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London Borough of Newham (202305405)

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REPORT

COMPLAINT 202305405

London Borough of Newham

12 April 2024

 

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 handling of:
    1. The resident’s service charge queries.
    2. The associated complaint.

Background

  1. The resident is a leaseholder of the property, and the landlord is the freeholder. The property is a flat within a building comprised of similar properties.
  2. On 2 October 2022, the resident emailed the landlord and requested a breakdown of the service charge costs in relation to minor repairs. She requested details of the nature of each repair, the breakdown cost of each repair and repair completion dates.
  3. On 9 January 2023, the resident submitted a complaint to the landlord. She explained she felt she had been overcharged service charges for minor repairs and that the work did not represent good value for money. The resident also stated the landlord did not provide her with any supporting documents or adequate explanations for the charges.
  4. The landlord provided its stage one complaint response to the resident on 26 January 2023. It apologised for its lack of communication regarding the resident’s service charge queries. The landlord stated that the relevant team would contact the resident shortly to discuss the resident’s service charge concerns and provide her with a breakdown of the costs for the minor repairs.
  1. On 13 March 2023, the resident requested her complaint to be escalated to the next stage of the landlord’s complaints process. The resident stated she was escalating the complaint because the landlord had failed to provide her with a breakdown of costs for the minor repairs which it agreed to do in its stage one complaint response.
  2. The landlord provided its stage 2 complaint response to the resident on 22 May 2023. It apologised for the delay in providing the breakdown of service charges following its stage one complaint response. The landlord explained that the resident had now been provided with a breakdown and explanation of her service charges, and it stated that she remained dissatisfied with the information provided. The landlord stated its repairs and maintenance service completed all repairs. Therefore, any charges were by internal transfer for the cost of the works and labour, rather than via an invoice. The landlord stated it would only receive invoices for repairs carried out by an external contractor, which in this case, did not apply. The landlord also apologised for its delay in responding to her stage one complaint. It offered the resident £100 compensation for the delay and £150 compensation for its delay in providing the resident with the service charge cost breakdown information.
  3. The resident remained dissatisfied with the landlord’s response and submitted her complaint to the Ombudsman. She stated her desired outcome was to receive a breakdown of costs and materials for the completed minor repairs and transparency around the cost of the minor repairs, such as unblocking the drain and replacing the pram shed door.

Assessment and findings

Scope of investigation

  1. This report will consider whether the landlord sufficiently responded to the resident’s query regarding the service charge. Disputes about the level of rent or service charge or level of increase are outside the remit of the Ombudsman and are better suited for consideration by the First Tier Tribunal (Property Chamber). This is because paragraph 42 (d) of the Housing Ombudsman Scheme (available on our website), explains that the service cannot investigate complaints that concern the level of rent or service charge or the amount of rent or service charge increase. Therefore, the Ombudsman will not respond to the resident’s concerns about the level of service charge, including whether it represented good value for money.

Policies, procedures, and legislation

  1. The landlord’s website provides information about service charges. It explains that a leaseholder will be charged for the services the landlord provides, as well as the ground rent. It states the services that a leaseholder is charged for will vary depending on where they live, the type of property they have, and the conditions of their lease.
  2. Section 22 of the Landlord and Tenant Act 1985 also sets out the statutory timescales when landlords are expected to respond to service charge enquiries. A landlord is expected to respond within one month of the request or six months of the end of the period to which the query relates, whichever is later.

Assessment

The resident’s service charge queries.

  1. On 26 September 2022, the landlord issued the resident with her annual service charge account bill for the financial year of 2021/2022. Following this, the resident emailed the landlord on 2 October 2022 and requested a breakdown of the service charge costs in relation to minor repairs. She requested details of each repair, a breakdown cost of each repair and repair completion dates.
  2. The landlord responded promptly to the resident’s initial query and responded within a couple of days. It provided the resident with a brief description of the repair, the invoice cost, and the completion of the repair. The landlord’s response was reasonable, and it provided all the information she requested. Following the receipt of the information, the resident emailed a further query to the landlord on 5 October 2022 and 16 October 2022. She explained she wanted to query about the cost of some repairs and asked the landlord for the following information:
    1. A detailed description/rationale for each entry on the spreadsheet it had provided.
    2. A breakdown of the calculation for each of the sums specified on the spreadsheet and how they have been apportioned.
    3. The relevant invoices/supporting documents and/or extracts showing the sums charged.
  3. There was a delay in the landlord responding to the resident’s request. Therefore, she sent a chaser email to the landlord on 24 November 2022 asking for an update on the requested information. The landlord responded to the resident on the following day and explained that the staff member who dealt with the query was on annual leave. It explained that it would provide the resident with an update on her request no later than 29 November 2022. The landlord failed to provide an update and a response to the resident’s query  until 15 December 2022. This delay was unreasonable and would have inconvenienced the resident as she was waiting longer than she should have been for an answer to her query.
  4. The landlord explained in its response sent to the resident on 15 December 2022, that the spreadsheet it had attached to its email included details of the repair works carried out and showed the breakdown of the calculation for each of the sums specified and how they had been apportioned. It also stated that the residents of the building reported the repair issues. The landlord also explained in its response that it could not provide any invoices for the repairs because the repairs were carried out internally by the landlord’s operatives and not by external contractors.
  5. The Ombudsman has reviewed the spreadsheet with the breakdown of the minor repairs which were sent to the resident. The following information was included in the spreadsheet:
    1. Job number.
    2. Description of repair.
    3. Completion date of repair.
    4. Invoice cost.
    5. Total cost for minor repairs charged to the leaseholders.
  6. The spreadsheet provided by the landlord included 5 minor repairs. An example of one repair included on the spreadsheet was a communal repair to a drain in the front garden, which was blocked and overflowing with sewage. The completion of the repair was on 20 January 2022 and the invoice cost was £463. The landlord’s response to the resident’s query was reasonable, and it provided sufficient information about the minor repairs which were carried out and the cost of each minor repair. It also provided an acceptable response of why it could not provide invoices.
  7. On 21 December 2022, the resident emailed the landlord and explained that she was unhappy with the information it had provided. She stated she had requested a detailed breakdown and wanted further details, such as when the issue was first reported and how the repair works were undertaken. The resident also stated that she found it unsatisfactory that the landlord could not provide supporting invoices.
  1. There was a delay in the landlord responding to the resident’s additional query. Because of the delay, the resident submitted a complaint to the landlord on 9 January 2023 and the landlord confirmed in its stage one complaint response issued on 26 January 2023 that it would respond to the resident’s service charge query soon. The landlord failed to respond to the resident’s query after issuing its stage one complaint response, which resulted in the resident escalating the complaint to stage 2.
  2. The landlord provided its stage 2 complaint response to the resident on 22 May 2023, which included a response to the resident’s query from December 2022. It explained that it previously provided the resident with a spreadsheet of the breakdown of the minor repairs and an explanation. The landlord restated it could not provide invoices because its internal repairs team carried all the repairs out. It explained that any charges are by internal transfer for the cost of the works and labour, rather than via an invoice. In addition, the landlord also explained in its file submission to the Ombudsman that its systems do not produce invoices for repairs completed by its internal teams, and it only receives invoices for repairs carried out by an external contractor, which, in this case, does not apply. The landlord also explained that repairs are carried out against a schedule of rates (SOR) which are adapted into SOR codes. It stated the SOR codes become a payment once a repair is completed, predominantly by its in-house operatives. Hence, there is no requirement for an invoice.
  3. The Ombudsman recognises the resident would like further information in response to her service charge queries. However, the landlord has provided a reasonable response to the resident’s service charge queries about the minor repairs, which included a spreadsheet with details of each repair, the cost of each repair and the amount charged to the resident. It has also provided a valid explanation of why it could not provide supporting invoices. Therefore, the Ombudsman would not expect the landlord to provide any further information in response to the resident’s queries in this instance.
  4. Although the landlord provided a sufficient response to the resident’s service charge query there were delays in the landlord responding to the resident’s second service charge query sent in October 2022 and the third query sent in December 2022. The landlord acknowledged and apologised for the failure and offered the resident £150 compensation. The compensation offered to the resident is compliant with the Ombudsman’s Remedies Guidance (published on our website), which sets out the Ombudsman’s approach to compensation. The remedies guidance suggests awards of £100 to £600 when there was a failure by the landlord which adversely affected the resident, but there was no permanent impact. In this case, there may be no permanent impact on the resident, as she eventually received a response from the landlord to his queries, but she was inconvenienced by the delayed response. The compensation proportionately reflects the impact of the delay on the resident, and it amounts to reasonable redress in this case.

The associated complaint.

  1. The Ombudsman’s Complaint Handling Code (The Code) sets out the Ombudsman’s expectations for landlords’ complaint handling practices. The Code states that a stage one response should be provided within 10 working days of the complaint. It also states that a stage 2 response should be provided within 20 working days. The landlord’s complaints policy references the same timescales as the Code.
  2. The resident first submitted her complaint to the landlord on 9 January 2023. Following this, the landlord provided its stage one response on 26 January 2023. This response was slightly late by a few days and not compliant with the Code and the landlord’s complaints policy.
  3. On 13 March 2023, the resident requested her complaint to be escalated to the next stage. It took over 2 months for the landlord to provide its stage 2 complaint response, which was provided on 22 May 2023. The response was late and would have caused inconvenience for the resident, as the resident was delayed in progressing the complaint to the Ombudsman because she needed to wait for the landlord’s final response before contacting our service.
  4. The landlord acknowledged in its stage 2 complaint response that there was a delay in issuing its stage one complaint response, and it offered the resident £100 compensation to recognise the delay. As the stage one complaint response was only late by a few days, the Ombudsman would have considered an apology proportionate for the delay. Although the landlord did not acknowledge its delay in issuing its stage 2 complaint response, the Ombudsman considers the £100 compensation offered by the landlord for its complaint handling errors is proportionate to recognise the delays in issuing both the stage 1 and 2 complaint responses.
  5. The compensation offered to the resident is compliant with the Ombudsman’s Remedies guidance referenced above. The compensation proportionately reflects the impact of the delay on the resident, and it amounts to reasonable redress in this case.

Determination (decision)

  1. In accordance with paragraph 53 (b) of the Housing Ombudsman Scheme, the landlord has made an offer of redress prior to investigation, which in the Ombudsman’s opinion, resolves the complaint about the landlord’s handling of the resident’s service charge queries satisfactorily.
  2. In accordance with paragraph 53 (b) of the Housing Ombudsman Scheme, the landlord has made an offer of redress prior to investigation, which in the Ombudsman’s opinion, resolves the complaint about the landlord’s complaint handling satisfactorily.

Recommendations

  1. It is recommended that the landlord pay the resident its original offer in its stage 2 complaint response of £250 in compensation within four weeks if it has not already done so. The Ombudsman’s finding of reasonable redress is based on the understanding that this compensation will be paid.