One Manchester Limited (202103295)

REPORT

COMPLAINT 202103295

One Manchester Limited

20 September 2021

Our approach

The Housing Ombudsman’s approach to investigating and determining complaints is to decide what is fair in all the circumstances of the case. This is set out in the Housing Act 1996 and the Housing Ombudsman Scheme (the Scheme). The Ombudsman considers the evidence and looks to see if there has been any ‘maladministration’, for example whether the landlord has failed to keep to the law, followed proper procedure, followed good practice or behaved in a reasonable and competent manner.

Both the resident and the landlord have submitted information to the Ombudsman and this has been carefully considered. Their accounts of what has happened are summarised below. This report is not an exhaustive description of all the events that have occurred in relation to this case, but an outline of the key issues as a background to the investigation’s findings.

The complaint

1. The complaint refers to:
   1. The landlord’s response to the resident’s concerns about the administration of her rent account in 2019 and 2020.
   2. The resident’s concerns about the administration of her rent account in 2015-16.
   3. The resident’s request for a rent refund.
   4. The landlord’s handling of the associated complaint.

Jurisdiction

2. What we can and cannot consider is called the Ombudsman’s jurisdiction. This is governed by the Housing Ombudsman Scheme. When a complaint is brought to the Ombudsman, we must consider all the circumstances of the case as there are sometimes reasons why a complaint will not be investigated.
3. After carefully considering all the evidence, in accordance with the Housing Ombudsman Scheme, the following aspects of the complaint are outside of the Ombudsman’s jurisdiction.

The resident’s concerns about the administration of her rent account in 2015-16.

4. Paragraph 39(e) of the Scheme states:
   1. The Ombudsman will not investigate complaints which, in the Ombudsman’s opinion were not brought to the attention of the member as a formal complaint within a reasonable period which would normally be within 6 months of the matters arising.
5. In her communication with this Service, the resident stated that she believed that the landlord had charged her rent account incorrectly in 2015. The Ombudsman encourages residents to raise complaints with their landlords in a timely manner, so that the landlord has a reasonable opportunity to consider the issues whilst they are still ‘live’, and whilst the evidence is available to reach an informed conclusion on the events which occurred. As the substantive issues become historical, it is increasingly difficult for either the landlord, or an independent body such as the Ombudsman, to conduct an effective review of the actions taken to address those issues. The historical issues provide contextual background to the current complaint, but the assessment is focused on the landlord’s actions in responding to the more recent events and, specifically, to the formal complaint made in January 2021.

The resident’s request for a rent refund.

6. Paragraph 39(g) of the Scheme states:
   1. The Ombudsman will not investigate 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.
7. Complaints that relate to the level, reasonableness, or liability to pay rent or service charges are within the jurisdiction of the First-Tier Tribunal (Property Chamber) and the resident would be advised to seek free and independent legal advice from Citizen’s Advice in relation to how to proceed with a case. It is outside the Ombudsman’s remit to order the landlord to refund any rent, however, we can look at the landlord’s communication with the resident about the issue and whether it investigated and responded to her concerns appropriately, in line with its policies and procedures.

Background and summary of events

8. The resident is an assured tenant of the landlord. The resident’s tenancy agreement specifies that rent payments are due weekly in advance on Monday in the relevant week. It adds that rent and service charges are calculated on an annual basis but are payable generally over 50 weeks a year. The agreement also states that there are two free weeks in a year, when no rent or service charge is due.
9. On 8 December 2020, the landlord sent the resident her rent account statement to advise her of the arrears balance on the account. The resident raised a complaint with the landlord on 18 January 2021 and explained that she believed the landlord had overcharged her. She had previously been paying monthly and had been told that the reason for the arrears was that the rent was charged weekly. She disputed this and believed that the account should be at a zero balance at the end of the rental period. She then changed her payments to weekly instalments and set up a standing order with her bank for the exact amount and number of payments. She did not understand why her account was now in a greater level of arrears.
10. The landlord issued a stage one complaint response to the resident on 21 January 2021 and explained the following:
    1. It noted that the resident was previously paying her rent monthly and her account had been in credit following each payment. She changed to weekly payments in March 2019 with the last monthly payment being made on 11 March 2019. The account balance at that time was £142.19 in credit. The landlord noted that the first weekly payment was not received until 8 April 2019, by which time a further two weeks of rent were due on the account.
    2. It explained that there was a three–week gap between payments, but one week was its April ‘rent-free’ week, meaning it had only charged rent for two of the weeks. When the first weekly payment was made into the account, the balance on the account was £9.01 in arrears. The landlord noted that this was the case until 30 March 2020, when no payment was received. The balance was then £84.15 in arrears. A double payment was made on 4 January 2021 which left the balance on the account at the time at £6.98 in arrears.
    3. The landlord explained that the small amount of arrears on the account had occurred because of an amount not covered when the resident changed from monthly to weekly payments. For this reason, it would not uphold the resident’s complaint. 
11. The resident emailed the landlord on 25 March 2021 and explained that she remained dissatisfied as her bank had confirmed that all 50 weekly payments were made whilst paying weekly, and 12 payments were made when paying monthly. The resident believed that the landlord had overcharged her whilst she was paying monthly and asked the landlord to refund all overcharges with interest.
12. The landlord responded on the following day and explained that for the complaint to be escalated, the resident would need to provide evidence as to why she believed that the information provided in its response was incorrect. It did not dispute the number of payments made by the resident as the only week that was missed was the week commencing 30 March 2020 but a double payment was made on 4 January 2021. It added that if the resident did not provide evidence to support her claim then the escalation would not be processed.
13. The resident responded on the same day and said that she wanted the landlord to provide evidence that no more than 50 payments were collected that year. She said that she had previously provided evidence and the landlord should consider its lack of records as a stage two complaint.
14. The landlord responded on 30 March 2021 and provided a spreadsheet of the resident’s rent account history since April 2015. It noted that there were 50 debits per year, which supported its stage one response. The landlord reiterated that the resident would need to provide full clarification of her query and supporting evidence before a stage two escalation request would be processed. It added that in line with its complaints policy, it would not consider matters which dated back to 2015.
15. The resident responded on 9 April 2021 and advised that the landlord had taken 51 payments in 2015-16 and 51 payments in 2019-20. The landlord then explained that there were 50 charges in 2015-16 as no charge was added to the account on the week commencing 21 December 2015 because this was the rent–free week. It confirmed that there were 51 charges in 2019-20 because the financial year had 53 Mondays as opposed to 52. This meant that one more weekly rent payment was chargeable as the rent payments were charged every Monday (and there were two rent free weeks per year). It confirmed that this had not been done in error.
16. The resident responded on 2 May 2021 and expressed dissatisfaction that the landlord had collected more payments in 2019-20 than agreed in her tenancy agreement. She said that the landlord owed her this money as the additional payment was not in line with her tenancy agreement. 
17. The resident referred her complaint to this Service in June 2021 as she remained dissatisfied with the landlord’s response and expressed concern that the landlord had charged 51 payments to her rent account in 2019-20, despite her tenancy agreement stating that there should be 50 payments per year. 

Assessment and findings

The landlord’s response to the resident’s concerns about the administration of her rent account.

18. The resident’s tenancy agreement states that the resident is responsible for ensuring that her rent is paid in full and on time. It confirms that rent payments are due weekly in advance on Monday in the relevant week. It adds that rent and service charges are calculated on an annual basis but are payable generally over 50 weeks a year. The agreement also states that there are two free weeks in a year, when no rent or service charge is due.
19. The landlord’s rent and service charge setting policy also states that rent and service charges will be calculated over 52 weeks and collected over 50 weeks. There are two rent free weeks: the first week of April and the week containing 25 December. For the years that have 53 Mondays in the financial year, rent and service charge will be collected over 51 weeks.
20. In this case, the resident initially raised her complaint about the arrears on her account as she believed she should be in credit. The landlord acted reasonably by providing a breakdown of the resident’s rent account statement and an explanation as to how the arrears on her rent account had occurred. The landlord’s explanation that there had been a shortfall in payment when the resident changed from monthly to weekly payments in March 2019 was in line with the rent statements provided to both the resident and this Service for review, and was therefore a reasonable explanation.
21. The resident also expressed concern that she had been overcharged by the landlord because she had made the correct number of payments and believed her account should be at a zero balance. The landlord initially responded stating that the resident’s rent history showed that there had been no more than 50 debits per year. When the resident disputed this and said that there had been 51 debits in 2019-20 it then confirmed that this was because the 2019-20 financial year had 53 Mondays as opposed to 52. This meant that one more weekly rent payment was chargeable as the rent payments were charged every Monday.
22. The landlord did not fully explain that there would be an additional charge in financial years with 53 weeks to the resident and did not provide the correct information from the outset. Whilst this is likely to have caused some inconvenience to the resident as she had needed to pursue this matter further to gain an explanation, she was not significantly disadvantaged as this did not change the outcome of the complaint. As above, the landlord was entitled to charge for 51 weeks.
23. The resident disputes the additional payment and is concerned that the landlord has not charged her rent account correctly in line with the tenancy agreement. If the rent calculated originates from a dispute about the terms of the tenancy, this would most likely require consideration by court or tribunal, which can issue a binding decision about whether the tenancy is correct. The resident may wish to seek independent legal advice and approach the Court or First-tier Tribunal (Property Chamber) to consider this aspect of her complaint.
24. In summary, there has been no maladministration by the landlord in respect of its response to the resident’s concerns about the administration of her rent account. The landlord took reasonable steps to explain the arrears and information in the rent statements to the resident within its stage one complaint response and invited the resident to provide further evidence if she believed this was not correct. There was some miscommunication initially regarding the number of debits in the 2019-20 financial year but the landlord has since explained its position reasonably. If the resident feels that her rent account has not been charged correctly in line with the Tenancy Agreement, she may wish to seek independent legal advice. 

The landlord’s handing of the associated complaint.

25. The landlord’s complaint policy states that it has two formal complaint stages; ‘investigate it’ as stage one and ‘review it’ as stage two. At stage one, a response should be provided to the resident within ten working days. If the resident remains dissatisfied, they can ask for their complaint to be reviewed at stage two. The policy states that the complaint must meet certain criteria to be considered at stage two. The complaint can be considered further if:
    1. All or some of the points raised as part of the complaint have not been investigated or responded to as part of stage one, or where the complainant feels the outcome is wrong.
    2. All or some of the agreed actions have not been carried out within the specified timescales or carried out to a less than satisfactory standard.
    3. The landlord failed to respond to the complaint within the published timescales as set out in this policy including any notified additional time.
26. The policy confirms that if a stage two request is rejected, the landlord would write to the resident within seven working days and provide an explanation of the decline.
27. In this case, the resident raised her initial complaint 18 January 2021. The landlord issued its stage one complaint response on 21 January 2021, within the timescales set out in its policy. The resident then asked for her complaint to be escalated as she believed that the landlord had overcharged her because she had made 50 payments in line with her Tenancy Agreement. The landlord appropriately responded to the resident’s first request for escalation by acknowledging her request and seeking more details about why she was dissatisfied before it could process the request. It then chose not to proceed with the resident’s request for an escalation, again stating that the resident would need to provide full clarification of her query and supporting evidence before a stage two escalation request would be processed.
28. It was reasonable for the landlord to initially ask for further evidence as to why the resident believed the balance on her rent account to be incorrect. The resident’s specific concerns about the number of payments debited from her rent account did not form part of the initial complaint to the landlord, however, in raising her further concern that there had been 51 debits from her rent account in 2019-20, the resident clarified her query and provided supporting evidence. As such, the resident’s escalation request should have been processed by the landlord.
29. It is the Ombudsman’s view that a complaint should be escalated at a resident’s request unless there is a good reason not to do so, for example where the resident has raised new issues which should be raised as a separate stage one complaint. As such, the landlord would have been expected to either process the resident’s escalation request or register a new complaint to respond to the resident’s concerns about the number of debits on her rent account. The landlord has not followed its formal complaints procedure as it had not processed the resident’s request for review despite the resident clarifying why she remained dissatisfied and providing evidence to show why this was the case. By refusing to do so, the landlord did not allow the resident the opportunity to challenge any decision or share concerns via an appeal process.
30. In summary, the landlord made an error in respect of its handling of the associated complaint in that it did not process the resident’s escalation request despite her clarifying her concerns. The resident was not significantly disadvantaged by the landlord’s decision not to escalate or register a new complaint as it had responded to her concerns informally and signposted her to this Service for further review. It is unlikely that the landlord’s position would have changed at stage two of its process as it maintained the same position when contacted by the Ombudsman to provide evidence for our investigation.
31. However, it is recommended that the landlord carries out staff training for complaint handlers to ensure that escalation requests are processed in future where the resident has provided their reasons for remaining dissatisfied.

Determination (decision)

32. In accordance with paragraph 54 of the Housing Ombudsman Scheme, there was no maladministration by the landlord in respect of its response to the resident’s concerns about the administration of her rent account and its handling of the associated complaint.

Reasons

33. The landlord acted appropriately by explaining how the arrears on the resident’s account had accrued and providing rental statements. There was some miscommunication regarding the number of payments debited to the resident’s rent account, however, the landlord has provided a satisfactory explanation as to why an additional payment was charged in 2019-20 in line with its policies.
34. The landlord would be expected to consider a resident’s request to escalate their complaint to stage two of its internal complaints procedure. In this case the resident was not significantly disadvantaged by the landlord’s decision not to process her escalation request as it had responded to her further concerns informally. However, it should have considered this request in line with its formal complaints procedure as the resident had provided clarification of her concern and evidence of the reasons why she believed her rent balance to be incorrect.

Recommendations

35. It is recommended that the landlord carries out staff training for complaint handlers to ensure that escalation requests are processed where the resident has provided their reasons for remaining dissatisfied.