MHS Homes Ltd (202211403)

REPORT

COMPLAINT 202211403

MHS Homes Ltd

12 January 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

The complaint is about the landlord’s:
1. Handling of the resident’s purchase of the property.
2. Setting of the rent.
3. Administration of the resident’s rent account.
4. Complaint handling.

Jurisdiction

What the Ombudsman can and cannot consider is called the Ombudsman’s jurisdiction. This is governed by the Scheme. When a complaint is brought to this service, the Ombudsman must consider all the circumstances of the case, as there are sometimes reasons why a complaint will not be investigated.
Section 42 (d) of the Housing Ombudsman’s Scheme states that the Ombudsman may not consider 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.
On 14 April 2022 the landlord emailed the resident to confirm that it was happy to temporarily accept rent payments based on him owning a 35% share of the property instead of 25% he actually owned. On 1 March 2023 the resident’s MP asked the landlord to extend the period into 2023/24. The resident has asked this Service to consider ordering the landlord to keep the rent payments at the lower rate, based on a 35% share.
The Ombudsman does not have the authority or remit to make such orders. Because of that, in line with paragraph 42 (d), complaints that relate to the level, reasonableness, or liability to pay rent 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.
Section 42 (f) of the Housing Ombudsman’s Scheme states that the Ombudsman 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.
The resident purchased the property via a resale. He paid the seller for a 35% share but only received 25%. The seller only owned 25% of the property. Due to an error by the landlord, which it has acknowledged, the memorandum of sale was not itemised to show the original 25% share and the need for 10% to be staircased. This led to what the landlord referred to as a failure in the sales process.
The property sales process is a formal and legal one. There are rules and regulations about the information provided to prospective buyers, and solicitors play an important role in advising and guiding their clients in the process. Allegations of impropriety, such as the ones made by the resident, are serious matters, and ones which, ultimately, can only be resolved by the courts. The courts can cross examine and call expert witnesses, and can make legally binding judgements on the parties involved in the sale. The Ombudsman does not have the authority or remit to make such judgments. Because of that, in line with paragraph 42 (f), this matter is better suited for the courts, and will not be part of this investigation.

Background

The resident is a leaseholder of the landlord, a housing association, through a shared ownership scheme. The lease commenced on 13 August 2021.
The property is a 2 bedroom flat on the third floor.
The landlord has no vulnerabilities recorded for the resident.

Summary of events

On 6 November 2021 the resident emailed the landlord to say he was in arrears because the landlord had delayed in setting up his direct debit. He also believed that he was being overcharged.
The landlord did not reply so the resident sent a chasing email on 18 November 2021. The landlord replied the following day, 19 November, to say the arrears officer would make contact when they returned from leave on 22 November.
The resident sent a chaser email on 26 November 2021. The landlord replied on 30 November to say it had asked the arrears team to make contact.
The resident chased the landlord again on 7 December 2021. The landlord replied on 8 December to apologise for the lack of response and advised it had sent the query to its homeownership team.
By 19 December 2021 the resident still had not received a response and therefore asked to raise a formal complaint (complaint 1). The landlord replied on 20 December to confirm the complaint had been logged and that the resident would hear from the investigating officer in a few days.
On 20 December 2021 the resident emailed the landlord to say he intended to invoice it for the time he had spent getting legal advice and chasing for nearly 2 months. He asked to be compensated for the “distress and inconvenience” caused by the situation which had impacted on his mental health.
On 24 December 2021 the landlord issued its stage 1 response to complaint 1, the main points being:
1. It apologised for the length of time it had taken to respond to his query, particularly as the resident had been chasing for a “number of weeks to no avail.” It confirmed this was “not acceptable” and acknowledged he had “not received the service it would expect.”
2. It had recalculated the rent account and would arrange for the credit to be added.
3. It was unable to refund the costs set out in his email. However, it would issue a £30 voucher as a gesture of goodwill.
4. The complaint was upheld and closed.
5. If the resident remained dissatisfied he could log an appeal within 1 calendar month.
The landlord’s internal records show that on 29 December 2021 it called and spoke with the resident to advise that the adjustment was complete and the account corrected. The resident said he would clear the account within a few days. It referred to a recent call with the resident during which he said he had the funds put aside and said it would therefore expect payment to be made that day or the end of the week at the latest. It said if this did not happen it would make contact again the following week to chase and would issue a letter. The file note states that the resident was “not happy about this and hung up.”
The resident emailed the landlord on the same day, 29 December, to say he had just received a “threatening” call regarding his rent account. He confirmed he had been contacted about the account being corrected on 24 December. During the call he had been asked when he would make payment. He said he would do it in a few days and was advised he must do so by the end of the week or he would be issued with a letter. Given that there had not been a working day between 24 and 29 December he said this was “unreasonable and unacceptable.” He described being “furious” and said he would make payment “under protest” as soon as possible. He said he wanted the issue dealt with as a formal complaint.
On 30 December 2021 the landlord emailed the resident to confirm it had raised a formal complaint (complaint 2), relating to staff conduct. It said the complaint would be investigated by the line manager who was currently on leave and that her response may be delayed until the following week.
The landlord emailed the resident on 18 January 2022 to follow up on a phone call it believed had been made to the resident to apologise for the conduct of the member of staff. It advised that if he was not happy with the outcome of his complaint, he could appeal within 1 calendar month. The resident replied on the same day, 18 January, to say that no one had contacted him.
On 19 January 2022 the landlord emailed the resident to say there had been a mistake and that the relevant officer had been asked to contact him regarding his complaint as soon as possible.
On 22 and 27 January 2022 the resident emailed the landlord to chase his complaint response.
On 27 January 2022 the landlord emailed the resident to apologise for the lack of communication and to confirm his complaint response had been escalated. It confirmed the complaint had been closed prematurely due to a miscommunication.
The resident emailed the landlord on 8 and 15 February 2022 to chase the complaint response.
The landlord issued its stage 1 complaint response to complaint 2 on 16 February 2022 and confirmed that:
1. Due to a process failure the amount of rent due was higher than he was expecting. When the resident contacted the landlord to report the mistake due to lack of information from its solicitors it took “far longer to resolve than it should have done.” It accepted and acknowledged the further failure and said it had implemented changes to prevent this happening again. It offered a £50 voucher by way of apology.
2. While it understood the resident’s reasons for withholding the correct rent payment, there was no legal basis for this and he remained liable for the correct amount.
3. That the officer who made the call on 29 December 2021 was “over enthusiastic” in her approach. It agreed that Christmas eve was not the most appropriate time to call. As a lesson learnt it would now suspend the collections process a few days before extended bank holidays in future.
4. The position regarding the non-payment of rent should have been explained sooner, when the issue of the incorrect amount was first brought to its attention. This was a further failure on its part on which it had arranged further staff training on.
5. It apologised for the poor communication and lack of response which it recognised was “not up to the standard expected”. Therefore, the complaint was upheld.
6. It said the resident had reached the end of its complaints process and the resident could contact this Service if he remained dissatisfied.
In his reply, also sent on 16 February, the resident stated his intention to escalate his complaint to this Service.
On 25 February 2022 the resident emailed the landlord to say it had set out the wrong rent figure on its annual rent increase notification, and it was higher than it ought to have been. The landlord raised this as a further formal complaint, complaint 3.
On 28 February 2022 the landlord and resident exchanged a number of emails about the status of complaint 1. The landlord confirmed that complaint 1 was closed on 23 December 2021 and that a stage 2 complaint would be an appeal raised 30 days after the stage 1 response. The resident queried why he had not been given the option to appeal in its latest complaint response of 16 February. He said he wanted to escalate complaint 2 to this Service.
The landlord advised that the resident was welcome to appeal its response to complaint 2. It said he could only do so in relation to staff conduct, not in relation to the rent statement, as this was the subject of its response to complaint 2. It raised complaint 3 as a second stage 1 complaint about incorrect rent charges.
It went on to confirm that complaints 1 and 2 were closed. It said the resident did not have a right to appeal its responses because it upheld the complaints and apologised for its mistakes. It said however, that if the resident did not feel it had fully addressed his concerns it would raise a further complaint provided that he specified what he felt had not been addressed.
The resident replied to the landlord to query its response as it contradicted what he had been told by a different officer earlier that day. The landlord reiterated that both complaints were upheld and closed so there was no right to appeal the decision. It asked the resident to specify any concerns he felt it had not addressed. After repeatedly asking the same question, the landlord finally confirmed that the response on 16 February was its stage 1 complaint response to complaint 2 only.
On 3 March 2022 the resident emailed the landlord in response to its stage 1 complaint response of 16 February. The response confirmed that the complaint had reached the end of the complaints process. However, in the landlord’s email of 28 February it said he had a right of appeal so he asked it to provide clarification.
In an internal email of 3 March 2022 the landlord confirmed that the resident had been given incorrect information about appeals. If a complaint was upheld, the resident still had a right of appeal.
On 7 March 2022 the landlord emailed the resident to clarify the stages and outcomes of his 3 complaints, as follows:
1. Complaint 1 was logged on 20 December 2021 in relation to ongoing issues with communication and incorrect figures on the rent statement. This complaint was upheld.
2. Complaint 2 was logged on 30 December 2021 in relation to conduct of a member of staff. This complaint was upheld.
3. The £30 voucher offered as part of the response to complaint 1 was increased to £50 as part of the response to complaint 2.
4. It confirmed both complaints were closed at stage 1 but that the resident could appeal them within 1 calendar month if he remained dissatisfied.
On 17 March 2022 the resident emailed the landlord to express his dissatisfaction in relation to its complaint handling which he said was “riddled with contradictions.” He said:
1. The voucher was not increased from £30 to £50 because they were issued separately and in relation to different complaints, one of which had already been closed.
2. He wanted to appeal the response to complaint 1 because the offer of a £30 voucher was not adequate.
3. It had previously told him he could escalate his complaint to this Service but then changed its mind.
4. He was not clear on what complaint 2 related to and was not sure whether he should appeal the response. He was also told he had reached the end of the complaints process but had then been told that was not the case which was frustrating.
On 18 March 2022 the landlord emailed the resident, as follows:
1. It apologised for the confusion and frustrations regarding its communication.
2. The request to appeal the response to complaint 1 had been logged. The investigating officer would contact him within the next 2 working days to introduce themselves and ask any further questions.
3. Complaint 2 was logged following the resident’s email about a phone call it had made. It had upheld the complaint and asked the resident to confirm if he wished to appeal the response.
4. It believed confusion was caused by the response dated 16 February addressing both complaints without being clear on what response related to which complaint.
5. The wrong paragraph was included at the bottom of the response for complaint 2. It confirmed that the resident did still have the right to appeal both of the complaints. It said it had identified this as a training need and had put measures in place to stop it happening again.
On 21 March 2022 the resident emailed the landlord to appeal his stage 1 response to complaints 1 and 2 on the basis that:
1. It had taken months to investigate his complaint.
2. He had been caused “distress and inconvenience” by the landlord “hounding” him for payment and threatening eviction.
3. He had been told the complaint could be escalated to this Service but was then told that was not the case.
4. Complaint 3 was raised on 28 February 2022, and he had not yet received a response which was now overdue.
5. On 28 February 2022 he was told that his account would be rectified as soon as possible but this had not happened.
6. The offer of vouchers was not adequate compensation.
The landlord replied to the resident on 21 March 2022 to confirm that his complaint had been escalated.
In an internal email dated 24 March 2022 the landlord sought to understand why the resident was being charged rent based on a 25% share when he believed he owned a 35% share. It identified that the issue was with the memorandum of sale which did had not itemised the 25% initial share and the additional 10% staircasing.
On 25 March 2022 the landlord wrote to the resident to confirm that his appeal had been upheld in relation to complaints 1 and 2. It added that the service it had provided was not what he should expect and it apologised.
On the 29 March 2022 the landlord sent an internal email to set out steps taken in respect of administration of the rent account, as follows:
1. The completion statement showed the buyer equity at 35%.
2. The rent account was adjusted to show the buyers details but the rent amount “was not touched” although it showed the equity owned at 35%.
3. Following a complaint from the resident the rent was adjusted based on the completion statement which it believed to be correct.
4. It delayed in correcting the account and chased the resident for arrears, leading to the complaint of 29 December 2021.
5. It then authorised the rent increases for 2022/23. It had no evidence of staircasing so it “let the rent go at the original amount” to be reissued once a memo of staircasing had been provided.
6. The resident then complained about the rent increase notification being set at the wrong amount. It apologised and said the remainder of the evidence was being sent. However, it then transpired that the staircasing did not take place and the resident only owned 25%.
7. It had made changes to ensure that both the completion statement and memorandum of staircasing was provided in future. Its sales team had also introduced a checklist to ensure that the memorandum of sale reflected true ownership and potential staircasing.
On 1 April 2022 the resident emailed the landlord to ask that it log that he had received another inaccurate statement. He was frustrated that this had happened given that he had already raised the issue as a formal complaint. He said he would not be altering his payments until he was issued with a correct statement.
On 4 April 2022 the landlord wrote to the resident in relation to complaints 1, 2 and 3 as follows:
1. It apologised for the way his complaints had been handled and the “confusion” this had caused. It also apologised for the length of time taken to investigate the issues and its “lack of communication.”
2. Complaint 2 was made in relation to staff conduct which was investigated and a response provided on 16 February 2022. It acknowledged that the investigating officer should not have responded to 2 open complaints in the same email as this caused confusion.
3. It failed to provide details as to how the resident could escalate his complaint which was required by its complaints process. The investigating officer had apologised and said they would ensure they use core templates in future.
4. An appeal response was issued on 25 March 2022, when it provided an additional £30 voucher.
5. It acknowledged that the appeal response did not address all of the issues raised by the resident in his appeal request.
6. Complaints 1 and 3 were linked so it responded to those together as they related to its communication.
7. A complaint was raised due to ongoing communication delays and incorrect figures on the rent account. This complaint was closed as upheld on the 23 December 2021 with confirmation it had reviewed and revised its processes around shared ownership rent accounts.
8. It subsequently issued a further rent statement, where again the rent was calculated on a 25% share. As a result of this, a thorough investigation took place to understand what had happened.
9. The investigation revealed that the resident had only purchased a 25% share of the property and the rent was calculated accordingly.
10. It paid £775 compensation comprised of:
  1. £175 for distress caused.
  2. £50 for delays in communication.
  3. £250 for process failure through the property sale.
  4. £300 for process failure through the complaint investigation.
On 5 April 2022 the resident emailed the landlord to say that he did not agree with the outcome of the investigation and did not wish to accept the compensation offered.
On 1 September 2022 the resident contacted this Service to set out his ongoing dissatisfaction with the landlord’s complaint responses. He sought a level of compensation which adequately reflected his situation.

Assessment and findings

Landlord’s obligations, policies and procedures

The landlord’s policy on ‘conduct becoming’ states that staff must maintain high standards of professionalism, fairness and courtesy in all their dealings with residents.
Its complaints policy says that a resident can appeal a complaint response within 1 calendar month of a complaint being closed. Any appeals will be acknowledged within 2 working days.
Its compensation policy says that discretionary payments, referred to as goodwill payments, may be made when there has been a failure of service which has caused delay, distress or inconvenience. Payments are broken down as:
1. Low impact – complaint has been upheld but there has not been significant inconvenience or distress caused. A maximum of £50 can be awarded.
2. Medium impact – inconvenience and/or distress has been caused as a result of a failure in service. A maximum of £250 can be awarded.
3. High impact – serious failure in service has taken place. A maximum of £500 can be awarded.
The policy says that compensation may include vouchers or monetary compensation.

Administration of rent account

The resident was proactive in his communication with the landlord about issues with his rent account. However, the landlord failed to respond to his email of 6 November 2021 causing the resident inconvenience, time and trouble in having to chase in a further email on 18 November.
The landlord replied the following day, 19 November 2021, to say the arrears officer would make contact when they returned from leave on 22 November. When the landlord failed to respond again, the resident was caused further inconvenience, time and trouble when he chased on 26 November.
The landlord replied, on 30 November 2021, and again said it had asked the arrears team to make contact. The resident had to chase for a third time via email on 7 December 2021. When the landlord replied on 8 December it appropriately offered an apology. However, on this occasion it said the home ownership team would reply. This contradicted its earlier response which said the rent team would deal with the enquiry. This was frustrating for the resident who could not be confident the landlord would deal with his query effectively.
The provision of misinformation, coupled with delays and failed promises was unreasonable because it caused the resident frustration, confusion and distress. He set this out further in his email of 20 December 2021 when he requested compensation for the “distress and inconvenience” caused by the situation which he said had impacted on his mental health.
In its stage 1 response to complaint 1, dated 24 December 2021, the landlord apologised for the length of time it had taken to respond to his query. It confirmed this was “not acceptable” and acknowledged he had “not received the service it would expect.” It said it had recalculated the rent account and would arrange for the credit to be added to the account. It said it would issue a £30 voucher as a gesture of goodwill.
However, as acknowledged by the landlord in its internal email of 29 March 2022, it delayed making the necessary adjustment to the rent account. The delay and a lack of communication resulted in the arrears team contacting the resident to request payment of the arrears which caused further frustration and distress.
In his email to the landlord of 29 December 2021 the resident set out his frustration at being chased to make payment following contact on 24 December. As the resident pointed out, the 29 December was the first working day since 24 December. Therefore, it was not reasonable of the landlord to chase payment on this day. Furthermore, it was inappropriate to take such a heavy handed approach during the call itself. The resident reported that he felt “furious” and “threatened” by the nature of the call which caused significant distress.
In its stage 1 complaint response to complaint 2, dated 16 February 2022, the landlord agreed that the officer had been “over enthusiastic” in her approach. It said that the officer was tasked with ensuring all accounts were brought up to date and applied the same process with the resident that was required elsewhere. The officer did not demonstrate fairness during their contact with the resident and did not comply with the landlord’s policy on ‘conduct becoming.’
The landlord’s response was confusing and contradictory because on the one hand it accepted its approach was not appropriate but then implied it was fair because it was no different to the approach applied to other residents. It is concerning that the landlord felt its general approach was justified and did not identify lessons learnt as to how its service could improve going forward.
Furthermore, it had committed to applying an adjustment to the rent account, which would result in a credit being applied. Therefore, it would have been reasonable to adopt a tailored approach, taking the individual circumstances into account. The level of distress caused was compounded by the nature of the call.
It failed to identify lessons learnt in relation to the call itself and what it would do differently to prevent a further reoccurrence which was inappropriate. Furthermore, this is the type of scenario where the landlord could have reasonably considered issuing a voucher by way of apology. That it failed to consider any form of compensation was a failure.
The complaint response also focussed inappropriately on the call that was made on 24 December. The resident’s complaint was about the nature of the call on the 29 December, not the one made on 24 December. However, there was no detriment caused to the resident by this error. In fact, there was a positive outcome because it led to the landlord making changes to the collections process ahead of extended bank holidays.
In its stage 1 response to complaint 2, dated 16 February 2022, the landlord provided a further response to the resident’s stage 1 complaint. It accepted and acknowledged the further failure and said it had implemented changes to prevent this happening again. It offered a £50 voucher by way of apology. It apologised for the poor communication and lack of response which it recognised was “not up to the standard expected”.
The landlord’s compensation policy does not set out the circumstances in which it will offer a voucher instead of a financial payment. However, the Ombudsman’s remedies guidance sets out that we would usually order the landlord to pay compensation for avoidable inconvenience, distress, detriment or other unfair impact of the maladministration or service failure.
The landlord was open and honest about the extent of its failures however, it failed to identify and acknowledge the detriment caused to the resident in terms of frustration, inconvenience and time and trouble. The landlord’s compensation policy says that discretionary payments may be made when there has been a failure of service which has caused delay, distress or inconvenience. Therefore, it would have been appropriate for the landlord to have considered a financial payment of compensation for service failure within the medium impact bracket.
Up to the point that the resident emailed the landlord on 25 February 2022 the landlord had applied an adjustment to the rent account to correct the level of rent charged. The adjustment was based on the completion statement, which stated the resident owned a 35% share. It was only when the resident raised a concern about the level of rent for the coming financial year that the landlord decided to investigate the matter further, as shown in its internal email of 24 March.
Taking into account that the landlord had already applied an adjustment to the rent account, the landlord’s internal email of 29 March 2022 does not adequately explain why it still issued the rent increase notification at the original amount. It would have been reasonable for it to have investigated the issue at the point it realised it did not have evidence of staircasing. Instead, it caused further distress to the resident by issuing the rent increase letter and, later a rent statement which was unreasonable.
As a result, a third stage 1 complaint was opened on 28 February 2022. It was only at this point that the landlord began to investigate what had gone wrong. Therefore, the landlord’s response was reactive, responding to a further failure, rather than proactively taking steps to identify what had gone wrong at the earliest opportunity. This was inappropriate because it prolonged the distress caused to the resident.
In its stage 1 response to complaint 1, dated 24 December 2021, the landlord apologised for the length of time it had taken to respond to his query. It issued a £30 voucher as a gesture of goodwill. In its stage 1 response to complaint 2, dated 16 February 20212, it offered a £50 voucher by way of apology. It apologised for the poor communication and lack of response which it recognised was “not up to the standard expected”. The complaint response does not state that this was offered by way of apology for the nature of the telephone call to the resident on 29 December.
The landlord’s final response issued on 4 April 2022 the landlord offered £175 for the distress caused by its response and £50 for delays in communication. A separate amount of compensation was set out for the failure through the sale (not assessed by this investigation) and complaint handling. Therefore, it is reasonable to conclude that the compensation for distress and communication was for the administration of the rent account.
Therefore, this investigation summarises compensation offered by the landlord in relation to its administration of the rent account to be as follows:
1. £80 in vouchers for failures including delays and poor communication, for general administration of the rent account.
2. £175 for the distress caused.
3. £50 for the delays in communication.
The landlord’s failures amount to maladministration. Our approach to assessing a remedy is based on our dispute resolutions: be fair, put things right and learn from outcomes. The landlord’s compensation policy says that high impact can be due to a persistent failure which occur over a prolonged period of time or an unacceptable number of attempts to resolve the complaint have failed. Where the landlord accepts full responsibility the maximum amount of compensation is £500. The Housing Ombudsman’s Remedies Guidance says that compensation of between £100 to £600 should be paid where there is a finding of maladministration.
The landlord failed to respond to communication from the resident which caused him to chase the landlord on multiple occasions despite assurances that he would be contacted. It delayed in applying the adjustment to the rent account which resulted in the resident being chased for payment of the arrears. Furthermore, despite knowing there was an anomaly with the rent account, it went on to issue a further rent increase notification and statement which compounded the resident’s distress. The level of compensation offered by the landlord did not put things right for the resident because it did not reflect the level of distress caused.
Taking this into account, an order had been made for the landlord to pay the resident £600 compensation. The landlord may deduct the £225 compensation it has offered if this has already been paid.

Complaint handling

The resident raised his second stage 1 complaint (complaint 2) on 29 December 2021, in relation to staff conduct. The landlord’s response to the complaint was delayed, confusing and contradictory.
In its email of 18 January 2022 the landlord referred to a phone call where it believed an apology had been issued however, it transpired that the call had never taken place. This was inappropriate because the misinformation caused frustration for the resident and further eroded the resident’s confidence in the landlord’s ability to resolve the complaint. It did, however, appropriately advise that the resident could make an appeal within 1 calendar month.
In its email of 19 January 2022 it said it would make contact with the resident however, it failed to do so. This was inappropriate because the resident was caused inconvenience, time and trouble in having to chase the landlord by emailing on 22 and 27 January.
Despite emailing the resident on 27 January 2022 to apologise for the lack of communication it once again failed to follow up causing further inconvenience, time and trouble when the resident chased again on 8 and 15 February.
The landlord emailed the resident a stage 1 complaint response to complaint 2 on 16 February 2022, 34 days after the complaint was made. It is unclear why the response was delayed and was therefore unreasonable.
The response stated that the resident had reached the end of its complaints process adding that the resident could contact this Service if he remained dissatisfied. This was inappropriate because it was not line with its complaints policy, which provides a right of appeal at stage 1. This was not its final response and therefore, the resident’s next stage would be to escalate his complaint within the internal complaints process. The misinformation created a false expectation for the resident, which he subsequently tried to act on, causing confusion and frustration.
In its response to the resident dated 28 February 2022 the landlord confirmed he did have the right to appeal the response to complaint 2. However, it went onto to confirm that complaints 1 and 2 were closed and that the resident did not have a right to appeal its responses because it upheld the complaints and apologised for its mistakes. Not only was this contradictory, it was also not consistent with its complaints policy. It then confused the matter further by saying that if the resident did not feel it had fully addressed his concerns it would raise a further complaint. This indicated he did have a right to appeal and escalate his complaint.
When the resident tried to clarify the matter further, the landlord once again inappropriately advised that the complaint was upheld and closed so there was no right to appeal the decision. However, yet again, it asked the resident to specify any concerns he felt it had not addressed, indicating a right of appeal existed.
It is not surprising that the resident remained confused by the landlord’s responses to his queries which had caused him a great deal of frustration. Furthermore, he was caused further inconvenience, time and trouble when he contacted the landlord on 3 March 2022 to try again to clarify whether he had a right of appeal. An internal email of the same date confirmed that the resident had been given incorrect information about appeals.
Having also raised a third formal complaint (complaint 3) on 25 February 2022 the landlord acted reasonably when it took the opportunity to clarify the status of all 3 complaints on 7 March. The landlord emailed the resident to clarify that he did have the right to appeal the stage 1 complaint responses for complaints 1 and 2 within 1 calendar month. Given that they were both closed in December, and the resident was therefore ‘out of time’, it would have been reasonable of the landlord to address this point. This would have also provided it with an opportunity to clarify next steps in terms of how he could escalate those complaints. Given the confusion that had already arisen, it was important that the landlord provide as much clarity as possible.
It referred to the £30 voucher offered at stage 1 of complaint 1 being increased to £50 at stage 1 of complaint 2. This was incorrect because the complaints were raised in relation to different issues and the compensation offered was therefore not connected. This was a further error in the landlord’s complaint handling which affected the resident’s confidence that the complaints process was an effective form of resolution.
Section 3.4 of the Housing Ombudsman’s Complaint Handling Code (the Code) says that residents are more likely to be satisfied with complaint handling if the person dealing with their complaint is competent, empathetic and efficient. Reflecting the number of failures thus far, the resident’s email to the landlord on 17 March 2022 described its complaint handling as “riddled with contradictions.”
He also said he wanted to escalate his stage 1 complaint for complaint 1. However, he was unclear on what complaint 2 was in relation to and was therefore not sure whether he should appeal. This due in part to the fact that the stage 1 response for complaint 2 also provided a further response to the issues considered in the stage 1 response for complaint 1.
Section 5.8 of the Code says that landlord’s stage 1 complaint responses should clearly set out the complaint definition and details of how to escalate the complaint to stage 2 if the resident remains dissatisfied. The evidence shows that the landlord failed to adhere to these requirements, causing confusion and frustration to the resident.
On 18 March 2022 the landlord acknowledged its failures in relation to complaint handling and apologised. It acted reasonably in using its discretion to escalate the request for an appeal of the stage 1 response to complaint 1 despite it being out of time. It demonstrated that it had learnt from outcomes in relation to advice given about appeals by identifying a training need. It said set out the measures taken to stop it happening again.
On 25 March 2022 the landlord provided its final response in relation to complaints 1 and 2. This was a response to the significant efforts made by the resident to pursue his complaint through the internal complaints process. Section 4.4 of the Code says that complaints should be resolved at the earliest opportunity. The internal complaints process for complaints 1 and 2 was avoidably lengthy and complex. This was unreasonable because it delayed the resident using the process to obtain a final response.
As part of its response to complaint 3, issued on 4 April 2022, the landlord also provided a further response to its complaints handling of complaints 1 and 2. It apologised for the way the complaints had been handled and the “confusion” this had caused. It said it had identified failures in its complaint handling and offered £300 compensation for process failure through the complaint investigation.
Part 6.4 of the Code states that factors to consider in formulating a remedy can include, but are not limited to, the:
1. Frequency with which something has occurred.
2. Number of different failures.
3. Cumulative impact on the resident.
The landlord failed to provide an effective complaint handling service which amounts to maladministration.
The landlord’s compensation policy says that high impact can be due to a persistent failure which occur over a prolonged period of time or an unacceptable number of attempts to resolve the complaint have failed. Where the landlord accepts full responsibility the maximum amount of compensation is £500. The Housing Ombudsman’s Remedies Guidance says that compensation of between £100 to £600 should be paid where there is a finding of maladministration.
This investigation has considered that the failures took place over a relatively short period of time, from 19 December 2021 to 4 April 2022. However, the evidence shows that there were a number of both repeated and new failures during that period. The resident made significant efforts to resolve his complaint, had he not done so he would not have received a final response. This was inappropriate because that would have prevented him from accessing a resolution through this Service.
Furthermore, when he did take it upon himself to try to clarify matters the landlord’s responses were misinformed and contradictory. The whole complaints process undermined the landlord/resident relationship leaving the resident with no confidence that the landlord was addressing his complaint in a competent manner. This caused the resident time and trouble, inconvenience and a significant amount of frustration. The compensation offered by the landlord did not reflect the distress caused to the resident by its complaint handling.
Taking the above into account an order had been made for the landlord to pay the resident £500 compensation. The landlord may deduct the £300 is it has offered if this has already been paid.

Determination (decision)

In accordance with paragraph 42 (f) of the Scheme the resident’s complaint about the landlord’s handling of the resident’s purchase of the property is outside of the Ombudsman’s jurisdiction.
In accordance with paragraph 42 (d) of the Scheme the resident’s complaint about the landlord’s setting of the rent is outside of the Ombudsman’s jurisdiction.
In accordance with paragraph 52 of the Housing Ombudsman Scheme there was maladministration in the landlord’s administration of the resident’s rent account.
In accordance with paragraph 52 of the Housing Ombudsman Scheme there was maladministration in the landlord’s complaint handling.

Reasons

The landlord failed to communicate effectively with the resident regarding the issues with his rent account and failed to apply the correction in a timely manner. Its conduct with regard to income collection was inappropriate. It caused further distress to the resident by issuing an incorrect rent increase notification and rent statement without considering the individual circumstances of the case.
The landlord failed to provide an effective complaints service. The landlord’s communication was delayed, confusing and contradictory. Furthermore, the resident had to make considerable efforts in order to receive a final response to 2 of his complaints.

Orders

Within 4 weeks of the date of this determination the landlord is ordered to pay the resident £1100 compensation, comprised of:
1. £600 compensation for the distress, inconvenience and time and trouble caused by the landlord’s failures in its administration of the rent account. The landlord may deduct the £225 compensation it has offered if this has already been paid.
2. £500 for the frustration, inconvenience and time and trouble caused by the landlord’s failure to provide an effective complaint handling response. The landlord may deduct the £300 compensation it has offered if this has already been paid.
Also within 4 weeks the landlord should write to the resident to apologise for the failures identified in this case.
Within 6 weeks of the date of this determination the landlord should arrange staff training to:
1. Ensure that all relevant staff adhere to the complaints policy, it should include:
  1. The structure of its complaint responses at each stage of the complaints process.
  2. The complaint escalation process.
2. Ensure that all staff adhere to its policy on ‘conduct becoming’ and embed the principles in their day to day contact with customers. The training should place a focus on making reasonable requests.

The date and content of the training should be provided to the Ombudsman, also within 6 weeks.

Recommendations

The landlord should consider amending its compensation policy to set out when it will offer vouchers, as opposed to financial payment, as compensation.