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Clarion Housing Association Limited (202008239)

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REPORT

COMPLAINT 202008239

Clarion Housing Association Limited

31 May 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 response to the residents’ request to change the tenancy from a joint tenancy to a sole tenancy and refund the deposit.

Background and summary of events

Background

  1. The residents, two housemates, commenced a joint assured shorthold tenancy in 2018 for a fixed term of six years. The residents, referred to as ‘resident A’ and ‘resident B’ in this report, rented the property under the landlord’s affordable homes scheme.
  2. The tenancy terms and conditions advises that the tenancy can be ended by giving four weeks’ notice, on receipt of which the landlord’s website advises it would contact the tenant and confirm the last day of the tenancy and the date and time of the check-out inventory, then complete the deposit release process. The landlord’s website (since at least 28 November 2020) advises that to rent a home under its affordable housing scheme, tenants need to be in employment, pass an affordability assessment and credit check, and pay a month’s deposit, in addition to meeting eligibility requirements. The linked information page for private tenants goes on to advise that named tenants have joint rights and responsibilities under a joint tenancy. When ending a joint tenancy before the term, all named tenants must sign the written notice, and anyone wanting to remain in the property would need to complete a new application process before the end of the notice period. There are no terms which allow addition of tenants apart from the succession of the tenancy by someone on the tenant’s death.
  3. The tenancy changes and assignment policy (published February 2019) aims to recognise changes in circumstances, and advises the landlord will not unreasonably withhold permission to change a joint tenancy to a sole tenancy but “arrangements for completing these will vary according to the type of tenancy (assignment or surrender and re-grant of a new tenancy).”
  4. The tenancy changes and assignment procedure goes on to detail in Section 3 that joint tenancies can only be changed to a sole tenancy by assignment; by ending a fixed term or periodic tenancy (via surrender or notice to quit) and granting a new one; or by court order. For fixed term tenancies, both joint tenants need to agree to surrender the tenancy and the landlord needs to agree to re-grant a new tenancy, which it will only consider if conditions are met such as the account being clear and there being no behavioural issues. Where the joint tenancy is surrendered, a new tenancy agreement will be produced in the system, staff will complete a sign up process, then end the previous tenancy in joint names after a new tenancy has been activated. A table at Section 6 of the tenancy changes and assignment procedure summarises that the landlord does not consider requests to change a joint tenancy to a sole tenancy in the case of assured shorthold periodic tenancies. However, requests to change a joint tenancy to a sole tenancy in the case of assured shorthold fixed term tenants (which appears applicable to the residents here) is done by “Surrender of tenancy by both tenants and re-grant.”
  5. The end of fixed term policy (published in February 2021) advises that where a joint tenant requests for the new tenancy to be a sole tenancy because the other tenant is no longer living in the property, this would be agreed to provided the landlord is confident that the joint tenant no longer lives there. The landlord’s website separately confirms (since at least 28 November 2020) that a fixed term joint tenancy can be changed to a sole tenancy, on confirmation from both tenants in writing. The landlord advises that it will normally agree to this if the tenancy has been kept to.
  6. The allocation policy confirms that the landlord may carry out an affordability assessment on applicants for ‘affordable rents’ properties.

Summary of events

  1. The residents’ account advises that in September 2020, resident A contacted the landlord about her intention to move out and leave resident B in situ with an incoming lodger. Resident A was informed that she could move out and make informal arrangements with the incoming lodger to repay her deposit. The residents reportedly queried this and were told different information in a second call and a further call on 11 November 2020. The same day, the landlord internally noted that previous information provided was wrong, and its contact centre should have raised a general enquiry to an appropriate team, or sought advice about the tenancy the residents were on. It noted resident A’s desire to be removed from the tenancy so as not to be responsible for any future debts, but noted that at sign–up, tenants were informed that one tenant moving out severed the tenancy for all. It noted that if the residents wanted to change their tenancy from a joint tenancy to a sole tenancy, this could be done at manager discretion, and if resident A wanted her name removed and it went from joint to sole tenancy, then a credit check on resident B would be needed to see if she can afford to rent on her own. The information provided is not clear about what the residents were told following this internal discussion. The residents report that the landlord subsequently informed resident A that if she moved out resident B would also need to move out, and that it would send out some paperwork.
  2. The residents’ account advises that this was not received, and so resident A made a complaint to the landlord on 8 January 2021. She explained she had been waiting a few months to be removed but the process was not raised correctly, and her name remained on the tenancy and made her liable for legal action despite no longer residing at the property. The same day, this investigation understands that the landlord wrote to the residents and said it was unable to accept applications to assign tenancies due to lockdown, following which resident A raised concern about having informed the landlord of a tenant change in September 2020 and having not yet received back her deposit of £696.
  3. The landlord provided a stage one response on 24 February 2021.
    1. It confirmed the issue had been discussed internally, and advised that resident A and resident B were signed up as joint tenants and so jointly responsible for the tenancy. It advised that it was “unable to change the tenancy from joint to sole,” and unable to return the deposit as the tenancy still existed. It advised that the residents would remain liable for the tenancy until they both surrendered the tenancy, and that it could send out a surrender form if they wished, but it recommended seeking legal advice.
    2. It apologised for the misleading information provided, the length of time it had taken to provide a response and any distress and inconvenience caused, and awarded £250 compensation.
  4. The residents emailed dissatisfaction with this on 1 March 2021.
    1. They were unhappy with contradictory information that had caused confusion and stress, which included being told they would have to vacate the property; being told they were put on the ‘wrong contract;’ being told they would have to undergo a divorce separation for resident A to move out despite being two friends living together; and being told no one else could move into the flat despite the contract contradicting this and a call agent ‘registering’ resident B’s partner before resident A moved out.
    2. They were unhappy resident B’s partner had moved in but was unable to change important information related to banks and work due to lack of a contract.
    3. They were unhappy resident A had not been refunded her deposit and the landlord had not conducted a review of the flat before resident B’s partner moved in, and noted that they understood it was illegal to withhold a deposit if a tenant had followed relevant steps.
    4. They requested removal of resident A from the tenancy and refund of her deposit; a review of the flat since the initial deposits were provided; for resident B and her partner to be named on the tenancy; and compensation for the conflicting information and time, stress and inconvenience.
  5. The landlord internally discussed the complaint and it was initially stated the outcome was unlikely to change as such tenancy changes could not be supported. It was then noted that it could not see a reason why the tenancy could not be changed from a joint tenancy to a sole tenancy in line with section 3 of its procedure. It was noted that, under section 6 of the tenancy changes and assignment procedure, the tenancy type could not be assigned as it was let on the income of both tenants. The tenancy would need to be ended, then an affordability assessment carried out of the remaining tenant, in order to sign resident B up to a new sole tenancy. The landlord subsequently internally agreed an ‘exception’ to the process that would allow resident B’s tenancy to be changed from a joint tenancy to a sole tenancy.
  6. The landlord provided its final response to the complaint on 14 April 2021.
    1. It acknowledged and apologised that it had wrongly advised resident A to make informal arrangements for the deposit and tenancy. It noted this was rectified in the previous response which advised the only way to receive the deposit was to surrender the tenancy.
    2. It said it was not clear it had provided advice to allow resident B to remain in the property, and it said there was a solution that should have been made available. It explained that as joint tenants the residents will have passed its income tests, and to move from a joint to a sole tenancy it would need to assess resident B’s income. It detailed a solution whereby resident A and resident B surrendered the tenancy; the property was inspected for damage; the deposit was refunded equally to the residents; resident B’s income was assessed; and the assured shorthold tenancy offered on the same terms and conditions/rent and a new deposit taken.
    3. It acknowledged and apologised that it had failed to offer timely and accurate communications, and added a further apology that it had not offered the option to move from a joint to sole tenancy. It awarded an additional £50 for this to bring its total compensation offer to £300 (replacing its previous offer of £250).
  7. In September 2021, when providing information toward the investigation, the landlord noted that there was a delay issuing complaint responses which it would award a further £50 for, bringing its total compensation offer to £350.

Assessment and findings

  1. The landlord was reasonable to not add the incoming occupant as a formal joint tenant, as the tenancy terms do not enable addition of formal tenants. The only scenario that appeared to facilitate this was the succession of the tenancy by someone on the tenant’s death. The landlord was also reasonable to advise that both residents needed to end their tenancy before the deposit was returned, as the tenancy was a joint tenancy and there was no condition that allowed resident A to end her tenancy in isolation from resident B and receive her deposit back.
  2. The landlord’s website is however clear that a joint tenancy can be changed to a sole tenancy if joint tenants surrender the tenancy and the tenant who wishes to remain re-applies. This was stated since November 2020 based on checks of when the webpage went ‘live.’ The landlord’s policies advise that a change of a joint tenancy to a sole tenancy is not unreasonably refused as long as certain pre-conditions are met about behaviour and rent payments. This investigation understands that in the case of resident B, this would also include meeting the financial criteria that both she and resident A met to originally obtain the property. The residents’ request to change the joint tenancy to a sole one appears to be one that is generally aimed to be accommodated, and should therefore not involve a seven to eight month delay and require a formal complaint to be considered and processed.
  3. The landlord offered £250 compensation at stage one, which was reasonable to account for the delay, but it still offered the resident the wrong information. Its advice was contrary to that in its policy, and this could have resulted in both parties terminating the tenancy, resulting in an unreasonable outcome for the residents in the circumstances. In its final response, the landlord detailed the most appropriate solution to the residents’ stated outcome and awarded £50 for not offering this previously.
  4. The landlord was appropriate and customer focused to award further compensation, however given the length of time that had passed before arriving at its solution; the inconvenience and distress this caused the residents; and the failure to reflect its policy in previous correspondence – the additional £50 offered falls short of what would have been reasonable. In addition to the amount that the landlord offered for the delays in its stage one response, it should have offered a further amount that better reflected the repeated delay in offering an appropriate solution in accordance with its policy, and the unreasonable time and trouble the residents were having to go to in order for this to be offered, for which £50 was too low in this Service’s opinion.
  5. The landlord should also have demonstrated in its response that it was taking appropriate learning from the case. This investigation understands it is unrealistic to expect staff to know the ins and outs of all policies, however there should be effective resources available to support them when handling enquiries. The course of events and information seen by the investigation suggests that relevant guidance and processes may not be sufficiently clear and do not, for example, clearly reflect the areas of the landlord’s website which mention change of joint to sole tenancies. The landlord should have demonstrated that it was taking effective action to ensure that such requests were effectively progressed more broadly as ‘business as usual’ in future, in line with this Service’s Dispute Resolution Principle to learn lessons from complaints.

Determination (decision)

  1. In accordance with paragraph 54 of the Housing Ombudsman Scheme, there was service failure in the landlord’s response to the residents’ request to change the tenancy from a joint tenancy to a sole tenancy and refund the deposit.

Reasons

  1. The landlord acknowledged and compensated for delays, misleading information and impact on the residents, and set out how the request could be accommodated. However, in the Ombudsman’s opinion the additional compensation offered in its final response fell short, given the length of time that had passed before arriving at the appropriate solution; the inconvenience and distress this caused the residents; and the wrong information in the stage one response. It also did not confirm it had learned lessons and detail steps it was taking, to try to ensure that requests to change the tenancy from a joint to a sole tenancy were effectively progressed more broadly as ‘business as usual’ going forward.

Orders and recommendations

  1. The landlord to pay the residents £450 for its handling of the case (£100 if the previous compensation has been already paid). It should provide evidence of compliance with this within four weeks of the decision.
  2. The landlord to review the case and in particular:
    1. Review any staff training needs for tenancy changes and assignments.
    2. Review relevant policy and procedures such as the tenancy changes and assignment policy and procedure, to consider if these could be clearer generally.
    3. Review if the landlord’s position and process for changing from a joint tenancy to a sole tenancy, including in the case of an ‘affordable rents’ tenancy, is sufficiently detailed in procedure.
  3. It should detail the outcome of its review, and any steps it is taking as a result, to this Service within six weeks of the decision.