Newlon Housing Trust (201912566)

REPORT

COMPLAINT 201912566

Newlon Housing Trust

8 February 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 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 Government guidance on cladding in relation to the building the resident owns a property in.
2. Response to the resident’s request to reimburse the costs which she had incurred in attempting to sell the property.
3. Complaint handling.

Background and summary of events

Background

The resident is the leaseholder of the property (the property) which the complaint concerns.
The property is a flat situated in a purpose-built block (the building). The building is nine storeys high – “ground and above”.
The landlord is the freeholder of the building.
Advice Note 14 will be referred to throughout the assessment. This advice note was issued by the Government in December 2018 as part of its Building Safety Programme. In summary the advice was for owners of high-rise leaseholder buildings where the external wall system of the building did not incorporate Aluminium Composite Material (ACM). The advice set out checks which owners could carry out to satisfy themselves, and their leaseholders, that their building was safe. This guidance was consolidated in ‘Building Safety Advice for Building Owners’, issued in January 2020. Paragraph 1.4 of this guidance states “for the avoidance of doubt, building owners should follow the steps in this advice as soon as possible to ensure the safety of residents and not await further advice or information to act”.
In response to the guidance some lenders took the view that, if certification could not be provided to demonstrate compliance with the Government’s guidance on fire safety, they would be unwilling to offer a mortgage on properties within these buildings as they would have a value of £0.
In January 2020 The Royal Institution of Chartered Surveyors (RICS), The Building Societies Association (BSA), and UK Finance agreed a new industry-wide valuation process to help people buy and sell homes and re-mortgage in buildings above 18 metres (six storeys). Form EWS1 was introduced to prove to lenders that external cladding had been assessed by an expert.

Summary of events

The resident informed the Ombudsman that she put the property on the market for sale in April 2019 and on 10 June 2019 she accepted an offer to purchase the property from a buyer.
On 21 June 2019 the resident contacted that landlord via its Live Chat to request some information regarding the building in order to progress the sale of the property. The landlord asked the resident to put her request for information in writing so it could be responded to by the correct team.
On 3 July 2019 the resident wrote to the landlord to request if the building had “recently passed a fire safety check”.
On 8 July 2019 the landlord sent the resident the recent fire risk assessment.
On 9 July 2019 the resident wrote to the landlord following review of the fire risk assessment. The resident said that she was concerned that the report noted that it was not known whether the cladding on the building was non-combustible.
On 18 July 2019 the landlord wrote to the resident regarding fire safety at the building. In summary the landlord said:
1. An assessment of the building had identified some materials on it which required further investigation. The landlord confirmed that this included the cedar wood paneling, foam insulation and STO render. The landlord confirmed that discussions and onsite meetings with the original builders had failed to give it assurances over the materials and how they were installed and signed off.
2. Depending on the outcome of further investigations by experts and fire engineers it was possible that works may be needed to remove or replace some of the materials.
3. As a precaution fire marshals would patrol the building 24/7. The landlord explained that in the event of a fire they would raise the alarm and ensure that the affected part of the building was promptly evacuated. The landlord confirmed that they would also notify the Fire Brigade and provide them with access. The landlord advised it would cover the cost of the fire marshals.
On 28 August 2019 the landlord undertook a cladding inspection in line with Advice Note 14.
On 2 September 2019 the resident wrote to the landlord to request the outcome of the cladding inspection.
On 9 September 2019 the landlord confirmed that it had yet to receive an update following the inspection
On 17 September 2019 the resident contacted the landlord to request the outcome of the cladding inspection
On 18 September 2019 the landlord wrote to the resident regarding the cladding inspection. The landlord confirmed the report was not yet available however it would provide an update as soon as it was in receipt of it.
On the same day the resident attended the landlord’s office as she was “not satisfied” with the update regarding the cladding inspection. The resident provided the Ombudsman with her account of the meeting:
1. The landlord explained that as a result of Advice Note 14 it was required to check all tall buildings which it owned in relation to fire safety and cladding.
2. The landlord could not answer why checks were not carried out on the building immediately following the introduction of Advice Note 14.
3. The landlord confirmed that the situation would “take some time to rectify”.
4. She informed the landlord that, had she known that the cladding on the building required investigation, she would not have made the decision to sell the property until the matter was resolved.
5. The landlord confirmed that it would “look into” her request to refund the cost of the leasehold pack she purchased as part of the sales process.
On 29 September 2019 the resident chased the landlord for the outcome of the cladding inspection and her request for a refund. Within her email the resident stated that she was “very frustrated” with the way the landlord had dealt with the cladding issue. The resident stated that had she “been aware of the problem [she] wouldn’t have put [the property] on the market”. The resident confirmed that she had incurred significant costs in relation to the sale of the property which she believed was a “direct consequence of [the landlord’s] negligence in carrying out essential inspections in due time and failure to inform the residents of the potential implications of [Advice Note 14]”. The resident said the costs included the leasehold pack (£270) and “solicitor fees and mortgage re-arrangement fess coming up to around £2000”. The resident confirmed that she expected the landlord to reimburse the costs.
On 1 October 2019 the landlord wrote to the resident. In summary the landlord said:
1. It hoped that it had clarified its position in relation to the cladding inspection when it met with the resident on 18 September 2019.
2. The estate which the building was situated was a “fairly large development which consisted of different fabrications and each block must be tested on their individual merit which [had] caused delay”.
3. It was still waiting for the results following the cladding inspection.
On the same day the resident responded to the landlord asking for a “timeframe”. The resident stated that the landlord had not responded to her request to cover the costs which she had incurred with the sale of the property.
On 3 October 2019 the landlord wrote to the resident confirming that “at this juncture it [was] difficult to give a precise timeframe for the completion of [the] investigation – as a ballpark [it] would say within the next two months”. The landlord said that in relation to the resident’s request for reimbursement it was seeking formal advice and would respond shortly.
On 30 October 2019 the resident attended the landlord’s office to request to speak with a member of staff regarding the cladding report. The resident informed the Ombudsman that despite waiting for over “75 minutes” no member of staff came to speak with her, despite being made aware that she was waiting in reception.
While the resident was at the landlord’s office on 30 October 2019 she registered a formal complaint. In summary the resident said:
1. Despite requesting the result following the cladding inspection, the landlord had failed to provide any information. The resident stated that the landlord informed her “six weeks ago” that the report would be available “soon”.
2. The landlord had failed to respond to her request to refund the cost of the leasehold pack.
3. She had attended the landlord’s office that day to speak with someone that day, but no one was available.
Within her complaint the resident asked the landlord to confirm:
1. When the results following the cladding inspection would be available.
2. Who would cover the cost of the report and any remedial works identified?
3. Who would cover the costs she incurred for the sale of the property which was “falling through due to [the landlord’s] failure to fulfil [its] duty as landlord”?
On 31 October 2019 the landlord emailed the resident a copy of the report dated 24 October 2019 following the cladding investigation. The report confirmed that the cladding was not compliant and remedial works were required. The report further noted that “there [were] ongoing investigations commissioned by [the landlord] which [would] establish the necessary remedial works and adequate interim measures…”
Within the landlord’s correspondence it said that it was “committed to carrying out any remedial works required following the current investigations to review the external cladding and insulation”. The landlord confirmed that it had appointed fire wardens while the investigation works were ongoing, and it would provide updates to residents as soon as it was able to. The landlord confirmed that it did not intend to pass the cost of the work to residents.
The resident informed the Ombudsman that during the first week of November 2019 the buyers pulled out of the sale of the property.
On 10 November 2019 the resident emailed the landlord confirming that she had lost the buyer for the property and to reiterate her request for the landlord to reimburse her costs.
On 12 November 2019 the landlord provided its stage one response. In summary the landlord said:
1. It was sorry that the resident felt that it did not provide her with information following the cladding investigation in a timely manner.
2. In line with Government advice it was carrying out investigations into the external cladding and insulation and fire stopping at all of its taller buildings. The landlord confirmed this included the building.
3. In July 2019 it wrote to all residents to explain that it had some initial concerns about the cedar wood paneling, sto render and insulation at the building and would be undertaking further detailed investigations. The landlord confirmed that it had explained that it would be appointing fire wardens as a safety precaution.
4. The “detailed external investigation works” were completed at the end of August 2019 and it was waiting for the formal report from its specialist contractor regarding next steps. The landlord explained that this takes time because “as well as carrying out physical investigations the contractor has to compare what they find to the original plans and specifications for the building before making recommendations”. The landlord confirmed that, once it received the report, it would update residents on the findings which were likely to include a programme of remedial works.
5. It was not intending to pass on the costs for any works required to residents, or the cost for additional fire safety measures such as fire wardens.
6. It would be happy to arrange a meeting with the resident with the relevant officers to discuss the resident’s concerns regarding cladding.
7. It was sorry for the inconvenience and cost the resident had experienced in relation to the sale of the property however it would not be able to make any refunds. The landlord explained that it did not consider that it had failed in its duty as a landlord. The landlord noted that decisions about mortgages and sales were between individuals and their lenders and were beyond its own control. The landlord said any decision to buy or sell a home has to be taken at a person’s own risk according to the prevailing conditions at the time.
8. The issue was nationwide and affected many other leaseholders. The landlord confirmed that it understood that the position was very difficult.
On the same day the resident wrote to the landlord to request to escalate her complaint. In summary the resident said:
1. The landlord’s stage one response did not answer her questions.
2. The April 2019 fire risk assessment for the building noted that it was not known if the cladding was flammable. The resident stated that if the landlord was committed to its residents’ safety why did it wait until August 2019 to carry out further tests.
3. It was unsatisfactory that the landlord only informed residents of the cladding issue in July 2019. The resident noted that this was shortly after the buyer’s mortgage had been refused. The resident confirmed that she would not have put the property on the market had she been aware of the cladding issue.
4. It was unsatisfactory that the landlord did not inform her of the results following the cladding investigation straight away. The resident suggested that, had the result been made available, the sale of the property may have gone ahead.
5. The issues she had encountered in selling the property could have been avoided if the landlord had been transparent regarding cladding on the building.
6. She would like the landlord to reimburse the following costs:
  1. £270 for the leasehold pack
  2. £999 to arrange a new tracker mortgage
  3. Estimated £1000 in solicitors fees.
On 15 November 2019 the landlord acknowledged the resident’s escalation request confirming that it would arrange a complaint panel meeting. The landlord advised that it anticipated that the panel could not be convened until next year however it would see if it could expedite it.
On 26 November 2019 the resident wrote to the landlord confirming that she expected a response to her complaint before Christmas as its complaint procedure suggested that the “whole procedure should not take more than eight weeks”.
On 2 January 2020 the Ombudsman contacted the landlord advising that the resident had been in touch about her complaint and requested that it provide a stage two response as a matter of urgency.
On 6 January 2020 the landlord acknowledged the resident’s correspondence. The landlord confirmed that “in normal circumstances” the panel would not consider her complaint until April 2020 however as she had made contact with the Ombudsman it would try to conclude the matter “sooner”.
On 8 January 2020 the resident attended the landlord’s office. The resident provided the Ombudsman with her account of the meeting:
1. The landlord “reproached” her for turning up without an appointment.
2. The landlord said it was working very hard to resolve the situation.
3. The landlord said that part of the delay was due to requiring access to a property to take samples.
4. She agreed for her property to be used if it was made good after. The resident said she requested the landlord put this action in writing however it did not do so.
On 17 January 2020 the landlord wrote to all leaseholders to provide an update on its response to the Government’s guidance on cladding and fire safety. In summary the landlord said:
1. Following the Grenfell Tower fire the Government had issued a number of Advice Notes about fire safety. The landlord set out that they covered a wide range of fire safety issues which had provided challenges for building owners across the country.
2. In complying with the Advice Notes it had initiated intrusive investigations to identify any fire safety deficiencies at all its tall buildings, including the building, to establish the scope of any remedial works necessary.
3. As a precaution it had appointed fire wardens to patrol in and around the building 24/7 based on its initial assessment of some of the external cladding materials used at the block.
4. Its specialist contractors had carried out investigations on the external cladding, insulation and fire stopping as well as the internal fire stopping measures and it was expecting their detailed report in the near future.
5. It was in the process of arranging access to a flat in the building so that it could carry out checks to the internal fire stopping measures between homes. The landlord confirmed that these investigations needed to be completed before it could specify any remedial works.
6. At this time it was unable to confirm the extent or complexity of any works which may be required or how long they would take. The landlord said that it was unlikely that it would commence remedial works within the next six months as once it had completed the investigations and reviewed its specialists’ findings it needed to appoint a contractor and work up a detailed specification.
7. It would communicate the findings and the details of any works required as soon as it was able to.
8. The building had an up-to-date fire risk assessment to ensure that it was compliant with the fire strategy for the building.
9. It was aware that the situation was impacting some leaseholders and they had experienced problems in trying to sell, staircase or remortgage their properties.
10. It had prioritised all matters relating to fire safety in the building.
On the 22 January 2020 the resident informed the landlord that she no longer wished to provide access to her property for samples to be taken.
On 28 February 2020 following further contact from the resident the Ombudsman wrote to the landlord to make enquiries on the status of its stage two response.
On 12 March 2020 the landlord wrote to the resident to confirm that the complaint panel had been arranged for 20 March 2020. The landlord confirmed that the resident may attend the panel if she would like to give evidence.
On 17 March 2020 the landlord wrote to the resident to confirm that due to Covid-19 “there [would] no longer be an actual meeting to which [the resident was] invited to attend”. The landlord said it would “advance [the resident’s] appeal as far as possible before any meeting review” and it would inform the resident when the meeting was likely to take place. The landlord confirmed that while the resident was no longer able to attend the panel she may make written submissions.
On 20 March 2020 the complaint panel met to consider the resident’s complaint.
On 21 April 2020 the landlord wrote to the resident providing the panel’s findings. In summary the landlord said:
1. All buildings owned by it were fully compliant under existing building regulations at the time they were constructed and had annual fire risk assessments to ensure that they met any new required fire safety standards.
2. Following the Grenfell Tower Fire, Advice Note 14 was introduced which required it to review all its taller buildings. The panel stated that “this work” was completed within a short period. The landlord confirmed that, in the case of the building, some findings came back inconclusive and prompted further detailed investigations. The landlord said that work plans were put in place to remove and replace materials where necessary and the fire strategy for the building was reviewed. The landlord confirmed that fire wardens were appointed to patrol the building 24/7 as an extra precaution. The landlord said that “the panel [felt] that [it had] demonstrated both willingness and responsibility in ensuring fire safety to its buildings and residents”.
3. It wrote to residents in July 2019 informing them of its intentions regarding investigation into the external cladding. The landlord confirmed that it also wrote with a further update in January 2020. The landlord said that the panel however felt that the landlord’s communication could have been better, including residents’ meeting and consultations.
4. The panel noted that the landlord’s responses to the resident’s enquiries regarding cladding were not always timely and it had delayed in escalating her complaint.
5. In December 2018 the Government introduced Advice Note 14. The landlord noted that “by this time” it had set up a special projects team to arrange a programme of inspections to meet the guidance. The landlord confirmed that the inspections needed to be carried out and signed off by suitably qualified specialist fire safety engineers which there was a shortage of. The landlord confirmed that once a building had been inspected it would either be signed off as fully fire safety compliant or needing remedial works.
6. From late summer 2019 lenders began to ask for separate sign off for buildings in relation to Advice Note 14. The landlord confirmed that at this point it was understood that some people started to experience problems with sales and staircasing applications. The landlord noted that at this point it appointed specialist fire safety engineers to provide a certified statement for lenders stating the position of buildings in relation to Advice Note 14 however in some instances the statement was not enough.
7. In January 2020 form EWS1 was introduced. The landlord confirmed that this had caused significant issues for sales of properties. The landlord explained that where a building had not been inspected or required remedial works, no engineer would sign the building off as fire safety compliant. The landlord confirmed that while the panel acknowledge the “difficult time” for many people it also accepted that the landlord was “limited in what it [could] do to influence the situation”. The landlord confirmed that the panel did not agree that the landlord was responsible for reimbursing the resident any financial loss involved in matters relating to the sale of the property.
The landlord concluded that the panel:
1. Believed that it had acted responsibly and appropriately in addressing the “unprecedented level of fire safety concerns following the Grenfell tower tragedy”.
2. Found that its communication could have been clearer regarding cladding.
3. Did not agree that it was responsible for any financial loss the resident experienced in her attempts to sell the property.
The landlord said it would like to offer the resident £75 compensation comprising £25 for the delay in considering the resident’s complaint appeal, £25 for poor communication and £25 for the late response to her initial complaint.
The landlord confirmed that if the resident was not satisfied with its response she may refer it to the Ombudsman for adjudication.
On 27 April 2020 the resident wrote to the landlord confirming that she was surprised to receive its final response. The resident noted that the landlord had indicated on 17 March 2020 that the panel on 20 March 2020 would be postponed.
On 28 April 2020 the landlord responded. The landlord said it was sorry if its correspondence dated 17 March 2020 was confusing. The landlord confirmed that as a date for the panel hearing had already been scheduled it was able to go ahead, however without her attending.
As the resident was not satisfied with the landlord’s response she referred the complaint to the Ombudsman for adjudication.

Post complaint procedure

On 17 July 2020 the landlord wrote to all residents within the building regarding form EWS1. In summary the landlord said:
1. Following the detailed inspections of the building it had commissioned specialist consultants to produce a remedial works plan and specification. The landlord confirmed that as soon as it had received this it would update residents and would start to explore options for carrying out the necessary works.
2. While it could not confirm a definite timescale it was likely that the works would take up to two years including receiving a detailed specification, tendering for a contractor, starting onside and completing the necessary remedial measure.
3. It currently had no plans to recharge residents for remedial fire safety works.
4. It had received form EWS1 and a supporting statement from its specialist fire safety engineers. The landlord confirmed that copies of the form and statement were often required by lenders and would be forwarded to any residents who had been in contact with its sales team about selling staircasing or re-mortgaging their home. The landlord suggested that the form and statement would be helpful to potential buyers and lenders, however as the initial investigations had identified that remediation works were required, it would be difficult to know the impact this would have on their decisions.
On 20 November 2020 the landlord wrote to all residents in the block to provide an update. In summary the landlord said:
1. It would be submitting a bid to the Government’s Building Safety Fund to help cover the cost of remedial fire safety works at the building.
2. There were several requirements of the bid process it would like to make residents aware of:
  1. The first phase was for it to submit a range of details to establish that the building was eligible for funding by 31 December 2020.
  2. In order to bid it had to confirm that the works could start onsite by 31 March 2021. The landlord said to achieve this it was having to accelerate its plans, including consulting residents on the works.
  3. It had to demonstrate that leaseholders were liable for the costs if the bid was unsuccessful and therefore it had to issue all leaseholders at the building with a section 20 notice for the cladding. The landlord noted that the section 20 notice did not mean that it would be charging the costs to residents as this was a last resort.
The landlord included an “outline of proposed works programme” with its correspondence.

Assessment and findings

The Ombudsman’s internal guidance for caseworkers considering complaints about cladding [1] sets out that, as the Government’s expectations in relation to cladding and fire safety are only detailed in guidance, there is an element of discretion for a landlord as to how and when it chooses to comply with it.
The Ombudsman’s guidance further sets out that when investigating a complaint relating to the Government’s guidance on fire safety and cladding the Ombudsman will consider the following points:
1. What are the landlord’s long-term plans for compliance with the guidance and are these fair and reasonable?
1. How has it communicated with shared owners/leaseholders regarding the situation and was this communication appropriate?
2. How has it responded to the individual circumstances of the leaseholder?
These points will be considered when assessing whether the landlord’s actions and response to the complaint were fair in all the circumstances.

The landlord’s response to Government guidance on cladding in relation to the building the resident owns a property in

As the Government’s expectations in relation to cladding and fire safety are only detailed in guidance there is an element of discretion for a landlord as to how and when it chooses to comply with it.
It is clear from the landlord’s correspondence with the resident that the landlord is taking steps in order to comply with the Government’s guidance in respect of the building. The evidence shows that the landlord has done so by inspecting the building and committing to completing the remedial work identified. In the Ombudsman’s opinion this is appropriate as, while the guidance is not a legal requirement, it has been established as best practice in relation to building safety and form EWS1 is required by lenders.
While the Ombudsman notes the resident’s concerns regarding the pace of the landlord’s investigation regarding cladding on the building, the Ombudsman is aware that the process to obtain certification is complicated and requires input from experts, which there is currently a shortage of within the industry. The Ombudsman has not seen any evidence to suggest that the landlord has unreasonably or purposefully delayed in commencing the process to obtain certification.
The most recent fire risk assessment completed prior to the complaint is dated 24 April 2019. The Ombudsman notes the following points in relation to the complaint:
1. The building presents a “moderate risk” meaning “outbreak of fire could foreseeably result in injury of one or more occupants, but it is unlikely to involve multiple fatalities”.
2. In response to the question “is the external cladding or façade confirmed as non-combustible” the answer given was “not known”. The report set out that further investigation was recommended.
3. Several tasks were raised in relation to fire stopping works. The report set out that the tasks had been assigned to Property Special Projects. The Ombudsman understands that Property Special Projects is the landlord’s team who is managing the landlord’s response to the Government’s guidance on cladding and fire safety.
Following the fire risk assessment and by July 2019 the landlord had arranged a waking watch at the building. In the Ombudsman’s opinion this was appropriate to mitigate and manage the risks identified until such time that the risks could be explored further and addressed.
The first correspondence which the Ombudsman has seen from the landlord to the resident regarding Advice Note 14 is dated 18 July 2019. The landlord explained the steps it was taking to investigate the cladding on the building. While it was appropriate the landlord explained that it was investigating the cladding, in the Ombudsman’s opinion the landlord omitted to include an explanation detailing the potential impact of the guidance on mortgage applications. As the impact of the guidance on mortgage applications was widely recognised within the housing sector by mid-2019 in the Ombudsman’s opinion the landlord’s omission was unsatisfactory and was a missed opportunity by it to fully explain the situation in relation to the guidance. Further, while the Ombudsman notes that by July 2019 the resident had accepted an offer on the property the Ombudsman considers that this information would have been useful to the resident so as to give advice on the likelihood of an abortive sale. It would also have been appropriate in the interests of being open and transparent regarding the situation.
The Ombudsman notes that in responding to the resident’s concerns there is no evidence that the landlord explored with the resident her individual circumstances and need to sell the property. In the Ombudsman’s opinion this would have been appropriate to determine if there were any action the landlord could take to mitigate the impact of the situation on the resident, such as granting permission to sub-let. The Ombudsman accepts that there may have been no actions which would have been appropriate, however its failure to explore any options was unsatisfactory.

The landlord’s response to the resident’s request to reimburse the costs which she had incurred in attempting to sell the property

The Ombudsman notes that the resident reports that, had the landlord informed her regarding Advice Note 14 following its introduction, she would not have put the property on the market in April 2019, rather she would have waited until compliance with the guidance was confirmed. While the resident’s comment is noted, the Ombudsman cannot assume that this would have been the case. Furthermore, the Ombudsman notes that the impact of Advice Note 14 on mortgage applications was not immediately known following the introduction of the guidance, and some lenders continued to offer mortgages despite a building not being compliant. At the time that the resident put her property on the market, April 2019, the full implications of Advice Note 14 on mortgage lenders’ decisions was not known.
The landlord refused the resident’s request to reimburse any costs that she had incurred in relation to the sale of the property. The landlord explained that this was because:
1. Decisions about mortgages and sales were between individuals and their lenders and was beyond its own control.
2. Decisions to buy or sell a property was taken at an individual’s own risk according to the prevailing conditions at the time.
3. It was limited in what it could do to influence the situation.
In the Ombudsman’s opinion it would have been reasonable for the landlord to have refunded the resident the cost of the leaseholder pack (£270). This is because the landlord was unable to provide certification to demonstrate compliance with the Government’s guidance. In the Ombudsman’s opinion the landlord’s decision demonstrated that it did not take the full circumstances of the resident’s situation into account.
The Ombudsman considers that the landlord’s decision to refuse the resident’s request to refund her other costs was reasonable. This is because, as identified by the landlord itself, lenders’ decisions on leaseholder mortgage applications was beyond its own control and it was taking steps to achieve compliance with the guidance.
In responding to the complaint, the landlord found that its communication regarding compliance with Advice Note 14 could have been better and therefore offered £25 compensation. As the landlord identified that its communication could have been improved it was reasonable for the landlord to make a good will gesture.

The landlord’s complaint handling

The landlord’s complaint policy sets out that it will respond to stage one complaints within 10 working days and a stage two panel should be held within 30 working days of the escalation request.
The resident’s stage one complaint was made on 30 October 2019 and the landlord provided its stage one response on 12 November 2019. The landlord’s stage one response was provided within its service standard and therefore appropriate.
The resident requested to escalate her complaint on 12 November 2019 and the landlord provided its final response on 21 April 2020, following the panel hearing on 20 March 2020. The evidence shows that in order to have her complaint responded to, the resident had to request intervention from the Ombudsman. The evidence further shows that the landlord’s final decision was not provided until approximately one month after the hearing had taken place. In the Ombudsman’s opinion the landlord’s handling of the resident’s stage two complaint was unsatisfactory and is contrary to the Ombudsman’s Complaint Handling Code. This is because the landlord did not adhere to its own timescales or provide updates to the resident regarding the delays. This would have resulted in unnecessary uncertainty to the resident in addition to time and trouble in pursing the complaint. Further, the landlord’s failure to provide the resident with a timely response was contrary to good complaint handling as the purpose of a complaint procedure is to address complaints at the earliest stage which the landlord did not do in this case. Finally, the Ombudsman notes that the landlord’s delay in convening the panel also delayed the resident’s access to the Ombudsman for adjudication.
The landlord acknowledged within its final response that it had not managed the resident’s escalation request in accordance with its complaint procedure. The landlord therefore apologised and awarded a total of £50 compensation in relation to complaint handling. In the Ombudsman’s opinion the compensation awarded is not proportionate to the circumstances of the case for the reasons set out above.
The Ombudsman notes that while the complaint was live the resident attended the landlord’s offices to discuss her concerns. The Ombudsman is not satisfied that the landlord’s management of her attendance on 30 October 2019 was satisfactory. When it became clear that no staff member was available to meet with the resident the landlord should have offered to arrange an appointment. In the Ombudsman’s opinion this would have been reasonable, including to reassure the resident that it wanted to resolve her concerns.
The Ombudsman notes the landlord’s correspondence dated 17 March 2020 regarding the panel hearing. In the Ombudsman’s opinion the correspondence was unsatisfactory as it did not clearly explain that the panel hearing to consider the resident’s complaint would still go ahead despite the resident not being able to attend due to Covid-19. The landlord apologised that its correspondence was not sufficiently clear regarding the status of the panel hearing. While the apology was appropriate to demonstrate that the landlord recognised its error, in the Ombudsman’s opinion it was unsatisfactory that the landlord did not offer the resident the opportunity to attend the hearing virtually or to speak to a member of the panel before the decision was issued. The Ombudsman understands that the resident may feel that her complaint was not given fair and unbiased consideration.

Determination (decision)

In accordance with paragraph 54 of the Housing Ombudsman Scheme there was:
1. Service failure by the landlord in respect of its response to Government guidance on cladding in relation to the building the resident owns a property in
2. Service failure by the landlord in respect of its response to the resident’s request to reimburse the costs which she had incurred in attempting to sell the property
3. Maladministration by the landlord in respect of its complaint handling

Reasons

The Ombudsman appreciates that the resident’s current situation is difficult and that she is in this position through no fault of her own. This is because until the landlord is able to provide certification, in line with the Government’s guidance, the resident is effectively in limbo as she is unable sell the property as lenders will not lend on it because of the cladding issue.
The evidence shows that the landlord is taking steps in order to comply with the Government’s guidance in respect of the building. The evidence shows that the landlord has done so by inspecting the building and committing to completing the remedial work identified. While it is appropriate that the landlord is taking steps to comply with the guidance the landlord’s communication with the resident in respect of situation was unsatisfactory. The landlord’s first communication dated 18 July 2019 omitted to include an explanation detailing the potential impact of the guidance on mortgage applications. As the impact of the guidance on mortgage applications was widely recognised within the housing sector by mid-2019 in the Ombudsman’s opinion the landlord’s omission was unsatisfactory and was a missed opportunity by it to fully explain the situation in relation to the guidance. Further in responding to the resident’s concerns there is no evidence that the landlord explored with the resident her individual circumstances and need to sell the property. In the Ombudsman’s opinion this would have been appropriate to determine if there were any action the landlord could take to mitigate the impact of the situation on the resident.
Following the fire risk assessment and by July 2019 the landlord had arranged a waking watch at the building. This was appropriate to mitigate and manage the risks identified until such time that the risks could be explored further and addressed as part of the remediation works to achieve compliance with Advice Note 14.
While the resident’s position is noted, as she says that she would have waited to put the property on the market in April 2019 had the landlord informed her regarding Advice Note 14 following its introduction, the Ombudsman cannot assume that this was the case. The Ombudsman notes that the impact of Advice Note 14 on mortgage applications was not immediately known following the introduction of the guidance in December 2018, and some lenders continued to offer mortgages despite a building not being compliant. At the time that the resident put her property on the market, April 2019, the full implications of Advice Note 14 for sales was not known.
In the Ombudsman’s opinion it would have been reasonable for the landlord to have refunded the resident the cost of the leaseholder pack (£270) in recognition that she was unable to sell the property as it was unable to provide certification to demonstrate compliance with the Government’s guidance. In the Ombudsman’s opinion the landlord’s decision demonstrated that it did not take the full circumstances of the resident’s situation into account.
The Ombudsman does not however consider that the landlord’s decision to not refund the resident’s other costs was unreasonable. This is because, as identified by the landlord itself, lenders’ decisions on leaseholder mortgage applications were beyond its own control and it was taking steps to achieve compliance with the guidance.
While the landlord recongised that its complaint handling had been unsatisfactory, and offered £50 compensation in recognition of its failing, in the Ombudsman’s opinion the offer was not proportionate to the circumstances of the case and did not fully take into account the landlord’s service failures in this respect.
In the Ombudsman’s opinion it was unsatisfactory that the landlord did not offer the resident the opportunity to attend the complaint panel hearing on 20 March 2020 virtually or to speak to a member of the panel before the decision was issued. The Ombudsman understands that the resident may feel that her complaint was not given fair and unbiased consideration. In addition the landlord delayed in providing its final decision following the panel hearing.

Orders and recommendations

Orders

The landlord should reimburse the resident the cost of the leaseholder pack which she purchased within four weeks of the date of this determination.
The landlord should pay the resident £200 compensation for not communicating the potential impact of Advice Note 14 on property sales at an appropriate point within four weeks of the date of this determination.
The landlord should pay the resident £300 compensation in respect of its complaint handling within four weeks of the date of this determination. This is in addition to the £50 compensation the landlord offered itself as part of the complaint procedure.

Recommendations

The landlord should write to the resident (and other leaseholders) within four weeks of the date of this determination to provide an update on its bid to the Government’s Building Safety Fund in relation to the cost of remedial fire safety works at the building.

[1] https://www.housing-ombudsman.org.uk/about-us/corporate-information/policies/dispute-resolution/guidance-on-cladding/