Barking and Dagenham Council (202001600)

REPORT

COMPLAINT 202001600

Barking and Dagenham Council

1 April 2021

Our approach

What we can and cannot consider is called the Ombudsman’s jurisdiction and is governed by the Housing Ombudsman Scheme. The Ombudsman must determine whether a complaint comes within their jurisdiction. The Ombudsman seeks to resolve disputes wherever possible but cannot investigate complaints that fall outside of this. 

In deciding whether a complaint falls within their jurisdiction, the Ombudsman will carefully consider all the evidence provided by the parties and the circumstances of the case.

The complaint

1. The resident is unhappy with the landlord’s division of service charges in relation to major works.

Determination (jurisdictional decision)

2. When a complaint is brought to the Ombudsman, we must consider all the circumstances of the case as there are sometimes reasons why a complaint will not be investigated.
3. After carefully considering all the evidence, I have determined that the complaint, as set out above, is not within the Ombudsman’s jurisdiction.

Summary of events

4. In June 2016 the resident was served with a Section 20 notice. The resident asked if the charge for these major works would be split between both commercial and leasehold units in the building. In October 2016, the landlord confirmed that the cost would be divided equally between all units in the building.
5. On completion of the major works, the resident received a bill. They raised a query as the costs had only been split between the leasehold units. The landlord explained that the commercial units only benefited from some aspects of the works meaning only some of the costs would be payable by these units.
6. The resident raised a complaint about the division of the service charges. In response, the landlord agreed to offer them a 50% discount on their service charge invoice.
7. The resident believes that the costs should have been equally divided between both the leasehold and commercial units in the building, therefore, the original amount of the invoice had been calculated incorrectly.
8. The landlord disagreed, explaining that the major works could not be split equally across both leaseholders and commercial tenants, and referred the residents to the First-tier Tribunal regarding the division of the charges.
9. On 1 June 2020, the resident brought the complaint to the Housing Ombudsman, explaining that they believe the landlord had agreed to split the cost of major works across both residential and commercial units. They believed that the landlord should recalculate the cost of major works to reflect this and then apply the 50% discount offered in response to their complaint.
10. Reasons
11. Paragraph 39(g) of the Scheme states that 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.
12. The leaseholders have been clear that their complaint is about the apportionment of service charges. They state that in 2016, the landlord explained that costs would be split across all units in the buildings, and have not done this.
13. The landlord’s position is that it cannot charge its commercial residents an equal share of the work carried out in the building. 
14. In its response to the complaint, the landlord offered to discount the charge for major works by 50%. The resident has explained that they believe the original calculation of service charges was incorrect and that this needs to be resolved prior to the application of the 50% discount. However, part of the resolution the leaseholders are asking for is that the landlord split the costs of the major works equally between both commercial and residential units. In order for this Service to recommend that the landlord do this, we would need to be satisfied that the charges had been calculated correctly and should be split in this way.
15. In accordance with paragraph 39(g) of the Scheme, this Service cannot consider the leaseholders’ complaint as it is concerns the level of service charge.
16. I’ve also looked to paragraph 39(i) of the Scheme, which states that 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.
17. The leaseholders have previously been advised that the First-tier Tribunal would be better placed to deal with this complaint. This is because they are able to consider leasehold disputes – including disputes over service charges. The Tribunal can also issue a binding decision about liability for service charges.
18. In accordance with paragraph 39(g) and (i) of the Scheme, this Service cannot consider the leaseholders’ complaint as it is best dealt with by the First-tier Tribunal.