London Borough of Hackney (202106968)

REPORT

COMPLAINT 202106968

Hackney Council

21 November 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

1. The complaint is about the landlord’s:
   1. Response to queries about the resident’s service charge account and its decision to initiate legal action against her for unpaid charges.
   2. Communication in respect of a query she made regarding extending her lease and responsibility for the replacement of the front door at the property.
   3. Customer service and complaints handling.

Background

2. The resident has been a leaseholder, of the landlord, at the property, from 16 December 2002.
3. The resident complained about the landlord’s response to her queries about her service charges and its decision to initiate legal action against her for unpaid charges.  Specifically, she believed she was being overcharged and requested clarification and information pertaining to services and associated charges.
4. The resident was dissatisfied with the landlord’s response to her queries, namely that it did not respond at all or gave her generic responses and responses which failed to answer her specific queries. Additionally, the landlord commenced legal action against the resident without having discussed the matters she was raising, with her, which she is also dissatisfied about.
5. The resident also expressed her dissatisfaction with the landlord’s communication. This was in respect of a query she raised regarding extending her lease and the responsibility of renewing the front door at the property. Although these issues were not raised as part of the initial complaint, the landlord addressed them within the stage two response.
6. In its response to the complaint, the landlord acknowledged and apologised for “severe delays” in responding to the resident’s queries regarding her service charges. The landlord acknowledged that one of the service charges disputed should be refunded, as the resident should not have been liable for this.  In respect of the other charges, it did not concede that the resident was not liable.  As well as providing a breakdown of charges and services and clarifying order numbers and making clear what each service was (as far as it could, given a cyber-attack), it reiterated the resident’s responsibility to pay service charges in accordance with the terms of her lease agreement. The landlord later refunded the resident for the one service charge that she should not have been charged for.
7. The landlord also acknowledged in its response, that it should not have initiated legal action against the resident for unpaid service charges. This was on the basis that there was an ongoing dispute about them, for which it apologised.
8. Regarding the extension of the lease and door renewal, the landlord apologised for the “oversight” in not responding to the resident’s emails in a timely manner. , It advised that it could not find the original email – although evidence of this had been provided by the resident, which it accepted.  The landlord also clarified the situation with the front door, and where responsibility for its replacement lay.
9. The resident remained dissatisfied with the landlord’s response.  She maintains that she is not responsible for payment of all of the service charges listed. She also does not consider that the landlord has provided sufficient information and clarity as to the issue. In addition, the resident believes the landlord should offer compensation given the stress and inconvenience caused by it filing legal action against her, when it has accepted it should not have done this.

Assessment

Landlord’s response to queries regarding service charges and legal action

10. It is not the role of the Housing Ombudsman Service to make a determination as to the level, increase or reasonableness of service charges. The First Tier Tribunal (Property Chamber) [FTT] can consider such matters, and the resident may refer the matter to the FTT if she remains concerned. The Ombudsman’s role when investigating this complaint has been to assess and determine how the landlord responded to issues raised by the resident. In particular, whether its response was in accordance with its policies and procedures and were appropriate and reasonable in all of the circumstances.
11. The landlord has accepted that there were significant delays in its responses to the resident’s queries regarding her service charges. It has acknowledged that there was in fact “severe delay” on its part, and attributed this to a large influx of emails.  It was appropriate that the landlord acknowledged this and that it offered its apologies and explained that it was looking at the way in which it managed its inbox and ways to improve things, to help prevent a recurrence.
12. The landlord did not respond to all of the resident’s emails. However, the responses which were provided were inadequate. In her emails, the resident was querying specific service charges and asking for clarification as to those, but the responses she received were poor. The landlord’s responses simply referred the resident to a link on its website – which provides standardised information regarding service charges. It also offered a generic explanation as to how service charges were calculated.
13. The landlord failed to grasp the specific queries early on, which led to a complaint being made. This may have been avoided if the landlord had responded in a timely manner, and addressed the issues which were being raised.  The lack of its engagement with the issue led to the landlord initiating legal action against the resident for unpaid service charges, which it also accepts was wrong in the circumstances. There were ongoing queries and disputes about the charges, which had effectively gone unanswered.  In this situation, the landlord would not initiate legal proceedings until these had first been clarified and if necessary, investigated and responded to.
14. It is not known why the landlord made the mistake of initiating legal action.  This caused an understandable level of stress and anxiety for the resident which could have been avoided. This included her having to submit a legal defence which was both inconvenient and stressful. The resident was proactively reaching out to the landlord, seeking to establish a dialogue about the issue and her concerns but the landlord inappropriately failed to meet her in this.
15. Despite recognising the error and stating that it had instructed its solicitors to withdraw legal action, the resident later received further correspondence pertaining to the legal action that was being taken against her.  This undermined trust and integrity in the landlord and further damaged the landlord-resident relationship. In addition, the landlord failed to formally confirm thereafter, that the legal proceedings were in fact stopped at that juncture, leaving the resident living with uncertainty and worry that could have been avoided.
16. The landlord’s explanation of a cyber-attack meaning that almost no data regarding the detail of service charges could be obtained, although later some information did emerge, was an inadequate explanation.  It is acknowledged that a cyber-attack may have rendered some information temporarily unavailable or difficult to obtain. However, the detail of service charges and information pertaining to service charges is a legal right of a leaseholder and the landlord has a responsibility to mitigate for such attacks on its data. The landlord also had a duty to seek to obtain the information from elsewhere where it is not available on its systems, for instance, from the contractors or suppliers or elsewhere.
17. Furthermore, the landlord’s explanation that there had been a cyber-attack did not go far enough in explaining what the impact of this had been. It would have been reasonable for the landlord to explain what it was doing to retrieve the information, and by when it expected part or some of this information might be available. The landlord’s response lacked transparency which further undermined trust in it.
18. In its stage two response to the complaint, the landlord provided a breakdown of charges. This included the correct order number and job names for works and provided this to the resident. It was appropriate that it sought to obtain this information, and did so, providing to the resident thereafter. The landlord cross checked the charges against works and in doing so, discovered a service charge that the resident was not in fact liable for, for which it appropriately refunded her for accordingly.
19. The landlord’s repeated assertion that it cannot provide further information due to the cyber-attack seven months prior is again, however, insufficient. The landlord has failed to explain what information or detail it cannot provide or if it is attempting to retrieve this. Whilst the resident has the right to take the matter to the FTT as discussed, its explanation regarding the cyber-attack is inadequately detailed. For the resident to contest the increase, level and reasonableness of service charges, further information about the charges must be available.  Although the resident can pursue this route in its absence, given the explanation of the cyber-attack and lack of further detail, this makes it difficult. The landlord has been vague in its responses surrounding this, which has served to aggravate and complicate the issue.

Landlord’s response regarding queries concerning extension of the lease and replacement of the front door

20. The landlord has accepted that it failed to respond appropriately to the resident’s queries regarding extension of her lease. When responding to the complaint, it said  that it could not find her initial query, whilst accepting that this was sent by her, given the resident provided evidence of this, as well as a subsequent email she sent.
21. In this case, there is clearly a theme of inbox management and poor communication, the former of which the landlord had said it would look into and address, in efforts to prevent a repetition in the future.  It is important that it does so, and indeed, that it goes further, as the issue of communication – both responding to emails and responding with clarity and in a tailored way.  This is because this spans each strand of this complaint. Whilst the landlord’s eventual response regarding extension of the lease was sufficient, it took too long to do so, which it again acknowledges.
22. Turning to the issue of the door, specific documentation has not been provided to this investigation to evidence what happened in this respect.  The theme continues, however, of a lack of response and a lack of clarity of response.  Again, whilst the landlord has since provided that clarity; that repair remains its responsibility but aesthetics, the resident, this was too late.

Customer service and complaints handling

23. The service failures in respect of communication are embedded throughout this complaint. The landlord failed to communicate effectively and had it done so, matters may not have escalated as they did and the tenant-landlord relationship may similarly, not have suffered.  As described, there are issues with inbox management across different areas; enquiries about service charges, enquiries about extension of the lease and enquiries about responsibility for repair and replacement of, in this case, a front door.
24. Not only was correspondence not responded to on some occasions, but where it was, the responses were insufficiently tailored to the contact from the resident and her specific queries.  The generic responses only served to aggravate and inflame the situation, as the resident became exasperated with a generic response and was understandably left feeling unheard.
25. The landlord missed opportunities too, in its responses to the complaint, to express empathy and understanding as to what the resident was communicating.  The resident was faced with legal action which the landlord has accepted she should not have been, yet no empathic understanding of the impact of this has been expressed by the landlord at any point. The landlord failed to sufficiently acknowledged the stress and inconvenience caused to the resident throughout.
26. Responding to a complaint is an opportunity for a landlord to demonstrate that it has heard and understood the complaint being made and a chance to put things right.  Putting things right is not only about compensation.  However, compensation may be appropriate, especially where there have been identified service failures, as there have in this case, with delay and lack of information being provided, as well as mistakes being made.
27. The landlord responded to the complaint late at stage two, five days after its 20-working day timescale articulated in its complaints policy.  Although it acknowledged this and apologised, it again missed an opportunity to express empathy and understanding and to offer a level of compensation in recognition, which would have sought to put things right and repair the mistake made.

Determination

28. In accordance with paragraph 52 of the Housing Ombudsman Scheme, there was service failure by the landlord in respect of the complaint about its handling of the resident’s queries regarding service charges and its decision to initial legal action.
29. In accordance with paragraph 52 of the Housing Ombudsman Scheme, there was service failure by the landlord in respect of its handling of the resident’s queries regarding the extension of the lease.  There was no maladministration in respect of the landlord’s response regarding the resident’s query about replacement of the front door.
30. In accordance with paragraph 52 of the Housing Ombudsman Scheme, there was service failure in respect of the landlord’s communication and complaints handling.

Orders and recommendation

Orders

31. Within four weeks of the date of this report, the landlord should:
    1. Pay the resident £300 compensation, comprised of:
       1. £150 in respect of the complaint about the landlord’s handling of the service charge queries and its decision to take legal action.
       2. £50 in respect of the complaint about the landlord’s response to queries regarding extension of the lease.
       3. £100 in respect of the complaint about the landlord’s communication and complaints handling.
    2. Write to the resident explaining what information is missing due to the cyber-attack.
32. Within eight weeks of the date of this report, the landlord should:
    1. Provide its staff with further training around communicating effectively with residents. In relation to complaint handling, the training should focus on ensuring that staff understand the reasons for a complaint, and seek clarification where they are unsure.
    2. Review its processes surrounding customer enquiries, and assess whether these can be improved to ensure that enquiries are not missed, and are responded to in a timely manner. Details of the review should be shared with this Service and the resident.
    3. Provide both this Service and the resident with details of any actions taken in response to the cyber-attack. Specifically in relation to ensuring that data remains accessible in the event of a future cyber-attack.

Recommendation

33. Within four weeks of the date of this report, the landlord should write to the resident and this Service to confirm its position regarding any legal action.