges the resident’s position that she was unable to obtain the best mortgage rate in January 2021 as the landlord had not obtained form EWS1 for the building during 2020, the Ombudsman also notes that a lender’s decision on a leaseholder’s re-mortgage application was beyond the landlord’s own control.
As part of her complaint the resident asked the landlord what steps it was taking to mitigate the financial burden on leaseholders while form EWS1 was outstanding. Within its complaint responses the landlord confirmed that it would consider sub-letting and it was seeking ways to expedite the inspections. While these actions were reasonable, in the Ombudsman’s opinion the landlord should also have reiterated the information provided within its newsletters on support. Specially that it would “offer whatever support [it could]” to those already affected by the Government guidance, therefore indicating that it was able to undertake personalised actions such as providing additional information to lenders to support a leaseholder’s re-mortgage application. However, alone this omission does not amount to a service failure.
The evidence shows that the landlord was able to bring froward the intrusive inspection from financial year 2022/23 to March 2021. The Ombudsman considers this a positive action.

The landlord’s complaint handling

The evidence shows that the landlord failed to respond to the resident’s complaint on receipt and following her chaser on 9 November 2020. The landlord acknowledged this service failure in responding to the resident’s complaint. Where a landlord acknowledges a service failure the Ombudsman will then consider whether it has made an offer of redress to put things right. In this case the landlord apologised and awarded £100 compensation.
The landlord’s apology was appropriate to demonstrate that it acknowledged that it accepted the fault and the impact on the resident.
The landlord’s compensation and good will policy sets out that it may offer compensation where it has identified a service failure. It was therefore appropriate that the landlord engaged the policy. While the policy does not contain a compensation matrix, in the Ombudsman’s opinion the level of compensation is proportionate to the circumstances, taking into account the length of the delay and therefore the distress and inconvenience the resident would have experienced as a result.
While the landlord did not respond to the resident’s escalation request within its 20 working day service standard, in the Ombudsman’s opinion this does not amount to a service failure. This is because the response was not significantly delayed, and it was provided after the landlord had spoken with the resident on 18 January 2021. The Ombudsman does not consider that the resident was adversely impacted by the landlord’s omission.
The purpose of a multi-tiered complaint process is to allow a landlord to review the responses it has given at stage one. It was therefore appropriate that the landlord provided further clarification within its stage two response on its complaint handling and the improvements it was making to ensure that it met its service standards.

Determination (decision)

In accordance with paragraph 54 of the Housing Ombudsman Scheme there was no maladministration by the landlord in respect of its response to the resident’s request to provide form EWS1 for the building which she owns a property in.
In accordance with paragraph 55b of the Housing Ombudsman Scheme, in the Ombudsman’s opinion, the landlord made a reasonable offer of redress to the resident in respect of its complaint handling.

Reasons

The landlord’s response to the resident’s request to provide form EWS1 for the building which she owns a property in

The landlord has taken and is taking steps to comply with the Government’s guidance in respect of the building, as it has completed an intrusive inspection and has committed to acting on the recommendations.
The landlord provided adequate reason and explanation to support its decisions and actions in prioritising the intrusive inspections on the buildings which it owns following the introduction of the BSA.
Following the introduction of the BSA, and while the complaint was live the landlord provided newsletters to leaseholders regarding its response to the Government’s guidance on fire safety and cladding. This was appropriate in order for leaseholders and shared-owners to be able to make informed decisions in respect of their properties.
The landlord demonstrated in its complaint responses and newsletters how it was taking steps to mitigate the financial burden on leaseholders while form EWS1 was outstanding, including approving sub-letting, seeking ways to expedite the intrusive inspections and seeking to providing individualised support where possible.

The landlord’s complaint handling

While the landlord failed to response to the resident’s complaint on receipt and following her chaser on 9 November 2020 it has since acknowledged its failing, apologised and awarded appropriate compensation to put things right.
While the landlord did not respond to the resident’s escalation request within its 20 working day service standard the delay in its stage two response was not so significant as to adversely impact the resident and it was provided following a phone call with the resident on 18 January 2021 to discuss the complaint.
It was appropriate that the landlord provided further clarification within its stage two response on its complaint handling and the improvements it was making to ensure that it met its service standards to address all the concerns which the resident had raised.

Recommendations

The landlord should write to the resident, and other leaseholders and shared-owners, to provide an update on the remedial works following the intrusive inspection in spring 2021.
The landlord should pay the resident the compensation, £100, which it awarded her during the complaint procedure if it has not already done so.
The landlord should act upon the recommendations within four weeks of the date of this determination.