Sovereign Living Limited (202204942)

REPORT

COMPLAINT 202204942

Sovereign Living Limited

13 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:
   1. The length of time it took the landlord to provide the management pack required for the sale of a property and the resident’s request to be compensated for this.
   2. The landlord’s handling of the associated formal complaint has also been considered.

Background

2. The resident is a shared ownership leaseholder of the property of which the landlord was the freeholder. The resident wished to sell the property which she had already vacated.
3. The Memorandum of Sale was issued on 7 April 2022 and there was a delay in issuing the management pack which was required to complete the legal sales process.
4. The resident made a complaint to the landlord on 6 May 2022 about the delay and requested compensation. The management pack was issued on 11 May 2022.
5. In its stage two response to the complaint dated 20 May 2022 the landlord confirmed its stage one response in which it apologised for the delay and offered to waive the £150 fee normally charged for the management pack.
6. In referring the matter to this Service the resident stated that, following the landlord’s final response to her complaint, the sale had been further delayed by the Estate Management Company (EMC) contracted by the landlord providing further information required for the sale.

Assessment and findings

The length of time it took the landlord to provide the management pack required for the sale of a property and the resident’s request to be compensated for this.

7. The landlord has a service level agreement to issue management packs in 10 working days and the pack was due by 25 April 2022. The pack was issued eleven working days late on 11 May 2022.
8. The reason for the delay appears to have been that the landlord mistakenly believed that reserves costs had been duplicated by inclusion in both the landlord’s service charge and the EMC’s service charge. The landlord was trying to resolve how to refund the duplicate costs. However, the costs had not been duplicated because the landlord’s service charge and the EMC service charge covered different items.
9. The resident kept chasing for the pack and was told by the home ownership team that the delay was because “ the reserve funds being collected by both Sovereign and the EMC were being looked into”.
10. The resident raised an official complaint on 6 May 2022 which was acknowledged on 9 May 2022 ( the next working day). The complaint was allocated to a member of staff in the service charges team who emailed the resident to say they were investigating the complaint of “duplicate reserves costs” and would be in contact “later in the week”.
11. On 10 May 2022 the resident emailed the member of staff in the service charges team to say that its response time was too slow and to request that the it come back to her later that day. There is no evidence of a response to that email.
12. On 11 May 2022 the landlord realised that there was no duplication of costs. The home ownership team left a voice mail for the resident to say the matter was “resolved” and copied the resident into an email to her solicitor explaining the reason for the delay. The home ownership team reported to the complaint handling team and said “please can this complaint be closed”.
13. It is unclear how the confusion about the suggested duplicate reserve costs arose. However, it took nearly a month for the landlord to establish that the costs had not been duplicated. The landlord’s communication with the resident should have been clearer as it was not until she complained and was contacted by the service charges team that the landlord mentioned any issue with duplicate payments.
14. The resident rang the landlord back on 11 May 2022 to say she was not happy that it had taken a month for information “that the landlord should have known to come to light”. She asked to speak to a “complaints handler” about her request for compensation for the delay and stress.
15. On 12 May 2022 a senior manager at the landlord sent an internal email to the complaint handling team explaining that there had been delays and the £150 administration fee for the pack should be waived. The internal email said that the landlord was arranging for this to happen and asked the complaint handling team to wait for this to be arranged before responding to the resident.
16. On 13 May 2022 the complaint handling team told the senior manager they would need to make a written response as this was a stage two complaint.
17. On 16 May 2022 the senior manager asked if there was a stage one response. The complaints handling team responded that they believed the home ownership team had agreed with the resident to close the complaint. This Service has seen no evidence that the resident had agreed that her complaint should be closed.
18. On 18 May 2022 the senior manager spoke to the resident and followed up with an email with the landlord’s stage one response. In it response the landlord said “Our delay in responding to your solicitors is acknowledged, and we uphold your request to waive the £150 administrative fee. We are sorry about this delay, and any inconveniences this caused. You also want [the landlord] to compensate you for the rent and mortgage as this property is currently empty and our lateness in responding to the solicitors’ pack caused a month’s delay for you. You also asked that your complaint be escalated to the next stage if your additional request for compensation is not upheld at this stage.” The landlord declined the request to compensate the resident for the rent and mortgage without explanation and said as a stage two it would now go to their manager for review.
19. On 20 May 2022 the same senior manager sent the resident a stage two response by email. The stage two response said that the senior manager had reviewed the complaint with their manager. In its stage two response the landlord said that it felt “ the stage one decision to award compensation of £150, which is the amount you would have been charged for the service was appropriate in the circumstances”. The landlord said that it was unable to agree to further compensation equivalent to one month’s charges.
20. On 10 June 2022 the resident referred the complaint to this Service. She added that she still owned the flat because the management pack from the landlord had not contained all the information required for the sale and she had been referred to the EMC. The EMC was charging her £300 for the management pack which it had still not provided and she was now seeking additional compensation for the £300 and further delay.
21. This Service explained to the resident that we cannot consider complaints unless they have gone through the landlord’s complaints process. Accordingly in this investigation we have only considered the delay in issuing the landlord’s management pack and the landlord’s handling of the associated formal complaint.
22. The landlord’s compensation guide says it can offer compensation “if the customer has suffered financial loss due to failure in delivering a service”. There is no evidence that the delay in issuing the management pack directly led to a delay in the sale. There are many reasons why the legal process of a sale might be delayed. It should also be noted that only the interest element of the mortgage payment could be said to lead to a financial loss. The landlord therefore acted appropriately in rejecting the resident’s claim for rent and mortgage costs incurred for a month’s delay in the sale.
23. The landlord acknowledged the delay in the production of the management pack and waived the £150 administration fee. For the reasons set out in the previous paragraph this, together with its apology, was an appropriate response and the landlord has offered redress to the resident which, in the Ombudsman’s opinion, satisfactorily resolves the complaint.

Complaints Handling

24. The resident’s complaint on 6 May was a stage one complaint. The landlord’s complaints policy says “When we know the outcome or have an agreed plan in place, we’ll send customers a letter addressing all the issues that have been raised”. Therefore the landlord’s home ownership team should not have requested that the complaint be closed without a written response being sent to the resident.
25. Neither the stage one or two response set out the reasons for not offering the requested compensation of one month’s rent and service charges as required by the HOS complaint handling code. This says at paragraph 5.8 “Landlords must confirm in writing to the resident at the completion of stage one in clear, plain language….. the reasons for any decisions made”. This was despite the escalation to stage two being specifically to consider the requested compensation of one month’s rent and service charges.
26. Whilst the landlord accepted that there had been a delay and offered an apology and compensation by waiving the £150 fee there is no evidence that the senior manager investigated what had led to the delay. Failing to take the opportunity to investigate also meant that the landlord failed to identify potential wider issues and thus improve its overall service delivery.
27. The stage two complaint should not have been considered by the same senior manager as the stage one. The HOS complaint handling code says at 5.12 “The person considering the complaint at stage two, must not be the same person that considered the complaint at stage one.” There is no evidence of the discussion the senior manager had with their manager. The stage two response was virtually the same as the stage one response and showed no evidence of a review.
28. The complaint handling failures identified above amount to maladministration by the landlord.

Determination

29. In accordance with paragraph 53 of the Housing Ombudsman Scheme, the landlord has offered redress to the resident which, in the Ombudsman’s opinion, resolves the complaint satisfactorily.
30. In accordance with paragraph 52 of the Housing Ombudsman Scheme, there was maladministration in relation to the landlord’s complaints handling

Orders

31. The landlord to pay the resident compensation of £150 in relation to the maladministration identified with its complaints handling.
32. The landlord to provide training to relevant staff in relation to the Ombudsman’s complaint handling code.
33. The landlord to evidence compliance with the above orders to this Service within 28 days of this investigation report.