London & Quadrant Housing Trust (202002368)

REPORT

COMPLAINT 202002368

London & Quadrant H T

22 July 2021

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 refers to:
1. The landlord’s response to the resident’s reports of a water leak into her property.
2. The resident’s concern that she should be paying her service charge directly to the managing agent of the building instead of the landlord.
3. The resident’s concerns about the level of her service charge.
4. The resident’s complaint to the managing agent of the building.
5. The landlord’s handling of the associated complaint.

Jurisdiction

What we can and cannot consider is called the Ombudsman’s jurisdiction. This is governed by the Housing Ombudsman Scheme. 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.
After carefully considering all the evidence, in accordance with the Housing Ombudsman Scheme, the following aspects of the complaint are outside of the Ombudsman’s jurisdiction.

The resident’s complaint to the managing agent of the building.

Paragraph 25 (a) of the Scheme states:
1. The Ombudsman can only investigate complaints by a person who is or has been in a landlord/tenant relationship with a member landlord. This includes people who have a lease, tenancy, licence to occupy, service agreement, or other arrangement to occupy premises owned or managed by a member can make complaints to the Ombudsman about members.
The Housing Ombudsman cannot look at matters where the complainant is not in a tenant-landlord relationship with a landlord who is a member of our Scheme. As the resident is not a tenant of the managing agent/freeholder of her building. It would not be within our jurisdiction to investigate the complaint she had made against it. We would only be able to consider the complaint she had made directly to the landlord as her contract is with the landlord not the freeholder. The resident would be advised to seek independent legal advice if she wishes to pursue action against the managing agent/freeholder. The Ombudsman cannot give legal advice and therefore we are unable to comment on this matter further.

The resident’s concerns about the level of her service charge.

Paragraph 39 (g) of the Scheme states:
1. 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.
In her correspondence with the landlord, the resident has expressed concern about an increase in her yearly service charge. The Ombudsman cannot review complaints about the increase of service charges and determine whether service charges are reasonable or payable. Complaints that relate to the level, reasonableness, or liability to pay rent or service charges are within the jurisdiction of the First-Tier Tribunal (Property Chamber) and the complainant would be advised to seek free and independent legal advice from the Leasehold Advisory Service (LEASE) (https://www.lease-advice.org/) in relation to how to proceed with a case.

Background and summary of events

The resident is a shared ownership leaseholder of a flat within a block of flats and pays rent and service charges to the landlord. The landlord is the head lease holder for her property but is not the freeholder of the building.
The freeholder is also the managing agent for the building. The resident experienced a leak into her property from the flat above, the landlord does not have any contractual relationship with the occupier of the flat above, who is also a leaseholder.
The resident emailed the landlord and the managing agent on 24 June 2020 and explained the following:
1. She said that she had been in touch with the managing agent, who explained that the leak was from the flat above and originated from the occupier’s kitchen sink. The occupier’s plumber had attended and rectified this issue. It had said that it had planned to carry out a further inspection of the flat above to ensure works had been carried out but had not been allowed access to the property. It said that it would arrange forced access if there were no further developments.
2. She had been contacted by the landlord of the flat above who had said that it had issues with black stains on the walls above the kitchen units and that there was no leak from the kitchen sink.
3. The resident asked her landlord to provide her with pictures of the location of the leak, the repair and a detailed report from the contractors and surveyors of the issues, which the managing agent had stated had come from the sink of the flat above.
The landlord responded on 25 June 2020 and explained that as the resident was a shared owner and the flat above the resident’s was not on its system, it could not get involved in the process of resolving the issue.
The managing agent responded to the resident on 29 June 2020 and explained that it had no details of the resident as being the occupant of her property because its relationship was with her landlord and not her. It confirmed that she would need to contact the landlord of her property to raise any enquiries or complaints. It confirmed that as the freeholder, it had a responsibility to ensure that communal services within the block are fit for purpose and free from defects. It had investigated this matter and confirmed that the communal pipework above the resident’s property was watertight. The leak affecting her property was from the kitchen sink of the flat above and it advised that her complaint should rest with the occupier of that flat. It confirmed that the leak had since been resolved. It explained that it wished to carry out a further investigation and removed a section of her ceiling to check that there were no breaks in the pipe above.
The resident raised a claim against the managing agent’s insurer around this time. The insurer responded on 14 July 2020 and explained that as the leak was coming from a flat that was not owned by the managing agent, it did not see how the managing agent had been negligent. The insurer therefore denied the resident’s claim. The insurer advised the resident to redirect her claim for compensation to the owner of the flat responsible. The resident was seeking compensation for the excess she paid to her own insurer for repairs to her flat, the costs of redecorating her flat and damage to the oven etc as well as loss of earnings for time taken off work to attend repairs.
Following contact from the resident, the Ombudsman wrote to the landlord on 5 January 2021 to outline the resident’s complaint about its response to her request that it took action to resolve a leak into her home. We asked it to contact the resident for further details of her complaint and provide a response within its complaint policy timescales.
The landlord acknowledged the resident’s complaint on 7 January 2021 both over the phone and via email. It confirmed that it would provide a response by 20 January 2021.
The landlord issued its stage one complaint response to the resident on 19 January 2021 and explained the following:
1. It confirmed that the resident had contacted it about the leak into her property and had said that this was coming from the flat above. The landlord had advised that it was not the landlord of the above property and it was therefore unable to take action to remedy the leak.
2. It advised the resident, if she had not done so already, to contact the occupier of the flat above to explain that water was leaking into her property and trust that they would take action. It said that it could write to the occupier of the property directly on her behalf if she was not able to do so.
3. It explained that, as a homeowner, the resident would need to claim on her own household insurance for damages because of the water entering her property. It had provided the resident with its insurer’s details.
4. It explained that if the resident remained dissatisfied, she could escalate her complaint to stage two of its internal complaints process.
The resident responded on 21 January 2021 and explained that the landlord had not addressed her concerns. She explained that the leak was resolved and her concern was that the landlord considered her responsible for dealing with issues such as leaks but the managing agent of the building would only communicate with the landlord. This meant that any issues took more than a year to resolve as she had to fight to be recognised as responsible and the managing agent would not communicate with her. She said that either the landlord should take responsibility, or she would be responsible and pay her service charge directly to the managing agent rather than the landlord.
The landlord responded on 25 January 2021 and explained that it could not be held responsible for the water leaks affecting the property. It also explained that the service charge payments would need to be paid directly to itself. It confirmed that the resident could escalate her complaint if she remained dissatisfied.
The resident asked to escalate her complaint on 26 January 2021 and explained that she had not said that the landlord would be responsible for the leak. She expressed concern that the managing agent considered the landlord responsible for her flat, so when she had housing issues, the managing agent would only speak to the landlord and not her. She felt she was paying a service charge for a service she did not have and said that either the managing agent should treat her as a customer, of the landlord should speak to it directly. She did not understand why she paid the landlord for the management of the building when it did not provide this service.
The landlord escalated the resident’s complaint on 26 January 2021 and confirmed that she would receive an acknowledgement email from the member of staff assigned to her case.
The landlord issued its stage two complaint response to the resident on 9 April 2021 and explained the following:
1. It apologised for the delay in responding to her complaint at stage two of its process. It acknowledged that the resident had contacted the Ombudsman as she was unhappy with the handling and response to her request for it to take action to remedy a leak into her property.
2. It confirmed that it had investigated the leak from the property above the resident and found that this was now rectified. It confirmed that for any damages, the resident would need to claim via her home insurance. If she did not have her own insurance, she would be able to refer a claim to the landlord’s insurance team.
3. It acknowledged that the resident was not happy as she felt she was not receiving the expected services from the managing agent. It explained that the resident would need to contact the managing agent directly for any dispute she may have about its services, as the landlord would not be able to deal with the resident directly regarding these matters.
The resident responded on the same day and explained that she was still dissatisfied as the landlord had not understood her concerns. She was concerned that she paid a service charge to the wrong company. She advised that she did not receive a service from the managing agent as it considered the landlord to be its customer, not her.

Assessment and findings

The landlord’s response to the resident’s reports of a leak in her property.

The resident’s lease states that she would be responsible for keeping in repair the interior of the property. In this case, the managing agent of the building would be responsible for the structure and common areas of the building and determining where the leak originated. If the leak originated from another leasehold property, it would be that leaseholder’s responsibility to resolve the leak and the managing agent’s responsibility to ensure this was completed satisfactorily and did not affect the structure of the building.
The landlord would have limited responsibility because it had no relationship with the occupier of the upstairs flat and could not compel them to take any action regarding the leak. If the resident feels that her property was damaged as a result of negligence by the occupier of the flat above, she may wish to take legal advice on how to proceed with a case against the occupier. The landlord could not directly investigate the cause of the leak itself as that was the managing agent’s role. However, the landlord would be expected to follow-up with the managing agent and provide updates to the resident regarding the progress of the repair once it was made aware of the issue.
This situation has clearly been distressing for the resident as there is no evidence that she was adequately informed of how she could resolve the problem with the leak or who she should contact about this. Following the resident’s concern that she had been given different accounts of where the leak had originated by the managing agent and the landlord of the flat above hers, it would have been appropriate for the landlord to discuss this matter with the managing agent on her behalf to ensure it was dealt with correctly and provide the resident with updates.
Whilst the landlord would not be directly responsible for the leak, it has responsibilities towards the resident and it would have been appropriate for it to act proactively in resolving the issue. There are limited steps it could take; however, the resident’s contract is with the landlord not the managing agent so the managing agent was not obliged to respond to the resident. The resident should be able to direct any enquires to the landlord in the first instance.
The landlord later said that it could contact the occupier of the above flat on her behalf, which would have been reasonable from the outset, however by this stage, the issue of the leak had already been resolved.
The resident is seeking compensation for her insurance excess, redecorating her flat and damage to the oven etc as well as loss of earnings for time taken off work. The landlord would not be expected to compensate her for these costs as it was not responsible for causing the leak or fixing it. The Ombudsman cannot consider any complaint about the insurer, but the resident may be able to approach the Financial Ombudsman about this, if she is dissatisfied with the insurer’s handling of her claim.
The landlord has taken appropriate steps to provide its insurance details to the resident so that she could raise a claim. As with any insurance claim, the resident would be expected to pay an excess. The landlord would not be responsible for paying this as the resident is claiming for the damage caused to the internal parts of her property which she is responsible for under the terms of the lease. If the resident feels that the leak had not been resolved or has issues in the future regarding leaks into her property, she should first contact the landlord. It would be the landlord’s responsibility to handle any disputes the resident has regarding the property in the first instance.
In summary, there has been service failure by the landlord in respect of its response to the resident’s reports of a leak in her property. The landlord did not communicate effectively with the resident regarding who would be responsible for determining the cause of the leak or resolving the issue. Whilst there were limited steps it could have taken; it would have been responsible for it to have liaised with the managing agents on the resident’s behalf due to its contractual arrangements. It is impossible to know whether the landlord’s involvement would have resolved the issue any sooner for the resident, however it would have been appropriate for the landlord to be proactive, nonetheless. This would have prevented her from having to contact the various parties without getting a response, other than to say she needed to contact someone else.
The landlord should offer compensation to the resident in recognition of the inconvenience caused by its lack of clear communication. It is also recommended that the landlord carries out staff training to ensure that staff members understand and can explain its responsibilities when it comes to its relationship with managing agents and freeholders of the buildings its properties are in.

The resident’s concern that she should be paying her service charge directly to the managing agent of the building.

The landlord’s head lease with the freeholder/managing agent makes the provision for the landlord to pay the freeholder for their services on behalf of the shared owner (the resident). The resident’s lease makes the provision for any charges payable to the managing agent to be recovered from the resident via their service charge. In line with her lease, it would be the resident’s responsibility to pay the service charge directly to the landlord. The landlord would then be obliged to pay the freeholder/managing agent for the services it provides.
In her correspondence with this Service and the landlord, the resident raised concern that she is paying her service charge to the landlord despite receiving services from the managing agent. She feels that she should pay this service charge directly to the managing agent so that it considers her to be the customer, rather than the landlord.
There has been no maladministration by the landlord in respect of its response to this concern, as the information it provided was correct; the resident would be responsible for paying her service charge directly to the landlord. However, it would have been helpful for the landlord to provide a further explanation of the lease and its obligations to prevent any uncertainty.
It is understandable that the resident wants to pay the managing agent directly, but her lease is her contract and this contract is with the landlord not the managing agent. There is no provision for the service charge to be paid directly to the managing agent. If the resident has concerns about the advice she was given when she purchased the property, she would be advised to seek free and independent legal advice from the Leasehold Advisory Service (LEASE) (https://www.lease-advice.org/)

The landlord’s handling of the associated complaint.

The landlord’s complaint policy states that it has a two-stage procedure for dealing with complaints. At stage one, a response should be issued within ten working days. If the resident remains dissatisfied, they can escalate their complaint to stage two. At stage two a complaint should be issued within 20 working days. At any stage, if the landlord is unable to meet these timescales, it should write to the resident and explain why; it should provide its response within a further ten working days.
There has been service failure by the landlord in respect of its handling of the associated complaint. The resident asked for her complaint to be escalated to stage two of the landlord’s process on 26 January 2021. The landlord acknowledged this request on the same day, but its stage two complaint response was not issued until 9 April 2021. This was significantly outside of its stage two complaint timescales by 32 working days. The landlord apologised for the delay in its stage two response, however there is no evidence to suggest that the landlord had kept the resident updated on the progress of her complaint or explained the reasons behind any delay.
Furthermore, the landlord does not appear to have fully engaged with the resident’s complaint. It told the resident to contact the managing agent regarding her concerns about the services she was receiving, despite her saying that the managing agent would not communicate with her directly. It also stated that it would not be able to deal with the resident directly regarding any dispute about the services provided by the managing agent.
This was not an appropriate response from the landlord as ultimately, the resident has no contractual relationship with the managing agent and had said that the managing agent would not communicate with her regarding such matters.
In summary, the landlord had failed to update the resident on the progress of her stage two complaint or explain the reasons behind any delay. It has also provided incorrect information regarding its responsibilities which is likely to have caused the resident further confusion and frustration. The landlord should offer the resident compensation in recognition of the inconvenience she has experienced because of these errors.

Determination (decision)

In accordance with paragraph 54 of the Housing Ombudsman Scheme, there was service failure by the landlord in respect of its response to the resident’s reports of a water leak into her property.
In accordance with paragraph 54 of the Housing Ombudsman Scheme, there was no maladministration by the landlord in respect of its response to the resident’s concern that she should be paying her service charge directly to the managing agent of the building instead of the landlord.
In accordance with paragraph 54 of the Housing Ombudsman Scheme, there was service failure by the landlord in respect of its handling of the associated complaint.

Reasons

The landlord has communicated poorly with the resident about who was responsible for the repairs. it did not act proactively by liaising with managing agent which it would be expected to do in view of the contractual arrangements with the managing agents.
In line with her lease, the resident is obliged to pay her service charge directly to the landlord. The landlord would be responsible for then paying the managing agent for the services it provides to the resident. If the resident disputes the information she had been provided, she may wish to seek independent legal advice.
There was a significant delay in responding to the resident’s complaint at stage two and there is no evidence that the landlord had updated the resident on the progress of her complaint or explained the delay. It also gave incorrect information about who would be responsible for handling any disputes the resident has regarding the services she receives which is likely to have caused some uncertainty and inconvenience.

Orders

The Ombudsman orders that the following actions take place within four weeks:
1. The landlord is to pay the resident £250, comprised of:
  1. £100 in recognition of the inconvenience caused as a result of its poor communication.
  2. £150 in recognition of the inconvenience caused as a result of errors in its complaint handling.

Recommendations

It is recommended that the landlord carries out staff training to ensure that staff members understand and are able to explain its responsibilities when it comes to its relationship with the managing agents and freeholders of the buildings its properties are in.
It is recommended that the landlord addresses any future concerns raised by the resident about the managing agent or repairs. Where appropriate, it should communicate with the managing agent on her behalf and provide regular updates.