Clarion Housing Association Limited (202109659)

REPORT

COMPLAINT 202109659

Clarion Housing Association Limited

31 August 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

The complaint is about the landlord’s response to the resident’s compensation request in respect to structural works, for which she was decanted from her property for seven weeks.

Background and summary of events

Background

The resident is a shared ownership sublease holder of the landlord. The landlord is a leaseholder of the freeholder, a property developer. The sublease commenced in 2017, and states that the landlord will endeavour to procure for the resident the insurance policy and receipt for the last premium.
The landlord’s decant policy sets out its approach to decants and includes that:
1. the landlord is committed to communicating with residents, informing them about required works, and keeping them updated.
2. no rent will be due on temporary accommodation but a tenant will remain liable for rent and service charges at their permanent home.
3. the responsibility for decants will be managed in accordance with the lease, and if this does not explicitly mention decant processes, applicable parties will need to agree who will cover the costs of decanting the resident prior to any works being undertaken.
4. all reasonable costs incurred as a consequence of having to move are met and in the case of a temporary decant, costs covered include removal and storage costs; costs such as internet; and replacement floor coverings. The daily expenses such as food are not reimbursed unless households stay in accommodation without access to cooking facilities.
5. home loss and disturbance compensation payments are applicable to residents who have to permanently decant from their homes, but these are not normally applicable for temporary decants unless this has resulted from the landlord’s actions, failure to act or negligence. The policy also advises that leaseholders will be compensated for home loss where there is a statutory duty to, otherwise leaseholders are expected to recover costs through their own insurance. The policy advises the latter will be the case for freehold properties where the landlord has no power to acquire the freehold.

Summary of events

The information provided advises that three years after the resident moved into the property in 2017, the developer (who is also the freeholder) reviewed the block after some issues were identified at a building of similar construction. The developer then wrote to the landlord on 13 August 2020:
1. The developer detailed that a review by an engineer had identified a small structural issue on the roof. They said there was no immediate safety concern but they needed to strengthen a small segment of the roof to provide extra support. They said this solution involved a carbon fibre reinforcement to a slab, which required access through the resident’s property and ceiling to implement. They said the works would take approximately twelve weeks to complete, and could not be completed with the resident in situ.
2. The developer said they appreciated the inconvenience this may cause and they would assist with finding alternative accommodation. They said the works would be at no cost and the property would be restored to the condition required by the lease. They asked the landlord to confirm who they could contact to discuss the works and how access could be gained to the property.
The resident’s account confirms the landlord informed her that there was an issue with the structural integrity of the flat’s ceiling which meant she would have to move out while remedial works took place.
The information provided advises that the landlord subsequently liaised with the developer to arrange a visit and to clarify the resident’s needs, concerns and queries in respect to the decant:
1. The resident requested clarification on the exact details of the issue; the area in her flat that would be affected; if carpets would be replaced; and if walls and ceilings would be redecorated.
2. The developer informed the landlord that the details of the issue had been previously shared, but clarified this was not within the apartment itself but a section of roof above that needed some additional strengthening. They advised it was not an immediate safety issue but was required for the long term serviceability of the building. They advised they awaited the full scope of works, but the works would occur above the kitchen and dining area and a bedroom. They confirmed that carpets would be replaced and making good, including decoration, would be done in areas where works were completed. They advised that all relevant stakeholders had been engaged including insurers who were satisfied with the course of action being proposed.
3. The resident required the temporary accommodation to be of a similar standard to her property; have internet connection; have adequate working space; and to be in a location that allowed a commute to her work offices if these re-opened.
4. The developer informed the landlord that they would be working with a company, which would liaise with the resident to source accommodation to her requirements and arrange removal and storage of belongings as necessary.
5. The resident queried whether there would be any daily expenses and compensation for the inconvenience of the works and the decant.
6. The developer initially informed the landlord that their aim was to ensure there were no out of pocket expenses as a direct result of the works, and daily expenses would not be considered on the basis that the alternative accommodation and facilities provided would be similar to the resident’s own. This investigation understands that the developer later offered £5,000 if the resident moved out imminently, or £500 if she moved out at a later date.
On 16 October 2020, the landlord wrote to the resident about the developer’s arrangements for the works and confirmed:
1. The scope of the works, which were aimed to be completed in eight weeks and by 12 December 2020, were to:
  1. Set up site compound at Ground Level (externally)
  2. Establish Welfare at Ground Level (externally)
  3. Install protection measures within Apartment
  4. Lift carpet / remove Kitchen units within the work area
  5. Soft Strip ceilings within corridor / study and kitchen / living area.
  6. Remove wall between kitchen and study
  7. Remove electrics within ceiling void within affected area
  8. Prepare and install Carbon Fibre to slab soffit
  9. Reinstate electrics / walls / ceilings / kitchen units
  10. Replace Flooring
  11. Remove protection measures and hand over to client / owner
2. The resident would be paid £5,000 and provided temporary accommodation at no cost to her.
3. The resident’s belongings would be transferred to the temporary accommodation, and other belongings and furniture in certain rooms would be packed and put in safe storage.
4. The resident’s property would be redecorated and have new carpet put down, in rooms where works were carried out.
The resident moved into temporary accommodation on 17 October 2020 and raised some queries between around then and 2 November 2020, which the landlords and developer discussed by email:
1. The resident reported that developer staff had said dust could not be prevented from permeating throughout the property, so she had asked for all belongings and furniture to be put in storage, which the developer noted. The resident said that, for the same reason, the carpet replacement should be for the full flat. The landlord asked the developer to confirm if all the carpet in the flat could be replaced, which the developer confirmed it would be.
2. The landlord asked the developer to confirm for the resident if the building insurers and National House Building Council (‘NHBC’) were aware of the work being carried out. The developer responded that the building insurer was aware and the NHBC had been notified of the developer’s review across their developments.
3. The landlord asked the developer to provide, for the resident, a written explanation of the precise nature of the defect. The developer responded that a small section of slab required additional reinforcement.
The information provided advises the developer provided information and photos to the landlord about the works progress, on 23 October; 6 November; and 20 November 2020. The landlord has stated it forwarded these and provided weekly updates to the resident, which she has not disputed.
On 22 November 2020, the resident made a complaint to the landlord. She noted she had moved into serviced apartments because a construction mistake by the developer caused an issue with the structural integrity of the ceiling of her shared ownership flat. She said she was not satisfied with the service she had received from the developer and the landlord.
In December 2020, the landlord contacted the resident to clarify her complaint and her desired outcome, and she responded that:
1. She had purchased and moved into the property in 2017 and then on 11 September 2020, she was informed by the landlord that there was an issue with her flat’s ceiling structural integrity due to a construction mistake. This meant that a section of the ceiling needed additional strengthening to ensure “the long-term serviceability of the building.” She was informed by the developer that the issue was identified in another of the developer’s buildings of similar construction which led them to carry out the works to her building.
2. She had moved out of the property since 17 October 2020 while the developer installed carbon fibre in the ceiling to make the building structurally sound, was staying in service apartments paid for by the developer, and had to continue paying her rent despite not living in her flat.
3. She had not received a detailed written explanation of the precise nature of the defect and a full write up of the remedial works, for her records and understanding.
4. She had been informed by the landlord and the developer that the NHBC and building insurers were satisfied with the remedial works, and that insurance of the building was unaffected, but she had not received any evidence to substantiate this.
5. The landlord had agreed that the works could be at a convenient time for her, but then the developer had “pushed extremely hard” for the works to begin immediately, because contractors were in place and there was a risk of a lockdown (due to the Covid-19 pandemic).
6. The landlord had said rectifying the issue was a very high priority for the developer, despite the developer saying there was no risk to her staying in the flat in the short to medium term.
7. The developer had been reluctant to be transparent, only provided information after multiple requests, and avoided putting information in writing.
8. The developer had been reluctant to recognise the impact of the issue on her, refused to accept she was entitled to any compensation, and communicated in a bullying way, such as demanding a response to a proposal within hours. She also reported that the developer said an offer of £5,000 would revert to £500 if she moved out in January 2021 when more convenient for her.
9. She said after discussing matters with her solicitor, she requested:
  1. A copy of the insurance policy and receipt for the last premium as detailed in clause 5.2 of the underlease;
  2. A written response from the building insurer of their response to the structural issue and written confirmation that they were satisfied with the remedial works and that the insurance of the building was unaffected;
  3. A written confirmation from the NHBC of their response to these structural issues and written confirmation they are satisfied with the remedial works;
  4. Written details of the precise nature of the defect and remedial work and a copy of documentation the landlord had received from the developer evidencing the need for the work and the concerns identified, including any structural reports; which she said was agreed she would receive at a site visit on 21 September 2020;
  5. A refund of rent payments for the time she was not in her flat, and compensation for mis-selling a property that was not structurally sound and for disruption caused to her and the enjoyment of her property.
The landlord issued its stage one response on 9 December 2020:
1. It noted that it had met with the resident before the works; provided the developer’s scope of works; and provided weekly updates about the works. It noted that after a recent visit to the property, she had then been happy to return on 5 December 2020.
2. It noted the developer had said that as they were the freeholder, they did not need to provide a structural engineer’s report or the precise nature of the remedial works. It noted the developer had confirmed the building insurer were aware and that the NHBC had been notified of the review across their developments.
3. It noted that it was informed that a small section of the slab required additional reinforcement, which meant ceilings had to be removed along with the top section of kitchen cupboards.
4. It noted that walls were redecorated and new carpet was laid, even in rooms where works did not take place, to ensure the carpet was consistent.
5. It noted a request for a rent refund during the time the resident was not in the property and declined this, as the developer had compensated for this by providing a property and covering additional costs.
6. It noted the resident was reassured there was no risk in staying in the property for the time being, but the developers were keen to carry out the works and offered a goodwill payment of £5,000, as contractors were in place and they were unsure if there could be delays due to the changing nature of the Covid-19 pandemic. It disputed that the developer was directly pushy, and said they had set a deadline due to the estimated timeframe for the works and the desire to return the resident to the property before Christmas.
7. It concluded it was confident that it had appropriately communicated with and supported the resident throughout the works. It said it apologised for any upset she was caused but it was pleased the works were completed ahead of schedule and to a high standard, which ensured she returned to the property well before Christmas.
The resident requested escalation of the complaint following this response. The landlord noted that she wanted insurance details as detailed in the underlease, and further details of the fault to inform her and solicitors about what compensation she should seek for the purchase of the property. It was noted the resident felt that, as part owner of the property, she was entitled to the information and the landlord should be able to provide it if it was open and transparent. The information provided advises that the landlord discussed the complaint internally, and confirmed with the developer that there was no technical report.
The landlord issued its final response to the complaint on 12 March 2021:
1. It acknowledged that the resident was unhappy with the information and the compensation she had been provided.
2. It said the developer had made good the defect at their own cost and so the insurance was unaffected. It said the resident would need to contact the buildings insurance provider, whose contact information it provided, for further detail on this.
3. It said the NHBC warranty was not affected by the works as the developer had carried them out, and there was no written information from NHBC as this was not necessary.
4. It noted the developer was the freeholder of the property and the landlord was a conduit for information they provided. It said it would expect the developer, as the freeholder, to hold any report regarding the fault, but it was unable to produce this as it was informed there was no such report. It attached information sent to it by the developer which it understood had been forwarded to the resident. This included the letter from the developer dated 18 August 2020 and progress reports from the developer dated 23 October, 6 November, and 20 November 2020 referenced at paragraphs 9 and 14 of this report.
5. It advised that the developer had agreed to pay the resident £5,000 and the cost of temporary accommodation and making good the property, and would not consider any further payments.
6. It advised that it disputed that the property was mis-sold as the fault was not apparent at the time of sale.
7. It concluded that it was satisfied it had acted properly in the matter, maintained a proper amount of communication, and responded fair and reasonably in its previous response. It acknowledged and apologised that there was a delay in its final response to the complaint and awarded £50 in recognition of this.
The resident subsequently brought the complaint to this Service. She restated that she should be refunded rent payments for the period she was not in the flat, and be given adequate compensation for being mis-sold a property that was not structurally sound and the significant disruption to her and the enjoyment of her property. She stated the landlord and the developer were reluctant to be transparent; to recognise the negative impact on her; and to accept she was entitled to any compensation. She stated they had communicated in a bullying way by demanding answers to their requests within a matter of hours. She stated that she only accepted the £5,000 as an incentive for the inconvenience of moving very quickly and had said she had reserved her right to pursue further action.

Assessment and findings

This Service understands the resident experienced disruption when she had to move out of her home for the works to be been done, and recognises this must have been very distressing and inconveniencing for her.
The Ombudsman’s remit in relation to complaints is set out by its Scheme, and Paragraph 39(i) of the Scheme 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.”
This means it is not within the Ombudsman’s authority or expertise to determine that the resident was mis-sold the property, or that the quiet enjoyment of her home was affected, in the same way as the courts. The Ombudsman’s main consideration is whether, taking account of all the circumstances of the case, the landlord followed proper procedure, good practice and acted and responded reasonably in the course of the complaint. While the Ombudsman can take a view on the position, if this is disputed, only a court can offer a definitive and legally binding decision.
The landlord is not the freeholder, however it has obligations to act as an effective intermediary and it seems to have done so in this case. The landlord worked with the developer and resident to facilitate her move out of the property within around two months of the developer’s initial communication. This shows that the landlord took steps to help swiftly address any issue with the structure of the block, as soon it became aware of this. The landlord did not manage the decant, which was reasonable given the circumstances, however the handling of the decant seems equivalent to if it was handled under the landlord’s decant policy set out at paragraph 3 of this report. The landlord ensured that the resident’s preferences in terms of accommodation, carpet replacement and redecoration were considered and addressed by the developer, which demonstrates it communicated effectively on her behalf in matters. It has not been disputed that the landlord then kept the resident updated over the seven week period she was out of her home. The landlord’s conclusion in its response that it appropriately communicated with and supported the resident throughout the works therefore appears reasonable.
The landlord acknowledged the resident’s claim the property was mis-sold and set out its position that it disputed this as the fault was not apparent at the time of sale, which appears reasonable. This investigation does not focus on the sale as this occurred several years before the complaint (and so is out of time); and it is not in this Service’s expertise to determine if the property was mis-sold, on which only a court can offer a definitive and legally binding decision.
The landlord acknowledged the resident’s request for details and reports about the structural issue, and this investigation can see it passed on to the resident what information it was in possession of and sent by the developer. The landlord therefore responded reasonably to this aspect given it is not the freeholder.
The landlord acknowledged the resident’s request for reimbursement of rent and service charges, but was reasonable to note that a property and additional costs were provided. This was in line with the landlord’s decant policy, which states that while no rent will be due on temporary accommodation, a tenant will remain liable for rent and service charges at their permanent home.
The landlord acknowledged that the resident felt parties were pushy and bullying toward her, and provided explanation. This investigation can see that the developer was keen for the works to be done, the resident was asked to make decisions quickly, and the situation will have been a stressful one for her. The resident’s account confirms she was given the choice of when to move out, and that she was compensated £5,000 to recognise the inconvenience that will have been caused by moving out so quickly. The landlord’s decant policy advises that for temporary decants it carries out, compensation such as the £5,000 and £500 the resident was offered is not applicable apart from coverage of accommodation and reasonable costs as a consequence of the decant. The resident therefore benefited from a payment of £5,000 which there is no specific obligation for her to be paid by the landlord. This demonstrates that the landlord and developer recognised the distress and inconvenience the situation will have caused the resident and liaised to exercise positive discretion.
The landlord acknowledged the resident’s requests for confirmations from the insurer and NHBC and set out its position on these. The responses were reasonable given the evidence and that the landlord was not the freeholder. The resident has the option to contact the insurer and NHBC directly for their position on matters, if she is dissatisfied with explanation provided and wishes to clarify things further.
The resident raises issues with transparency however apart from an apparent misunderstanding that the structural issue was with her ceiling, when it was with the roof of the block, the evidence for this is limited. The resident was appropriately given opportunity to meet with the developer about the matter, and was forwarded information such as the scope of works in October 2020, which explained what was intended to be done. The resident was also supplied (or re-supplied) relevant information with the final response. The information the resident was provided has been transparent about important points, such as there being a structural issue which required works, and the issue not affecting her safety or the insurance status of the building.
In the Ombudsman’s opinion, considering all of the circumstances, the landlord has responded appropriately to the complaint. The landlord took steps to help swiftly address any issue with the structure of the block, and to minimise as much as possible the impact on the resident of having to rectify this through the ceiling of her property. The resident benefited from a payment of £5,000 which there is no specific obligation for her to be paid by the landlord. The landlord considered the resident’s concerns and set out reasonable positions, given its role in matters as a leaseholder itself.
While the above is the case, the landlord did not seem to provide the insurance policy and receipt for the last premium, which the lease obligates it to endeavour to do. This does not have a significant impact on the outcome of the complaint, and so a recommendation is made in respect to this.

Determination (decision)

In accordance with paragraph 54 of the Housing Ombudsman Scheme, there was no maladministration in the landlord’s response to the resident’s compensation request in respect to structural works, for which she was decanted from her property for seven weeks.

Reasons

The landlord took steps to help swiftly address any issue with the structure of the block, and to minimise as much as possible the impact on the resident of having to rectify this through the ceiling of her property. The resident benefited from a payment of £5,000 which there is no specific obligation for her to be paid by the landlord. The landlord considered the resident’s concerns and set out reasonable positions, given its role in matters as a leaseholder itself.

Orders and recommendations

Recommendation

The landlord to liaise with the resident and developer in respect to her request for a copy of the insurance policy and receipt for the last premium, or set out its position on this to the resident. The landlord should inform this Service of its intention in respect to this recommendation within four weeks of this decision.