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One Manchester Limited (202214383)

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REPORT

COMPLAINT 202214383

One Manchester Limited

10 May 2023

 

Our approach

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

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

The complaint

  1. The complaint is about a letter sent by the landlord to the resident on 21 March 2022 concerning arears on the resident’s rent account.

Background

  1. The resident is an assured tenant of the landlord, which is a housing association. The property is a maisonette.
  2. On 13 December 2021 the landlord sent a letter to the resident informing her that her rent account was £162.48 in arrears. The landlord sent a second letter on 21 March 2022 informing the resident that the rent account was £84.15 in arrears and informed the resident that if the debt was not paid within the next three days that it would commence legal proceedings.
  3. The resident wrote to the landlord on 29 March 2022 and requested to raise a complaint into the 21 March letter. The resident described the elements of the complaint as:
    1. She disputed that her rent account was in arrears and that the letter had been incorrectly sent. The resident had records of all rent payments she had made since 2009 which showed her account was up to date. However, due to the seriousness of the letter, the resident felt obligated to make the requested payment.
    2. The letter did not provide any information as to the status of the rent account and only asked for payment in very intimidating language.
    3. As a resolution to the complaint, the resident requested compensation for the alarm and inconvenience the issue had caused.
  4. The landlord sent a stage one complaint response to the resident on 8 April 2022, then a stage two complaint response on 3 August 2022. In its responses, the landlord:
    1. Explained that the resident at the time of the March 2022 letter paid a weekly standing order of £78.33 for the rent. However, the resident previously paid the rent monthly and the switch from monthly to weekly payments had resulted in a £5.82 debt on the account.
    2. Informed the resident that there had been a delay in processing the £78.33 payment which resulted in the 21 March 2022 letter being generated requesting payment of £85.15 (£78.33 plus the £5.82).
    3. Apologised for its error in sending the letter. It explained it had now made changes to its procedures so any arrears letters would no longer be sent to the resident without checks first being made to ensure that all payments had been received. The landlord also confirmed that the £5.82 debt had been cleared.
  5. In referring the case to this Service, the resident described the outstanding issues of the complaint as the landlord had not properly explained the issues she had raised relating to how it had managed her rent account in its complaint responses.

Assessment and findings

Relevant policies and procedures

  1. Section 1.1 of the tenancy agreement relates to payments. Section 1.1.2 states that “the payment of Rent and (where applicable) Service Charge are due weekly in advance on Monday in the relevant week. Rent and Service Charge are calculated on an annual basis but are payable generally over 50 weeks a year”. Section 1.1.3 states “you must pay your rent and any applicable Service Charge on time. Payment is due every week but you can pay in advance every two weeks or every month if you prefer”.
  2. The landlord’s income and debt recovery policy describes its approach to debt collection as follows:
    1. “It is recognised that Income Management is an emotive area of work and as such [the landlord] is committed to treating all customers fairly whilst at the same time reminding them of their responsibility to pay rent and/or service charge, sundry debt including but not limited to recharges, former tenancy arrears and court costs. Whilst a serious view is taken of outstanding debt, it is recognised that some customers are financially or otherwise disadvantaged and therefore, a preventative and supportive approach will be adopted.”
  3. The landlord described its procedures for sending warning letters as that it will send a stage 1 arrears letter when a rent account is in arrears to over £50 and a stage 2 NOSP (notice of seeking possession) warning letter when a rent account in in arrears to over £80.
  4. The landlord’s compensation policy states that it will consider offering a discretionary compensation payment in circumstances where it has “failed to deliver to the standards expected e.g. poor complaint handling, delays in providing a service, failure to provide a service that has been charged for, failure to meet target response times and failure to follow policy and procedure. If we are clearly responsible for a service failure we can make a discretionary payment”.
  5. The remedies guidance in the compensation policy recommends a payment level of £1 to £100 for “minor disruption”, which is defined by the landlord as “service failure occurred but low impact and low effort to resolve”.

Scope of Investigation

  1. On receipt of the first arrears letter, sent by the landlord on 13 December 2021, the resident raised a separate complaint with the landlord on 21 January 2022. The landlord sent a stage one complaint response on 25 January 2022, then a stage two complaint response on 17 June 2022. The resident brought this complaint to this Service and a report was sent on 20 December 2022.
  2. On 18 January 2021, the resident raised a complaint with the landlord relating to how it had managed her rent account. The landlord sent a stage one complaint response on 21 January 2021, then declined the resident’s request to escalate the complaint on 26 March 2021. The resident brought the case to this Service and a report was sent on 20 September 2021.
  3. Paragraph 42(m) of the Housing Ombudsman Scheme states that the Ombudsman “may not consider complaints which, in the Ombudsman’s opinion, seek to raise again matters which the Housing Ombudsman, or any other Ombudsman has already decided upon”. Therefore, this report will only consider the elements of the complaint relating to the 21 March 2022 letter sent by the landlord to the resident, as issues relating to the 13 December 2021 letter and how the landlord managed the rent account have already been addressed in the two reports already sent to the resident detailed above.
  4. In an email sent to this Service on 11 February 2023, the resident described how her health had been affected by the landlord’s actions. The Ombudsman does not doubt the resident’s comments. However, it is beyond the remit of this Service to make a determination on whether there was a direct link between the landlord’s actions and the resident’s health. Whilst we cannot consider the effect on health, consideration has been given to any general distress and inconvenience which the resident experienced as a result of any errors by the landlord.

The letter sent on 21 March 2022 concerning rent arrears on the account.

  1. Once the landlord received the resident’s correspondence disputing the letter sent on 21 March 2022, it had a duty to respond to the matter in line with its obligations set out in the tenancy agreement and its published policies and procedures.
  2. It is not in dispute that the letter was sent in error. Therefore, it was appropriate for the landlord to apologise to the resident, confirm that her rent account was not in arrears and explain what changes it had made to ensure this would not happen again. This position is in line with the Ombudsman’s Dispute Resolution Principles of: be fair, put things right and learn from outcomes.
  3. The landlord acted fairly in acknowledging its mistake and apologising to the resident. It put things right by confirming the rent account was not in arrears and the existing small debt had been cleared. It demonstrated that it learnt from its mistake by changing its procedures so that any arrears letters would no longer be automatically sent to the resident without first being reviewed to ensure all payments had been received.
  4. However, it would have also been appropriate for the landlord to consider a compensation offer to the resident. The clear alarm and distress caused to the resident in being mistakenly threatened with legal action meets the threshold for a discretionary compensation payment at the minor disruption level of the landlord’s compensation policy detailed above. While the alarm caused to the resident was significant, the landlord addressed the issue in a timely manner when it was brought to its attention, therefore the minor disruption level is the appropriate tariff to use to calculate the compensation award.
  5. Therefore, in order to fully resolve this complaint, it would be appropriate for the landlord to pay the resident £75 compensation in recognition of the alarm and distress caused by the landlord incorrectly threatening legal action. This payment is line with both the landlord’s compensation policy and the Ombudsman’s own remedies guidance (which is available on our website). This recommends a payment of £50 to £100 in cases of service failure of a short duration that may not have significantly affected the overall outcome. This includes distress and inconvenience, time and trouble, disappointment, loss of confidence, and delays in getting matters resolved.
  6. As previously stated above, it is not with the jurisdiction of this Service to consider elements of the complaint relating to the 13 December 2021 arrears letter or how the landlord managed the resident’s rent account.

Determination

  1. In accordance with paragraph 52 of the Housing Ombudsman Scheme, there was service failure by the landlord in respect of the letter it sent to the resident on 21 March 2022 concerning arears on the resident’s rent account.

Orders

  1. For the service failure and reasons set out above, the landlord is ordered to pay to the resident £75. This payment should be made within four weeks of the date of this report. The landlord should update this Service when payment has been made.