Metropolitan Thames Valley Housing (MTV) (202317108)

REPORT

COMPLAINT 202317108

Metropolitan Thames Valley Housing (MTV)

17 February 2025

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

The complaint is about the landlord’s:
1. Response to the resident’s query about the increase in service charge in 2021-22.
2. Complaint handling.

Background

The resident is a leaseholder at the property, which is a flat. The resident pays a variable service charge to the landlord.
On 19 December 2022, the resident asked the landlord why his service charge was increasing from £191.35 to £468.39 a month. As the landlord had not explained this, he made a complaint on 23 January 2023.
The landlord responded at stage 1 on 2 February 2023. It said it was reviewing the service charge accounts due to a number of queries from residents. It subsequently confirmed its review on 8 February 2023. It confirmed that it had overcharged the resident by incorrectly including ground rent in his charge that it should not have been collecting, and so it credited him this amount.
The resident repeated that the landlord had not explained why the actual service charge had been more than the estimated cost.
The landlord responded at stage 2 on 19 July 2023. It said that it had followed its procedure in responding to his query. It acknowledged that there had been a delay with it providing the information. It offered £100 compensation for this.
The resident referred his case to the Ombudsman, as he complained that the landlord had not explained why the service charge had increased.

Assessment and findings

Scope of investigation

Paragraph 42.d. of the Scheme sets out that the Ombudsman is unable to investigate issues about the level or increase of service charges, and therefore their reasonableness or the liability to pay them. If the resident wishes to challenge these aspects and/or seek recovery, he may do so by making an application to the First Tier Tribunal (Property Chamber). While we are unable to assess the level or reasonableness of the service charge, we will consider whether landlord responded to the resident’s query about this in line with its policies and procedures, and whether this was fair and reasonable in all the circumstances.
Within his communication, the resident advised that the situation had caused him stress. The courts are the most effective place for disputes about personal injury and illness. This is largely because independent medical experts are appointed to give evidence. They have a duty to the court to provide unbiased insights on the diagnosis, prognosis, and the cause of any illness or injury. When disputes arise over the cause of any such injury, testimony can be examined in court.
Therefore, it is quicker, fairer, more reasonable, and more effective for the resident to seek a remedy for experiencing stress through the courts because we do not have the authority or expertise to provide this in the way the courts might. This is line with paragraph 42.f. of the Scheme, which says we may not consider such complaints. While the Ombudsman cannot consider the effect of the landlord’s actions or inaction on health, consideration has been given to any general distress and inconvenience which the resident experienced as a result of its actions or inaction.
In a second complaint to the landlord (7 June 2023) the resident raised concerns about his direct debit payment. The landlord responded to this at stage 1 (13 June 2023). The resident did not escalate this aspect of complaint further. Paragraph 42.a. of the Scheme states that the Ombudsman may not consider complaints which are made before exhausting the landlord’s complaints procedure. As the resident did not ask the landlord to escalate this matter to its final stage of its internal complaints procedure, the query about the direct debit does not form part of this investigation.

Response to the resident’s query about the increase in service charge in 2021-22

The resident asked the landlord on 19 December 2022 why his service charge would be increasing from £191.35 to £468.39 a month. The landlord told him that same day that it would respond within 20 working days. It tried to call him on 20 January 2023 (21 working days later) but it could not reach him. It asked for his best contact details.
The resident made a complaint on 23 January 2023, as the landlord had not explained the service charge increase.
The landlord explained the following day that the deficit on his service charge account was the difference between the estimated costs and the actual costs. However, it did not explain why the deficit had occurred, which was the basis of the complaint.
The landlord said that it would be reviewing the service charge accounts due to a number of resident queries.
The landlord responded to the complaint at stage 1 on 2 February 2023. It said that it had tried to call the resident and had sent him an email. The complaint was not upheld, as it had contacted him. It did not answer the resident’s query about why there had been a difference from the estimated to actual expenses.
Following the review of the 2021-22 accounts, the landlord told the resident on 8 February 2023 that:
1. As a leaseholder, he did not have to pay ground rent after 31 March 2022. It had charged him this in error and had credited this to his account.
2. For sinking fund contributions there would be a difference between the estimated charge and the income shown on the accounts. This was because the sinking fund contribution had been deducted and allowed for on the annual sinking fund statement.
The landlord issued a revised service charge certificate. This showed that the resident had underpaid the service charge by £681.12. Although it was appropriate for the landlord to review its accounts, it still failed to explain why the deficit had occurred.
It is not clear when the resident escalated the complaint but the landlord acknowledged an escalation request on 27 February 2023. It asked (2 March 2023) which complaint the resident wanted to escalate as the reference number did not match. The resident confirmed it was this complaint on 15 April 2023.
The landlord responded at stage 2 on 19 July 2023. It said that:
1. Following the complaint, it had contacted the relevant department to resolve the concerns. It had therefore followed procedure.
2. It apologised for the delays in providing the service charge information requested. This had now been provided.
3. It offered a total of £100 compensation for the delay in providing the service charge information. (Its compensation for complaint handling has been considered separately below).
This response again focused on the action the landlord had taken following the complaint. However, it did not recognise that it had still not explained why the deficit had occurred, which was the basis of the resident’s complaint.
Following the involvement of the Ombudsman, the landlord reviewed the case again in May 2024. It acknowledged that it could have done more to directly explain why there had been a service charge increase rather than just provide the data. This was the key point of the resident’s complaint. It is not clear why it took this additional review for it to realise that it had not explained this to the resident.
As part of this review, the landlord reconsidered the compensation. It made a new offer of £300 compensation (the amount for complaint handling has been assessed separately). This replaced the £100 previously offered and was made up as follows:
1. £150 for the initial delay in contacting the resident.
2. £150 for the distress and inconvenience caused by not directly answering the query.
The Ombudsman encourages landlords to resolve complaints no matter what stage a case is at. However, the main focus for a landlord should always be to make sure that a case is resolved during its internal complaints process.
It was not until the resident referred his complaint to the Ombudsman, that the landlord conducted a further review of the case. At this stage, it acknowledged that it had not explained the increased charge to the resident. As such, it increased its offer of compensation.
Although this did indicate a willingness to learn, there was little evidence of this at the time of the original complaint investigation. The landlord failed to address the main aspect of the resident’s complaint via its internal complaints procedure and it failed to explain how the deficit had occurred.
A referral to the Ombudsman might sometimes mean another opportunity for the landlord to consider the complaint as part of our mediation process, if both parties agree to this. However, this should still have been fully investigated during the internal complaints procedure and mediation did not take place between the parties after the complaint was referred to us, which was open to the landlord to contact the resident about.
Following the involvement of the Ombudsman, the landlord made a new offer of £300 compensation for this aspect of complaint. The amount offered was within a range the Ombudsman’s remedies guidance would recommend where there has been a failure which adversely affected the resident.
Although additional compensation was appropriate, this should have been offered during the internal complaints procedure. The Ombudsman’s outcomes guidance is clear that a finding of reasonable redress is less likely to be determined under such circumstances.
The landlord offered this increased compensation in May 2024. This was around 16 months after the resident’s initial complaint. As such, the landlord failed to effectively put things right during the internal complaints procedure.
It also missed the opportunity to learn lessons from the outcome at the time of its original investigation. As such, the landlord did not act in line with the Ombudsman’s Dispute Resolution Principles to be fair, put things right, and learn from outcomes, and maladministration has therefore been found.
To acknowledge the significant delay in the landlord acknowledging that it had failed to respond to the main point of the complaint, an apology and additional compensation of £150 has been ordered. This takes into account the frustration caused to the resident over this time period in line with our remedies guidance’s recommended range of compensation for such failures. It is also concerning that the resident told us the landlord has still not explained why his service charge increased. It has therefore also been ordered to contact him to arrange to discuss this, as well as to tell him about his right to inspect and take copies of its accounts, receipts, and service charge documents.

Complaint handling

The landlord’s complaints policy states, in line with the Housing Ombudsman’s Complaint Handling Code (the Code):
1. At stage 1, it will acknowledge a complaint within 5 working days. It will respond within 10 working days of the acknowledgment.
2. At stage 2, it will respond within 20 working days.
3. If additional time is needed at either stage, it will keep the resident informed.
The resident made the initial complaint on 23 January 2023. The landlord responded at stage 1 on 2 February 2023. This was within 8 working days.
Although this response did not answer the resident’s query, the landlord said that it was reviewing the service charge accounts. This was appropriate given that it had received a number of queries from residents. This was a way to ensure that the information provided was accurate. It then completed its review on 8 February 2023.
It is not clear when the resident escalated the complaint but the landlord acknowledged an escalation request on 27 February 2023. On 2 March 2023, the landlord queried which complaint the resident wanted to escalate. This was reasonable given the discrepancy in the reference number. The resident confirmed this on 15 April 2023.
The landlord responded at stage 2 on 19 July 2023. This was 98 working days after the escalation acknowledgment and 64 working days after the resident had confirmed which complaint he wanted to escalate. This was not in line with the stage 2 response timeframe of its policy or the Code. There is no evidence that the landlord had kept the resident updated throughout this delay.
During the internal complaints procedure, the landlord offered £50 for poor complaint handling. This was not proportionate to recognise the extent of its failure, given the length of the delays and the fact that the complaint responses did not answer the resident’s complaint. These would have adversely affected the resident, which the Ombudsman’s remedies guidance recommends be recognised with compensation from £100.
After the involvement of the Ombudsman, and a further review by the landlord, it made a new offer of £200 compensation for its complaint handling in May 2024, as follows:
1. £100 for not addressing the failings during the stage 1 process.
2. £100 for the complaint delays.
As mentioned in the previous section of this report, this increased offer of proportionate compensation in line with our remedies guidance should have been made during the complaints procedure. In addition, this compensation did not acknowledge the landlord’s delays in only making this offer around 16 months after the resident’s initial complaint. As such, there was service failure.
The Ombudsman has therefore ordered an apology and an additional £50 compensation to acknowledge the impact and frustration caused to the resident by the poor complaint handling. This is in line with our remedies guidance’s recommendation of compensation from this amount for such delays in getting matters resolved.

Determination (decision)

In accordance with paragraph 52. of the Scheme, there was maladministration in the landlord’s response to the resident’s query about the increase in service charge in 2021-22.
In accordance with paragraph 52. of the Scheme, there was service failure in the landlord’s complaint handling.

Orders

The landlord is ordered to take the following action within 4 weeks of this report and provide evidence of compliance to the Ombudsman:
1. Apologise in writing to the resident for the failures identified in this case.
2. Pay a total of £700 compensation to the resident. This figure includes the landlord’s earlier offer of £500. The landlord does not have to pay this £500 again if this has already been paid. The compensation is made up of:
  1. £450 to acknowledge the effect on the resident of the landlord’s failure to respond to his query in respect of the service charge.
  2. £250 to acknowledge the effect on the resident of the landlord’s complaint handling failures.
3. Contact the resident to arrange a meeting between it and him to discuss its full explanation as to why his service charge increased in 2021-22.
4. Inform the resident of his right to inspect and take copies of its accounts, receipts, and documents relating to service charges within a specified period under section 22 of the Landlord and Tenant Act 1985. It should include details of how he can exercise this right and local arrangements for inspecting invoices (for example, attending its offices at a particular address, and any cost for making copies).