Southern Housing (202334769)

Background

1. The resident’s flat is on a development managed by a third-party managing agent. There is also an Estate Management organisation, which has certain responsibilities for the estate. The Estate Management organisation’s costs are passed to the managing agent. The managing agent then passes the Estate Management organisation costs, along with its own, to the landlord, which then passes these on to the resident.

What the complaint is about

2. This complaint is about the landlord’s response to the resident’s:
   1. Request for information about her service charges under Section 22 of the Landlord and Tenant Act 1985.
   2. Queries about her managing agent charge.
3. We have also considered how the landlord handled the complaint.

Our decision (determination)

4. We have found that:
   1. There was maladministration by the landlord in respect of its response to the resident’s request for information about her service charges under Section 22 of the Landlord and Tenant Act 1985.
   2. There was service failure by the landlord in respect of its response to the resident’s queries about her managing agent charge.
5. We have also found there was maladministration by the landlord in how it handled the complaint.

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

Summary of reasons

6. It should not have taken the resident to have to raise a formal complaint, and go through the entire complaints process, for the landlord to recognise the need for it to comply with its legal obligations. For it to have taken some 11 months to provide a response to her request for information about her service charges under Section 22 of the Landlord and Tenant Act 1985 was a failing, which would have understandably caused the resident significant inconvenience and frustration.
7. We recognise the understandable inconvenience and frustration to the resident given the length of time it took for her queries about her managing agents charges to be progressed. However, overall, we are satisfied the landlord demonstrated proactive engagement with the managing agent and repeatedly chased them for the service charge account information requested by the resident. The landlord was also resolution focused in its approach to potentially obtaining information for the resident for 6 years, despite the managing agent’s initial refusal to do so. However, the issues identified with the promised 2-weekly contact by a named property manager have resulted in a finding of service failure.
8. There was an excessive delay in the landlord issuing its stage 2 response which would have understandably caused the resident significant distress and inconvenience.

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.

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.

9. Under Section 22 of the Landlord and Tenant Act 1985 (LTA 1985) variable service charge payers have the right to request to inspect receipts, invoices etc in relation to the last accounting year.
10. On 27 February 2023, the resident complained to the landlord that it had failed to respond to her request under Section 22 of the LTA 1985. The resident said she first requested this in November 2022. We have not seen evidence of the resident’s initial request.
11. However, at the point of the resident’s complaint of 27 February 2023, the landlord was evidently aware that the request had been made and should therefore have responded in accordance with its obligations under Section 22 of the LTA 1985.
12. This would mean it would have been expected to provide the resident with facilities to inspect the accounts, invoices, records, and any other documents supporting the summary within 1 month of the request, and not later than 27 March 2023, which it failed to do.
13. By the time of its final response of 13 December 2023, the landlord had still failed to comply with its obligations with regards to Section 22 of the LTA 1985. In its response, the landlord apologised that the resident had ‘not been provided to date’ with access to the requested information and provided a link to ‘the relevant documents.’
14. While the landlord’s apology and provision of the requested information is welcome, these alone are not sufficient to provide reasonable redress for the understandable inconvenience and frustration to the resident for the 13 months she had been waiting for these to be provided.
15. We are aware that the resident was dissatisfied with the information provided by the landlord saying it did not correlate or make sense. However, the assessment of the information, its accuracy or reasonableness, would be a matter for the First Tier Tribunal (Property Chamber) or court. It is not a matter that we have the expertise to determine. We have already spoken to the resident to explain this, who agreed this would not be included in our investigation.

16. It is not for us to comment or take a position on the response of the managing agent to the requests made by the landlord in response to the queries raised by the resident. Instead, it is for us to consider whether the landlord’s actions in response to the resident’s concerns were fair and reasonable.
17. The landlord’s Service Charge Dispute Resolution policy states if the resident’s building or estate is managed by a third-party agent, it will liaise with the relevant parties to get all the information it needs to investigate the matter. This is consistent with our expectations of landlords in cases where there is a third-party managing agent.
18. On 27 November 2022, the resident emailed the landlord to ask how much she was paying the managing agent as part of her service charges and what this covered.
19. The landlord responded on 6 December 2022 to say that her query had been passed to its service charge team who would confirm how much the charge was and what it covered. The landlord said the service charge team would provide the response by 20 December 2022.
20. We have not seen evidence of the landlord providing the resident with this information at that time. However, in an email to the managing agent on 15 December 2022, the landlord said its service charge team had confirmed with the resident what her monthly managing agent charge was. In the same email the landlord asked the managing agent to provide a breakdown of the services it was providing on the resident’s estate.
21. On 7 February 2023, the landlord emailed the resident to advise it was yet to receive a response from the managing agent about the queries she had raised. The landlord said it would continue to chase them until they provided a response.
22. We have seen evidence of the landlord contacting the managing agent 6 times more between 15 December 2022 and its email to the resident on 7 February 2023. In its correspondence the landlord repeatedly asked for the managing agent to provide a breakdown of the services it was providing on the resident’s estate. The landlord also explained that the resident was seeking a full breakdown of the managing agent charges she had paid since she moved into the property in 2007.
23. On 7 February 2023, the managing agent emailed the landlord a list of what the resident paid over the year for each of their charges. The landlord forwarded these to the resident on 13 February 2023. The same day the resident raised a number of queries with the landlord about these charges. The landlord responded on 20 February 2023 to say that it had raised her queries with the managing agent and would update her as soon as it had a response.
24. By the time of its stage 1 response of 22 March 2023, the landlord had still not received a response to the resident’s concerns from the managing agent. We accept that the responsiveness of managing agents can be variable, and in some cases the ability of the landlord to influence this is limited. Nevertheless, the landlord apologised to the resident and took steps to ensure it kept the resident informed of any updates. This it did by committing to a named property manager contacting the resident every 2 weeks until her queries were resolved.
25. The named property manager did, in general, contact the resident as promised every 2 weeks. However, there were a couple of delays in that contact. The first being immediately after the stage 1 response when the named property manager failed to contact the resident until 21 April 2023, some 4 weeks after the stage 1. The second being between their contact of 9 May 2023 and 30 May 2023, a period of 3 weeks.
26. It is also noted from the property manager’s response on 30 May 2023 that they were evidently unaware of what the current situation was and had to ask the resident if she had received a response from the service charge team. This would have been understandably frustrating for the resident given the landlord had said the named property manager would keep her up to date, not for her to update them.
27. These failings in respect of the contact from the named property manager have resulted in the finding of service failure in this case.
28. Otherwise, we are satisfied that the landlord’s response to the resident’s concerns was both reasonable and in accordance with its Service Charge Dispute Resolution policy and the Ombudsman’s expectations. This is because:
    1. On 14 August 2023, the landlord provided the resident with the breakdown of charges provided by the managing agent, including the previous and current year’s budget and schedules. The landlord also:
       1. Confirmed that the resident contributed to both the managing agents and an Estate Management organisation.
       2. Said it had requested invoices and supporting documents for the resident from the managing agent for the past 6 years.
       3. Noted the managing agent were only obliged to provide the last year so they may not provide all the evidence it had requested.
       4. Explained the managing agent had 1 month from receipt of the request to provide the invoices and supporting documents so it anticipated a response by 13 September 2023.
       5. Explained that the managing agent may require the resident to visit their office to inspect the documents but it asked if they could make them available electronically.
    2. By 21 October 2023, the managing agent had still not provided the documents requested by the landlord, despite the landlord continuing to pursue it for these.
    3. On 4 December 2023, the landlord noted the managing agent had refused to provide these as they wanted a ‘specific enquiry’ from the landlord. In an internal email of 7 December 2023, the landlord’s External Managing Agents contracts manager said they had left a message for the resident to call or text them to let them know when she was free to discuss this.
    4. By the time of its stage 2 response on 13 December 2023, the landlord had met with the managing agent and ‘spoken with them at length’ about the resident’s concerns.
    5. While they were not prepared to provide copy invoices for the last 6 years, the managing agent said, if the landlord was to provide the resident with the last 6 years accounts, it would consider providing copy invoices for specific service charges the resident would like investigated further. The landlord agreed to do this.
    6. The landlord also said it had asked the managing agent if they would provide the full set of invoices for a fee and would let the resident know the outcome.

29. The Housing Ombudsman’s Complaint Handling Code (the Code) sets out when and how a landlord should respond to complaints. The relevant Code in this case is the 2022 Edition (March 2022). Our findings are:
    1. The landlord had a published complaints policy which complied with the terms of the 2022 Code in respect of timescales.
    2. The landlord has since updated its complaints policy in line with our 2024 Code (April 2024).
30. The resident raised her formal complaint with the landlord on 27 February 2023 and sent a follow up email to her complaint on 2 March 2023. The landlord acknowledged the complaint the same day as her follow up email and within 5 working days of her initial complaint. The landlord would then have been expected to provide its stage 1 response by 16 March 2023, within the next 10 working days.
31. It did not do so, instead it emailed the resident to apologise for the delay. The landlord explained that the reason for the delay was ‘further investigation’ and committed to providing its response by the 23 March 2023. This was reasonable given both the landlord’s complaints policy and the Code allow for the landlord to extend the deadline by 10 days if it is not able to provide it’s response, as long as it explains why and confirms when its response would be sent, which it did in this case.
32. The landlord issued its response, as promised, on 22 March 2023. The resident responded to the landlord on 26 March 2023 to say that her complaint had not been resolved. In accordance with the landlord’s complaints policy and the Code, the landlord would have been expected to acknowledge the resident’s escalation request and provided its stage 2 response within 20 working days. It did not do so.
33. Instead, the resident had to chase it on 30 June, 9 July 2023, and 28 July 2023 for its response. The resident also emailed the landlord’s CEO on 6 August 2023 to complain about the landlord’s lack of response to her escalation request. However, the resident was still not provided with a stage 2 response.
34. On 21 October 2023, almost 7 months after her escalation request, the landlord emailed the landlord again to escalate her complaint. The landlord contacted the resident about her escalation request on 24 October 2023 to ask what she remained dissatisfied with. The resident responded to this the same day. However, the landlord did not then provide its final response until 13 December 2023, some 9 months after the resident has asked for this to be escalated.
35. This was an excessive amount of time for the resident to have to wait to get a response to her formal complaint and would have understandably caused her significant distress and inconvenience.
36. It is noted that while the resident was waiting for a response to her formal complaint, the landlord was corresponding with her under its service charge dispute process. Having reviewed the evidence, it is clear that within the landlord itself there was a lack of clarity about whether her concerns should be responded to as a service charge dispute, and therefore under its Service Charge Dispute policy, or as a formal complaint.
37. In order to seek to resolve this lack of clarity the landlord has, in addition to apologising and paying compensation to the resident, been ordered to review its handling of her case to see what learning it can take from it to prevent similar failure happening in the future.