Southwark Council (202210731)

REPORT

COMPLAINT 202210731

Southwark Council

24 March 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 the landlord’s handling of:
   1. The resident’s request for a copy of the final service charge account bill including complete list of works, for major works completed in 2018/2019 on his property.
   2. The associated complaint.

Background

2. The resident is a leaseholder of the property, and the landlord is the freeholder.

Scope of investigation

3. This report will consider the delays the resident experienced in receiving the final service charge account invoice. It will also consider whether the lists of works on the final account invoice were sufficient. Disputes about the level of rent or service charge or level of increase are outside the remit of the Ombudsman and are better suited for consideration by the First Tier Tribunal (Property Chamber). Therefore, the Ombudsman will not respond to the resident’s concerns about the cost of the major works or whether this provides good value for money.
4. In 2018/2019, major works were carried out on the resident’s property. The major works included, roof repairs, brick work repairs, decoration, and general works. The works were completed on 15 March 2019. Following the completion of the works, the resident requested a copy of the final account invoice and a list of completed works for the major works. The resident sent the request to the landlord on 10 July 2019. The resident also emailed the landlord to chase the requested final account invoice on 23 July 2019 and 2 August 2019.
5. The landlord emailed the resident on 4 September 2019 with a list of works. However, it did not include the costs of the works. Following this, the resident responded to the landlord’s email on 4 September 2019. He requested a more detailed list of works which included the costs.
6. On 5 September 2019, the landlord told the resident that he would need to contact the homeownership team for the final bill with costs. The landlord also stated that it would email the contractor for an extensive list of the works carried out on the block. It also explained that the defect liability period for the works end on 6 March 2020.
7. On 12 September 2019, the landlord emailed the resident and stated it would be best for the resident to send a full list of the issues he had identified. The landlord could then report the appropriate issues to the repairs team. The landlord stated that this would be instead of the landlord providing the full list of works.
8. The resident emailed the landlord for an update on the final bill in September 2019 and October 2019.
9. On 12 March 2021, the landlord emailed the resident and provided an update about the final bill. It stated that it was waiting for information internally from another team. The landlord also stated it was unable to provide a timescale for the final bill to be issued.
10. On 11 July 2021, the resident emailed the landlord and asked for another update on the final bill. The landlord responded to the resident’s email on 26 July 2021. It stated that it had not yet received the final account from its investment delivery team.
11. On 3 October 2021, the resident emailed the landlord and stated he would like to raise a complaint. The resident stated he had not received the final bill for major works which were completed on the block in 2018. He also stated that he had not received a detailed final list of works.
12. On 27 October 2021, the landlord responded to the complaint maintaining that it was awaiting the necessary information internally from another team.
13. In November 2021, the resident requested for his complaint to be escalated to the next stage. He stated as a leaseholder he cannot hire surveyors to judge the price-quality ratio of the work completed by the landlord’s contractor.
14. On 18 March 2022, the resident emailed the landlord for an update on the final bill. He stated that it had been over a year since he had had received an update.        Also on 19 May 2022, the resident resent a copy of his complaint to the landlord which he sent in November 2021.
15. The landlord emailed the resident on 8 June 2022 and provided its stage two response to his complaint. The landlord said it was still awaiting information internally. The landlord also stated that it partially upheld the complaint based on the time the resident had been waiting for the final account invoice. However, it stated it did not consider that there is any blame which could be linked to its officers or teams.
16. The resident remained dissatisfied with the landlord’s response. He stated his desired outcome is for the landlord to change its practices on sharing final accounts with detailed list of works. Also, he would like to receive the final account invoice including detailed list of works. Finally, he would like to receive interest on the money to be returned to him once the bill is finalised. The resident recently received a copy of the draft final account invoice in February 2023.

Assessment and findings

The complaint about the resident’s request for a copy of the final service account bill including complete list of works

17. The landlord’s service charges policy states that a resident has the right to request a written summary of the costs which make up the service charges from the landlord. It also states that the summary must be given to the resident within one month of their request, or six months of the end of the period to which the summary relates, whichever is later. This information is compliant with Section 22 of the Landlord and Tenant Act 1985 which sets out the statutory timescales when landlords are expected to respond to service charge enquiries.
18. The landlord’s website has a leaflet which summarises key information about service charges for major works. It explains that a final account invoice is prepared by the contractor manager when a works contract has finished, and the defects liability period has ended. It also states that it uses the final account to reflect the actual amount of money spent on the block or estate.
19. It has been acknowledged that when the resident initially requested a copy of the final account invoice, the defect liability period had not elapsed. The defect liability period was March 2020. As the landlord’s major works leaflet explains that a final account invoice is prepared after the defect liability period, it is evident that the final account invoice would have not been available at time of the resident’s initial request. The landlord did tell the resident about the defect liability period date. However, it is clear that the communication could have been better by explaining to the resident that the final account invoice would not be ready until after the defect liability period had elapsed.
20. The resident emailed the landlord for an update on the final account invoice in September and October 2019. The resident did not receive a response to his update request until 18 months later, which was on 12 March 2021. The landlord stated that the service charge construction team is yet to receive the complete final account information from its investment delivery team. The landlord also stated it was unable to provide a timescale. There was a significant delay in the landlord responding to the resident’s update request which was unreasonable. Furthermore, at the point the landlord provided it’s update the defect liability period had passed by over a year.
21. The resident has also stated that the list of works on the invoice are not detailed enough. He has stated that it is not clear which repairs were carried out. The landlord should provide the resident with a clearer list of the works carried out. For example, for general repairs this could include more specific details of which repairs were completed and the associated cost. The landlord’s service charge policy also explains that the resident has the right, within six months of receiving a written summary of costs for the landlord to provide the resident reasonable facilities to inspect the accounts, receipts and other documents supporting the summary of costs. So, it is suggested that the landlord works with the resident if he requests this service.
22. Overall, there have been significant delays in the landlord providing a copy of the final account invoice to the resident. The defect liability period ended in March 2020; therefore, the final account invoice should have been sent to the resident shortly after this date. However, it was not sent to the resident until nearly three years after the defect liability period had expired. This is completely unacceptable. The landlord has said the delay was due to it awaiting information from other teams internally. This is not an adequate explanation for a delay of this length. The landlord should have adequate processes in place to ensure effective communication between teams so it can fulfil its legal obligations to provide information on service charges to leaseholders upon request.
23. The resident initially requested a copy of the final account invoice, so he could arrange for a surveyor to inspect the price/quality ratio of the major works which were completed on the property. As the landlord has taken several years to issue the final account invoice to the resident, it would be very difficult for the resident to arrange for a surveyor to inspect the works and to challenge the works at this point. The major works were completed in March 2019; therefore, the quality of works would have now potentially deteriorated due to the number of years which has passed. The delay in providing the resident with the final account invoice has caused significant distress and inconvenience to the resident as he had to chase for this on multiple occasions.

24. Given the significant delay in the landlord providing the final account invoice to the resident. It would be appropriate for the landlord to pay the resident £700 compensation. The amount of compensation awarded is in line with the Ombudsman’s Remedies Guidance and is proportionate to the significant distress and inconvenience caused to the resident.

The landlord’s complaint handling

25. The landlord’s complaints policy states that it will respond to a resident’s stage one complaint within 15 working days. It also states that it will provide a stage two response within 25 working days. The Ombudsman’s Complaint Handling Code (The Code) sets out the Ombudsman’s expectations for landlords’ complaint handling practices. The Code states that a stage one response should be provided within ten working days of the complaint. It also explains that a stage two response should be provided within 20 working days from the request to escalate.
26. The landlord’s response timescales in its complaints policy are not in line with the Code. A recent check of the landlord’s website shows that the same complaints policy is still in place. Therefore, the landlord should review and update the timescales in its complaints policy and ensure that they are compliant with the Code. In this case I have assessed the delays against the Code as the landlord’s complaint policy should be in line with the Complaint Handling Code.
27. The resident first submitted his complaint to the landlord on 3 October 2021. As part of his complaint, he stated he had not received the final bill or detailed list of works for major works which were completed on the block in 2018. The landlord then provided its stage one response on 27 October 2021. This response was approximately 18 working days after the resident emailed his complaint to the landlord. The response time was late and not compliant with the timescales referenced in the Code.
28. It took around seven months for the landlord to provide its stage two response, despite the resident chasing for this several times. The landlord apologised for the delay in its stage two response, however a reason was not provided for the significant delay. As the landlord has not explained the reasons for this delay, the Ombudsman can only conclude that it was unreasonable. The delay would have caused significant inconvenience for the resident as he had to chase the landlord for a response, and he was delayed in progressing the complaint to the Ombudsman because he needed to wait for the landlord’s final response before contacting our service.
29. Given the significant delay in the landlord providing its stage two response and the slight delay in issuing its stage one response. It would be appropriate for the landlord to pay the resident £200 compensation for the distress and inconvenience caused. The amount of the compensation is appropriate to recognise the delay the resident experienced. It is also compliant with the Remedies Guidance.

Determination (decision)

30. In accordance with paragraph 52 of the Housing Ombudsman Scheme there was severe maladministration by the landlord, in handling the resident’s request for a copy of the service charge final bill including complete list of works, for major works completed in 2018/2019 on his property.
31. In accordance with paragraph 52 of the Housing Ombudsman Scheme there was maladministration in the landlord’s complaint handling.

Orders

32. The landlord to pay the resident £700 compensation in recognition of the distress and inconvenience caused from its delay in issuing the final account invoice to the resident.
33. The landlord to pay £200 compensation for its complaint handling.
34. These payments should be made within four weeks of the date of this report.
35. The landlord to contact the resident to apologise for the failings in this case.
36. The landlord to provide a clearer detailed list of the major works carried out. For example, for general repairs this should include more specific details of which repairs were completed and the associated cost. The detailed list of works should be provided to the resident within four weeks of the date of this report, with a copy sent to the Ombudsman for our records.
37. The landlord to carry out a review into the resident’s case and identify any mistakes and improvements. The landlord should draft a report on its findings and provide a copy of the report to this service and the resident. The report should be provided within eight weeks of the date of this report.

Recommendations

38. The landlord should review its complaints policy to ensure that its complaint response timescales are compliant with the Ombudsman’s Complaint Handling Code.