London & Quadrant Housing Trust (L&Q) (202205311)

REPORT

COMPLAINT 202205311

London & Quadrant Housing Trust (L&Q)

30 November 2023

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:
   1. the landlord’s handling of the resident’s service charge queries about communal car parking,
   2. the landlord’s complaint handling.

Background

2. The resident holds an assured tenancy with the landlord for a 3 bedroom maisonette.
3. In February 2020, the resident contacted the landlord to query the service charge amount she was paying. She explained that her property was a maisonette, and was not connected to other flats at the block. Additionally, the resident told the landlord that one of her neighbours was not being charged for the communal car park gate at the block, but she was. The landlord told the resident that it had checked its information and that all residents were charged accordingly for the services they had access too.
4. On 20 April 2022, the landlord’s property manager contacted it to query the charges the resident was paying for the communal car park gate. Subsequently, the landlord confirmed it would investigate the charges and make any adjustments if necessary.
5. On 27 April 2022, the resident raised a stage 1 formal complaint to the landlord. She said that she had previously queried being overcharged for the communal car park gate. She said that the property manager had discovered she and 4 other residents had been overcharged for the gate, and requested that 14 years of charges for the gate be returned to her.
6. On 3 May 2022, the landlord sent its stage 1 response to the resident. It confirmed that based on the information provided by its property manager, it had been charging the resident incorrectly for the communal car park gate since 2014/15. It said that because the 22/23 year had already begun, it was unable to change the charges for that year, but had included a credit for the whole year in its workings out. From April 2023, it confirmed that all residents would be charged correctly, and a credit would be applied to the resident’s account in 10 working days.
7. The resident replied and asked that her service charges for communal services from 2012 also be looked at. The landlord stated that it was unable to look at charges from that time, as it was too late to look into them as per the terms explained in her annual rent and service charge increase letters. The resident then requested that her complaint be escalated to stage 2 of the landlord’s complaints process.
8. On 21 June 2022, the landlord issued its stage 2 response to the resident. It reiterated what it had previously about not looking into service charges before 2012, and that the resident had not been paying for the communal car park gate until 2015. The landlord explained that service charge legislation states residents have 6 months within which to request further information or raise queries and it was unable to review charges beyond 2012/13 as a result. It confirmed that a refund of £1,347.48 for the communal car park gate charges had been refunded back to the resident on 3 May 2022, following her stage 1 complaint.
9. The landlord also awarded the resident £60 in compensation for her time and trouble in chasing the landlord for updates, and £60 for the landlord’s delays in responding to queries. An additional £20 was awarded for the delay in providing its stage 2 response.
10. The resident responded to accept the refund for gate charges, but explained that she wanted all charges looked at, and an explanation for the increase in the service charge costs. The landlord explained to the resident that its service charges were charged in line with the resident’s tenancy agreement. Additionally, the landlord refunded the resident for communal electrical testing charges, communal emergency lighting charges, and communal emergency lighting maintenance she had been charged for in error between 2017 – 2023.
11. The resident remained unhappy with the landlord’s responses, and brought her complaint to this Service to investigate. As a resolution to her complaint, the resident wants to be refunded for any additional communal car park gate charges backdated to 2008.

Assessment and findings

Scope of Investigation

12. In her correspondence with the landlord and the Ombudsman, the resident has queried the increase in her service charges related to the car park gate. The Ombudsman understands the resident’s concerns about this. However, as fixed service charges are a contractual obligation between the landlord and the tenant or leaseholder, any dispute in respect of the level of reasonableness of the charge should be referred to the court or tribunal. As such, this part of her complaint is not something the Ombudsman can consider.
13. This is in line with paragraph 42 (f) of the Housing Ombudsman Scheme, which states that we may not consider 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, other tribunal or procedure.
14. Additionally, the resident has raised concerns to this service about other communal charges she believes she was paying, and the landlord not being able to provide her with service charge statements before 2012. But this did not form part of her formal complaint to the landlord. As such, this is also something that the Ombudsman cannot consider. This is because of paragraph 42 (a) of the Ombudsman scheme which states that the Ombudsman may not consider complaints which, in the Ombudsman’s opinion are made prior to having exhausted a member’s complaints procedure. The resident would need to raise a formal complaint with the landlord about these issues first before this Service could investigate it.

Service charge for communal car park gate

15. The resident’s tenancy agreement states that she is responsible for paying rent and other charges including service charges for the property. Additionally, the landlord’s service charge policy states that “only services that are provided can be charged for.”
16. In February 2020, the resident told the landlord she was paying more for the car park then one of her neighbours. The landlord responded by saying that all residents were being charged for the services they used. It also said that her neighbour’s charge may differ because they were in a different property.
17. However, when its property manager queried the car park charges in April 2022, the landlord found that it had in fact been overcharging the resident. Subsequently, it credited her account with a refund of £1,347.48. Additionally, in its stage 2 response to the resident, the landlord awarded her £120 in compensation for her time and effort in chasing it for updates about the charges, and for its own delays in responding to her queries. However, had it investigated the resident’s query about this properly in February 2020 when she first raised it, it could have resolved this problem and credited her account much sooner than it did.
18. By failing to properly investigate the resident’s concerns thoroughly when she raised them, it continued to overcharge her unnecessarily for an additional two years. While it was right that the landlord offered the resident a refund, at no point in its complaint responses did it recognise that it could have gotten this decision right at an earlier time. This was a failure by the landlord, and one that meant the resident’s income was impacted unnecessarily for longer than it should have been, with no recognition from the landlord of the inconvenience caused to the resident by the delay.
19. To recognise this, and the prolonged impact on the resident and her finances, the landlord has been ordered below to pay the resident an additional £200 in compensation. It has also been ordered to increase its compensation award for time and effort and delayed responses from £120 to £200. This is in line with the Ombudsman’s remedies guidance for failures adversely affecting the resident which the landlord has failed to acknowledge, and where the offer of redress was not proportionate to the failings identified in this report.
20. When the landlord discovered its error in overcharging the resident, it should have taken steps to put her back into the financial position she would have been in, had the error not occurred. While it refunded the amount she had paid in error, the refund did not take into account the time she was left without that money. The landlord has therefore been ordered below to pay the resident 8% statutory interest for the additional 2 years she was unnecessarily left without the funds in her account.
21. The resident queried why she was only being refunded from 2014/15, when she had been living at the property for 14 years. The landlord explained that the oldest files it had on record dated back to 2012. It provided the service charge and rent increase letters it had sent to her at that time, to show that it had not started charging her for the gates until 2014. It said that if the resident had documents that said otherwise, it would consider them. Additionally, the landlord explained that service charge legislation states residents have 6 months within which to request further information or raise an issue about the charges. Also, the service charge and rent increase letters previously sent to the resident all stated that if the resident did not accept the proposed new rent, they must refer queries to their local rent assistant committee before the starting date of the proposed new rent.
22. It is not clear why the landlord has no records of the resident’s service charges beyond 2012. But, even if it had, it would not have been able to review them due to the legislation set out above, and its own rent/service charge appeals process. The landlord has no records on file to show that the resident had been paying communal car park gate charges prior to 2014, and the resident has also not been able to provide information to show otherwise.
23. However, If the resident is able to find information in her records that shows she was paying communal car park gate charges prior to 2014, it is recommended below that the landlord consider this, and take appropriate action if necessary, given the previous errors it made in overcharging her for the communal car park gate.

Complaint Handling

24. The landlord’s complaint handling policy states that it will respond to stage 1 complaints within 10 working days. The policy also states that, where the complainant is dissatisfied with its resolution at stage 1, it will escalate the complaint to stage 2 of its process. For stage 2 complaints, the policy states it will respond within 20 working days.
25. The resident raised a stage 1 formal complaint on 27 April 2022. The landlord responded on 3 May 2022. This was in line with its complaints policy.
26. When the resident responded on 3 May 2022 to voice her dissatisfaction with the response, the landlord escalated the complaint to stage 2 of its complaints process. However, it did not issue its stage 2 response to the resident until 21 June 2022. This was following contact from this Service on 16 June 2022 requesting that it provide a response to the resident. This was outside of the landlord’s complaints policy.
27. To recognise the delay in providing its stage 2 response, the landlord awarded the resident compensation totalling £20. This was in line with its compensation policy of awarding £10 for failing to respond to a query within 10 working days, and failing to respond to a formal complaint within the timescales published in its complaints policy. This was in line with its complaints policy, and was appropriate redress from the landlord.

Determination

28. In accordance with paragraph 52 of the Housing Ombudsman Scheme, there was maladministration by the landlord in its handling of the resident’s service charge queries about communal car park charges.
29. In accordance with paragraph 53 (b) of the Housing Ombudsman Scheme, the landlord has offered redress to the resident for its complaint handling failures prior to investigation which, in the Ombudsman’s opinion, resolves the complaint satisfactorily.

Orders and recommendations

Orders

30. The landlord is ordered to pay the resident compensation totalling £495.58 within 4 weeks, this is broken down into:
    1. £200 additional compensation for failing to recognise and acknowledge the impact of its service charge error on the resident.
    2. £80 additional compensation to proportionately recognise its delay in responding to the resident’s service charge queries.
    3. 8% statutory interest for 2020 – 2022, totalling £107.79 (Full amount overcharged £1,347.48 x 8% = £107.79).
31. The landlord will contact the Ombudsman within 4 weeks to confirm that it has complied with the above orders.

Recommendations

32. It is recommended that the landlord considers any additional information the resident provides it with in relation to service charges before 2012, if she is able to do so.
33. It is recommended that the landlord pay the resident the compensation award of £20 for its complaint handling failure, if it has not already done so.