Royal Borough of Kensington and Chelsea (202120447)

REPORT

COMPLAINT 202120447

Royal Borough of Kensington and Chelsea

27 November 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

The complaint is about the landlord’s handling of the resident’s:
1. Requests for major works information.
2. Concerns about workmanship quality.

Background

The resident is a leaseholder of a two-bedroom flat on the second floor of a residential block owned by the local authority landlord. The lease began on 27 July 1987. There are no vulnerabilities recorded for the resident.
On 16 February 2016, the landlord launched a Section 20 major works consultation regarding the next phase of external cyclical works. A Notice of Intention was sent as part of the consultation requirements, describing the works, which included window repairs and replacement. The estimated cost for the works was £221,051.76, and the share of the resident’s contribution was £7,298.20.
The works on site started on 19 September 2016 and concluded in July 2017. The resident wrote to the landlord soon after and said:
1. Operatives removed the paint from the window using sandpaper, which scratched the glass at the resident’s property and in communal areas.
2. The communal windows used to be air and watertight, but following the works, they left with gaps allowing draft and rain to enter.
3. The resident requested a breakdown of the works carried out.
The resident kept pursuing the matter, and in August 2019, the landlord replaced the glazing at the resident’s property as a gesture of goodwill. It said it could not provide a further breakdown of the works at this stage as the contractor had not agreed on the final account.
In March 2021, the landlord wrote to the resident and said the actual cost for the project came to £565,901.71, and the share of the resident’s contribution came to £19,128.18. The landlord said it would cap the cost at 20% above the estimated amount in line with its leasehold management policy. Therefore, the resident’s final share was £8,757.84, and he had to pay an additional £1,459.64 on top of the original estimate.
On 15 August 2021, the resident made a formal complaint. The resident requested a breakdown of the works carried out and asked for redress to the defect in communal areas. The landlord responded on 17 September 2021 and said:
1. It did not have the revised schedule of work carried out.
2. It would not be “proportional or reasonable” to replace the communal glazing, considering the minor extent of the scratches.
3. There was no correlation between the damage to communal windows and the work it had carried out.
The resident escalated his complaint on 20 October 2021 and said:
1. Operatives broke a window at the beginning of the work, which the landlord replaced. This window had the same defects as the rest, showing it was not a historic damage.
2. Operatives removed the side pivots from the vertical edges of the windows, so the windows are loose in the frames.
3. The resident wanted to know who approved the additional works, which ones were carried out, and where.
The landlord sent its final response letter on 18 November 2021 and said:
1. It already showed the resident the schedule of work it had.
2. It was necessary to carry out draft proofing, which was not part of the original scope of work and partly the reason for the increased cost.
3. There have been several work cycles; it was impossible to say which set of works damaged the glazing.
4. The communal windows only had minor adjustments that would have not caused the damage to the window.
5. The contractor would have walked the site and agreed on any additional work in the final account. It did not have more information. It has since brought this department in-house and improved its record-keeping.
6. It did not identify service failure in handling the matter since it brought its capital investment programme in-house and found no faults with its handling.
The resident approached this service on 27 June 2022. He said the landlord must have had a breakdown of the overspending. According to the resident, the contractor did not carry out the work, and whatever it did carry out was to poor standards. The resident said he should not have been made to pay the bill if the landlord could not explain the overspend. To resolve the complaint, he would like the information he requested and the landlord to take accountability for its poor handling of the works.

Assessment and findings

Scope of Investigation

The Ombudsman will consider complaints in the context of a member landlord’s management of service charge accounts and handling of enquiries relating to service charges.
This Service does not have the authority to make a decision on the reasonableness or the resident’s liability to pay charges related to major works. This includes whether the works represented good value for money. These issues are usually best determined by the First Tier Tribunal (Property chamber), which can make legally binding decisions on the liability to pay and reasonableness of service charges. This route is available to the resident if he still has such concerns.
Therefore, the focus of this investigation has been whether the landlord responded fairly, openly and in accordance with its obligations to the resident’s queries, whether it explained the additional charges appropriately, and whether it acted reasonably on the resident’s concerns about the quality of workmanship.

Policies and procedures

The lease sets out the resident’s obligation to pay a proportion of the landlord’s costs in carrying out its repair and maintenance obligations. Under the terms of the lease, the landlord is responsible for keeping in good repair the windows and window frames.
Section 20 of the Landlord and Tenant Act 1985 (as amended) sets out the consultation requirements landlords must follow. A section 20 notice is a notice given by landlords to leaseholders to tell them that it intends to carry out work or provide a service that leaseholders will have to pay towards. It must serve this notice on any leaseholder who would be affected by the work or receive the service. Section 20 notice will include information about what is planned and how much it is estimated to cost. It will also allow leaseholders to take part in the consultation process. Landlords must ‘have regard’ to the observations received from leaseholders.
It is a common industry practice that at the end of the defect liability period (typically 1 year from practical completion of the works), the landlord would start to work with its contractors on the final account. The landlord would then write to residents with a final statement. The landlord’s leasehold policy caps costs 20% above the original estimated costs.
The Landlord and Tenant Act 1985 section 22 requires a landlord to provide access to information about the service charges and relevant costs relating to the charges.

The landlord’s handling of the resident’s request for major works information

Shortly after completing the work in 2017, the landlord wrote to the resident that the cost had increased by 43%. (The landlord’s decision to cap resident’s contribution at 20% above the estimated amount was not communicated to residents at that time). It is recognised that this was a significant financial obligation for the resident that has caused him worry and distress. Accordingly, the resident pursued the issues of his complaint to try and ensure that all the charges were fully explained, fair and understandable and that the standard of work was satisfactory.
In the absence of itemised billing, the resident raised questions that would help him understand the overspend. He asked:
1. Who instructed the contractor to do the extra work?
2. What was done for the amount overspent, and where was it done?
According to the evidence, the landlord’s responses to the resident’s query were as follows:
1. During the consultation period on 11 March 2016, the landlord wrote to the resident that: “the consultants would have the clerk of work inspectors, and the works would be thoroughly inspected as they progress”. It also said on 2 August 2019 that the appointed surveyor was the person in charge of approving the works. Therefore, the resident received the answer to this question.
2. In November 2016, the landlord sent a newsletter to residents stating that each window needed to be inspected for repairs. The repairs included broken sash cords, windows needing adjustment, and locking mechanisms requiring replacement. The resident requested a full breakdown detailing the number of sash cords renewals in particular. According to the evidence, there were 186 window repairs, 41 of which were sash cords renewal. The work was carried out in 36 properties within the resident’s block. It is unclear why the landlord did not provide this information to the resident.
While it is not for this service to decide whether the landlord’s responses were sufficient to support the resident’s liability to pay the resulting service charge for the works, its responses and explanations were insufficient.
The resident requested a revised list of the works carried out as it was not clear to him which repairs were carried out. The landlord should have provided the resident with a clearer list of the work. For example, this could include more specific details of which repairs were completed on each window and the associated cost. On 17 September 2021, the landlord wrote to the resident and said it did not have a revised copy or detailed list of the works. It is of some concern that the landlord did not know enough information to explain the scope of work, given that the works were supposed to be inspected by the clerk at each stage of the process, as the landlord reassured the resident at the start.
In its final response letter, the landlord said the previous management organisation was responsible for the lack of record keeping during the tendering process in February 2016. However, the resident’s outstanding queries were about the ad-hoc expenditure that came to light during the works. Ultimately, this would be a list of the costs the landlord incurred and agreed to pay for during negotiations on the final accounts. Therefore, the landlord’s explanation is not reasonable.
It has taken the landlord 4 years to publish the final account. This made it harder for the resident to challenge the landlord’s handling of the works and enlist the help of this service.
According to the evidence, it was only in March 2021 that the landlord confirmed it would cap the resident’s contribution at 20% above the original estimate. This investigation recognises that the landlord’s policy of capping major works costs at 20% of the initial estimate is a positive and fair policy, which the landlord was not obligated to offer. However, this was a standing policy, and it was not specific to the works that are the subject of this investigation. It was not implemented to mitigate errors in its handling a particular project.
The landlord wrote to the resident and said that as the cap was in place, it was satisfied that the resident received a ‘fair deal’ and would not answer any more of the resident’s correspondence on this matter. However, the resident should have received the information he requested so he could reach his own conclusions. The landlord’s policy did not mitigate the landlord’s obligations nor the resident’s rights to inspect the account.
Overall, the resident’s request for information about major works was not dealt with appropriately. There was an extensive delay in providing information that was not all related to the final account. Furthermore, there is an ongoing delay with the information the resident has yet to receive. The landlord said the delay was due to awaiting information from its contractors. This was not an adequate explanation for a delay of this length. The landlord said the lack of records was due to the previous management organisation. The landlord should have had adequate processes to ensure effective communications and oversight of third parties so it could fulfil its legal obligations to provide information to leaseholders upon request.
The landlord missed an opportunity to mitigate the resident’s distress by suspending the demand for payments it could not explain, including any interest penalties it imposed on the resident’s account. Although the landlord responded to the resident repeatedly, its answers did not provide sufficient information that it should have recorded and kept on file as the work progressed. Additionally, the landlord could have also collated the missing information during the 3 years it negotiated the final account with its contractors.
Given the distress and inconvenience caused to the resident, the time, and significant efforts the expended since 2017, it is appropriate that the landlord take actions to put it right for the resident. In line with the Ombudsman’s remedy guidance for cases involving maladministration, where the impact on the resident has not been permanent, an order of £500 compensation has been made to redress the landlord’s failures.

The landlord’s handling of the resident’s concerns about workmanship quality

In this case, the resident raised concerns with the landlord about workmanship quality from the outset. On 11 March 2016, the landlord responded to the resident’s observations and said it had a “reliable team of professional consultants and contractors” and that “The consultants will have the clerk of work inspectors and the works will be thoroughly inspected as they progress”.
In May 2017, while the works were ongoing, the resident reported defects. The landlord contacted the contractor on 21 March 2018 and stated:
1. “Most, if not all, window panes have scratches consistent with being caused by rubbing down with glass paper”. It said the contractor was required to document pre-existing damage unless it was considered negligible. The landlord wrote: “Given the severity of these scratches and the fact that the contractor could not prove otherwise, [the landlord] concluded that the contractor caused the damage.
2. Regarding the vertical damage, the landlord said: “Excessive amounts of wood were removed from the sashes. As a direct consequence, the windows were damaged, giving rise to wind and rain entering the stairwell that was not apparent previously”.
The landlord formally responded to the resident on 17 July 2018 and said:
1. Independent consultants had identified some areas where the quality of workmanship was unsatisfactory. It was in the process of dealing with these issues.
2. “There would be a separate inspection at the end of the defects period, which would provide another opportunity to identify any issues with these to give residents additional assurance and comfort on the quality of workmanship”.
3. It had discussed with the resident that replacing the glazing would not be proportional or reasonable considering the minor extent of the scratches. However, it would be seeking to compensate residents.
Evidently, the landlord’s initial response was appropriate. It acted on the resident’s concerns, and it raised the matter with its contractor. There is a gap in the evidence, and it is unclear how the landlord resolved the matter with its contractor. However, shortly after, the landlord offered to replace the glazing in the resident’s property as a gesture of goodwill, at no cost for the resident. From the evidence supplied to this service, it was not apparent that the replacement glazing offered to the resident was excluded from the final account. A further recommendation has been made below for the landlord to remember that when this service requests evidence, it must provide all the available evidence. Furthermore, the landlord should show the resident that this was omitted from the final account.
With regards to the communal windows, the landlord said to the resident that there was no evidence the works had caused the damage. In his escalation request, the resident provided the landlord with evidence. He said one of the properties had its glazing replaced by the landlord as the work started. The new glazing had the same damage that the landlord said was “consistent with the rubbing of sanding paper”. There is no evidence that the landlord investigated this aspect of the resident’s complaint. This was not appropriate.
Similarly, with regard to the draft from the vertical edges of the communal windows, the resident provided a detailed explanation of what occurred with the windows. This was not related to the excessive paint removal but to the installation of a new closing mechanism. There is no evidence that the landlord investigated this issue. Moreover, If the window was in its current state of repair before the works had started, the landlord was obliged to repair it as part of the works it carried out.
The landlord reassured the resident at the start of the work that it would inspect the quality of workmanship after each stage. However, the landlord failed to ensure reasonable oversight and supervision of the works, nor an adequate level of scrutiny prior to signing the project off at the end of the defect liability period. This was not appropriate.
Overall, the landlord has failed to address the resident’s concerns about workmanship in a timely manner. The landlord initially dismissed the resident’s claims of poor workmanship. It then agreed there were issues, but there is no evidence it followed the issue through with its contractor. There is no evidence it investigated the resident’s evidence that the damage was caused by the operatives changing the opening mechanism, nor did the landlord inspect the new glazing it had just installed.
The resident initially requested information about the scope of work to assess the workmanship quality. The project was completed in March 2017; therefore, the quality of the works would have now potentially deteriorated due to the years that have passed. It would be difficult for the resident to arrange for a surveyor to inspect and challenge the works at this stage.
The resident expended significant time and efforts into this matter, but the delay has hampered the resident’s right to challenge the workmanship. Therefore, it would be appropriate for the landlord to put this right for the resident. A further order of £500 in compensation has been ordered below to redress the detriment caused to the resident.
Finally, there is no indication that the landlord has ”learned from outcomes” in this case or detailed any actions it would take to prevent similar issues from recurring in the future. A further order is made below to address this.

Determination

In accordance with paragraph 52 of the Housing Ombudsman Scheme, there was maladministration by the landlord in its handling of the resident’s request for major works information.
In accordance with paragraph 52 of the Housing Ombudsman Scheme, there was maladministration by the landlord in its handling of the resident’s concerns about workmanship quality.

Orders and recommendations

Orders

Within 4 weeks of the date of this report the landlord must:
1. Pay the resident £500 compensation in recognition of the distress and inconvenience caused by the landlord’s handling of the resident’s request for information.
2. Pay the resident £500 compensation in recognition of the time and trouble he expended in raising his concerns about workmanship quality.
3. Review its handling of the case, with reference to the failings outlined in this report. The landlord must write to this service outlining the reasons for these failing and the actions it has/will be taken to prevent a recurrence.
4. Write to the resident providing a detailed description of each charge included in the final account for which the resident had to contribute financially, irrespective of the landlord’s cap of the costs.
5. The landlord must suspend any late payment interests applied to the resident’s service charge account in relation to the major works final account invoice until such time it provided the resident with the information he requested: what works were carried out to which windows within the resident’s block, redacted to comply with data protection regulation.

Recommendations

The landlord should remember that when this service requests evidence, it must provide all the available evidence.