Phoenix Community Housing Association (Bellingham and Downham) Limited (202101157)

REPORT

COMPLAINT 202101157

Phoenix Community Housing Association (Bellingham and Downham) Limited

22 December 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

This complaint is about how the landlord handled the resident’s request that it dispense with the requirement to repay the Right to Buy (RTB) discount.

Background

The property is a first floor flat. The resident was a tenant of the landlord from 2002 until they purchased their flat under the Preserved Right to Buy (RTB) in December 2017.
The resident’s neighbour was arrested for assaulting the resident on 11 May 2019. On 14 August 2019, the neighbour was convicted of using threatening or abusive words or behaviour or disorderly behaviour likely to cause harassment, alarm or distress, and received an 18 month conditional discharge. On 4 December 2019 the neighbour was served a Notice of Seeking Possession (NOSP) by the landlord and told not to have contact with any of his neighbours.
On 16 June 2020 the resident reported that the communal door had been vandalised and, on 16 July 2020, that their car had been damaged. On 14 July 2020, the landlord sent instructions to its solicitors to start injunction and possession proceedings against the resident’s neighbour.

Summary of events

On 21 July 2020 the Housing Manager spoke to the resident on the phone. The resident advised that they would like to sell their flat but were concerned about the penalty that could be imposed for moving before the end of the 5 year repayment period. The resident asked if they could be considered for an exemption based on the Anti-social behaviour (ASB) they had been experiencing.
On 23 July 2020 the resident sent a follow up email to the landlord requesting a virtual meeting, which took place with their Housing Manager on 28 July 2020. The Housing Manager advised the resident that their request for the landlord to dispense with the requirement to repay the Right to Buy (RTB) discount would be sent to the Head of Specialist Housing Services for consideration.
The resident’s request was considered by the Head of Specialist Housing Services who submitted a report to the Executive Team for consideration at their meeting on 24 September 2020. The report noted that the resident had requested exemption on grounds of prolonged racial harassment and explained the circumstances of the case. The report went on to explain that:
1. There were three years remaining on the discount repayment period and any sale of the property before 7 December 2020 would incur a repayment amount of approximately £79,795. If the property were to be sold after 8 December 2020 it would incur a repayment amount of approximately £53,196.
2. There was no legal ground on which to exempt the sale from the Right to buy discount repayment that would be due.
3. The landlord was already in the process of evicting the neighbour.
The report was considered by the Executive Team on 24 September 2020 and on 8 October 2020. The Executive Team declined the resident’s request on the basis that appropriate action was being taken against the neighbour. The notes from the meeting also recorded that the ASB had been well managed but the legal process had been delayed due to COVID-19.
The resident was informed of the landlord’s decision to decline their request in a telephone call with their Housing Manager on 18 November 2020.
On 23 November 2020, the resident logged a formal complaint with the landlord regarding its decision to reject their request to sell their property without repaying some of the discount due under the five-year rule. The resident challenged the landlord’s assertion that their situation was not exceptional enough to grant their request, citing that:
1. Prior to that time it was never their intention to sell their property. However, they did not feel safe and the continuous harassment from their neighbour was the sole reason they wanted to move on after 18 years.
2. They had not been able to park their car near their property since it was damaged on 15 July 2020.
3. The mental toll this had taken on them had been immense, and that they still had increased anxiety even though they had cameras installed in their flat.
4. Their request to sell without paying any fraction of the discount back, was to help them purchase a new property given the current economic situation and the increased price in the housing market.
The resident said that they wanted the landlord to reconsider its decision and to explain why they were advised of that decision verbally and not in writing. The resident also said that they wanted the landlord to consider whether any restrictions could be put in place to ensure their neighbour stopped parking underneath their window and what other options it might be willing to put in place to enable them to feel safe again.
On 7 December 2020, the County Court issued an Interim Injunction Order, in a case bought to the court by the landlord, that the neighbour be forbidden (whether by himself or by instructing or encouraging or permitting any other person) from:
1. Engaging in conduct causing or likely to cause harassment, alarm, nuisance, annoyance or distress towards any person with a right (of whatever description) to reside in or occupy any home located in, or in the locality of the resident’s block
2. Parking his vehicle or any other vehicle owned by him on the property.
The landlord issued its stage one response on 7 December 2020. The landlord acknowledged that the resident’s current situation was very difficult and that it partially upheld their complaint. The landlord said that:
1. The resident’s case did meet the threshold for consideration by its Executive team and that the Executive Team acknowledged that the nuisance the resident was experiencing was distressing, unacceptable and had required intervention from the landlord throughout. However, the resident’s request had been declined as the Executive team were satisfied that the steps it had taken to address the ASB were proportionate and aligned with its ASB policy and that its policy did not provide a mechanism for a review as the Executive Team’s decision was final.
2. It acknowledged that there had been difficulties relating to the resident’s neighbour parking inappropriately and that this created considerable inconvenience to the resident. The landlord said that whilst there was no designated parking in place, it had warned the neighbour about his parking and that this had been included in the injunction application, the first hearing for which was scheduled for 7 December 2020.
3. It would continue to keep the resident updated on the legal case as the matters progress and that when the injunction was obtained it would share the contents with the local Police and Safer Neighbourhood Team so that they would be able to take the appropriate enforcement action, if necessary.
4. It acknowledged that it had failed to provide the resident with written confirmation of the decision of the Executive team, for which it apologised and asked that the landlord accept its Stage one response as confirmation of the decision that had been made.
The resident wrote to the landlord to escalate their complaint on 15 December 2020. The resident said that the landlord had failed to comply with the guidance in Section 155 of the Housing Act 1985 with regards to the landlord’s discretionary powers. The resident also said that they also remained dissatisfied with the landlord’s failure to provide then with written confirmation of the Executive team’s decision, stating that there was sufficient time for the landlord to have provided the written response before resorting to responding as part of its complaint response. The resident also asked the landlord what other options it might be willing to put in place to enable them to feel safe again.
On 23 December 2020, there was a further court hearing where it was ordered that the Interim Injunction Order of 7 December 2020 continue until the final hearing, which was listed on 24 and 25 May 2021.
The Director of Customer Services called resident on 21 January 2021 to confirm that they were considering the resident’s complaint and that their final response would be issued by 25 January 2021.
The landlord issued its final response on 26 January 2021, in which it confirmed its position regarding the resident’s request to waive the requirement to repay their right to buy discount. The landlord acknowledged that discretion did exist under the Housing Act however, its Preserved Right to Buy Policy stated that such requests would only be considered in exceptional circumstances such as where the resident developed a condition that made the property uninhabitable for them and not for financial reasons. The landlord said that there was no evidence of any medical condition and that, whilst it acknowledged the problems the resident was having with their neighbour, it was satisfied with the steps it had taken to tackle this.
Whilst it found no service failure with regards to its decision regarding the discount repayment, the landlord did partly uphold the resident’s complaint on the basis that:
1. The resident needing to park their car away from their property was not dealt with effectively in its stage one response, which the landlord said it regretted. The landlord went on to explain that, whilst it did contact the police, they confirmed that there was no evidence to connect the neighbour with the incident and had closed the case, and therefore there was no further action the landlord could take.
2. A separate and clear letter setting out the Executive Team’s decision and the reasons behind it should have been made immediately available to the resident, for which it apologised.
3. Its stage one response did not advise the resident of their escalation rights, which did not conform with its complaint’s procedure, for which it also apologised.
The resident brought their complaint to the Ombudsman on 14 April 2021.
On 28 May 2021, the County Court ordered that the Injunction Order of 7 December 2020 continue until 23 May 2023.
On 23 July 2021 a possession order was awarded against the neighbour, following which the neighbour vacated and returned the keys to the property.

Assessment and findings

Relevant legislation, policies and procedures.

Government Guidance: ‘‘Right to Buy – the use of discretionary powers on repayment of discount’’ states that:
1. Under section 155 of the Housing Act 1985, residents who dispose of a property within a specified period after purchasing it under the Right to Buy scheme have to repay upon demand by the landlord all or part of the discount they received on purchase, unless it is an exempted disposal
2. Section 185 of the 2004 Act clarifies that landlords have discretion as to whether or not to demand repayment of the full amount of discount for any disposal which takes place on or after 18 January 2005, and which triggers repayment of discount.
3. It is for each landlord to decide whether the circumstances in any particular case would justify the exercise of discretion under section 155 of the Housing Act 1985.
4. Where the former landlords are registered social landlords (for example, where the former tenant bought under the Preserved Right to Buy), the landlord should bear in mind that, under the Homes and Communities Agency’s (as of 1 October 2018 the Regulator of Social Housing) regulatory code, they are required to protect public money and to make the best use of the resources that it has to meet it objectives.
The guidance gives examples of circumstances where discretion might be justified including where an owner of the property wishes to move because of a demonstrable threat of violence or of significant harm; for example, due to racial, religious, homophobic or any other kind of harassment. The guidance also states that it is envisaged that this power will only be used in exceptional circumstances, and that landlords will have procedures in place to consider and decide requests that discretion should be exercised and that the consideration process should be open, fair and transparent.
The landlord’s Preserved Right to Buy (RTB) policy:
1. Confirms that once purchased there are restrictions on the sale of the home for a period after the Preserved Right to Buy has been exercised and that within five years a proportion of the discount will have to be repaid to the landlord.
2. States that where the legislation permits discretionary decisions to be made by the Landlord, any such decisions will be made by the Head of Service. Any requests will only be considered in exceptional circumstances such as the purchaser developing a medical condition that makes the property uninhabitable for them and not for financial reasons.

Assessment

The ASB perpetrated by their neighbour was clearly an extremely distressing and worrying experience for the resident and it is understandable that they would feel anxious about remaining in their property, particularly whilst their neighbour remained living in the flat below them.
On 23 July 2020 the resident asked to meet virtually with the landlord to discuss their concerns. The requested meeting took place, with the Housing Manager, on 28 July 2020 during which the resident advised the landlord that they were considering selling the property because of the ASB they had been experiencing and asked whether it might be possible for the landlord to dispense with the requirement for them to pay back their RTB discount. During the meeting the Housing Manager said that they would refer the resident’s request to the Head of Service, in accordance with its Preserved Right to Buy (RTB) policy, which they did.
In this case the Head of Service referred the decision to the landlord’s Executive team (the Chief Executive, Directors and Assistant Directors) who considered, in two meetings on 24 September 2020 and 8 October 2020, whether the circumstances of the case justified the exercise of its discretion under section 155 of the Housing Act 1985. It must be noted that there was no obligation on the landlord to agree to the resident’s request.
Whilst acknowledging the distress the ASB had caused the resident, the Executive team satisfied itself that it was taking appropriate steps to deal with the ASB, that the ASB had been well managed but the legal process had been delayed due to COVID-19, and that there was no evidence to suggest that the resident could not sell their property without the repayable discount being waived and therefore declined the resident’s request.
The resident expressed concerns that the landlord failed to comply with the guidance in Section 155 of the Housing Act 1985 with regards to the landlord’s discretionary powers.
During the meetings on 24 September and 8 October the landlord considered whether using its discretion might be justified based on the ASB experienced by the resident. It should also be noted that:
1. Under the regulatory code, the landlord was also required to protect public money and to make the best use of the resources that it has.
2. The landlord was obliged to resolve the ASB. The landlord had issued the resident with a NOSP and sent instructions to its solicitors to start injunction and possession proceedings against the resident’s neighbour on 14 July 2020.
3. The legal proceedings were then delayed due to Covid restrictions. Once those restrictions were lifted the legal proceeding recommenced and on 23 July 2021 a possession order was awarded against the neighbour, following which the neighbour vacated and returned the keys to the property.
The landlord followed its process for considering the resident’s request, by reviewing the reasons given against its own policy and the relevant legislation. The decision was also made at the appropriate senior level in the organisation.
Whilst the landlord was entitled to make its decision with regards to the resident’s request to waive the requirement for repayment of the RTB discount, there were nevertheless failings in its administration of the request.
It took two months for the landlord to consider the request and then a further two weeks to make a decision, there was also a further delay in advising the resident who was told by telephone. This was addressed in the stage 1 response in which the landlord recognised that advising the resident over the phone was not an appropriate way for the resident to have been informed of the landlord’s decision. However, the landlord did not acknowledge the delays in conveying the decision to the resident, which took over a month after the decision was made on 8 October 2020.
In its final response, of 26 January 2021, the landlord apologised to the resident that the Executive Team’s decision was not clear in its stage one response and that a separate and clear letter setting out the decision, and the reasons behind it, should have been made immediately available to them. It is not evident that any such letter was subsequently sent, however, the complaints responses explained the reasons for declining the resident’s request.

Conclusion

The landlord took the resident’s concerns seriously, with the Executive Team discussing the resident’s request in two meetings on 24 September 2020 and 8 October 2020. Whilst the landlord’s was entitled to refuse the resident’s request, the landlord’s acknowledgement and apology for not providing the resident with details of its decision in writing and the delays incurred in the process did not provide the resident with reasonable redress for those failings. As such a finding of service failure has been found for which the landlord is ordered to pay the resident £100 compensation.
The landlord has subsequently advised this service that it accepted that there was a need for it to clarify the process for responding to RTB dispensation requests and that going forward it would set out timescales for the process, ensure the decision is provided in writing to the resident and make it clear at the beginning of the process that the there is no appeal.
Given that this was the reason for service failure being determined in this case, an order has been made to ensure that the landlord does so.
The resident also complained to this service that they asked if they could appeal the decision but were told the Executive Team’s decision was final, there was no arrangement for an appeal process and the resident should follow the complaints procedure if they were dissatisfied with the decision. Whilst the complaints process did provide the resident with an opportunity to request that the landlord’s decision be reconsidered, the landlord may also wish to reconsider its position and to include a process by which residents can appeal the decision made.

Determination (decision)

In accordance with paragraph 54 of the Housing Ombudsman Scheme there was service failure by the landlord in respect of its handling of the resident’s request that it dispense with the requirement to repay the Right to Buy (RTB) discount.

Reasons

In response to the resident’s request that the landlord waive the repayment of their RTB discount in order for them to move, the landlord appropriately considered their circumstances and whether there were grounds under which it might apply its discretion. The landlord’s decision to decline the resident’s request was reasonable and in accordance with its policies and procedure.
The landlord failed to provide the resident with reasonable expectations as to when they could expect their request to be considered, how long the decision process might take or when, and how, they would be advised of the outcome. Once the decision had been made the landlord also failed to provide the resident with formal written response with regards to the outcome of the Executive Team decision.

Orders

That within 28 days of the date of this determination the landlord is to:
1. Pay the resident £100 for its failures in respect of its handling of the resident’s request.
2. Take the necessary steps to clarify its process for responding to RTB dispensation requests, including setting out timescales for the process and ensuring the decision is provided in writing to the resident. The landlord is also to reconsider its position with regards to there being no appeal process.
3. Confirm that it has complied with the above orders.