Stonewater Limited (201915252)

REPORT

COMPLAINT 201915252

Stonewater Limited

25 January 2022

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. This complaint is about:

   a. the level of redress the landlord awarded in respect of its acknowledged delays and failures while handling the resident’s reports of an inadequate water supply at the property;

   b. the landlord’s response to the resident’s concerns about rent arrears, his assigned tenancy rating and the landlord’s decision to take court action in respect of arrears;

c. the landlord’s complaint handling.

Background and summary of events

Background

2. The resident is an assured tenant, and the tenancy began on 14 November 2007. The property is a one-bedroom flat in a block.
3. The tenancy agreement confirms the landlord is obliged to keep any installations for the supply or heating of water in good repair and proper working order. It shows the resident’s weekly rent payment is to be paid in advance, and comprises net rent, service and support charges, council tax and a water charge. The landlord will not interfere with the resident’s right to peacefully occupy the premises, except where access is required for works or where a court has given it possession by ending the tenancy.
4. The landlord has a compensation policy. The policy has a section concerning the “Loss of use of Facilities”. It says where a loss of water heating facilities has occurred, and customers have been provided with alternative sources of heating or hot water, the customer will be compensated at £5 per day for the difference in the running costs between their usual heating system and the temporary source provided. The policy shows the landlord is entitled to offset compensation payments against debts.
5. The landlord has provided the resident’s account history from 20 November 2007 to 13 September 2021. It shows the account has been consistently in debit from the account opening date. While the arrears did not become immediately significant, the history from 2010 shows the resident was around two weeks behind on his rent at this point. The information shows the arrears have built up gradually over an extended period.
6. The landlord operates a “Rewards” policy. The policy links the services it offers to the way residents manage their tenancies. For example, residents awarded a higher banding can participate in kitchen or bathroom renewal programmes and are given a greater choice of fixtures. A bronze tenancy rating is applied to residents who do not meet, or breach, the conditions of their tenancy agreement. The rating will be applied where a rent account is in arrears.
7. The resident has a number of vulnerabilities relating to his physical and mental health. From the information seen, it is unclear whether the landlord was aware of these vulnerabilities from the beginning of the timeline.
8. The resident told the Ombudsman he was seeking compensation on the basis the property was without water for a period of three years and nine months. He disputed ever being in arrears on his rent account and feels he was unfairly threatened with eviction on that basis. He wants the landlord to stop initiating court action in respect of the arrears, amend his tenancy status to a higher banding, charge his water bill from a separate account and install a water meter.

Summary of events

9. The landlord’s contact records show the resident reported low water pressure on 19 January 2015. The notes show he had no access to drinking water as the flow from his taps was impaired. They also show his toilet cistern was taking a long time to refill.
10. A further note from 27 January 2015 shows the property had no hot water and the landlord had identified a problem with the immersion heater. The notes confirm the parties had been in contact on a number of occasions between these dates while the problems were being investigated.
11. The landlord’s repair history records confirm the hot water supply was restored on 28 January 2015. The repair note did not reference a lack of water pressure or any faults with the flow of cold water. Contact records from the same day show the resident notified the landlord the correct pressure had been restored and he was pleased with the result of the repair. This timeline suggests the issue was ongoing for a period of nine days.
12. The records show the resident remained in frequent contact with the landlord between 29 January 2015 and 15 May 2016. The notes confirm various issues prompted this contact, but no discussions about problems with the water supply were recorded.
13. On 16 May 2016 the resident asked the landlord to contact the Department of Work and Pensions (DWP) about his water rates, which were to be paid through his Income Support allowance. The records show the landlord complied with this request on 19 May 2016 but was unable to get through to an adviser.
14. The next relevant history record is dated 22 March 2017. It shows the resident had contacted the landlord in relation to arrears on his rent account. Further, he had indicated the debt was connected to his water bill rather than his rent.
15. The next record shows the resident was sent a warning letter on 22 March 2017. The note shows the letter confirmed the resident was at risk of receiving a bronze tenancy rating due to arrears on his rent account.
16. The next contact record is dated 28 October 2016. It shows the resident had reported being threatened with eviction over an unpaid water bill. The notes did not record whether the situation was successfully resolved.
17. The records show the resident contacted the landlord on 1 February 2018 to discuss his account. They suggest he had called with the intention of making of a payment.
18. The repair history and contact records both confirm the resident next reported water supply problems on 16 February 2018. The contact history note referenced low water pressure at the property with no other residents affected. It said there was no water from the kitchen cold tap and the resident had no access to drinking water.
19. Similar notes from 16 and 19 February 2018 show the landlord’s contractors had identified and isolated a water leak, but they were unable to resolve the issue. This was because the property’s unvented water cylinder required a specialist contractor to attend.
20. A note from 9 March 2018 shows the landlord contacted the resident in connection with the tenancy Rewards scheme. It said the tenant was aware of the scheme. Further, he disconnected the call after advising the arrears were related to his water bill and not his rent.
21. A note from 9 March 2018 shows the property still lacked an adequate water supply. Further, the resident was coping with the help of a neighbour who was filling up water bottles. It confirms the resident was offered a temporary decant on 16 February 2018, but he had declined due to mobility problems. It shows the landlord offered to reimburse the resident for any bottled water he was forced to buy while the situation was ongoing.
22. A contact note from 12 March 2018 shows the landlord was waiting for parts to complete the repair.
23. Notes from 16 March 2018 show the resident asked to raise a formal complaint but was told the landlord would wait until the repair was complete before it would launch an investigation. During a second conversation, the resident said, if the problem was still unresolved by the following day, he would either arrange his own plumber or begin legal proceedings. Further, it was a breach of his human rights to leave a disabled tenant with no access to water for over a month.
24. The contact history shows the resident was sent a letter on 2 July 2018 confirming a bronze status had been applied to his tenancy. This was due to the debt on his account. Both history records show the landlord had not responded to the resident’s report form March 2018 at this point.
25. The next contact note from 14 September 2018 shows the resident had been in touch again about the water supply. It said there was no water from the kitchen cold tap but drinking water was available through the hot water supply. Further, the resident had said he been without cold water since Christmas (2017). The repair history contains a similar note but neither record confirms how the situation was resolved. However, both records confirm there were no further reports of water supply issues beyond this point. They therefore suggest this incident was fully resolved by the end of September 2018, which represents a period of around seven months.
26. The next relevant contact notes are dated 22 January 2019. They show the resident had contacted the landlord and asked for compensation since he was paying for water which he had not received. They confirm he was paying £4.56 per week for “metered” water. Further, the landlord’s internal recommendation was to ask him for details of the dates where the supply was cut off, the duration of the incidents and evidence of any losses incurred.
27. The contact history shows several entries between 24 May and 3 June 2019. They began with an attempt to visit the resident in connection with his rent arrears. They show a letter was left at the property advising the resident to arrange a payment plan to avoid court proceedings. They show the resident disputed his weekly water charge and referenced continuous immersion heater issues since 2015, which caused him to use bottled water during that time. Ultimately, the landlord decided to halt any court action until the matter was resolved.
28. A note from 25 July 2019 shows the resident felt he should be reimbursed for one year of water charges because he was without a supply for that long.
29. Notes from 17 September 2019 show the resident was asked for information to allow the landlord to assess his compensation claim. The resident said he would confirm the details in writing shortly.
30. The resident’s formal complaint letter was dated 26 September 2019. The main points were:

a.     From January 2015 the resident experienced problems with the water pressure.

b.     The landlord replaced a value at some point in 2017 but the resident could not recall the details. However, the new valve was not fit for purpose as it still took three hours to fill the bath.

c.      Between 2017 and February 2018 the resident had repeatedly reported he had no water supply. The situation had forced him to buy bottled water in addition to relying on help from his neighbours. The situation had been difficult given his disabilities.

d.     In February 2018 the landlord’s contractor told him the wrong valve had been fitted.

e.     The landlord had ignored his requests for compensation, along with his requests for an amended water rate account to reflect the supply problems.

f.        The landlord should stop referring to his arrears in water payments as rent arrears and threatening him with legal action.

g.     After a discussion around the water supply, the landlord had promised to halt threats of court action in May 2019, but they had nonetheless continued. A separate action had resulted in the resident receiving court costs.

31. The landlord responded in writing on 17 October 2019, but it treated the resident’s concerns as an enquiry rather than a complaint. It acknowledged the resident may have been without a water supply between 19 and 28 January 2015 but noted no compensation had been requested at the time. Further, that no issues had been reported between January 2015 and February 2018. It said the resident called to discuss a payment plan for his water rates in 2016, 2018 and 2019. Because he had made payments in 2018 totalling £290, it suggested he had no issue with making water related payments at the time. His request for compensation was therefore declined.
32. The resident wrote to the landlord again on 10 February 2020 requesting compensation. He said he would approach the Ombudsman if he did not receive a reply within 14 days.
33. Following involvement from the Ombudsman, the landlord issued a complaint acknowledgement on 28 July 2020. It indicated a response would be issued by 11 August 2020.
34.  The landlord issued a stage one complaint response on 10 August 2020. The main points were:

a.     An investigation confirmed, between January 2015 and September 2018, the resident had reported water issues frequently and it was clear he had experienced distress and inconvenience.

b.     The landlord was prepared to award £400 in compensation, for stress and inconvenience resulting from poor service, along with an additional £140 for bottled water.

c.      The resident’s rent account had been in arrears since 2008. The arrears predated the water supply issues and would impact the resident’s tenancy rating and ability to move home.

35. The resident queried the response on 20 August 2020. He said any arrears for water should be settled as part of the complaint resolution. Further, he should be invoiced separately for water going forward so the charge would not be included in his rent account. As a result, he should not receive legal threats in connection with arrears on a utility account. On this basis, he disputed ever being in rent arrears and asked the landlord to confirm this in writing. He also asked for his account status to be amended to the highest band to allow him to access the full range of services.
36. Following further correspondence between the parties, the landlord escalated the resident’s complaint on 3 December 2020. During this correspondence the landlord accepted it had failed to raise the matter as a formal complaint on three separate occasions and acknowledged it had taken the Ombudsman’s intervention for the complaints process to finally begin. The resident was advised this failure was reflected in its previous offer of compensation. A formal stage two complaint acknowledgement was issued on 7 December 2020.
37. A stage two response was issued on 14 December 2020. It said:

a.     Because the arrears predated the water supply issues the landlord was unable to withdraw any actions being taken in conjunction with its arrears process.

b.     The landlord was unable to change the resident’s banding because it was correctly reflecting the resident’s arrears.

c.      The landlord had calculated the resident’s water charges between 2016 and 2018. It was prepared to refund 50% of these charges in the form of compensation to address his experience.

d.     The landlord’s total offer of compensation had now increased to £845.44 because of the calculation. This new figure reflected the refund of charges, along with distress and inconvenience and the cost of bottled water.

38. Following further correspondence between the parties in April 2021, the landlord informally reviewed its offer of compensation at stage two. On 28 April 2021 it confirmed it was willing to increase its total award to £1109.83. This was the figure required to clear the resident’s rent arrears at the time of the offer. The landlord later clarified that its amended figure reflected an increase in the award for distress and inconvenience. Further, it would be sufficient to change the resident’s banding, which would allow him to move properties and prevent further arrears action.
39. On 7 May 2021 the resident submitted a counter settlement offer of £26,807.83 based on his own calculations. Because the parties were ultimately unable to agree a settlement, the Ombudsman was asked to conduct an independent investigation to resolve the dispute.

Assessment and findings

40. The evidence confirms the problem was ongoing for a period of around eight months in total before a normal water supply was restored at the property. This figure is based on nine days between 19 and 28 January 2015, along with a period of seven and a half months between 16 February and 30 September 2018. It is recognised that during this time the situation had a considerable impact on the resident’s routine and lifestyle.
41. In relation to the failures identified the Ombudsman’s role is to consider whether the redress offered by the landlord put things right and resolved the complainant’s complaint satisfactorily in the circumstances. In considering this the Ombudsman takes into account whether the landlord’s offer of redress was in line with the Ombudsman’s Dispute Resolution Principles: Be Fair, Put Things Right and Learn from Outcomes as well as our own guidance on remedies.
42. The resident’s comments about a complete absence of water facilities between January 2015 and September 2018 were considered carefully in conjunction with the timeline. However, it shows reports about the nature of the problem varied over time. This is because the records from the incident in January 2015 confirm there was initially no hot or cold-water supply to the property, until the resident notified the landlord he was pleased with the subsequent repair on 28 January 2015.
43. When the second incident began, notes from 16 February and 6 March 2018 again record there was no hot or cold supply. This is supported by the resident’s comment on 16 March 2018 that he had been without any water for a month. However, when the same incident was reported again on 14 September 2018 the notes record the resident had access to drinking water from the hot water supply. They also show the resident said the property had no cold water since Christmas. As has been mentioned in the timeline, there are no records confirming a repair was completed during the interim period between February and September 2018. It is noted the resident was offered a temporary decant when the incident was first reported.
44. This inconsistency makes it difficult to gauge the extent of the problem, but this is largely due the quality of the landlord’s record keeping. Its repairs history consistently failed to record the exact nature of the problem, the specific action that was taken to fix it, or whether it responded at all to an incident. However, both records confirm there were no reported incidents in 2017. Nor is there any information to show a valve was fitted during the same year. Given the inconsistency it is reasonable to conclude that, overall, the resident’s complaint concerns an inadequate supply of water rather than a complete absence of the facility for an extended period.
45. That said, the timeline suggests there was a period of up to three months where the resident lacked any water supply. This calculation is based on the strong wording of the resident’s report on 16 March 2018. This assessment found it was reasonable to conclude that if the problem had persisted with the same degree of severity, the contact history would record additional urgent contacts from the resident about the problem.
46. Though the landlord’s compensation policy contains a provision for a loss of facilities, its wording confirms this provision is not directly relevant to the circumstances of this case. This is because there is no indication the resident was provided with an appliance to temporarily resolve the problem, which then increased his energy costs. There are no other provisions in the policy, that provide a daily compensation rate, against which landlord’s redress offer can be compared.
47. While the rationale behind the landlord’s second calculation, based on refunding 50% of the resident’s water charges between 2016 and 2018, was reasonable, this assessment found the resulting offer was too low given the overall duration of the problem and its impact on the resident. This is because the resident experienced a period where he had either no access, or limited access to a water supply. During this time, he was forced to purchase bottled water or rely on his neighbours. The difficulties presented by the situation were also intensified given resident’s disabilities. As a result, this assessment considered the landlord’s final compensation offer of £1109.83 in conjunction with the Ombudsman’s internal redress guidance.
48. It is noted that the landlord’s total award is in line with our expectations for instances where a landlord’s maladministration or severe maladministration has had a serious long-term impact on a resident. For example, where a landlord is responsible for failures that lead to an Environmental Enforcement Order, or which resulted in a resident needing a long stay in temporary accommodation due to its mishandling of repairs. This represents a reasonable benchmark for comparison given the circumstances.
49. Given the above, this assessment found the landlord acted fairly by awarding a reasonable amount of compensation to remedy its acknowledged delays and failures in respect of its handling of the resident’s reports of an inadequate water supply. The overall level of compensation offered, in relation to this complaint point, therefore represents reasonable redress on the part of the landlord.
50. In connection with the resident’s arrears related concerns, the tenancy agreement confirms payments for water are an integral part of his weekly rent, which is to be paid in advance. Further, the landlord is entitled to apply to the courts for a judgement if it is seeking to take possession of the property. These terms were agreed by the resident at the outset of the tenancy and rent arrears is a reasonable basis for the landlord to seek a court judgement. The account history confirms the account has been in varying levels of arrears since 2007.
51. Having considered the account history in conjunction with the landlord’s Rewards policy, the evidence shows the resident’s bronze tenancy status was applied appropriately in accordance with the policy’s terms. There is therefore no obligation on the part of the landlord to amend the tenancy status in line with the resident’s preference. Similarly, no information has been seen to show the landlord is obliged to cease issuing notices of seeking possession while the account remains in arrears.
52. The Ombudsman is unable to compel the landlord to install a water meter at the property. This is ultimately an internal decision for the landlord, which would likely require an amendment to the tenancy agreement. It is noted the landlord made reasonable enquiries as to whether the resident’s preference for a separate water account could be accommodated and it notified him of the result accordingly. Further, that the landlord’s final offer of compensation was made with the intention of clearing the account arrears at the time of the offer. This would have allowed the landlord to the amend the resident’s banding to accommodate this preference and prevented further notice of court action while the account was up to date.
53. Given the above, this assessment found no maladministration in respect of the landlord’s response the resident’s concerns surrounding the account arrears.
54. In relation to the landlord’s complaint handling, the timeline shows the resident first raised a complaint on 16 March 2018. At this point, he was told the landlord would wait until the matter was fully resolved before it would begin investigating. It is reasonable to conclude the landlord could have opened a complaint record at this time, which would have helped it to keep track of events while the issue was ongoing. Raising a complaint would have also prevented the landlord from forgetting about the case, along with reassuring the resident his concerns would be properly investigated.
55. Given the above, it would have been appropriate for the landlord to comply with the resident’s request in March 2018. Instead, it missed an opportunity to monitor the progress of repairs through a complaint record, and it appears to have forgotten about the case until it was later re-raised by the resident. Given the above, it is reasonable to conclude the landlord’s record keeping and, therefore ultimately, decision making were both adversely impacted by its failure to raise the resident’s initial complaint.
56. Since he did not receive a response to his first request, the resident raised his concerns again on three further occasions between 22 January 2019 and 10 February 2020. However, it took more than two years and four months, from the initial request on 16 March 2018, for the landlord to begin a formal investigation on 28 July 2020. The timeline shows the complaint was only properly acknowledged at this stage following intervention from the Ombudsman. The above represents an inappropriate timescale, and it required an inappropriate level of engagement from the resident to progress the complaint. Based on the timeline, this repeated failure to comply with the resident’s requests resulted in delays to both the repairs and the resolution of his complaint.
57. During the interim period, in October 2019, the landlord treated the resident’s formal complaint letter as an informal enquiry. This was inappropriate given the resident was effectively prevented from accessing the landlord’s complaints procedure. It was particularly inappropriate given the nature and severity of the incidents, along with their impact on the resident. By failing to record the complaint, the landlord reduced the accuracy of its complaint data until the case was raised correctly. It is reasonable to conclude its capacity to monitor and learn from this information was reduced during this time.
58. It is noted the landlord told the resident, in informal correspondence on 3 December 2020, that its initial compensation award reflected failures in its complaint handling. This suggests it had considered the issue as part of its formal investigation. However, complaint handling was not referenced in either its stage one or stage two complaint responses. The timeline also shows the issue was given little further informal consideration prior to the landlord’s final compensation offer. Given the above, this assessment found the landlord failed to clearly identify the duration and significance of its complaint handling failures. From the evidence, it is clear the resident experienced separate distress and inconvenience due the landlord’s complaint handling.
59. This assessment found the landlord’s repeated failure to raise or respond appropriately to the resident’s complaint amounted to maladministration. The landlord is encouraged to ensure it raises complaints promptly going forward to avoid similar issues from reoccurring.

Determination (decision)

60. In accordance with paragraph 55 of the Housing Ombudsman Scheme, the landlord has offered reasonable redress in respect of respect of its acknowledged delays and failures whilst handling the resident’s reports of an inadequate water supply at the property.
61. In accordance with paragraph 54 of the Housing Ombudsman Scheme there was no maladministration in respect of the landlord’s response to the resident’s concerns about account arrears, his assigned tenancy rating or the landlord’s decision to seek court action in respect of the arrears.
62. In accordance with paragraph 54 of the Housing Ombudsman Scheme, there was maladministration in respect of the landlord’s complaint handling.

Reasons

63. The landlord’s offer of £1109.83 compensation was in line with the Ombudsman’s expectations where a landlord’s maladministration has had a serious long-term impact on a resident.
64. The evidence confirms the resident’s account was in arrears prior to the incidents with the water supply. The landlord was therefore entitled to apply a bronze rating and seek a court judgement in accordance with the tenancy agreement and its policies and procedures.
65. The resident experienced additional distress and inconvenience as a result of the landlord’s repeated failure to raise a formal complaint over more than two years and four months. During this time the resident was effectively prevented from accessing the landlord’s complaints procedure. Ultimately, the landlord also failed to properly consider this aspect of the complaint. It was therefore unable to identify the full extent of its complaint handling failures or offer reasonable redress.

Orders and recommendations

Orders

66. The landlord, if it hasn’t already, to pay the resident its final offer of £1109.83 within four weeks of the date of this report. If the landlord’s intention is to clear the resident’s arrears, and the debit balance has increased since its last offer, the landlord is free to increase its award accordingly. However, there is no obligation to do this. The award must not fall below the above amount if the overall arrears level has since decreased. In this eventuality, any funds remaining after the balance is cleared should be paid directly to the resident as compensation.
67. The landlord to pay the resident, within four weeks, a separate award of £200 for the distress and inconvenience he was caused by the above identified failures in its complaints handling.

Recommendations

68. The landlord to share details of this decision with its staff to ensure it learns from the resident’s experience.
69. The landlord to review its record keeping practices to ensure it captures the following information: problem cause, action taken and whether a repair is complete. This is particularly important when responding to serious issues such as the lack of an adequate water supply.
70. The landlord to ensure formal complaints are raised promptly whenever a resident expresses dissatisfaction.
71. The landlord should provide evidence of compliance with the order and confirm its intentions regarding the recommendation within four weeks of the date of this report.