Peabody Trust (202307369)

Back to Top

REPORT

Peabody Trust

4 October 2024

Amended 29 January 2025


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

  1. The complaint is about the landlord’s:
    1. Administration of the resident’s service charge account.
    2. Handling of the resident’s reports of a repair to the communal lift.
  2. The Ombudsman has also considered the landlord’s complaint handling.

Background

  1. The resident is a leaseholder of a flat in a block, and the landlord is the freeholder. The resident purchased the lease to her property in July 2013. The landlord does not have any recorded vulnerabilities for the resident.
  2. The resident contacted the landlord on 25 September 2022 to ask for an update on the actual service charges for the financial year 2021-22. The landlord wrote to the resident on 28 September 2022 to inform her that there was a delay in providing the actual service charges on her account. It explained that it was letting her know under its obligations under Section 20(b) of the Landlord and Tenant Act 1985, and it apologised for the delay.
  3. The resident contacted the landlord on 28 December 2022 and said that she was unhappy with the delay in providing the actual service charges. She said she had tried to raise a complaint about the matter, and she wanted “reassurance that the significant errors” of previous years would not be repeated.
  4. The landlord attended to a repair of the communal lift on 11 April 2023. The notes from the repair visit reported the “door trim” had come away from the wall, it was re fitted and the lift was left in working order.
  5. Following further correspondence from the resident about the issue on 8 April 2023, the landlord emailed the resident on 24 April 2023 to confirm it had opened a stage 1 complaint investigation. The landlord sent its stage 1 complaint response to the resident on 28 April 2023. It upheld the resident’s complaint and apologised for the delay in providing the actual service charges. It explained the issue had occurred due to “staff shortages” and it hoped to send the information within 4 weeks. It offered £25 in compensation for its handling of service charge account, and £25 for its complaint handling.
  6. The resident was unhappy with the landlord’s stage 1 complaint response and asked her complaint to be taken to stage 2 on 1 May 2023. She said there was “systematic failings” on the part of the landlord.
  7. The landlord sent the resident the ‘actual annual service charges’ for the financial year 2021-22 on 25 May 2023, with its stage 2 complaint response. It upheld the resident’s complaint and apologised for providing “misleading and incorrect” information about the service charge account during the complaints process. It addressed a communal lift repair and said it had been unable to identify any “oversight” by its contractor. It offered the resident £50 in compensation for its handling of the service charge issue, and £100 for its complaint handling.
  8. The resident contacted this Service on 9 September 2023 and asked us to investigate her complaint. She said that she was unhappy with the landlord’s administration of the service charge account, and the time it took to investigate her complaint.

Assessment and findings

The landlord’s administration of the resident’s service charge account

  1. The resident’s lease agreement states she is liable to pay a charge for services provided by the landlord. The lease agreement states that the landlord will provide estimated cost to pay in advance and will provide an “adjustment to actual expenditure” as soon as “practicable” at the end of each financial year.
  2. Section 20b of the Landlord and Tenant Act 1985 states that a landlord cannot recover service charge costs that were incurred more than 18 months before it formally demands them. The exception to this rule is if it writes to the leaseholder within 18 months of incurring the costs informing them that they have incurred costs, the amount of them, and that they will be demanded in due course.
  3. The landlord’s website regarding Service charges gives information to homeowners regarding service charges and which includes a number of frequently asked questions, including ‘How are service charges calculated?’. Under this section the landlord provides the reader with a response, which includes ‘We’ll send you a written statement showing the service charge income and expenditure no later than 30 September each year.’
  4. The landlord’s service charge policy states that the landlord will provide residents with a statement of actual service charge expenditure within six months of the year end, or if the agreement states, earlier where possible, or issue a Section 20(b) Notice where it is not able to provide statements of actual service charge expenditure within six months of the year end.
  5. Therefore, based on the landlord’s website and service charge policy, the landlord is expected to provide residents with a written statement by 30 September each year. If it is unable to meet this deadline, then it should issue a section 20(b) notice to each resident affected.
  6. This investigation has focused on the landlord’s administration of the resident’s service charges. It is not within our remit to determine whether service charge was payable, or the reasonableness of the charges. Complaints that relate to the level, reasonableness, or liability to pay rent or service charges are within the jurisdiction of the First-Tier Tribunal (Property Chamber) and the resident would be advised to seek free and independent advice from the Leasehold Advisory Service (LEASE) ( https://www.lease-advice.org) in relation to how to proceed with a case, should she wish to do so.
  7. The evidence shows that there was a delay in the landlord providing the resident with the actual service charges for 2021-22. In line with its obligations under the Landlord and Tenant Act 1985. The landlord explained, in its letter outlining its obligations under section 20b of the Act, that there was a delay but it would be issuing further charges.
  8. As part of the section 20(b) notice, the landlord also included some frequently asked questions, which included information as to why there was a delay in providing the final accounts. In addition to this, it also explained that as soon as it had finalised the accounts, it would write to residents with the accounts but was unable to provide further details at the time. This was reasonable and in line with its obligations.
  9. The evidence shows the resident was inconvenienced by the need to chase it for information on the service charge accounts. That the landlord apologised for the delay was appropriate. That it did not set out when it hoped to provide the information was unreasonable and inconvenienced the resident. She was left not knowing when it would provide the actual charges.
  10. The landlord’s stage 1 complaint response, of April 2023, appropriately apologised for its handling of the matter, and offered redress. It explained what had caused the delay (a new process to “ensure accuracy and transparency”). The response did not show appropriate learning about what it would do to prevent similar failings happening again. It is noted it cited “staff shortages” as a reason for the delay. A more thorough response to this concern would have been appropriate, and helped build trust.
  11. The landlord sent the actual service charge information within the 4 week timeframe it set out in its stage 1 response. This was reasonable in the circumstances, and that it offered a further apology for the delay was appropriate.
  12. The landlord’s stage 2 complaint response, of May 2023, offered a more detailed explanation of its handling of the issue. It explained its position on challenging service charges and acknowledged the resident’s frustration at its handling of the issue. This was appropriate and went some way to putting right the lack of learning shown in its stage 1 response.
  13. In line with Section 20 of the Landlord and Tenant Act 1985, the landlord is obliged to issue a section 20(b) notice which informs residents of costs that have been incurred during the service charge period, and that they will need to contribute to them through the service charge. This notice ensures residents are notified of the intent to recover costs, even if the final amount has not been calculated yet. Once this notice is issued, the landlord is not obligated to provide the accounts by a set date.
  14. It would be best practice for landlords to give residents a new estimated date, but it is acknowledged that there are multiple factors which can impact a landlord’s ability to produce the final accounts within a specific timescale. Therefore, it would not be reasonable for a landlord to provide residents with a specific date. Furthermore, it is also not obligated to do this. However, a recommendation has been made regarding this.

Repair to the communal lift

  1. The resident’s lease agreement states that the landlord is responsible for the repairs to the “common parts” of the building. The landlord’s repairs policy states for “routine repairs” residents will be offered the next available appointment for their repair at the point of booking.
  2. The evidence provided for this investigation shows the landlord attended to repairs to the communal lift in October 2022, February 2023, April 2023, and November 2023. The landlord has only provided information about the repairs from April 2023, and November 2023. This is a failing in its record keeping, and as such it has not been possible to assess its handling of the repairs from October 2022, and February 2023. The evidence supports the resident’s conclusion that the repair was reported on multiple occasions.
  3. The lift repair of November 2023 occurred after the landlord issued its final complaint response. As the landlord has not had the opportunity to respond to any concerns about the later repair as part of a formal complaint, it is not within the scope of this investigation to consider.
  4. The evidence indicates that the resident raised her concern about its handling of the lift repair as part of her stage 2 complaint, of May 2023. The resident expressed a concern that she had to keep raising the repair, as its contractor was not properly fixing it. The landlord’s stage 2 complaint response, of May 2023, was dismissive of the resident’s concerns.
  5. The landlord set out that it had not inspected the repair itself and relied on photos, due to the volume of repairs it oversees as a large landlord. While this approach itself is not unreasonable, it appeared to accept the resident had to raise the repair on multiple occasions. Its complaint response provided multiple reference numbers the resident had been given when raising the repair, and appeared to accept the “frustration” caused. Considering it accepted the resident had raise the repair multiple times, that it failed to acknowledge the inconvenience this cause was inappropriate.
  6. The landlord’s records around the repairs were poor. The landlord’s complaint response in relation to the matter lacked detail, and was dismissive of the detriment the resident had experienced. The lack of detail is evidence of a lack of learning. As such we have determined there was service failure in its handling of the matter.

Complaint Handling

  1. The landlord operates a 2 stage complaint procedure. Its procedure states that it will acknowledge a stage 1 complaint within 5 working days and send a response within 10 working days. It states it will send stage 2 responses within 20 working days.
  2. The evidence indicates that the resident first expressed dissatisfaction with the landlord’s handling of the substantive issue in this complaint on 28 December 2022. That the landlord did not open a complaint at that time was unreasonable, and a failing in its complaint handling. The Ombudsman’s Complaint Handling Code (the Code) states that a complaint is an expression of dissatisfaction, however made, and does not need to include the word complaint. That it did not open a complaint investigation at that time is evidence the landlord operated an unfair and hard to access complaints process. This inconvenienced the resident, and she was cost further time and trouble of needing to raise the complaint again in April 2023.
  3. The landlord’s stage 1 response was sent 4 months after the resident first expressed dissatisfaction, which was an unreasonable delay in responding to the complaint. The stage 1 complaint response appropriately offered redress for its complaint handling, but its response lacked learning about what is was offering redress for. This was inappropriate, and a further shortcoming in its complaint handling.
  4. The landlord’s stage 2 complaint response was sent within the timeframes set out in the Code, and its procedure. We welcome the fact that it made an increased offer of compensation in recognition of its complaint handling failings. The landlord offered a more detailed level of learning about the failings it had identified in its complaint handling, which went some way to putting right its earlier failing. Considering the level of redress offered, and the learning shown at stage 2, we have determined the landlord’s offer of compensation was reasonable in the circumstances.

Determination

  1. In accordance with paragraph 52 of the Housing Ombudsman Scheme there was no maladministration in the landlord’s administration of the resident’s service charge account.
  2. In accordance with paragraph 52 of the Housing Ombudsman Scheme there was service failure in the landlord’s handling of the resident’s reports of a repair to the communal lift.
  3. In accordance with 53(b) of the Housing Ombudsman Scheme the landlord made an offer of redress, which in the Ombudsman’s opinion, resolved its handling of the resident’s complaint.

Orders

  1. Within 4 weeks the landlord is ordered to:
    1. Apologise for the failings identified in this report.
    2. Pay the resident £75 in compensation in recognition of the inconvenience caused by its handling of the repair to the communal lift.

Recommendations

  1. It is recommended that the landlord pays the resident the £100 it offered for its complaint handling if it has not already done so, as well as the £50 it offered for its administration of the service charge account can be deducted from this total if already paid.
  2. It is also recommended that when a Section 20(b) notice is issued, the landlord should consider whether it is appropriate to provide additional communications periodically until it is able to provide the final statements. For example, every 3 months.