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London & Quadrant Housing Trust (L&Q) (202306736)

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REPORT

COMPLAINT 202306736

London & Quadrant Housing Trust (L&Q)

21 November 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 the landlord’s handling of the resident’s service charge queries.
  2. The Housing Ombudsman has also considered the landlord’s complaints handling.

Background

  1. The resident is a shared ownership leaseholder. The property is a flat within a building comprised of similar properties.
  2. The landlord named in this report is responsible for the internal common parts of the building. The freeholder of the building is a different social housing provider who is responsible for the structure of the building. There is also a managing agent which is responsible for providing communal services to the block on the landlord’s behalf.
  3. On 23 February 2023 the resident contacted the landlord requesting an explanation of specific fees within her service charges. This was submitted as a stage 1 complaint request in response to receiving her service charge summary for the financial year 2023-2024. The resident asked for clarification of what was meant by:
    1. Managing agent costs
    2. Managing agent costs (homeowners)
    3. Management fees
  4. In the same complaint, the resident said that services were not being provided because there was no housing manager available and the building had not been inspected since 2022. The resident believed she was owed a refund due to the absence of these services.
  5. On 9 March 2023 the landlord responded to the resident’s stage 1 complaint. In the complaint response, the landlord provided a summary of the 3 specific costs and referred the resident to a different department about service delivery issues. The landlord also sent a separate email to the resident which contained budget estimates for 2023-2024 and some invoices which showed how previous years had been calculated.
  6. On 9 March 2023 the resident asked for her complaint to be escalated to stage 2 of the landlord’s complaints procedure. In her escalation request, she said the explanation was not clear and reiterated the request for her contributions to be refunded due to the absence of services.
  7. On 12 April 2023 the resident again emailed the landlord asking for her complaint to be escalated to stage 2 of its complaints procedure. The resident said she felt she was being double charged and asked for clarification if there was a sinking fund and how much was in it. The resident said nobody is cleaning or visiting the block, and emails to housing staff are not being replied to.
  8. On 30 November 2023 the landlord responded to the resident’s stage 2 complaint. The landlord said it provided a summary of the fees at stage 1 and that it moved to a fixed band structure in April 2020 to show residents the cost of their fees each year. The landlord also shared separate information about the breakdown of fees with the stage 1.
  9. On 20 March 2024, the resident emailed the landlord. The resident said she had requested a breakdown of service charges for 3 years and felt that she had been charged multiple times for the same thing. The resident said the landlord had not explained what the charges cover. She asked for a full breakdown of the service charge accounts, including invoices. The landlord provided the resident with further information in response to this.
  10. The resident was dissatisfied with the landlord’s explanation of the service charges when it responded to her complaints. The resident is seeking a clear breakdown of her service charge contributions as an outcome to her complaint.

 

 

 

Assessment and findings

Scope of investigation

  1. It is understood that the resident’s complaint concerns the information she was provided about the service charges, and the explanation provided by the landlord. The Ombudsman cannot review complaints about the level or increase of service charges and determine whether they are reasonable or payable. Complaints that relate to the level, reasonableness, or liability to pay rent or service charges are within the jurisdiction of the First-Tier Tribunal (Property Chamber) and the resident would be advised to seek free and independent advice from the Leasehold Advisory Service (LEASE) in relation to how to proceed with a case, should she wish to do so. Paragraph 42.d of the Housing Ombudsman Scheme states that we may not consider complaints which relate to the level of rent or service charge or the amount of the rent or service charge increase.
  2. This report will therefore consider whether the landlord responded appropriately to the resident’s queries about her service charges and the information it provided up to its stage 2 complaint response on 30 November 2023.

Policies, procedures and legislation

  1. The landlord’s service charge policy explains its approach to setting, collecting, and managing service charges for its tenants, leaseholders, and licensees. The policy explains that its leases and tenancy agreements will set out what services are charged for within certain estates. The policy also provides an explanation of the landlord’s terminology on relevant service charge documents. This includes, but is not limited to, what it means by managing agents and management fees. The landlord has not provided this service with a copy of the resident’s lease agreement.
  2. The landlord’s website also provides further information about its service charges. The website explains how some residents may live in a property where some services a provided by 3rd party management companies, rather than directly by the landlord’s staff. The website also says that homeowners may see 2 lines on their statement, which shows the split across managing agent costs, and managing agent homeowner costs.
  3. Section 21 of the Landlord and Tenant Act (1985) gives leaseholders the right to ask their landlord to supply a summary of the relevant costs, which make up their service charges for the last accounting period. The summary should be compiled by a qualified professional. A resident’s request must be submitted to the landlord in writing.
  4. Section 22 of the Act gives leaseholders the right to inspect any receipts or invoices which support the landlord’s service charge figures. The request must be made within 6 months of receiving the summary. Requests must again be submitted in writing. The landlord must provide facilities for inspecting the information within 1 month of the request, and the facility for inspecting the service charges must be available for a period of 2 months.

The landlord’s handling of the resident’s service charge queries

  1. When the resident asked the landlord to provide an explanation of 3 specific costs within her service charges, it did so in its stage 1 complaint response. The landlord also sent a separate email with supporting documentation. It was reasonable for the landlord to respond to the resident’s query and provide her with this information. The landlord also shared copies of its invoices with the resident relating to the payments it made to the managing agent in 2021-2022 in support of the landlord’s figures. This was also fair and reasonable.
  2. The landlord summarised the charges for the resident and explained what it meant by:
    1. Managing agent costs
      1. This included costs for services provided by 3rd party managing agents who maintain communal areas
    2. Managing agent costs (homeowners)
      1. This covered services provided by 3rd party managing agents which are only applicable to leaseholders. The landlord said this included things like insurance, communal repairs, and sinking fund contributions
    3. Management fees
      1. Services provided directly by the landlord to the resident.
  3. The landlord provided a clear explanation to the resident of each charge. This demonstrated the separation of costs across the various elements. There was no evidence which shows the resident was being charged twice for the same service and no evidence that services were not being provided.
  4. In her complaints to the landlord, the resident also raised her concerns about a sinking fund. The resident asked for clarification if one was held and how much was in it. In the email shared with the resident on 9 March 2023 the landlord provided the resident with documentation which showed the sinking fund balance. It was reasonable of the landlord to share this information with the resident in view of her concerns.
  5. The landlord provided the resident with an explanation of the charges in its stage 1 complaint, separate emails, and the supporting documentation to help the resident understand the charges. Therefore, there was no maladministration by the landlord with regards to the information it provided the resident about her service charges.

The landlord’s handling of the resident’s complaint

  1. The landlord operates a 2-stage complaints procedure. At stage 1, it says it will log and acknowledge a complaint within 5 working days of receiving it and respond within 10 working days.
  2. At stage 2, the landlord says it will issue its final response within 20 working days of the resident’s escalation request. The landlord says it may extend this by an additional 10 working days.
  3. When the resident raised her complaint at stage 1, the landlord responded to her within its published timescales. The resident chased the landlord for its acknowledgement of her complaint on 7 March 2023 and the landlord issued its full stage 1 complaint response on 9 March 2023, which was reasonable.
  4. At stage 2, however, there were significant delays in the landlord providing its final complaint response. The resident requested to escalate her complaint on both 9 March 2023 and 12 April 2023. The landlord issued its stage 2 complaint response on 30 November 2023. There was a delay of 166 working days for the landlord to issue its final response. The landlord did not tell the resident why there was a delay nor did it acknowledge the delays in its final response. This was unreasonable and unnecessarily delayed the resident from bringing her case to this service, causing her inconvenience.
  5. In addition, at both stage 1 and stage 2 of the landlord’s complaints procedure, the resident raised her concerns about service delivery in communal areas related to her contributions. She said that services to communal areas were not being provided. In its complaint responses, the landlord referred the resident to another department. This was unreasonable and the landlord missed an opportunity to investigate service delivery issues and provide the resident with a formal response to her concerns through its complaints process.
  6. The Housing Ombudsman’s Complaints Handling Code (the Code) sets out our service’s approach to landlords’ complaint handling practices. The Code specifies that complaints officers should have access to staff at all levels to facilitate a prompt resolution of complaints. In this case, the landlord failed to respond to a significant element of the resident’s complaint by not providing any details about her concerns with service delivery in its response.
  7. Because the landlord did not consider compensation, nor did it acknowledge or apologise for the delays, the Housing Ombudsman makes a determination of maladministration for its handling of the resident’s complaint.
  8. In considering what the landlord now needs to do to put things right, the Ombudsman relies on our own remedies guidance (available on our website). The guidance enables the Ombudsman to order compensation payments for identified service failings where the landlord did not appropriately acknowledge a failure and where the resident faced delays in getting matters resolved. This service therefore orders the landlord to pay the resident £150 in compensation, in view of the delays, time, and trouble faced by the resident in receiving the landlord’s stage 2 complaint response and the failure to fully address her complaint in this response.
  9. The landlord is also ordered to contact the resident to provide her with a new opportunity to raise her concerns about service delivery within communal areas as a complaint. If the resident chooses to raise a new complaint about service delivery, the landlord should ensure that it fully investigates any concerns about this and responds in line with the timescales in its complaints policy.

Determination

  1. In accordance with paragraph 52 of the Housing Ombudsman Scheme, there was no maladministration with regards to the landlord’s handling of the resident’s service charge queries.
  2. In accordance with paragraph 52 of the Housing Ombudsman Scheme, there was maladministration by the landlord with regards to its handling of the resident’s complaint.

Orders and recommendations

Orders

  1. Within 4 weeks of this report, the landlord is ordered to:
    1. Pay the resident £150 in compensation for the delays, time, and trouble she experienced with regards to the landlord’s handling of her complaint
      1. Compensation payments should be paid directly to the resident and not offset against any potential arrears
    2. Contact the resident to provide her with the opportunity to raise her concerns about communal service delivery as a new stage 1 complaint.