Metropolitan Thames Valley Housing (MTV) (202117191)

REPORT

COMPLAINT 202117191

Metropolitan Thames Valley Housing

5 June 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

The complaint is about the landlord’s:

1.     response to the resident’s request for information relating to water rates.

2.     handling of the associated formal complaint.

Background

1. The resident is a shared ownership leaseholder of the landlord.
2. The resident raised concerns with the landlord about the cost her of water charges. The resident’s property was up for sale, and on 20 October 2021, she informed the landlord that she had an offer on the property that was conditional on knowing the correct costs for water. The landlord informed her that an update would be provided on 22 October 2021, however, no response was provided within this timeframe.
3. On 25 October 2021 the resident raised a complaint that the high water charges were preventing her from selling her property. The resident set out her complaint as follows:
   1. The landlord had been actively obstructing the sales process.
   2. The landlord had demonstrated a failure to provide a timely and transparent response to a simple query regarding water charges.
   3. The landlord had been overcharging for water for years and keeping the money.
4. The stage one response was issued on 8 November 2021. The landlord upheld the complaint because the resident had not received a response to the issues she had raised. The landlord stated that the delay in addressing the matter was because it was busy working through end of year accounts. The resident was advised that a full response about the water charges would be provided after a further 20 working days. The landlord apologised for the inconvenience caused to the resident and offered £40 compensation for her time and trouble.
5. The resident escalated her complaint to stage two on 29 November 2021. She stated that she had not received a response about the water charge issues. The stage two response was issued on 14 March 2022. The landlord confirmed that the communal water meter had been changed from a commercial tariff to a residential tariff. It stated that any credit or deficit applied to the resident’s account would be issued with the final service charge account statement, issued in September. The landlord partially upheld the complaint due to the time taken to provide a stage two response. In addition to the £40 offered at stage one, a further £35 compensation was offered to the resident for poor complaint handling.
6. On 29 March 2022 the resident asked this Service to investigate her complaint. The resident requested the following outcomes:
   1. The water bill to be reduced to a reasonable amount, or in line with her usage.
   2. The service charge to be provided in line with the lower water bill amount, so that this could be presented to buyers.
   3. Water charges to be reviewed historically and compensation provided for overpayments.
   4. £1000 compensation for the time and cost caused, including the loss of prospective buyers.

Assessment and findings

Resident’s request for information relating to water rates.

7. The water charges were included in the overall service charge paid by the resident. The landlord estimated the water charges based on the previous year’s actual charges. The actual charges were calculated at the end of the financial year and any credit or deficit would be applied to the account retrospectively.
8. The landlord’s Service Charge Summary and accompanying Frequently Asked Questions (FAQs) document states that if a resident disagrees with items on the estimated service charge, the landlord will investigate and work with the resident to resolve their query. It states that if the landlord agrees that it has made a mistake, it will adjust the resident’s estimated charge.
9. This Service has viewed emails between the landlord and the resident from October 2021. As stated above, the landlord informed the resident that it would provide her with an update about the water rates by 22 October 2021. No update was provided on this date and the resident contacted the landlord on both 24 and 25 October 2021 to chase up the response. The landlord did not respond, and the resident then raised her complaint. This reflects a failing in the landlord’s communication with the resident. The landlord should maintain regular communication with residents about issues they have raised, and notify residents if they are unable to provide updates on previously agreed dates.
10. Within her complaint dated 25 October 2021, the resident stated that she had approached the landlord several times since June 2021 to request information on the water charges, and to seek a resolution. The resident stated that she approached Castle Water who had informed her that the account with the landlord had been closed in August 2021. The resident explained that she also contacted Thames Water who advised that there was no residential account for her property. The resident expressed concern that she would lose another buyer for her property due to not receiving the requested information from the landlord.
11. The landlord did not appear to dispute that the resident raised her concerns in June 2021. The evidence provided to this Service indicates that the landlord had been made aware of a potential issue with the water charges as early as March 2021. It is unclear what, if any, actions the landlord took to address the issues raised by the resident between June to mid-October 2021. No correspondence has been provided to reflect the communication the landlord had with the resident during this period.
12. As stated in paragraph seven, the FAQs relating to service charges states that if issues are raised about service charges the landlord will investigate and work with the resident to resolve their query. No evidence has been provided to reflect that information was given to the resident about the water charges during this time, or that any investigative steps were taken. As such, the landlord does not appear to have acted in line with its own guidance.
13. In its stage one response the landlord did not address why it had not provided any information to the resident about the water charges since the matter was first raised in June 2021. The landlord stated that it was currently ‘extremely busy’ working on end of year accounts and that a full response would be provided in a further 20 working days. While it is accepted that certain periods may be busier than others, the landlord should have been able to provide accurate information to the resident about the water tariff in a timelier manner.
14. The landlord’s internal emails indicate that it started taking steps to investigate the issues raised about the water charges from October 2021 onwards. These emails reflect that the provider for the resident’s property was Castle Water which supplied water to commercial properties, rather than residential properties. The water rates were therefore based on a commercial tariff which may have resulted in higher costs for the resident. There is no indication that the landlord provided confirmation to the resident that the water tariff was incorrect. It would have been appropriate for the landlord to have communicated this to the resident, and explain what steps it was going to take to put things right.
15. The landlord’s emails reflect that, on 14 October 2021, a request was made internally for the water provider and tariff to be changed. Further internal emails during December 2021 indicate that the matter was being looked into, but it is unclear exactly what actions were being taken. On 29 December 2021, an internal email confirmed that the commercial account had been closed, and the account was now with Thames Water on a residential tariff.
16. Between the escalation request and the stage two response, the landlord contacted the resident approximately six times to notify her of further delays in responding to her complaint. The landlord informed the resident that the issues raised about the water charges were complex and that a meeting had been held to discuss the complaint. However, no further indication was given to the resident as to what actions were being taken to investigate the issues during this period. Further to this, the evidence suggests that the resident was not notified of the change of tariff until the stage two response dated 14 March 2022. This was more than two months after this had been confirmed internally. It would have been best practice for the landlord to have provided honest and transparent updates throughout as to the enquiries undertaken.
17. On 31 August 2022 the resident informed this Service that the water charges had been adjusted and as a result she had found a buyer for her property. This therefore indicates that the landlord has reasonably resolved the issue of the high water rates, and that the service charges had been adjusted accordingly.
18. On 9 June 2023 the landlord informed this Service that a credit of £864.26 for the refund of personal water charges was applied to the service charge account in March 2023. The refund was for charges during the financial year 2021/2022. It is therefore clear that the landlord took appropriate steps to conduct a review of the charges for the financial year 2021/2022, and identified that a significant amount of credit was owed. It is unclear as to whether the resident has received this credit as she has now sold the property.
19. This Service has not seen any evidence to support that the landlord deliberately obstructed the sales process, as alleged by the resident. However, the evidence does support that the landlord failed to provide a timely and transparent response to the resident’s request for information relating to water rates. Although the landlord has now taken steps to resolve the high water charges, the delays in information being provided to the resident about this issue have not been properly addressed. The evidence reflects that there were unreasonable delays in the landlord providing the requested information and that there was a lack of meaningful updates to the resident. The landlord did not work with the resident to resolve the issue, as set out within its own guidance. These failings amount to maladministration by the landlord.
20. The resident stated that she experienced difficulty selling her property due to the high water rates. This is likely to have caused distress and inconvenience. The poor communication and lack of clear updates are likely to have caused further frustration to the resident.
21. In its stage one response the landlord apologised for the delay in providing information to the resident about the water rates, and offered £40 compensation for her time and trouble. However, the landlord has not acknowledged the further delays that occurred following the stage one response. As such, the compensation offered is not proportionate to the impact of the further failings identified in this report, and an increased amount of compensation should be offered in order to remedy this. While it would not be possible for the Ombudsman to establish a causal link between the water charges and the sale of the resident’s property, the level of distress and inconvenience to the resident has been taken into account when determining a reasonable amount of compensation.
22. An additional compensation amount of £300 would be appropriate redress for the failings identified, and for the adverse effect that these failings had on the resident. This is in addition to the £40 already offered by the landlord. This amount is in line with this Service’s remedies guidance for financial redress, which suggests amounts of £100 to £600 where there has been a failure which adversely affected the resident, but no permanent impact.
23. There is no evidence to indicate that the landlord reviewed the water charges for the financial years prior to April 2021. In its stage two response, the landlord addressed the resident’s request for accurate information about water charges from 2015 onwards. The resident requested that any money owed from overpaying during this period should be returned to her. The landlord attached a statement from Thames Water that was backdated to 2017. It stated that Thames Water had revised their charges which resulted in an increase in costs. However, it is noted that the resident was on a commercial rather than a residential tariff during that period.
24. The landlord has provided this Service with the service charge schedule for the financial year 2022/2023. This states that the personal water charge for the property was £298.74 and the communal water charge was £148.82. This indicates a reduction in the cost of the water charges from previous years.
25. The reduction in water charges since the change in tariff, and the amount of credit refunded for financial year 2021/22 suggest that the resident’s water charges were unreasonably high. In order to properly resolve the complaint, the landlord should conduct a review of the water charges from 2017 onwards and establish whether the resident overpaid during this time. If the landlord finds that the resident was overpaying, compensation should be offered accordingly.

Complaint handling

26. The landlord’s stage one response was provided ten working days after the resident made her complaint. This is in line with the timeframes stipulated in its complaints policy. However, it failed to provide a full response to the substantive issue.
27. The landlord’s complaints policy states that stage two responses should be provided within 20 working days of the escalation request, and that if it cannot respond within the timeframe, it will keep residents informed and agree new response times. The resident escalated her complaint on 29 November 2021, and the stage two response was issued on 14 March 2022.
28. The Housing Ombudsman’s Complaint Handling Code states that if the landlord cannot provide the stage two response within 20 working days, it should provide an explanation and a date for when the stage two response will be received. The code states that this should not exceed a further 10 working days without good reason.
29. The landlord therefore did not act in line with its policy or the Code as there was a significant delay in the stage two response being provided to the resident. It is evident that the landlord contacted the resident several times during this period to notify her that the outcome would be delayed, and to extend the stage two response deadline, but nevertheless, this significant delay caused the resident frustration and distress.
30. The landlord partially upheld the complaint due to the time taken to provide the stage two response. It apologised for this and offered £35 compensation for poor complaints handling. The compensation offered is not reasonable redress for the adverse effect that the significant delay in the stage two response caused. It is noted that the resident’s substantive issue about the water charges was being dealt with through the complaints process, and so this increased the impact of the delays on the resident.
31. An additional compensation amount of £300 would be appropriate redress for the complaint handling failures. This is in addition to the £35 already offered by the landlord. This amount is in accordance with this Service’s remedies guidance which suggests compensation of between £100 and £600 when the landlord has attempted to put things right but when the offer made is not proportionate to the failings identified.

Determination

32. In accordance with paragraph 52 of the Housing Ombudsman Scheme, there was maladministration by the landlord in the way it handled:
    1. the resident’s request for information relating to water rates.
    2. its handling of the associated formal complaint.

Orders

33. Within 28 days of this report, the landlord must pay the resident a total of £675 compensation. This is made up of:
    1. £340 for the failings identified in respect of the landlord’s handling of the resident’s request for information relating to water rates. This is inclusive of the £40 already offered at stage one of the complaint.
    2. £335 compensation for the failings relating to the landlord’s complaint handling. This is inclusive of the £35 already offered at stage two of the complaint.
34. The landlord should conduct a review of the water charges from 2017 onwards to establish whether the resident overpaid for water during that period, and compensate the resident accordingly if it finds she did overpay due its error with the tariffs. The landlord should set out its findings in a report and provide this to both the resident and the Ombudsman.
35. The landlord should evidence compliance with these orders to this Service within 28 days of this report.