Sovereign Network Group (202342744)

Background

1. The landlord issued estimate service charges for the financial year 2022 to 2023, due to discrepancies it later issued a revised estimate. The revised estimate omitted estimates for reserve fund contributions, refuse and communal maintenance charges. The resident highlighted this. The landlord later reconciled the accounts and included charges for those omitted from the revised estimate. The resident says the error meant she had to pay £393.65.

What the complaint is about

2. The complaint is about:
   1. The landlord’s handling of the resident’s concerns about the revised estimate for the financial year 2022 to 2023.
   2. Complaint handling.

Our decision (determination)

3. We have found there was:
   1. Reasonable redress for the landlord’s handling of concerns about the revised estimate for the financial year 2022 to 2023.
   2. Service failure for complaint handling.

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

Summary of reasons

The landlord’s handling of the resident’s concerns about the revised estimate for the financial year 2022 to 2023

4. The landlord appropriately apologised for its errors with the revised estimate. Its complaint responses explained where things went wrong and why. It offered the resident of the option to pay via a payment plan, and £50 compensation in attempts to put things right. There was reasonable redress for this aspect of the complaint.

Complaint handling

5. The landlord exceeded the timeframe set within its complaints policy, of 20 working days, for its stage 2 response. It did not identify the delay as part of its internal complaints process.

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.

Recommendation

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.

6. The revised estimate for the financial year 2022 to 2023, from August 2022, said the original estimate included an error relating to reserve fund contribution, refuse and communal maintenance. It said the error had been corrected and how charges would be revised prior to April 2023. It included a breakdown of charges for insurance, management fee and rent only. It is unclear why the landlord did not identify that it had not included the reserve fund, refuse and communal charges within its revised estimate. This is especially because its letter explained these had been corrected.
7. Following receipt of the revised estimate, the resident told the landlord that it had missed standard charges. It is not disputed that at that time the resident was incorrectly told the revised estimate was correct. Here the landlord missed a further opportunity to identify its error.
8. On 28 September 2023 the landlord finalised the service charge accounts for the financial year 2022 to 2023 and said an additional amount of £393.65 was due. Within its complaint responses it explained how the introduction of a new system, used for the first time, contributed to the errors and apologised. The stage 1 response explained that around the time of its revised estimate, queries were raised about increased costs. It had incorrectly assumed the missing charges had been removed due to the queries raised and as such told the resident the revised estimate was correct.
9. The landlord appropriately apologised for its errors, acknowledged the impact in paying lower contributions, informed the resident of the option to pay via a payment plan, and offered £50 compensation in attempts to put things right.
10. The lease allows for charges relating to reserve fund contribution, refuse and communal maintenance. It also allows the landlord to charge for deficit amounts once it reconciles accounts. The landlord explained this within its complaint responses and the resident has said she expected to pay for these charges as she had always done.
11. While the landlord’s error and failings are acknowledged, its complaint responses show insight into its failings. It appropriately explained how the errors occurred, apologised and made some attempt to put things right. When considering the points combined, the landlord’s total compensation offer satisfactorily resolves this aspect of the resident’s complaint.

12. The resident raised her complaint on 19 November 2023. The landlord responded on 4 December 2023 in line with the timeframe of 10 working days for a stage 1 response, as set within its complaints policy.
13. The resident escalated her complaint on 2 January 2024 and the landlord responded on 7 February 2024. This timeframe of 26 working days exceeded that set within its complaints policy (20 working days). The landlord’s complaints process says it has 5 working days to acknowledge a complaint, there is no evidence to show it did this or that it kept the resident updated on when it would respond.
14. As part of its stage 2 response, the landlord did not identify its complaint handling delay and made no attempt to put things right despite its compensation policy allowing for payments in such circumstances. This was a missed opportunity and amounts to a service failure.
15. When considering the impact the complaint handling delay may have had on the resident, a compensation amount of £50 has been decided as appropriate in the circumstances. This amount falls within the service failure banding of our remedies guidance and has been decided as appropriate in the circumstances.

Learning

16. The landlord should consider if it has adequate processes in place to ensure service charge information is correct before issuing to residents.

Knowledge information management (record keeping)

17. The landlord did not use the knowledge and information available to it when responding to the resident’s concerns about the revised estimate.

Communication

18. The landlord’s communication could have been better. It missed opportunities to identify errors with its service charge estimate and its complaint handling delay.