Platform Housing Group Limited (202218287)

REPORT

COMPLAINT 202218287

Platform Housing Group Limited

6 June 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 complaint is about:
   1. the landlord’s response to the resident’s concerns about the amount of equity she obtained following the sale of her property.
   2. the landlord’s handling of the resident’s enquiries about the sale of her property.

Background

2. The resident was a leaseholder of the property which she occupied between 2009 and 2022, owning a 50% share. During her time living there, she made a number of improvements including adding a conservatory, and improvements to the kitchen and bathroom.
3. The resident contacted the landlord on 4 January 2022 to advise that she wanted to sell the property. The landlord sent a letter explaining the resale process to the resident on the same day. She was given advice to obtain a Royal Institute of Chartered Surveyors (RICS) valuation to assess the market value of her property. A RICS valuation followed on 25 February 2022. It took into account the market value plus £15,000 as an uplift for the improvements the resident had made.
4. The resident contacted the landlord on 3 March 2022, providing invoices for the improvements she had made to her property. She asked that it considered amending the uplift on the RICS valuation to £20,000. The landlord explained that the RICS valuation was not based on how much she had paid for the improvements, but how much value had been added to the property. It provided the resident with a breakdown of estimated costs and a number of resale options. It explained to the resident that she may wish to undertake a second RICS evaluation and seek further legal advice.
5. O 27 June 2022 the resident put in an offer for a bungalow which was accepted subject to contract. On 7 July 2022 she informed the landlord she had sold her property subject to contract. On 9 August 2022 the landlord provided a breakdown to the resident of what she would receive, taking into account the share she owned in the property and a recently updated RICS valuation. In doing so, the advisor had incorrectly applied the uplift for improvements and provided the resident with the wrong figure, which left the resident believing she was likely to get an extra £15,000 than the correct amount. The correct figure was however sent to the resident’s solicitor and later clarified again during a conversation that took place on 20 October 2022, prior to exchange of contracts.
6. The landlord acknowledged that there were discrepancies in the information it had provided the resident and offered her £180 fee as a goodwill gesture for the confusion with the figures. Formal instruction documents were later sent to all parties with the correct figures, and the resident proceeded to sell her property and purchase the bungalow.
7. On 17 November 2022 the resident made a complaint. She explained that when she first made the offer on the bungalow, she did so on good faith to the maximum she could afford. She said that the administrative error by the landlord left her feeling as though she was “£15,000 down” and felt the initial calculation it had communicated should have been honoured. The landlord responded at stage 1 of its complaint process on 14 December 2022. It explained that the incorrect figures had been provided in “human error” and was sorry for the confusion it had caused. It upheld her complaint, and said it wanted to increase the amount of compensation to £280 for the inconvenience she had experienced.
8. The resident was unhappy with the response, and said she still wanted it to reconsider reimbursing her £15,000. The landlord provided the resident with a final response on 20 January 2023. It explained that it felt that no further compensation was due, but acknowledged that its staircasing and resales team could have been more explicit in referring the resident to her solicitors to obtain the correct information at an earlier stage. It agreed to take learning from her complaint to ensure that this was made clearer to residents in the future.
9. In contact with the Ombudsman, the resident has explained that the discrepancy of £15,000 in the landlord’s earlier communications have meant she has been unable to make the improvements she had planned for the bungalow. She felt the £280 the landlord had offered her was not a true reflection of her experience, and requested again that the landlord reimburse her £15,000.

Assessment and findings

Jurisdiction

10. What the Ombudsman can and cannot consider is called the Ombudsman’s jurisdiction. This is governed by the Scheme. When a complaint is brought to this Service, the Ombudsman must consider all the circumstances of the case, as there are sometimes reasons why a complaint will not be investigated.
11. The resident has explained that that the information the landlord provided her led her to believe she would receive £15,000 more from the proceeds of her house sale. The resident has reported that she felt that she had “no option” but to proceed with the sale because the bungalow she wished to purchased suited the needs of her family. She asked the Ombudsman to consider making a determination that the landlord honour the £15,000 in order to resolve her complaint.
12. A landlord is not obliged to give additional proceeds from a house sale over and above those a resident is entitled to, based on a previous calculation error. In this case, the landlord was entitled to correct their error, which it did in consultation with solicitors in October 2022 and prior to the exchange of contracts. 
13. After carefully considering all the evidence, the complaint about the landlord’s response to the resident’s concerns about the amount of equity she obtained following the sale of her property is not within the Ombudsman’s jurisdiction to investigate. This is in accordance with paragraph 42(o) of the Housing Ombudsman Scheme which concerns matters where the complainant is seeking an outcome which is not within the Ombudsman’s authority to provide.

The landlord’s handling of the resident’s enquiries about the sale of her property.

14. The evidence shows that when the resident first informed the landlord that she wanted to sell her home, the landlord responded promptly. She was sent a resale letter which explained the process and she was advised of the requirement of a RICS survey to confirm the market value of the property. When the resident raised subsequent questions about the resale value, the landlord responded to her in a timely manner.
15. On 3 March 2022 the resident asked the landlord to consider the full amount of money she had spent on improvements to the property, sending it a number of invoices for consideration. The landlord responded promptly and sensitively to the resident’s request. It provided an accurate explanation of how the RICS valuation was calculated and referred her to the capital funding guide. It also advised her that she could seek an alternative RICS valuation, which was appropriate.
16. Four RICS valuations were obtained in total between February 2022 and September 2022. This meant that the breakdown and options available to the resident changed dependent upon the most up to date valuation, and she was sent a number of different versions as a result. It is accepted that the differing RICS valuations caused the resident confusion, and would have impacted her understanding of what she could reasonably afford. The evidence shows that the landlord communicated each breakdown with the resident in a timely manner. It was empathetic to the resident’s desire to sell the property and frequently referred her to her estate agent to discuss the best possible market price for her property, which was appropriate.
17. It is accepted from the evidence seen that the resident was provided with incorrect information regarding the breakdown of projected costs in August 2022, following an updated RICS valuation. This error is not disputed by the landlord. The landlord recognised that the advisor had incorrectly applied the uplift, resulting in a difference of £15,000. Once it was brought to the attention of the landlord, and through further discussions with solicitors prior to exchange, it amended the formal instruction documents which was appropriate.
18. It is recognised that the confusion in figures had caused the resident confusion and upset. As soon as the error was identified, the landlord made an offer of £180 as a goodwill gesture to the resident for its mistake, which was reasonable. It explained the reason for the discrepancy, and advised her to speak to her solicitors for further clarification. This was a reasonable response. Solicitors play an important role in advising and guiding their clients, and are responsible for ensuring that they understand legal implications of any pending transactions.
19. In determining whether there has been service failure or maladministration we consider both the events that initially prompted a complaint and the landlord’s response to those events. The extent to which a landlord has recognised any  shortcomings and the appropriateness of any steps taken to offer redress are as relevant as the original mistake or service failure. In this case, the landlord acknowledged that it had failed to provide accurate information and made arrangements to update the formal documents before the exchange preceded, at which point the resident could have withdrawn.
20. The landlord’s compensation policy says that gestures of goodwill or financial redress may be payable where the resident has experienced inconvenience. Within its stage 1 complaint response, the landlord appropriately apologised for providing incorrect advice and acknowledged the confusion it had caused. It increased its initial offer of compensation to £280 which was reasonable redress and sufficient to put right its communication failure. 
21. In summary, the landlord was in regular communication with the resident about the sale of her property and responded promptly to queries she raised. It recognised it had made a mistake in providing an incorrect breakdown to the resident consistent with an administrative error in August 2022. Once it realised this, it demonstrated positive dispute resolution and a willingness to put things right, both by compensating the resident and taking learning from her complaint to improve future services.

Determination

22. In accordance with paragraph 42(o) of the Housing Ombudsman Scheme the landlord’s response to the resident’s concerns about the amount of equity she obtained following the sale of her property is outside of the Ombudsman’s jurisdiction.
23. In accordance with paragraph 53(b) of the Housing Ombudsman Scheme, the landlord has offered redress prior to investigation which, in the Ombudsman’s opinion resolves the complaint satisfactorily, resulting in a finding of reasonable redress.