Wealden District Council (202108318)

REPORT

COMPLAINT 202108318

Wealden District Council

10 June 2022

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:

The complaint is about:
1. The landlord’s response to the resident’s report of differences between leaseholder’s and tenant’s service charges for the period 2017-2021, 2020-2021, and 2021-2022.
2. The landlord’s complaint handling.

Scope of this investigation

In relation to the above complaints, the Ombudsman will investigate this complaint insofar as it concerns the service and response the landlord provided to the resident in relation to his requests for information. However, the Ombudsman has not investigated the substantive aspect of the resident’s complaint namely whether the differences between leaseholder’s and tenant’s service charges for the stated period or any period are justified and correct as this concerns issues outside of the Ombudsman’s jurisdiction.
The Housing Ombudsman Scheme states that:
1. Under paragraph 39(g), the Ombudsman will not investigate complaints which, in the Ombudsman’s opinion, concern the level of rent or service charge or the amount of the rent or service charge increase.
2. Under paragraph 39(i), the Ombudsman will not investigate complaints which, in the Ombudsman’s opinion, concern matters where the Ombudsman considers it quicker, fairer, more reasonable or more effective to seek a remedy through the courts, a designated person, other tribunal or procedure.
This complaint would require a forensic analysis of the accounts and a determination of the law which is not within the remit of the Ombudsman to carry out and, in the view of the Ombudsman, is best suited to the jurisdiction of the First Tier Tribunal (Property Chamber – Residential Property) (referred to in this report as the “Property Tribunal”).
The Housing Ombudsman Scheme also states that:
1. Under paragraph 39(o), the Ombudsman will not investigate complaints which, in the Ombudsman’s opinion, seek to raise again matters which the Housing Ombudsman, or any other Ombudsman has already decided upon.
The resident’s complaint about the landlord’s response to his report of differences between leaseholder’s and tenant’s service charges was addressed in the Ombudsman’s investigation reference 202108306. While the period of the resident’s complaints slightly differed as to the period the resident referred to, the principle was the same that the service charges were different for leaseholders and tenants.
It remains open to the resident to make an application to the Property Tribunal for a determination whether the landlord was in breach of its statutory obligations under the Landlord and Tenant Act 1985.

Background and summary of events

The resident made three similar complaints, which slightly differed as to the period the resident referred to. This report will refer to those complaints as complaint A (dealt with under reference 202108306), complaint B (made 17 May 2021 and received 25 May 2021) and complaint C (received 1 June 2021).
The resident occupied a first–floor, one–bedroom retirement-living flat under a lease which began on 18 February 2008. The resident’s property is within a ‘retirement housing’ development of which the landlord is the freehold owner. The block has residents with varied tenures (leaseholders and tenants).
The resident is subject to a contact restriction placed on the resident under the landlord’s unreasonable behaviour policy. The landlord wrote to the resident in March 2021 in relation to how it was managing the resident’s contact, including an explanation of its approach. It proposed steps for the resident to take to further manage the communication. This included including restricting himself to no more than 2 letters per month (which would be responded within 10 working days), all contact to come through a single point of contact and desisting from making repetitious requests.
In response to the Ombudsman’s report dated 8 January 2021, the landlord changed its practices to either log a communication of the resident as a complaint or provide an explanation as to why it would not do so.

Legal and policy framework

Under the lease, the landlord had an obligation to manage the development in “a proper and reasonable manner” and employ agents or contractors to do so and “to keep in good and substantial repair and condition and to renew amend and clean when and as necessary and appropriate… all drives paths parking spaces landscaped areas and grounds forming part of the Development’ and ‘to manage the Development for the purpose of keeping the Development in a condition similar to its present state and condition”.
Under Paragraph 5(1)(b) of the terms of the lease, the resident was obliged to pay the landlord a service charge, being one part of the costs of the landlord carrying out its lease obligations, including to insure and keep insured the resident’s property and the estate in which it was situated, provide a warden service, provide communal facilities, and keep in good and substantial repair the buildings and elements in those buildings. The Ombudsman has not seen the tenancy agreements but the contractual arrangements are likely to be different, particularly given the respective legal relationships are different.
The lease set out how the costs of providing the services was calculated.
Under the landlord’s service charge policy, service charges payable by the leaseholder were dictated by what was contained in the resident’s lease, whereas the policy set out how basic services, such as maintenance and estate management, were covered by rent, and additional services by a service charge.
The landlord complaints procedure defined a complaint as ‘”an expression of dissatisfaction about our services’ customer comments, requests for service or reports of problems were not considered to be complaints and would not be recorded as such but passed to the relevant department for consideration”.
The complaints procedure comprised of a 2-stage process where the landlrod would respond with its Stage 1 response within 15 working days of the complaint being made and with its Stage 2 response within 20 working days of the complaint being escalated.
The landlord had categorised the resident as a vexatious complainant under the landlord’s ‘Unreasonably Persistent or Vexatious Complainants Policy’. This policy allowed for the landlord to limit contact with the resident by applying one method of contact or reducing duration of contact. It also stated that: ‘This policy does not prevent an individual who is categorised as unreasonably persistent or vexatious under this policy from raising a legitimate request for service e.g. about bin collections, as outlined in the Council’s complaint procedure. This will be considered and logged and where appropriate dealt with as a request to do something about the matter.’
The restrictions implemented include the terms that the landlord ‘will not acknowledge receipt of any correspondence from you’ and ‘will respond to any requests in strict order of receipt’ and only spend 30 minutes per month on the resident’s communication. Following an investigation by the Ombudsman in relation to a separate matter, the landlord was advised to inform the resident on those occasions where it declined to progress a formal complaint.
It is noted that the landlord has since amended its approach to provide the resident with a timescale for responses.
In response to the Ombudsman’s report dated 8 January 2021, the landlord changed its practices to either log the complaint or provide an explanation why it would not do so.

Chronology

The background of this complaint is set out in the Ombudsman’s investigation 202108306.
Further to those events, on 17 May 2021, the resident made a complaint (B) that he referred to as “potential extra service charges payable 2021/2022” that leaseholders paid more service charges than tenants and he wanted an explanation of the differential regarding 2021/22.
On 23 May 2021, the resident wrote to the landlord heading the letter “complaint re differing service charges for tenants and leaseholders from 1 January 2017 to 31 March 2021.” The landlord date stamped the letter as received on 1 June 2021. The resident’s complaint was that there was no justification for the higher service charge. The resident also complained in general about how his complaints had been handled and set out that the landlord had not complied with its complaints policy.
On 26 May 2021, the landlord acknowledged the resident’s complaint it referred to as “errors in service charges payable 2021/2022” referring to the resident’s complaint it had received on 25 May 2021 and allocated a complaint reference. It aimed to provide a full reply within fifteen working days of receipt of a complaint. However, it was experiencing a large volume of contact across its departments and therefore there would likely be a delay in responding. If it was necessary to extend the timeframe, it would advise the resident accordingly.
It provided a first–stage response to complaint B on 3 June 2021 addressing the resident’s letter on 17 May 2021 as follows:
1. It acknowledged the resident’s first complaint referred to the service charge for 2020-21 and this complaint mentioned the charge for 2021-22, but the complaint was in essence about the same matter. The response would be “largely” the same.
2. There were elements in leaseholders’ service charges that were not included in the secure tenants’ service charges, so consequently the service charge between the two tenures does differ.
3. It listed some charges not payable by tenants.
4. It referred the resident to the summary of accounts and to invoices the resident had received.
5. The complaint was not upheld.
6. If the resident wished to dispute the service charge, he had recourse to the Property Tribunal.
On 10 June 2021, the landlord acknowledged the resident’s complaint (complaint C), which, it stated, it had received on 1 June 2021. It allocated a further reference number. It gave the same timescale as the previous response.
On 11 June 2021, the resident wrote to the landlord a letter headed “clarification of complaint (B)”. He pointed out his complaint was about the differential in service charges between leaseholders and tenants. The lengthy letter was headed “leasehold and tenant service charge”. He stated the landlord had not acknowledged his letter of 17 May 2021 and 3 June 2021 and he did not feel the response dated 3 June 2021 was compliant with the landlord’s complaint procedure.
On 16 June 2021, the landlord provided its Stage 1 response to complaint C as follows:
1. It referred the resident to its responses to his previous complaints. It acknowledged that the resident had expanded the complaint to include other years.
2. The resident believed the difference in the service charge for tenants and leaseholders should only be heating and hot water, insurance and the contribution to the sinking fund, whereas the actual difference is more than this. He had referred to the landlord’s service charge policy.
3. The landlord also referred to that policy which set out a number of items the service charge covered beyond those that the resident had mentioned.
4. Consequently, the complaint was not upheld.
5. It again referred the resident to the Property Tribunal.
The resident wrote to the landlord on 24 June 2021 referring to the landlord’s response dated 16 June 2021 stating that prior to the 2020 policy, service charges were levied in accordance with a factsheet and the differential had been increasing every year. The resident also referred to 5.10 and 5.11 of the Housing Ombudsman’s Complaint Handling Code regarding seeking a resolution. The resident requested that the complaint C be escalated.
On 2 July 2021, the resident wrote to the landlord chasing a response to his request to escalate complaint B and referring to previous correspondence. The landlord replied on 8 July 2021, explaining that the initial complaint was received 25 May 2021 and replied to on 3 June 2021. It explained that the resident’s further letter of 11 June 2021 received on 18 June 2021 was treated as a request for clarification. It would consider the resident’s request to escalate his complaint. It also stated that the resident’s letter was “unnecessarily long” and the landlord could “miss the crux of (his) complaint as it (was) buried within the multitude of copied text and unnecessary commentary. It invited the resident to submit a revised letter but would proceed with its own interpretation.
On 15 July 2021, the resident wrote two letters, both date stamped as having been received on 19 July 2021.
The first letter referred to the landlord’s letter of 16 June 2021. He stated there had been a misunderstanding of the complaints. He set out what he considered which was which complaints. He apologised for any confusion he may have caused and stated that he looked forward to the landlord’s acknowledgment of and response to his request to escalate his complaint C.
The second letter stated he was clarifying his complaint B and stating he was expecting a response to his Stage 2 request.
The landlord acknowledged the resident’s request to escalate complaint B on 19 July 2021. It would consider the request and set out its criteria for escalation together with a timescale of 20 working days for its response.
The landlord wrote to the resident by letter dated 22 July 2021 referring to complaint C and adding a different internal reference number. It was headed “leasehold and service charges” and addressed its complaint handling. It referred to a request received on 1 July 2021 stating that the landlord had not addressed the resident’s request for information relating to its failure to follow complaint handling procedures. It had accepted that prior to January 2021 not all complaints were effectively processed. It considered reviewing all responses but concluded such a review would not be beneficial and gave its reasons as the passage of time and the number of subsequent complaints dealing with similar issues. It had offered an apology which it felt was sufficient remedy.
On 26 July 2021, the landlord sent its Stage 2 response to complaint C referring to the resident’s request to escalate his complaint received on 1 July 2021. It did not consider the landlord had provided any new information and that the Stage 1 response adequately explained the differential. As it had deemed that the complaint was not justified, it did not consider a remedy was appropriate.
On 18 August 2021, the landlord wrote to the resident with its Stage 2 response as follows:
1. It referred to the resident’s letter received on 19 July 2021 in which he requested his complaint be considered for escalation to Stage 2 of its complaints process.
2. It stated that the resident’s request did not contain any new information that supported the original complaint and that the complaint was answered fully at Stage 1 therefore it had concluded that the matter did not warrant escalation to Stage 2.
3. It referred the resident to its responses to the resident’s previous complaints, which while these covered different periods, were about the fact there was a difference in the service charges paid by tenants and leaseholders.
4. It added that the landlord was incorrect when it said that the basic service charge for leaseholders included elements such as repairs to communal areas that were not payable by tenants. The resident had provided “a lengthy argument” that tenants should be charged for communal repairs and referenced a factsheet. The landlord stated that the factsheet (which had since been superseded by the service charge policy) stated that “items not included in tenants’ service charges would be repairs and maintenance to the building”.

Assessment and findings

The landlord’s response to the resident’s report of differences between leaseholder’s and tenant’s service charges for the period 2017-2021, 2020-2021 and 2021-2022.

Given the substantive issues of the resident’s complaints concerning service charges were outside the Ombudsman’s jurisdiction, the Ombudsman will consolidate its investigation of those complaints which is limited to how the landlord handled the resident’s queries prior to referring the resident to the Property Tribunal.
It was not disputed that the landlord also had obligations under LTA 1985 to provide certain information. The landlord’s approach to the resident as a vexatious complaint was to apply a different timescale for responses because of the high level of correspondence it received from him, rather than not respond altogether. However, it may be clearer for the resident if the landlord gave a timescale for responses rather than state how much time it would allocate each month, an approach the Ombudsman understands the landlord may have adopted since.
The landlord acted reasonably in not merely and immediately directing the resident to the Property Tribunal but by seeking to explain its position and to provide a response to the resident’s questions. The Ombudsman would expect a landlord to seek to address an issue without immediately referring a resident to a court or tribunal and without having first provided a reasonable explanation of its actions. This aligns with the dispute resolution principles of being fair and proportionate and also with the expectations of a court or tribunal to seek to resolve matters without litigation.
The evidence showed that the landlord had sought to explain why there was a difference between the service charges between leaseholders and residents. They were likely to be differentials as the charges were governed by different principles. The issue for the resident was whether the landlord complied with its legal obligations in relation to how it passed on service charges to the resident. In relation to that, the landlord having provided what explanation it reasonably could, the leaseholder had the right to refer the service charges to the Property Tribunal.

The landlord’s complaint handling

The resident made two complaints B and C that were very similar in nature, that the landlord had not responded to his complaint that leaseholders and residents were being charged differently for service charges and that the differential was not justified. The resident had already made the same complaint previously, which complaint has been investigated under Housing Ombudsman reference 202108306.
While the periods the resident referred to slightly differed between all three, the core issue, in the opinion of the Ombudsman, was the same, namely that the service charges for leaseholders and tenants were different. The landlord, despite having made a similar observation, chose to address each complaint separately. The landlord responded to complaint B at Stage 1 within the timescales set out in its policy and in its correspondence. However, the resident’s letter dated 11 June 2021 contained a request to escalate complaint B. The landlord’s request for a revised letter was reasonable given it was very lengthy. The request demonstrated its intention to address the resident’s complaint. The landlord acknowledged the resident’s request to escalate his complaint on 8 July 2021 and then did so again on 19 July 2021, leading to a delay in its second final response to complaint B to 21 August 2021, over two months after the escalation. While, in mitigation, the landlord was handling a number of complaints by the resident, some of which were similar, the landlord would benefit from a very clear internal system in order to track its complaint handling and in particular identify any requests for escalation.
The landlord’s acknowledgement of complaint C was slightly delayed (by five days) but it responded within its set timescales. Given the acknowledgement contained information the resident had received previously and the delay was minor, while the resident may have felt some frustration, the Ombudsman does not consider that the delay caused any significant impact on the resident.
The landlord had already explained previously that service charges were charged according to a resident’s lease, or in accordance with a tenant’s tenancy agreement. They are different agreements. The landlord acted reasonably in not simply directing the resident to the Property Tribunal but by seeking to explain the differentials between the leaseholders and tenant’s service charges in some detail.
The landlord had acted reasonably in following the Ombudsman’s comments in its report dated 8 January 2021 to either treat the resident’s letters as complaints or provide an explanation why it would not do so. It also acted reasonably in reviewing the impact of its previous failures, given it had upheld the resident’s complaint regarding its complaint handling. The landlord’s explanation why it would not review all previous complaints was reasonable.
However, the landlord had not addressed the resident’s complaint of 23 May 2021 about its complaint handling until prompted to by the resident, until 22 July 2021. This delay, coupled with the delay in responding at Stage 2 in complaint B, constituted service failure, although there was no long-lasting impact on the resident as a result of the delays.
The resident referred to paragraphs 5.10 and 5.11 of the Ombudsman’s Handling Code which relates to any concerns the landlord may have about legal liability. This guidance relates to the issue of compensation that a resident may be entitled to if the landlord was found by a court to be negligent in law. While this part of the Code addresses a different issue to the resident’s complaint, the Ombudsman would expect a landlord to seek to address an issue without immediately referring a resident to a court or tribunal without having first provided a reasonable explanation of its actions. In this case, the evidence showed that the landlord had provided explanations to the resident. Therefore, in the circumstances, it was reasonable to refer the resident to the Property Tribunal.
The landlord acted appropriately in not escalating the complaint B and C to a review at Stage 2 as in the view of the Ombudsman, the resident had not provided grounds for escalation which appeared to be a repetition of the resident’s previous points. In any event, the forensic analysis the resident was seeking was more appropriately dealt with by the Property Tribunal.

Determination (decision)

In accordance with paragraph 54 of the Housing Ombudsman Scheme, there was no maladministration in relation to the landlord’s response to the resident’s report of differences between leaseholder’s and tenant’s service charges for the period 2017-2021, 2020-2021, and 2021-2022.
In accordance with paragraph 54 of the Housing Ombudsman Scheme, there was service failure in relation to the landlord’s complaint handling.

Reasons

The landlord went as far as it was reasonably able to in explaining the reasons for the differences between leaseholder and tenant’s service charges before referring the resident to the Property Tribunal.
The landlord’s overall handling of the substantive complaints was reasonable and appropriate, however there were occasions, given the volume and similarity of complaints and, on occasions, the landlord’s difficulties in interpreting the complaints, that the landlord appeared to lose track of the complaint trail. This led to some confusion in complaint references and headings.

Orders

The landlord is ordered to pay the resident compensation in the amount of £50 within 28 days.
The landlord should confirm to the Ombudsman compliance with the order within 28 days.

Recommendations

The landlord should ensure that:
1. It includes a heading and the complaint reference in all its correspondence and ensures that the complaint references remain consistent throughout the stages of the complaint correspondence including the acknowledgement of the complaints.
2. It considers a clear internal tracking system specifically for vexatious complainants in order to track its complaint handling and in particular identify any requests for escalation.
3. It ensures that it has addressed all aspects of a complaint, whether in previous correspondence or existing correspondence.
4. It considers what are identical complaints and whether it has already addressed the complaint previously however it ensures it provides an explanation to the resident of its approach, consistent with its practices post January 2021.