Walsall Housing Group Limited (202219666)

REPORT

COMPLAINT 202219666

Walsall Housing Group Limited

22 February 2024

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 resident’s complaint is about:
   1. The landlord’s handling of a dispute over the rear garden.
   2. The landlord’s handling of issues relating to a parking space.
2. The Ombudsman has also considered the landlord’s complaint handling.

Background

3. The resident has a shared ownership lease with the landlord for a ground floor 2 bed maisonette located in a small residential estate. At present, she has a 75% share of the property. The property includes a car parking space outside of the maisonette.
4. In August 2021, the resident paid for a valuation report for her property and instructed a solicitor to help her buy the remaining share of the property (‘staircasing’) and become the owner of the freehold.
5. In November 2021, the resident’s solicitor was told by the Land Registry that there had been an issue when the lease was initially registered in May 2019. The landlord did not own the car parking space as it had not been transferred to the landlord by the original developers who build the estate, therefore it could not be transferred to the resident as the landlord could not transfer ownership of something that it did not own. This issue was pointed out to the landlord’s solicitors by the resident’s solicitors in the same month with a request to resolve it promptly so the resident could buy the remaining share of the property.
6. On 2 November 2022, the resident made a formal complaint about the issue with transferring the car parking space and about the boundary of the rear garden. The complaint stated:
   1. The resident had asked to buy the final share of the property in August 2021 and had discovered that none of the car parking spaces in the development had been included in the original transfer of ownership of land from the developer to the landlord. This meant that all of the parking spaces were still owned by the original developer and could not be transferred to the residents. No resolution had yet been reached despite the landlord being aware of the issue for over a year.
   2. The resident’s solicitor had advised her that she could not buy more shares of the property or sell her lease until this issue was resolved. The valuation report bought in August 2021 had now expired and the resident would have to pay for another if the issue was resolved and she still wanted to buy the remaining share of her property.
   3. The resident had been in touch with the company which had taken over the original developer, who had told her that resolving this issue is fairly straightforward and should not take more than 10 working days.
   4. The plans for the development and her property show that areas of rear and side gardens at the development are allocated to specific properties. This led the resident to believe that part of the rear garden was allocated to her and her immediate neighbour as this is what the plan set out. The resident had since been told by the landlord that the garden is communal for all residents in a row of 4 properties. This led to a legal dispute between the resident and the landlord over entrances and fencing in the garden as well as whether the garden is communal or if portions are allocated to specific properties.
7. An acknowledgement of the complaint sent to the resident by the landlord on 4 November 2022, defined the complaint as being about the parking space transfer issue and issues with the rear garden boundary. It informed the resident that a response would be provided within 10 working days.
8. The landlord’s solicitors wrote to the resident’s solicitors on 15 November 2022, stating that the garden was communal, that the only way to allocate individual portions of the garden was via a variation of the leases for all 4 properties, and that the landlord was not willing to do this.
9. A Stage 1 complaint response was provided on 17 November 2022. It refused to discuss the issues about the rear garden boundary as this had already been addressed by the landlord’s solicitors. It accepted that the original registration of the lease with the Land Registry had been incorrect due to the point about ownership of the car parking spaces not being transferred to the landlord in the first place, but that many of the delays in correcting this issue were beyond the landlord’s control. It stated that the landlord had become aware of the issue in November 2021 and that there had been contact between the residents’ solicitors and the landlord’s solicitors on this point, with the resident’s solicitor telling the landlord the issue was resolved and that staircasing could continue. The landlord only became aware that the issue was not resolved in May 2022 after further contact from the resident’s solicitor. The original developer had been taken over by another company and the landlord was trying to get in touch with the solicitors who were working with the new owners – the landlord had only become aware of the takeover a month ago. The landlord apologised for the delay and told the resident it was doing all it could to resolve the transfer issue as soon as possible. It also offered to pay for another valuation report when the resident was ready to staircase.
10. The resident asked for escalation of her complaint to Stage 2 on 20 November 2022 for the following reasons:
    1. she wanted clarification on the timescales for when the transfer issue would be resolved,
    2. she disputed that the landlord had become aware of the takeover of the original developer a month ago,
    3. and that the landlord had only shown her the plans when she bought the lease and had not warned her that the garden was communal.
11. The landlord responded on 24 November 2022, rejecting the escalation request. It explained that the request had been rejected as the original Stage 1 response had been thorough, no new information had come to light for the landlord to consider, and that it was not responsible for delays in the transfer of the parking space. It offered to pay for any additional costs for valuation reports which had been caused by the delay in the transfer. Issues with the rear garden boundary had concluded and the landlord’s solicitors had been in touch about this point via the resident’s solicitor.
12. On 2 February 2024, the landlord and the resident told this Service that the transfer of the parking space from the original developer to the landlord had been completed and that it would be transferred to the resident soon. The landlord agreed to pay the resident’s legal costs for resolving the issue with the title to the property.

Assessment and findings

Jurisdiction

13. 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, or part of a complaint, will not be investigated.
14. In accordance with paragraph 42(f) of the Housing Ombudsman Scheme, the Ombudsman may not consider complaints that, in the Ombudsman’s opinion, “concern matters the Ombudsman considers it quicker, fairer, more reasonable, or more effective to seek a remedy through the courts, other tribunal or procedure.”
15. After careful consideration of all the evidence, the resident’s complaint regarding the landlord’s handing of a dispute over the rear garden falls outside of the Ombudsman’s jurisdiction.
16. The complaint relates to ambiguity over whether the rear garden is communal and shared with other residents, or if the garden is actually split in two and the resident owns a portion of this as part of her property. The plans originally submitted to the Land Registry by the original developer indicate the garden is split into separate gardens for every 2 properties in a row at the development, with these areas described as ‘communal area boundary’ and marked as pink on the plan. However, the terms of the resident’s lease do not make any reference to an area marked pink or to a communal area boundary.
17. Although the developers plans may well have shown that separate gardens were to be allocated, the terms of the resident’s lease do not show this. The lease is the legally binding agreement between the resident and the landlord, rather than the plans. The landlord’s solicitors have clarified it’s position that the garden was communal after correspondence with the resident, disputing with the resident’s solicitor about the interpretation of the lease and asserting that the lease had to be varied to allow individual gardens to be allocated. The terms of the lease are therefore in dispute in this case and a binding determination is required on the interpretation of the lease and whether the garden is communal or if portions are allocated to specific residents.
18. The Ombudsman cannot issue a binding decision about the rights and ownership of the rear garden as this is ultimately a matter for a court to determine. If the resident remains dissatisfied, it is recommended that she seeks further advice from her legal representatives as to the merits of making a claim via the appropriate court or tribunal as to the terms of the resident’s lease.
19. With this in mind, this investigation will only consider the landlord’s response to issues with the parking space being omitted from transfer to the resident and the landlord’s complaints handling.

The landlord’s handling of issues relating to a parking space

20. Documents from the Land Registry clearly show that the car parking space which was supposed to be part of the resident’s property was not transferred to the landlord by the original developer. The wording of the transfer deed effectively omitted the parking spaces for all residents in the development from the transfer, leaving ownership with the original developer. The landlord appears to have been genuinely unaware of this omission as it had attempted to transfer ownership of the space to the resident on purchase of the lease, with this issue only came to light in November 2021 when the resident attempted to purchase the remaining share of her home.
21. The parking space was owned by another party, so the landlord could not have lawfully transferred it to the resident without first becoming the owner or arranging for ownership to be directly transferred to the resident. As the landlord was not the legal owner of the space and could not transfer it, the Ombudsman accepts any delays in transferring the parking space prior to the landlord becoming the owner of the space were beyond the landlord’s control.
22. Although delays were beyond the landlord’s control, the landlord should still have communicated with the resident and given updates on any developments to assure her it was taking the issue seriously and it was still taking steps to resolve it. This failing led the resident to make a formal complaint a year after the issue was first identified, which could have been avoided if the landlord had kept the resident up to date about progress of any actions it was taking.
23. The landlord should have checked the transfer documents from the original developer thoroughly before signing to ensure that the entire property had been transferred. Failing to make adequate checks contributed to the transfer issue arising and ultimately left the resident with a property which she could not sell or staircase.
24. It is positive the landlord showed willingness to address the transfer issue and that there have been significant recent developments which ultimately allow the parking space to be transferred to the resident. It is also positive that the landlord has offered to pay for another valuation report and to cover the legal fees for resolving any complications with the resident’s legal title to the property. However, this does not amount to reasonable redress for the landlord’s failings on this point as it does not acknowledge the distress and inconvenience caused to the resident by having a property which could not be fully staircased through no fault of her own, and it does not acknowledge that the landlord should have checked the transfer deeds carefully to make sure there were no faults both at transfer from the original developer and to the resident. This Service has therefore found maladministration in the landlord’s handling of issues related to the parking space.
25. The Ombudsman has seen evidence that the issue experienced by the resident with the parking space does affect other residents within the development. The Ombudsman has therefore issued an order which addresses this point.

The landlord’s complaint handling

26. The landlord’s complaints policy in operation at the date of the resident’s complaint states that it has a three-stage complaints procedure. All complaints are acknowledged within 2 working days. Stage 1 complaints are responded to within 10 working days, Stage 2 responses within 15 working days, and Stage 3 within 20 working days. Any extensions to this time limits will be agreed with the complainant.The policy also reserves the right to refuse a request to escalate a complaint if each element of the complaint has been investigated and there have been no change in circumstances.
27. Paragraph 4.14 of the Ombudsman’s Complaint Handling Code states:
    1. A landlord must not unreasonably refuse to escalate a complaint through all stages of the complaints procedure and must have clear and valid reasons for taking that course of action. Reasons for declining to escalate a complaint must be clearly set out in the landlord’s complaints policy and must be the same as the reasons for not accepting a complaint.
28. The landlord’s Stage 1 and refusal of escalation were within time limits set out in its complaints policy and in the Ombudsman’s Complaint Handling Code. The Stage 1 response only covered one of the points raised by the resident in detail. In principle, an agent of the landlord can provide a complaint response (including solicitors instructed by the landlord), which means in this case that the landlord and the landlord’s solicitors responses can be read together as the complete complaint response. However, all complaint responses must detail how to escalate a complaint if the resident is not satisfied with the answer and this detail is missing from the landlord’s solicitor’s response. The Ombudsman considers it best practice to ensure that all points in a resident’s complaint are addressed in the landlord’s complaint response and that copies of any element responded to by another party are included in this response.
29. The landlord’s response to the request for escalation was clear, gave reasons for the refusal, and informed the resident of her right to approach the Ombudsman. The response was within time limits set out in the landlord’s complaints policy. This complied with the requirements for refusing escalation set out in the Ombudsman’s Complaint Handling Code and in accordance with the landlord’s complaints policy. However, the Ombudsman considers that it would have been good practice to accept the escalation request as the handling of this complaint would have benefitted from being reviewed by someone unconnected with the original complaint handling. Refusal of the escalation request left the resident with no choice but to approach the Ombudsman for dispute resolution.
30. The Ombudsman notes that the landlord’s complaints handling policy was updated in April 2023, reducing the complaints procedure to two stages and removing the landlord’s right to refuse an escalation request.
31. As the landlord acted in line with its complaints policy and the Ombudsman’s Complaint Handling Code in refusing the escalation request, this Service has found no maladministration in the landlord’s complaint handling.

Determination

32. In accordance with paragraph 42(f) of the Scheme, the resident’s complaint about the landlord’s handling of a dispute over the rear garden is outside the Ombudsman’s jurisdiction.
33. In accordance with paragraph 52 of the Scheme, there was:
    1. Maladministration in the landlord’s handling of issues relating to a parking space.
    2. No maladministration in the landlord’s complaint handling.

Orders and Recommendations

Orders

34. Within 4 weeks of the date of this report, the landlord must:
    1. Pay £500 to the resident as compensation for the distress and inconvenience caused by the landlord’s failings in handling issues relating to a parking space.
    2. Provide this Service with an assurance that it will enter or has entered into an undertaking to cover the resident’s legal costs for rectifying the issues with her title to the property. A copy of the undertaking must be provided to this Service.
35. Within 12 weeks of the date of this report, the landlord must:
    1. Provide this Service with an assurance that it has identified all residents affected by issues arising from the transfer of land from the original developer to the landlord and from the landlord to residents within the development where the resident’s flat is located. This Service must be provided with an action plan detailing the steps it has taken or is taking to resolve this issue for other residents within the development, as well as confirmation as to whether it will cover resident’s legal costs.

Recommendations

36. The landlord should review its complaint handling procedures and make sure that any refusals to escalate a complaint are handled carefully. The landlord should remind its complaints handling staff that complaints may well benefit from escalation due to being reviewed by someone not connected with the original complaint investigation.