Paragon Asra Housing Limited (202406572)

Background

1. After receiving her revised service charges for the 2023/2024 financial year, the resident asked the landlord to explain several costs. As she did not receive a response to her queries, she raised a formal complaint. She then asked us to investigate because she remained dissatisfied with the landlord’s responses.

What the complaint is about

2. The complaint is about the landlord’s:
   1. Handling of the resident’s service charge queries, including explanations and justifications for the costs.
   2. Complaint handling.

Our decision (determination)

3. We have found:
   1. The landlord is responsible for maladministration in its handling of the resident’s service charge queries.
   2. The landlord is responsible for maladministration for its complaint handling.

We have made orders for the landlord to put things right.

Reasons

4. The circumstances of this complaint are well known by the parties involved, so it is not necessary to detail everything that’s happened or comment on all the information we’ve reviewed. We’ve only included the key information that forms the basis of our decision of whether the landlord is responsible for maladministration.

What we have not investigated

5. The Ombudsman does not investigate complaints about the level of service charges. The resident said throughout her complaint that some elements of her charges were unreasonable and unjustified. Any concerns about the level of the service charge would be better considered by the tribunal or court, given their powers and expertise. This investigation has therefore focused on how the landlord responded to the resident’s request for information and explanations about her charges.

The landlord’s handling of the resident’s service charge queries

6. The resident asked the landlord to explain and justify the costs included in her service charge. This included requests for further information about the administration fee, emergency lighting and communal window cleaning. She sent these queries on 7 March 2024, but the landlord did not acknowledge them, and she escalated the matter to a formal complaint on 21 March 2024. It would have been reasonable for the landlord to have acknowledged her initial queries.
7. We recognise that it may have been dealing with a high volume of queries and been unable to respond immediately. However, the landlord could have managed the resident’s expectation by offering an acknowledgement letter and a timescale for a full response. This may have prevented her escalating the matter to a formal complaint.
8. In May 2024, the landlord began investigating the resident’s complaint internally. This was positive, but we have not seen evidence that it investigated her queries before this point, which was 2 months after her initial query. It would have been more reasonable to begin investigating sooner after it received her queries.
9. The landlord recorded that communal window cleaning was a new service rolled out across all sites and that leaseholders and shared owners had been informed. As the resident is a secure tenant, she was unlikely to have received any communication. Her tenancy agreement states that, after consulting affected tenants, the landlord may vary services and give 28 days’ written notice. We have not seen evidence that the landlord carried out this consultation or issued the required notice before adding the service. This indicates that the landlord did not follow the tenancy agreement when introducing this new service, which was unreasonable.
10. The landlord also noted that playground equipment costs were based on its contractor’s quotes and covered maintenance, monthly inspections and an annual inspection. It also recorded that it had changed its administration charge to a fixed annual fee in 2021/2022 following consultation, using the 2021/2022 figures and phasing this in over 3 years. The charge for 2024/2025 was recalculated using current costs. This approach aimed to give certainty and improve transparency.
11. For the emergency lighting costs, the landlord noted that a contractor carried out checks in August and September 2023. It said the emergency lighting repair budget covered any repairs identified during inspections. It reviewed the pest control budget and found some property-specific costs had been incorrectly charged to the estate. It reduced the budget from £7930.02 to £350. Although the investigation was positive, the large discrepancy indicates the landlord should have verified the figures before issuing the budget statement.
12. The landlord’s investigations found that both the pest control and communal gas charges required correction and that the resident’s account would need to be adjusted. It was reasonable for the landlord to review and amend the budgets, but it could have addressed the resident’s queries sooner, given the length of time she had been waiting for a response.
13. The only update the landlord provided to the resident was on 13 May 2024, which was the same day as the stage 1 response. In its stage 1 response, the landlord acted reasonably by explaining its findings from its investigation into the resident’s queries. It confirmed that her account would be adjusted and that a revised letter and statement would be issued. This showed that, although the landlord eventually provided clear information, its communication before the stage 1 response was limited.
14. In its internal records on 19 June 2024, the landlord noted significant shortcomings in its communications and responsiveness. It accepted that delays in providing information and addressing the resident’s concerns had contributed to the escalation of issues that could have been resolved earlier. It was reasonable that it had acknowledged this internally, but it would have been more positive if it had communicated this accountability directly to the resident.
15. On 19 August 2024, the landlord confirmed that it had completed its review of the resident’s charges. It removed the communal gas charge, reduced the pest control charge to £350.40 and playground costs to £2703.06. It told the resident that her service charge would reduce by £0.92 per week, backdated to 6 May 2024. It was reasonable that the landlord eventually corrected the charges.
16. On 20 August 2024, the landlord explained that it had also removed the emergency lighting charge, which reduced the resident’s weekly charge by a further £0.36. It confirmed that the playground maintenance charge would remain unchanged, as this cost was correct. We note there had been disagreement about the number of play areas, which the landlord reviewed. It was reasonable that the landlord responded to the feedback it received and continued to look into the resident’s concerns after the complaints process had ended. We are unable to determine how many play areas there are but have recommended that the landlord map this out so that it is clear for the resident.
17. The landlord continued to review the resident’s service charges, including inspecting the play areas in September 2024. It found the areas were in a state of considerable neglect. It said its contractor undertakes regular safety checks, but the landlord rarely acts on the contractor’s recommendations. As the cost of these inspections is recharged to residents, the landlord noted that this raised questions about fairness when recommendations are not followed. It also noted that residents do not use the play areas and it may need to consider writing off this investment if the area continues to be unused. It was positive that the landlord was considering the fairness of this as it is important that residents are receiving value for their money.
18. Overall, while the landlord acted reasonably in reviewing the resident’s queries and providing open and reasonable explanations for her charges, it could have acted to address the resident’s queries sooner. We have found maladministration in the landlord’s handling of the resident’s service charge queries. The landlord has not offered any compensation for this complaint point, and we consider compensation appropriate due to the delays in its responses. We order the landlord to pay the resident £150, which is in line with our remedies guidance where a landlord has failed in its service and not reasonably addressed the issue.
19. We have not seen any evidence that the landlord consulted the resident before introducing the communal window cleaning charge, as required by her tenancy agreement. It should therefore follow the correct consultation process and consider whether compensation is due, given that it did not properly introduce the cost and bring it to the resident’s attention. It should also give the resident the opportunity to comment on introduction of this service. The landlord should discuss any outstanding concerns and future plans for the playground areas with the resident. It should also ensure it has revised and backdated the resident’s service charges.

Complaint handling

20. The resident raised her complaint on 21 March 2024, and the landlord acknowledged it on 28 March 2024, which was within the timescale set out in the Service’s Complaint Handling Code (“the Code”). The landlord issued its stage 1 complaint response on 13 May 2024, causing an unreasonable delay of 20 working days.
21. The resident escalated her complaint to stage 2 on 17 June 2024, and the landlord acknowledged this request on 19 June 2024, in line with the required timescale. The landlord requested an extension of 7 working days on 26 July 2024, and the resident chased the landlord on 7 and 12 August 2024. It subsequently provided its stage 2 complaint response on 20 August 2024, which was 26 working days over the required timescale.
22. The landlord therefore caused significant delays during its complaints process, which would have likely caused distress and inconvenience for the resident, particularly as she was chasing the landlord during this time. We note that the landlord offered £70 compensation for the resident, however, do not consider this to go far enough to put things right for its maladministration. We therefore order it to pay the resident an additional £50 compensation.

Putting things right

Where we find service failure, maladministration or severe maladministration we can make orders for the landlord to put things right. We have the discretion to make recommendations in all other cases within our jurisdiction.

Orders

Landlords must comply with our orders in the manner and timescales we specify. The landlord must provide documentary evidence of compliance with our orders by the due date set.

Recommendations

Our recommendations are not binding, and a landlord may decide not to follow them.