Clarion Housing Association Limited (202100142)

REPORT

COMPLAINT 202100142

28 June 2021

Our approach

1. 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. 
2. 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

3. The complaint is about charges in respect of major works, specifically, the landlord’s ability to recover these costs having not set up a sinking fund for such purposes. 

Determination (jurisdictional decision)

4. 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.
5. 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

6. The resident is a leaseholder of the landlord at the property and on 9 December 2019, the landlord sent him a ‘Section 20’ notice, in accordance with the Landlord and Tenant Act 1985, setting out its intention to carry out major works at the property, asking for any observations to be made within 35 days from the date of the notice. The resident did not submit any comment.
7. On 7 February 2020, the landlord sent a further letter to the resident, advising him of the cost of the major works; he would need to pay £3,953.85 every 6 months from 1 April 2020.
8. The following month, on 17 March 2020, the resident emailed the landlord querying the charges for major works; he had understood that a sinking fund should have been set up to cover such circumstances.
9. The email was sent to an address no longer in use by the landlord which caused delay in the landlord responding.  The resident contacted the landlord on further occasions, including on 22 June 2020, to which the landlord responded on 3 July 2020, advising that the matter had been raised as a formal complaint and it would be in touch within 10 working days.
10. On 10 July 2020 the landlord confirmed that any action to recover costs had been put on hold pending the outcome of the investigation into the complaint and stated that it hoped to be able to provide an update the following week.
11. On 15 July 2020, however, the landlord emailed the resident, advising it needed additional time to be able to respond to the complaint.
12. The landlord investigated the complaint by seeking advice from its ‘Rent & Service Charge’ team and sought legal advice. 
13. On 3 August 2020 the resident chased the landlord for a response to his complaint again. The landlord said in reply that it was hoping to be able to provide a response by 7 August 2020.  On 11 August 2020 the landlord advised that the matter was still being looked into. 
14. The resident stated his dissatisfaction with the length of time it was taking the landlord to look into his complaint in an email to it dated 12 August 2020, to which the landlord responded on 20 August 2020, stating that the matter was still being investigated and apologised for the delay.
15. On 25 August 2020 there was email communication between the landlord and resident, with the landlord stating that it could not get hold of the resident by telephone and the resident confirming the landlord had the correct number and that similarly he could not get hold of the landlord.
16. On 26 August 2020, the landlord issued its stage one response to the complaint. The landlord apologised for its delay in responding, stating that it had not been able to reach the resident on the telephone number he had provided. The complaint was not upheld.  The landlord advised that there was no reserve or sinking fund and that the lease did not require it to contractually provide one; this was based on legal advice. 
17. Having requested his complaint be escalated to stage two of the landlord’s complaint procedure, on 24 November 2020, the landlord issued its stage two response to the complaint. It apologised for its delay in issuing the response, for which it offered £50 in recognition. The landlord did not uphold the complaint, reiterating its legal position.
18. The resident continued to express his dissatisfaction with the landlord’s actions as well as his disagreement with the landlord’s legal position as to the recoverability of fees and outcome of the peer review thereafter.

Reasons

19. Paragraph 39(g) and 39(i) of the Housing Ombudsman Scheme state the following respectively:

“The Ombudsman will not investigate complaints which, in its opinion…

(g) “…concern the level of rent or service charge or the amount of the rent or service

charge increase”;

(i)                 “…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”.

20. The resident is disputing the level and reasonableness of the charges levied by the landlord for the major works; he believed his service charges were already contributing to a sinking fund and moreover, that the landlord was legally obliged to have set a reserve fund up for the very purpose of major works and that this is a requirement in accordance of the lease agreement.  The landlord does not agree with the resident’s interpretation of the lease.
21. The First–Tier Tribunal (Property Chamber) is able to assess and make rulings on reasonableness and liability as to service charges, including section 20 major works charges.  It is also able to make a definitive interpretation of the lease, and consider the alleged failure of statutory requirments if this is required for the resolution of the case.  The Ombudsman is unable to do this and this makes this aspect of the complaint outside of the jurisdiction of this Service to consider in accordance with paragraphs 38(g) and 39(h) of the Housing Ombudsman Scheme.
22. Should the resident want to take matters further, he may wish to make an application to the First Tier Tribunal (Property Chamber). The Ombudsman would like to apologise for the length of time that it has taken to confirm our jurisdiction in respect of the complaint.  Jurisdiction is a complex matter and to come to a conclusion on the complaint a thorough assessment the facts had to be completed first.