Sovereign Network Homes (202128502)

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REPORT

COMPLAINT 202128502

Network Homes Limited

21 April 2023

 

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 response to requests for compensation following reports of damp and mould.

Background

2.     The resident holds an assured tenancy with the landlord. The property is a one bedroom first floor flat.

3.     In the summer of 2020, the resident reported damp in his property to the landlord. The landlord acknowledged this and advised him that it would speak with its contractor and update him on the next steps.

4.     On 25 February 2021 the landlord identified the cause of the damp. It said that it was coming from a leak from the condense pipe of a neighbouring property. Between July 2021 and September 2021, the landlord tried to gain access to the neighbouring property to assess the leak. During this time the resident reported to the landlord that his wooden flooring was starting to expand and that he was unable to live there due to the damp and mould. 

5.     On 30 October 2021 the resident raised a complaint with the landlord. In his complaint he said that he had reported damp and mould in his property in June/July 2020, and that no progress had been made. He said that the damage to his property was getting worse and that his wooden flooring had expanded due to the damp and was a trip hazard. He asked the landlord to remove the flooring and assess the damage. He also said that he rarely stayed at the property as he was concerned that the mould and damp was detrimental to health.

6.     On 15 November 2021 the landlord responded to the complaint at stage one of its complaints process. It said that the resident reported damp on 24 August 2020. The landlord apologised to the resident for the breakdown in communication between it and its contractor and said that this had led to unnecessary delays. The landlord said that the leak was resolved on 11 November 2021. It provided the resident with information on how to claim for his damaged flooring through its insurance, and awarded him compensation of £1,080.00 for delays in resolving the issue, and the inconvenience caused. It said that the compensation would be applied to his rent account to offset arrears.

7.     On 4 January 2022 the resident asked the landlord to escalate his complaint. He said that his rent arrears should be cleared for the whole 18-month period, and he asked to be compensated for his damaged flooring.

8.     The landlord issued its final response on 7 February 2022. In summary, its response said:

  1. The compensation awarded to the resident at stage one was in line with its policy.
  2. It provided the resident with a schedule of works for repairs to his kitchen and lounge.
  3. It said that there was no timeframe for these works but it would look at further compensation once the repairs were complete.
  4. The landlord reiterated that any compensation paid would be offset against any arrears.
  5. The resident should either claim via his content’s insurance or the landlord’s insurers for his damaged flooring and provided him with details on how to do this.

9.     On the 29 March 2022 the landlord informed the resident that a schedule of repair works had been agreed and revised its award of compensation to £1,574.00 for the delays it had caused, and the distress, time and trouble experienced by the resident. This was offset against his rent arrears.

10. In his initial complaint to the Ombudsman, the resident said that he was unhappy with the amount of compensation offered. He said that the problems with the damp and mould had been going on for two years and that he wanted the landlord to ‘…pay my rent for the period and compensate me for my flooring that was damaged.’ The resident has more recently stated that he would like the landlord to compensate him for the period he was not staying at the property due to damp and mould. The resident has confirmed that the repairs to the property were completed at some point between March and May 2021.

Assessment and findings

Policies and procedures

11. The landlord’s timescales for routine repairs state ‘We aim to attend within two weeks of you reporting the repair, and we aim to complete most repairs within one calendar month’.

12. The landlord’s compensation policy sets out the amount of compensation that should be considered ‘taking into account the impact of the failure on the complainant’ and breaks it down into three categories: low, medium and major impact.

  1. ‘Low Impact. The complainant has just cause but has not suffered significant inconvenience or distress as a result of the events. Low impact means the manager accepts the service has not achieved the expected standards. However, the impact is not significant or unreasonable and therefore the compensation constitutes a token in acknowledgement of our failure to perform.’
  2. ‘Medium Impact. The events have caused unreasonable inconvenience and it is clear that the service has failed to meet the required standards. Repeated failure to address the shortcoming could give rise to consideration of medium impact level of compensation.’
  3. ‘Major Impact. A serious failure in service standards. It could either be the severity of the event, a persistent failure over a protracted time or an unacceptable number of attempts to resolve and address the complaint. Major impact could also apply to expenses incurred by the complainant. We will only consider expenses incurred directly as a result of the event’.

13. The landlord’s compensation policy breaks this down further into three categories:

  1. Delay
    1. Low Impact of the delay £5 per week
    2. Medium Impact of the delay £10 per week
    3. Major Impact of the delay with possibly injury to health £20 per week

 

  1. Distress
    1. Low Impact of the distress £5 per week
    1. Medium Impact of the distress £10 per week
    2. Major Impact of the distress with possibly injury to health £20 per week

 

  1. Time and trouble
    1. Low Impact of the time and trouble £1 per week
    1. Medium Impact of the distress of the time and trouble £3 per week
    2. Major Impact of the time and trouble £5 per week

14. The landlord’s compensation policy states ‘We will only consider compensation for lost/damaged items via the compensation scheme in exceptional circumstances. In such cases, reasonable efforts must be made to obtain proof of the cost of items etc from the customer in support of claims’.

15. The landlord’s compensation policy states ‘Compensation awards will be automatically credited to a resident’s rent or service charge account, where those accounts are in arrears’.

The landlord’s response to requests for compensation following reports of damp and mould

16. When investigating a complaint, the Ombudsman applies its Dispute Resolution Principles. These are high level good practice guidance developed from the Ombudsman’s experience of resolving disputes, for use by everyone involved in the complaints process. There are only three principles driving effective dispute resolution: 

  1. Be fair – treat people fairly and follow fair processes;
  2. put things right, and;
  3. learn from outcomes.

17. The Ombudsman must first consider whether a failing on the part of the landlord occurred, and if so, whether this led to any adverse affect or detriment to the resident. If it is found that a failing did lead to an adverse affect, the investigation will then consider whether the landlord has taken enough action to ‘put things right’ and ‘learn from outcomes’.

18. It took the landlord over five months to identify the cause of the leak and over eight months to resolve the issue. It then took over four months to repair all of the damage caused by the leak. The delays were in the main due to a misdiagnosis of the cause of the damp and mould, and a significant breakdown in communication between the landlord and its contractor. The repairs were completed over 17 months outside of the landlord’s repairs timescales. This would have caused significant distress and inconvenience to the resident.

19. During the period of the complaint the resident informed the landlord that he was not living at the property and that he had been told it was not safe to breath in the damp. Following his first report, the landlord arranged for a surveyor to inspect the property on 11 August 2021. This was a reasonable response to the resident’s concerns; however, it is unclear if this inspection took place, and the Ombudsman has not been provided evidence of the surveyor’s report. Although the photographs provided by the resident to this Service showed some evidence of damp in the resident’s kitchen and lounge, there is insufficient evidence for the Ombudsman to be able to conclude that the property was uninhabitable.

20. In the resident’s complaint to the landlord and subsequent escalation request, he said that his flooring had been damaged due to the damp and mould and asked the landlord to compensate him for this. It is outside of the Ombudsman’s authority to make a definitive finding that the damage to the residents flooring was caused by the damp and mould in the property, however, the Ombudsman can assess whether on the balance of probability, if all, or some of the damage to the flooring was due to failings by the landlord.

21. Photographic evidence provided by the resident to the Ombudsman showed minor damage and black staining to one of his wooden floor panels. The photos also showed that the damp had affected the resident’s skirting boards in his lounge and that some of this, for example, to his walls, was near to the resident’s flooring. These factors, coupled with the considerable time the resident had lived with the damp, meant that it was likely that the damage to his flooring, at least in part, had been caused by the damp and mould. It is also likely that any damage to the flooring was exacerbated by the misdiagnosis of the damp and mould and subsequent delays from the landlord in identifying the leak.

22. In his complaint to the landlord, the resident asked for compensation for his damaged flooring, and a rent rebate for the period that the repair had been ongoing. The landlord awarded a final compensation amount to the resident of £1,574.00. It is unclear how the landlord calculated its compensation. Although the landlord should have set out its calculations clearly in its responses, the amount is broadly in line with its compensation policy. It is also in line with the Ombudsman’s remedies guidance, which states that awards of up to £1000 should be considered where there was a failure which had a significant impact on the resident. Overall, the level of compensation awarded was fair and proportionate in relation to the inconvenience, distress and time and trouble caused, due to the delays from the landlord in resolving the matter.

23. However, the landlord should have taken the resident’s reports that he was not living at the property into consideration when calculating the compensation amount. It should have also considered his request for his rent arrears to be cleared for the whole period he had lived with the damp and mould. There is no evidence that the landlord had considered this request. The landlord failed to explain to the resident how it had arrived at its compensation figure, what had been considered and how the compensation had been calculated. This would have caused confusion and distress to the resident.

24. In addition, the landlord’s offer of compensation made no reference to the resident’s claim for damage to his flooring. The Ombudsman’s own ‘Guidance on complaints involving insurance issues ‘(available online) sets out that where a claim for damage is made, a landlord should initially at least consider whether there is any evidence that it has been at fault for any claimed damage to a complainant’s property / belongings and not refer complainant’s straight to an insurer. In this case due to the significant delays in resolving the leak, it would have been reasonable for the landlord to have requested proof for the cost of his flooring. It could have then considered his compensation request under ‘exceptional circumstances’, in line with its compensation policy. Instead, the landlord told the resident to make a claim through his own home and contents insurance or the landlord’s insurers. Given the landlord’s failings in resolving the damp and mould, this advice was inappropriate as a first step.

25. The landlord failed to adequately address the requests for compensation for damaged flooring in its responses. This would have caused further distress and inconvenience to the resident. Although the resident has been unable to provide any proof for the cost of his flooring, the Ombudsman is satisfied that the resident would have incurred some costs in relation to his damaged flooring, that may not have arisen had the service failings from the landlord not occurred.

26. When awarding compensation, the Ombudsman considers what is fair in all the circumstances. The amount of compensation awarded to the resident by the landlord is broadly in line with what the Ombudsman would expect when there have been serious failings, and this has been taken into consideration when assessing the complaint.

27. However, there are also failings that have been identified in this report that have not been ‘put right’ by the landlord. The Ombudsman’s remedies guidance suggests compensation between £100 to £600 where there has been a failure from the landlord that has adversely affected the resident. Orders for remedy are made below in line with this.

28. Finally, the landlord’s compensation policy states ‘Compensation awards will be automatically credited to a resident’s rent or service charge account, where those accounts are in arrears’. It was therefore in line with the compensation policy for the landlord to offset the compensation against the resident’s arrears. However, the blanket implementation of such a policy risks a resident who has been awarded compensation for direct financial loss or out of pocket expenses not directly receiving that sum to settle their financial outlay. Landlords should consider the impact such a policy may have on an individual resident or whether the sum to be off-set is in dispute. In this case the amount was not awarded for financial loss, however the landlord should consider reviewing this ‘blanket’ policy.

29. It is the Ombudsman’s position that compensation awarded by this Service should be treated separately from any existing financial arrangements between the landlord and resident and should not be offset against arrears. This applies regardless of whether the landlord’s compensation policy allows it to do this and it is particularly the case where. As such, the compensation ordered below should be paid directly to the resident, and not offset.

Determination

30. In accordance with paragraph 54 of the Housing Ombudsman Scheme, there was maladministration by the landlord, in respect of its response to requests for compensation following reports of damp and mould.

Orders

31. Within the next four weeks the landlord must:

a.            pay the resident £225 compensation (this is in addition to the £1,574 that has previously been credited to the resident’s rent account), comprised of:

  1. £150 in recognition of the damage to his flooring.
  2. £75 for distress and inconvenience for not adequately addressing the resident’s requests for compensation.

b.            Write to the resident and this Service to confirm what learning it has taken from this case and what steps it intends to put in place to ensure that any claims for compensation are responded to appropriately.

 Recommendations

32. It is recommended that the landlord familiarise itself with the Ombudsman’s spotlight report on damp and mould and assess itself against this.

33. It is recommended that the landlord reviews its ‘blanket’ policy for offsetting compensation payments.