Peabody Trust (202303413)

Background

1. Under the lease agreement, the resident pays variable service charges. In March 2023 she asked the landlord to provide information regarding the way the buildings insurance aspect of the charge was calculated. She remained dissatisfied with the increase in the cost of the insurance and disputed the calculation of the service charges and that works had been carried out.

What the complaint is about

2. The complaint is about the landlord’s response to the resident’s:
   1. Reports that the landlord had incorrectly calculated service charges and insurance costs for 2022/2023, as well as incorrect comparisons of previous years’ service charges and insurance receipts.
   2. Reports that the landlord had not carried out services covered under the service charges, including ground maintenance and gardening work.
   3. Complaint.

Our decision (determination)

3. There was service failure by the landlord in its response to the resident’s reports that the landlord had incorrectly calculated service charges and insurance costs, as well as incorrect comparisons of previous years’ service charges and insurance receipts.
4. There was an offer of reasonable redress by the landlord for its response to the resident’s:
   1. Reports that the landlord had not carried out services covered under the service charges, including ground maintenance and gardening work.
   2. Complaint.

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

Summary of reasons

5. The landlord reviewed the resident’s concerns about its calculation of the service charges and it acted reasonably in providing her with breakdown of the charges. However it failed to acknowledge its delay in providing the service charge accounts in line with its policy timescales.
6. The landlord recognised it was unable to provide evidence that it had carried out some of the services covered by the resident’s service charges. It agreed to refund these charges for a 12-month period. We consider this to be reasonable action to resolve this matter.
7. The landlord acknowledged that it had failed to follow its complaints policy and offered reasonable redress for its significant failures.

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.

Our investigation

The complaint procedure

What we found and why

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 considered

8. Within the resident’s complaint, she raised concerns about the increased service charges and the reasonableness of the cost of her buildings insurance. In its stage 1 response, the landlord confirmed it had provided the resident with a detailed response from its insurance team on 29 June 2023. It did not provide us with a copy of this, however it is not clear that this is in dispute and therefore it is reasonable to conclude that the resident’s outstanding complaint is about the level of the price of the insurance. We do not generally investigate complaints about the level and reasonableness of service charges. This is because the first-tier tribunal is best placed to consider this given their powers and expertise. Therefore, we have not investigated this issue.

What we have considered

9. The lease agreement says that the landlord should keep accounts of the service costs incurred in each service charge year. At the end of each service charge year, it should provide the resident with a statement showing the:
   1. Total costs of that service charge year.
   2. Proportion of the charges that is payable by the resident.
   3. Sums paid in advance by the resident.
   4. Balance due from or to the resident.
10. The landlord’s service charge policy states that, when a resident requests to inspect documentation, it will follow section 22 of the Landlord and Tenant Act 1985. Under this legislation, a resident must make the request within six months of receiving a section 21 summary, and the landlord must provide the information within one month.
11. On 10 March 2023 the resident asked the landlord for a breakdown of general building and grounds maintenance costs. She disputed the landlord’s calculation of the difference charged and believed it had compared the costs with the wrong year. The landlord appropriately passed her queries to the relevant departments and told her she would receive a response from each team within 15 working days.
12. In its stage 2 response on 16 April 2024, the landlord said it would not review charges for 2021–22 because it had issued them in February 2023. However, it did not acknowledge that its summary of service charge accounts had been provided outside the six‑month window set out in its own policy, which was not appropriate.
13. In this response, the landlord said it had replied to the resident’s requests on 25 May, 30 May and 1 June 2023. It accepted that it had not provided a full breakdown of the charges, apologised, and supplied the missing information at stage 2. It also explained the service charges for 1 April 2022 to 31 March 2023 and confirmed the difference between the actual and estimated charges.
14. The information in the landlord’s complaint response was consistent with the annual service charge statement previously provided to the resident. It also gave a further breakdown of the communal service charges and explained how it calculated them in line with the lease. We are satisfied that the landlord responded reasonably by reviewing the resident’s concerns and confirming the accuracy of the figures.
15. Because the landlord did not acknowledge that it had issued the accounts outside the timescales set in its policy, we have made a finding of service failure. We have ordered the landlord to pay the resident £50 compensation for the inconvenience caused. This is in line with our remedies guidance which applies where a minor failure occurred but did not affect the overall outcome for the resident.

16. The landlord’s service charge policy says that it will facilitate its customers’ ability to scrutinise relevant information and received feedback on the services delivered as part of its assessment of value for money of the service charges.
17. On 11 September 2023 the resident told the landlord that she disputed that it had carried out services and repairs that were part of her service charges. She asked the landlord provide proof of the grounds maintenance service as an example. In its initial response, the landlord explained that it carried out periodic checks on service delivery. It said, additionally, it had recently introduced an app allowing the upload of photos after visits. It explained this would help it evidence visits and support in its contract management. In the stage 2 complaint however, it acknowledged that it was unable to provide evidence of the service charges for the 2022/2023 year for the:
    1. Estate communal maintenance.
    2. Estate caretaker.
    3. Grounds maintenance.
18. In recognising that it was unable to demonstrate what works had been carried out, the landlord said it would refund the resident for 12 months of the charges. That was a reasonable step to for the landlord to take as it was unable to evidence it had carried out the work the resident had paid for. It also apologised to the resident for this failing. In its final response the landlord also awarded compensation of £200 to acknowledge the time and effort the resident took in raising the issues. This sum was in line with our remedies guidance and proportionate to reflect the impact on the resident. Therefore, we have made a finding of reasonable redress by the landlord.

19. The landlord’s complaint policy says when a complaint is raised, it will:
    1. Log and acknowledge it within 5 working days of receipt and respond at stage 1 within 10 working days of acknowledgment.
    2. Acknowledge a request for a stage 2 review within 5 working days of the escalation being received and respond within 20 working days of acknowledgement.
    3. Provide an explanation to the resident if more time is required and provide a clear timeframe for when the response will be received.
20. In its final response, the landlord acknowledged that it had failed to respond appropriately to the resident’s complaint within its timescales. It confirmed that:
    1. There were delays in logging and responding to her complaint at stage 1.
    2. It failed to escalate her complaint when it received the request.
    3. It did not respond within the agreed timeframe at stage 2.
21. The landlord apologised for its failings and explained that it would review the service and learn from mistakes. It offered the resident £300 compensation to recognise the inconvenience the resident had experienced. This level of compensation is in line with its policy where it has identified there was a significant failure in following the complaints policy. This is also in line with our remedies guidance for a failure that adversely affected the resident but did not have a permanent impact. Therefore, we have made a finding of reasonable redress by the landlord.

Learning

22. The landlord identified learnings to improve its complaints procedure in its final response.

Knowledge information management (record keeping)

23. The landlord was unable to provide evidence of works that had been carried out. It explained that it had implemented a new app to combat this issue.

Communication

24. The landlord recognised issues in its communication with the resident and apologised.