Clarion Housing Association Limited (202125830)

REPORT

COMPLAINT 202125830

Clarion Housing Association Limited

6 July 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 landlords landlord’s handling of:

1. the resident’s mutual exchange; and
2. the subsequent complaint.

Background

Summary

2.     The resident held a tenancy property with his previous landlord (‘landlord A’)which was a social rent tenancy. On 27 July 2021, he applied to mutually exchange with one ofa tenant of Clarion Housing Association Limited (who will be referred to as the landlord in this report)’s tenant. That tenant had a fixed-term (assured shorthold) affordable rent tenancy. Affordable rent tenancies usually have a higher rent than social rents. TheThe resident has complained to the Ombudsman about how Clarion Housing Association Limited (who I shall refer to as ‘the landlord’)the landlord handled his mutual exchangethat application.

Background

3.     The mutual exchange was agreed on 13 September 2021. The exchange deed was executed on 20 September 2021, with a tenancy start date of 4 October 2021. In summary, the resident’s complaint iss as follows:

1. The resident explained that during the application and the exchange he was not made aware that his new home would be an ‘affordable rent’ property as opposed to a ‘social rent’ property. As his former property was set at a “social rent” he expected that his new home would be the same.
2. He raised concerns both at the time of the exchange and after about the level of rent. Specifically, he says he asked the landlord to clarify the rent. He says he was never made aware that the rent type in the new home would be different to the rent type in his previous home.
3. The landlord never liaised with him or considered his concerns about the rent.
4. The resident did not move into the property until December 2021. The resident felt that the process was unreasonably delayed. He said this was because due to the landlord’s failurethe landlord failed to communicate with his previous landlord (landlord A); and that he was not updated on this issue in good time.

4.     The resident raised a his formal complaint to with his landlord on 17 March 2022. The residentHe explained that he was only made aware of the difference in rent typesthe rent in the new property on 25 January 2022, which was in response to raising it informally with the landlord. TheIt landlord responded at stage 1 of its formal complaint process on 19 May 2022. The landlordIt did not uphold the complaint about the mutual exchange. It did, however, apologise after identifying a service failure due to lack of communication and offered the resident £200 compensation.

5.     The resident remained dissatisfied and requested an an escalation of the complaint on 26 May 2022. The landlord issued its final response on 27 September 2022. The landlord did not uphold the complaint about the mutual exchange. It did identify a service failure in its complaint handling and offered £250 compensation.

6.     The resident’s position is that the  advised the Service that the remaining issues are that the landlord failed to acknowledge that it did not communicate with him effectively its lack of communication about the exchange process. Specifically, he feels that the landlord had ample opportunity to clarify the rent in good time prior tobefore the completion of the exchange. He further explained that the exchange would not have gone ahead had the resident known about the type of rent due. The resident feels that he has been adversely affected by giving up his social rent status for a more expensive rent type.

Assessment and findings

The handling of the application processDid the landlord delay the application?

7.     The resident stated that as part of the exchange process he was not provided with proper communication by the landlord when he was a mutual exchange applicant. The resident felt that at the time the process was occurring the landlord was not sharing the appropriate documentation with landlord A to enable to mutual exchange to complete. The resident then chased landlord A for the information requested and was told that this had already been provided to the landlord.

8.7.Thehe evidence shows that the landlord had suggested a tenancy start date to the resident’s previous landlord A for as early as  of 4 October 2021 and revised it to 22 October 2021 or another suitable date. There is evidence that the landlord chased landlord Athe resident’s previous landlord for its responses on several occasions between 20 September 2021 and 10 December 2021. The substantive delay to the tenancy start date was because a reference had not been received by landlord A.There is no evidence to suggest that the landlord unreasonably delayed matters.

9.8.References were required for the tenants as part of the mutual exchange. Landlord AThe resident’s previous landlord acknowledged that it had received the reference on two previous occasions from the landlord but that it had not provided it to the correct officer. The Ombudsman cannot fault the landlord for this. Equally, the evidence suggests shows the landlord tried on several occasions to suggest a tenancy start date with Landlord A with no agreement being forthcoming. The Ombudsman cannot fault the landlord for this. Similarly, I cannot fault the landlord for this.

10.9.The landlords agreed to an exchange date of 29 November 2021. HoweverHowever, landlord Athe resident’s previous landlord provided a different date on the legal forms. At this stage, the residents requested 20 December 2021 as a move inmove-in date, which both landlords accommodated.

10. The Ombudsman cannot find failure with in the way the landlord handled the progression of the application,. This is because the evidence shows that it liaised with landlord Athe resident’s previous landlord in a timely way.

Updates to the resident

12.11.During this time the landlord engaged with the resident on the following occasions:

1. 11 August 2021 – to explain that a decision on the mutual exchange would be given by 13 September 2021.
2. 8 September 2021 – to update the resident that its references had been provided to landlord Ahis previous landlord.
3. 13 September 2021 – to advise the resident that the application had been approved and that it had offered a tenancy start date of 4 October 2021.
4. 21 September 2021 – to advise the resident that it was waiting for landlord Ahis previous landlord to agree to the proposed tenancy start dates.
5. 22 September 2021 – to advise the resident that it was waiting for landlord Ahis previous landlord to confirm the tenancy start date.
6. 26 October, 52021 November and 9 November 2021 – to explain it was still waiting for landlord Athe resident’s previous landlord to progress the process.

g.     5 November 2021 – to explain it was still waiting for landlord A to progress the process.

h.     9 November 2021 – to say it was waiting for landlord A to progress the application.

7. 10 December 2021 – to arrange the sign-up appointment with the resident for 17 December 2021.

12. It is clear from the evidence that frequent communication was provided to the resident regarding the progress of the application. As such, I cannot find fault with the landlord’s communication.

13. It is clear from the evidence that frequent communication was provided to the resident regarding the progress of the application.

The handling of the exchange

14.  The resident stated that the landlord did not attend the sign-up appointment arranged for the 17 December 2021. The records show that the other tenant had called the landlord at the time to ask why this was. The appointment was re-arranged for 20 December 2021. The evidence does not show that the landlord acknowledged the missed appointment or apologised to the resident for the delay in the sign-up appointment.  

15.13.The Ombudsman finds that this is a servicewas a failure and that it would have been fair and reasonable to expectfor the landlord to have notified the resident that the meeting was unable to proceed in good time, and the reasons behind thiscould not go ahead before the appointment date.

Communication regarding the rent type

16.14.The landlord’s mutual exchange policy states at cClause 3.13 of the landlord’s mutual exchange policy states that “all incoming tenants will bewould be given full advice and information as if they are awere a new tenant being signed up to a new tenancy.” It is logical to assume that a new tenant would be informed of the rent level and tenancy type.  

17.15.The landlord stated in its stage 1 response dated 19 May 2022,accepts that it should have completed a welcome call with the resident to discuss the tenancy but that it failed to do so. However, in place of the welcome call, it wrote to the resident on 6 August 2021 advising him to liaise with the neighbourhood officer to check that he would not be losing out on any existing rights. The resident stated that after he received the letter, he tried to contact the landlord on at least five occasions to try to ascertain the rent type. He says he was told that he had not been allocated an officer and could not speak to anybody. The landlord offered the resident £200 for this and an apologyapologised for its lack of communication.

16. In its final response dated 27 September 2022, the landlord stated that the welcome call would have taken place after the exchange was completed and that it would not have changed the concerns raised by the resident regarding rent. Additionally, It also said that a welcome call was made to the resident on 11 August 2021 to the resident, and that it advised him s records indicated that he was advised appropriately of the charges before the formal exchange was completed. The landlord stated argues that the resident he would have had had an opportunity to stop the exchange at that point. The resident disputes that the welcome call occurred at any stage.

18.17.The landlord’s records state that during the welcome call, the affordability of the rent was discussed with the resident. However, it is unclear if the rent level was discussed in any detail. It is also unclear if the impact of future rent increases was explained to the resident. The landlord’s records here ought to have been clearer. On this basis, the Ombudsman is not able to find that the landlord demonstrates it discussed the level of rent with the resident as it should have done under clause 3.13 of its policy.

18. The evidence shows that the resident was given a document that stated, “it is important that you check your rent type and level with your prospective landlord as this may alter if you exchange properties.” This does clearly state it was the resident’s responsibility to satisfy themselves of the rent payable before the exchange was completed.

19. isNevertheless, the responsibility of the resident to find out the rental type prior to the completion of the exchange process. On the balance of probabilities, the resident is likely to have called the landlord to ascertain the terms of the tenancy in more detail. Iit is clear from the evidence that the resident did try to contact the landlord regarding other terms of the tenancy, but however had been was unable to speak to anybody that could offer clarity on those points. Therefore, it is not clear whether the landlord’s staff could have offered clarity on the rent when he called.  

20. In relation to the evidence surrounding the welcome call made on 11 August 2021, although affordability of the rent was noted as having been discussed with the resident, it is unclear if the rent type was discussed in any detail. Also, it is unclear if the impact that the “affordable rent” type would have had on any future rent increases was explained to the resident.

21. Further evidence suggests that there is a consensus that the landlord “does not offer social rents” because it is a private housing association and is therefore unable to offer social rent. This is the advice provided to the resident by the landlord on 7 February 2022, in response to his informal complaint. However, the website of the landlord does offer guidance that distinguishes between rent increases for both “secure rent tenancies”, “affordable rent tenancies” and “shared ownership rents.” This would suggest that the landlord does offer both types of tenancies. 

22. The Ombudsman finds that the landlord did not offer the resident the correct advice, in relation to the different tenancies that it can choose to offer, in February 2022. This is deemed to be a service failure because it misled the resident by saying that it only had affordable rent tenancies, which is not the case. This was not appropriate.

23.20.Prior to the completion of the exchange, the landlord wrote to the resident on 13 December 2021. In that correspondence, , in it the landlord stated the new rental liability,liability, however, it did not refer to the rent type. On the deed of assignment dated 20 December 2021, the rent is provided but not the rent type. On the occupancy agreement of the former tenant, the rent type is not stipulated either, however it is noted that this agreement is dated from 2017 and was issued initially by a different landlord.

24. The Ombudsman considers that because of the significanceGiven the difference in rents and rent type of how the landlord can choose to raise the rent, based on the rent type, the Ombudsman considers the landlord ought to have been unequivocally clear about the rent level and type before the exchange was completed – so that the resident had enough information to have made an informed choice. The landlord should have satisfied itself that its new tenant was clear on the material features of their new tenancy. it would have been fair and reasonable to draw the resident’s attention to this term of the tenancy prior to the completion of the exchange. It would also be reasonable to conclude that this would be expected to be explained to any prospective resident as part of a sign up for a new tenancy or exchange; and therefore, is an applicable obligation on the landlord.There is no clear evidence to demonstrate this. On that basis, Tthe Ombudsman finds that this is a failurethere was a failure to effectively communicate the terms of the new tenancy agreement to the resident in a timely mannerpromptly.

25.21.In evaluating the impact of this on the resident there is no doubt that this will be a term that binds the resident for the entirety of his tenancy to the landlord. However, the resident does state in communications to the landlord on 7 February 2022 that the full cost of the rent is being paid by his benefits, but if he were to return to work this would cause him considerable difficulty.

22. AdditionallyThat said, often when two tenants discuss a mutual exchange, they will ask questions and discuss key features of the tenancy. To this end, the resident ought to have asked for details about the rent. That would not have been unreasonable. Moreover, it would have been reasonable for the resident to have halted the exchange process until he received the key information about his new tenancy. So, whilst the Ombudsman finds the landlord at fault, we are unable to hold the landlord responsible for the entirety of the errors in this case, as the resident could have clearly prevented the exchange from going ahead without key information. the necessary information had been provided to him regarding why the rent was higher than his former property.

26.23.In evaluating the impact of this on the resident, there is no doubt that this will be a term that binds the resident for the entirety of his tenancy to the landlord. However, the resident does state in communications to the landlord on 7 February 2022 that the full cost of the rent is being paid by his benefits, but if he were to return to work this would cause him considerable difficulty

27. The Ombudsman finds that the liability to check the new terms of the tenancy agreement, inclusive of the rent type, falls to the resident. However, it would have been fair and reasonable for the landlord to have clearly explained the rent type and detailed how rent increases would apply as part of its introductory process. Therefore, the Ombudsman considers there to have been a failure by the landlord to follow its mutual exchange policy.

24. There is not enough evidence to say that the resident would have rejected the property had he known about the rent and rent increases. Indeed, he opted to go ahead with the exchange without knowledge of either.  

28.25.It must be noted that on 7 February 2022, the landlord informed the resident that it did not offer social rent because it is a private housing association. This comment was made to the resident in response to his informal complaint. However, the landlord does offer social rent tenancies, affordable rent tenancies and shared ownership rents. This means that the information given to the resident was not genuine and was purposefully or inadvertently misleading. This was a service failure.

The landlord’s handling of the subsequent complaint

29. The landlord’s complaint policy, which was in force at the time the resident raised his formal complaint, does not provide any response timeframes. Although the landlord provides in its self-assessment that this has been included in its interim complaints policy which was applicable to its final response, the Ombudsman finds this to be maladministration. This on the basis that the interim policy was temporary in nature and for use only whilst the landlord was updating its systems following a cyberattack it experienced in June 2022. The Ombudsman would expect both policies to be updated in line with the Code and referenced in its self-assessment.

30.26.The resident raised his formal complaint to the landlord on 17 March 2022 and the landlord responded to this on 19 May 2022. The Ombudsman’s Complaint Handling Code states that complaints should be responded to within 10 working days. The landlord responded in 43 working days which is 33 working days outside of the timeframes set by the Code. The complaint doesresponse did not acknowledge its the delay in responding to the resident. The Ombudsman considers this to be a complaint handling failure by the landlord.

31.27.The resident escalated his complaint on 26 May 2022, and the landlord responded formally on 27 September 2022. During this time, the landlord’s systems had been affected by a cyberattack. The resident was made aware of this by email on 1 July 2022. The landlord apologised and explained that it was unable to progress the complaint. It promised to resume the process as soon as it was able. The interim complaint policy states that stage two responses should bewere due within 40 working days. The policy also states that if the landlord was unable to work to this timeframetimeframe, then it would explain why and provide regular updates and a new timescale for completion.

28. It took the landlord 85 working days to provide a final response. There is no evidence to suggest that any contact was made with the resident to provide a new timeframe or regular updates regarding his complaint progression. The response itself does acknowledge the delay in responding to the resident and provides offers a compensatory offer of £100 compensation for this and a further £150 to acknowledge that the resident had experienced inconvenience in having to chase it for a response. Based on the compensation policy and the Housing Ombudsman’s Gguidance on Rremedies, the Ombudsman finds this was reasonable redress for the failures identified in the landlord’s complaint handling.

 

Determination

33.29.In accordance with paragraph 52 of the Scheme, there was maladministration by the landlord in its handling of the resident’s mutual exchange, specifically the communication regarding the rent type and rent increases.

34.30.In accordance with paragraph 53(b)2 of the Scheme, there was maladministration by the landlord in its handling of the subsequent complaint.the landlord offered the resident reasonable redress to recognise the errors in the complaint procedure.

Orders and recommendations

Orders

35.31.The Ombudsman orders the landlord to take the following steps, within 28 days of the date of this determination:

1. provide the resident with a written apology acknowledging the service failures identified in its handling of the resident’s mutual exchange, specifically relating to the rent type andtype and rent increases.
2. pay the resident £850 in recognition of the failures identified in its handling of the resident’s mutual exchange and the distress and inconvenience caused.

c.      pay the resident £250 in recognition of the failures identified as part of its complaint handling.

36.32.The landlord must provide the Ombudsman with evidence of compliance with the above orders no later than 28 days of the date of this determination.

Recommendations

33. The Ombudsman recommends that the landlord:

1. pay the resident the £250 compensation it offered in its final response; and

2. The landlord should consider conducting a lessons learned review on how it handles mutual exchanges. It should consider creating a checklist to ensure all relevant information is given to residents about the level of rent, rent type, and tenure  and to check the property and property condition. This document can then be provided to the tenanttenants at the point that the an exchanged exchange is agreed upon, but before the exchange has taken place. This will aim to prevent further failures like this one from occurring.