London & Quadrant Housing Trust (202003604)

REPORT

COMPLAINT 202003604

London & Quadrant H T

30 September 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

This complaint is about:
1. The landlord’s handling of issues with heating and hot water from the communal plant room.
2. The landlord’s overall management of the servicing of the heat interface units (HIUs).
3. The landlord’s decision to reintroduce a heating and water charge.

Background and summary of events

Background

The resident has a shared ownership lease of the property with the landlord. The property is a two bedroom, 1st floor flat. The lease commenced on 9 October 2015. There is a Head lease between the landlord and the Freeholder of the block within which the property is located.
The Freeholder has appointed a managing agent which is responsible, on behalf of the freeholder, for providing all services to the block, including the maintenance and repair of the communal plant room and the network of pipes carrying hot water to each flat.
Each flat has its own heat interface unit (HIU), which uses heat distributed from the communal plant room to provide heating and hot water within that flat. HIUs include individual meters for each property. The landlord is responsible for the maintenance and repair of the heat interface unit (HIU) within the resident’s property and has an appointed contractor to carry out these works.
In April 2017 the landlord wrote the resident to confirm that due to technical issues affecting the communal plant room and HIUs a decision had been made to cease all billing for heating and hot water until further notice.
The resident has bought this complaint to the Ombudsman as a group complaint on behalf of himself and 11 other shared owners in his block.
In considering a group complaint, the Ombudsman can only investigate matters on the basis that the facts and circumstances are exactly the same for all parties to the complaint. This investigation has therefore focused on the landlord’s response to reports of issues with heating and hot water from the communal plant room, the landlord’s overall management of the servicing of the HIUs in the resident’s block and whether it was reasonable for the landlord to reintroduce a heating and water charge to all residents.
The Ombudsman expects a formal complaint to be made within a reasonable amount of time, normally within six months of the matter being complained about occurring. Therefore, this investigation focuses on events following the residents committee meeting on 24 January 2019. This being more than 12 months before the resident logged their formal complaint on 3 March 2020.

Summary of events

Following a resident’s committee meeting on 24 January 2019, attended by both the landlord and the managing agent, the landlord emailed the resident on 31 January 2019 to confirm that it had a new maintenance contract for the servicing and maintenance of the HIUs. The landlord said that it would update the resident when it had any further information about when the servicing programme would commence. The landlord also said that it would write to all residents to advise when the billing would recommence, which it said would be before April 2019.
The managing agent also emailed on 31 January 2019 to confirm that the communal plant room was working as it should be and that the issues raised indicated that there was a problem with the HIUs which would need to be reported to the landlord, as the managing agent did not carry out maintenance of the HIUs.
At a residents’ meeting in April 2019, the landlord confirmed that scheduled servicing of HIUs would commence from 1 May 2019. There is evidence of the landlord’s heating contractor writing to the resident on 15 April 2019 advising that an appointment had been made for it to carry out the service of the resident’s HIU on 1 May 2019, and requesting that the resident provide access to their property on that day.
On 11 September 2019, the landlord emailed the resident a copy of the letter that it intended to send residents, regarding it recommencing the billing for heating and hot water, and asking for feedback. The letter was considered by the residents’ association the following weekend and their feedback was provided by the resident on 7 October 2019. The residents expressed their continued concerns about the progress of the servicing of the HIUs, the proposed costs for fixed billing and any potential cost to the resident should a further inspection of the HIUs be required if there were to be issues with consumption.
On 4 November 2019, the resident emailed the managing agent and the landlord to ask why the hot water was not working again that day. The managing agent responded the same day advising that it had contacted its contractor to ask for an update of what had happened. The landlord followed this up with the managing agent on 7 November 2019 asking them to confirm what the latest was with the communal plant room. The managing agent responded to the landlord on 11 November 2019, copying in the resident, to confirm that the issue was still ongoing as the computer and cable for the communal plant room had failed and that it was awaiting a quote to for the replacement of both. The managing agent wrote to the resident on 12 November 2019, in response to a direct complaint by the resident, to confirm that the cable was being replaced week commencing 9 December 2019 and that the computer would be replaced at the same time.
On 12 December 2019, the landlord emailed the resident, following on from a further residents’ meeting on 3 December 2019 (which it said was attended by both itself and the managing agent). The landlord confirmed that it had made the decision to commence billing from January 2020. The landlord said that:
1. It understood that there was opposition to this, due to ongoing outages due to the communal plant room failures and outstanding servicing to some of the HIUs.
2. All residents had been offered a service of their HIU and that for those that had been carried out its contractor had reported that there were no concerns regarding their operation. The landlord said that if residents still wished to take up to offer of a service it would arrange this.
3. It would except meter readings so that residents could go on actual billing but if readings were not provided it would send out fixed bills. With regards to outages due to the communal plant room failures, the landlord said that it was speaking to the managing agent about the frequent failures but residents not paying heating bills due to this would not be accepted.
On 5 February 2020, outages of the communal plant room, the servicing of the HIU’s, and the heating and hot water costs charged to residents were discussed. at a resident’s meeting, attended by both the landlord and the managing agent. During the meeting the resident explained how they were frustrated at being ‘caught in the middle and being past from pillar to post’ when reporting issues to the landlord and the managing agent. The resident acknowledged that the managing agent had taken steps to rectify this but the outages remain too frequent. It was agreed that at the next residents’ meeting in April 2020 the outages from the communal plant room and the relationship between the landlord and the managing agent would be discussed.
With regards to the HIU servicing: the minutes noted that the landlord would post HIU certificates to those flats that had already been serviced and that discussions between the landlord and the managing agent, about the managing agent being in control of all heating and hot water going forward, were still in the preliminary stages.
With regards to the billing of heating and hot water costs: the resident shared their concerns about previously high bills due to the HIUs and sought reassurance that there won’t be any on-going issues; that they would start uploading readings and then do so monthly to allow them and the landlord to see if there were any issues with excessive consumption readings; and that once at least two sets of readings showed acceptable consumption they would then pay for the consumption they used. If there were to be a large discrepancy the resident would contact the landlord’s energy team to discuss.
The landlord spoke to the resident over the telephone on 3 March 2020, following which the resident confirmed that they wished to log a formal complaint about the breakdown of the heating and hot water supply to their property from the communal plant room, the servicing of the HIUs and the charges applied by the landlord. The resident said that the landlord’s persistence in charging for heating and hot water despite not fulfilling its previously agreed promises remained ‘‘a sticking point’’.
On 18 March 2020 the landlord provided its stage one, and final, complaint response in which it set out the following:
1. It recognised that there had been historic issues relating to the supply of heating and hot water at the block. The landlord acknowledged that it had a responsibility to work with the managing agent to seek to resolve any issues for which the managing agent was responsible.
2. Its records confirmed that regular resident meetings were held in July 2018 and on 5 occasions throughout 2019. The landlord said that the meetings demonstrated its commitment to improving service delivery, to engage with residents and to build positive relationships.
3. It had confirmed that it would contact its heating contractor to gain heat interface unit (HIU) worksheets to demonstrate the history of HIUs within properties over the previous 12 months. It noted that if service history was not available, it would service all the HIUs again.
4. It considered payments of £25 to be very reasonable and good value, especially considering energy costs in 2020. It recognised that residents had received a notification in 2017 from the landlord that it would absorb costs, but stated that things had moved on since then and the landlord was unable to fund services indefinitely.
5. It had agreed to review residents energy consumption data after a 2-3 month period of analysis. It noted that fixed billing would not be suspended on the basis that residents were continuing to use heat and hot water which they needed to contribute towards.
6. It stated that escalation of the complaint or further review would not have any influence on the outcome and that it was closing the complaint.
On 16 April 2020, the landlord informed the resident’s committee that it had received reports for 33 properties whose HIU services had been completed. The landlord advised that the HIU servicing for the 19 remaining properties would now be delayed until after the COVID-19 restrictions had been lifted and it was safe for its contractors to attend.

Assessment and findings

The landlord’s handling of issues with heating and hot water from the communal plant room.

In situations where the landlord is not responsible for a repair and it is reliant upon a third party (in this case the managing agent) to take action, the resident is also reliant on the landlord to pursue the managing agent to ensure that the said action is being taken. In such situations the Ombudsman expects the landlord to effectively pursue the managing agent on the resident’s behalf. It also expects landlords to ensure that there are effective communications between all parties. This is approach is confirmed in the landlord’s Homeowner Handbook which states that where a managing agent has been appointed by the Freeholder, the landlord will ‘‘work with the managing complaint to ensure acceptable standards are maintained’’.
In their complaint to this service, the resident said that the outages of heating and hot water occurred ‘‘for hours on end’’.
There is evidence of the landlord seeking to engage with managing agent with regards to the issues regarding the communal plant room, attending resident’s meetings on four occasions between January 2019 and February 2020 where the managing agent was present. Following the meeting of 24 January 2019, the managing agent wrote to the resident on 31 January 20219 to confirm that the communal plant room was working as it should be.
Following the resident’s email to the managing agent on 4 November 2019, and not having received the promised response from the managing agent, the landlord acted appropriately by actively pursuing an update from the managing agent on 7 November 2019. The managing agent responded to the landlord on 11 November 2019 explaining that it was awaiting a quote for the replacement of the computer and cable. In response to a direct complaint from the resident, the managing agent confirmed that the works would be completed on 9 December 2019.
It is noted that the resident would like the landlord to ensure that the managing agent re-negotiate its service level agreement with its contractors. However, whilst the landlord can share any views and concerns it might have with regards to the managing agent’s contractors, the landlord does not have that level of influence over the arrangements between the managing agent and contractor.
Whilst it is acknowledged that this matter has caused the resident frustration, distress and inconvenience, I am satisfied that the landlord has taken reasonable steps to engage with the managing agent, and that there was no service failure by the landlord in respect of handling of issues with heating and hot water from the communal plant room, during the period of time covered by this investigation. It has also been noted that it was agreed that at the residents’ association meeting in April 2020, which was attended by both the landlord and the managing agent, that the ongoing relationship between the landlord and the managing agent would be discussed.

The landlord’s management of the servicing of the heat interface units (HIU)

The landlord is responsible for the servicing of the heat interface unit (HIU) within the resident’s property and appointed a contractor to carry out these works. The landlord is responsible for the effective management and monitoring of the contractor that it appointed.
On 31 January 2019 the landlord confirmed that it had a new maintenance contract for the servicing and maintenance of the HIUs and would update the resident when it had any further information about when the servicing programme would commence.
Where servicing is planned residents should be informed of the work that will be undertaken and the timescale for completion. The next evidence of the landlord updating the resident about the servicing of the HIUs was at the residents meeting in April 2019, at which point the landlord confirmed that scheduled servicing of HIUs would commence from 1 May 2019. There is no evidence of the landlord providing the resident with any explanation of the four month delay between it appointing a contractor in January 2019 and the commencement of the servicing in May 2019.
In its final response of 18 March 2020, the landlord confirmed that it would contact its contractor for servicing worksheets to demonstrate the history of the servicing of the HIUs within properties over the previous 12 months. Given that the landlord had a responsibility to manage the service provided by the contractor, and given the longevity of the issues with the heating at the scheme, it is reasonable to expect the landlord to have had systems in place and for it to monitor the progress and performance of its contractor on a regular basis. It is also reasonable to expect the landlord to have ready access to information about what the position was with regards to the servicing, without having to seek 12 months of service histories from its contactor in response to a complaint.
The landlord has provided a copy a spreadsheet which confirms the information provided by landlord at the resident’s committee of 16 April 2020. There are 52 properties within the resident’s block that were due to have their HIUs serviced, this includes the resident’s property. Of these 33 properties are listed as having their HIUs serviced between May and July 2019. There are no records of any servicing taking place after July 2019. 29 properties do not have a service date and only one property is listed has having received its service record, this was not the resident’s property.
The landord’s comments that not all residents had agreed to having their HIUs services have been noted. However, there is no evidence of the landlord taking a proactive approach to ensure its contractor was progressing the servicing as promptly and thoroughly as possible in the 14 months between when it appointed the contractor in January 2019 and its final response to the resident’s complaint in March 2020. Had it done so the landlord would have had to opportunity to identify and address any issues at a much earlier stage, including chasing the contractor to ask why no servicing took place after July 2019, and may have avoided the need for 19 remaining properties to have their servicing further delayed due to the introduction of COVID-19 restrictions in March 2020.
Having considered the evidence, and for reasons set out above, I am satisfied that there was service failure by the landlord in respect of its management of the serving of the HIUs.

The landlord’s decision to reintroduce a heating and water charge to the resident.

Under Clause 3.25 of the lease, the resident is obliged to enter into a separate Supply Agreement with the landlord (or at the Landlord’s direction) in respect of the supply of the metered usage of, and the payment for, heating and hot water via the Heating Interface Unit (HIU) and for the maintenance of the relevant infrastructure.
The resident’s supply agreement commenced on 8 September 2015. The supply agreement obliges the resident to pay the landlord a charge in respect of the amount of utility supply used at the property which may be based on an estimate or meter reading.
The landlord initially said that it would commence billing again before April 2019. There is evidence of the landlord engaging with residents regarding its communication about the billing, seeking feedback from residents in September 2019. In December 2019, the landlord confirmed that the billing would commence from January 2020. The landlord also confirmed that its contractor had reported that there were no concerns regarding the operation of the HIUs it had serviced.
It is acknowledged that in April 2017 the landlord agreed to cease all billing for heating and hot water until further notice. However, it would not be reasonable for the landlord to continue to cover the cost of the resident’s heating and hot water in perpetuity as the landlord would have continued to be charged directly for bulk fuel by the managing agent and it would not be appropriate for it to absorb the residents personal heating costs on an ongoing basis.
In recognition of the resident’s concerns about excessive consumption readings from the HIUs the landlord agreed to review the consumption once two meter readings had been received from the resident but did not agree to delay the billing entirely, confirming that it would be continuing with the fixed billing until readings were received. This was a reasonable response and was in accordance with Section 3.6 of the supply agreement which states that payments made by the resident will include (a) ‘‘an amount to cover the Charges (which may be based on our estimate of the Utility Supply used by you)’’. Section 3.8 also states that any estimate of the Utility supply used will be reconciled against ‘‘actual meter readings when we next read your Meter and may adjust the amount of the Charges accordingly’’.
I acknowledge the resident’s concern about the reliability of the costs charged. However, having considered the evidence, and for reasons set out above, I am satisfied that there was no maladministration by the landlord in respect of the landlord’s decision to reintroduce a heating and water charge to the resident.

Determination (decision)

In accordance with paragraph 54 of the Housing Ombudsman Scheme there was no maladministration by the landlord in respect of handling of issues with heating and hot water from the communal plant room.
In accordance with paragraph 54 of the Housing Ombudsman Scheme there was service failure by the landlord in respect of management of the servicing of the heat interface unit (HIU) within the resident’s flat.
In accordance with paragraph 54 of the Housing Ombudsman Scheme there was no maladministration by the landlord in respect of its decision to reintroduce a heating and water charge to the resident.

Reasons

The landlord was not responsible for any repairs or maintenance to the communal plant room, this being the responsibility of the managing agent (on behalf of the Freeholder). The landlord nevertheless actively engaged with the managing agent, both at resident’s meetings and following the resident’s report of 7 November 2019, and took reasonable steps to seek to find a resolution to the issues that the resident had been reporting.
The servicing of the HIUs had not been completed 14 months after the contractor had been appointed. The landlord failed to apologise for the unacceptable delay or to recognise that it could have done better with regards to the management of its contractor and the progression of the servicing. Had the landlord done so during the complaints process this may have gone some way to restoring the resident’s trust in the landlord and the reliability of the service it provided.
The resident was obliged under their supply agreement to pay for the costs of heating and hot water in their property, the landlord acknowledged the resident’s concerns about excessive meter reading and agreed to put a reasonable plan in place to review the costs once two readings had been received.

Orders and recommendations

Orders

That within 28 days of this determination, the landlord is to:
1. Apologise to each of the 12 residents for its management of the servicing of the heat interface units (HIUs).
2. Pay each of the 12 residents £100 for its failure to effectively manage the overall servicing of the heating interface units (HIUs).
3. Carry out of review of its management and monitoring of its HIU servicing contractor and, within the following 14 days, provide each of the 12 residents with the outcome of its findings together with any actions it plans to take as a result.
4. The landlord is to provide each of the 12 residents with an update on the current position with regards to its discussions with the managing agent, about the managing agent being in control of all heating and hot water going forward, which it advised were still in the preliminary stages in the residents’ meeting of 5 February 2020.
5. The landlord is to confirm to this service that it has complied with each of the above orders no later than 11 November 2021.