Applications are open to join the next Housing Ombudsman Resident Panel – find out more Housing Ombudsman Resident Panel.

MHS Homes Ltd (202227292)

Back to Top

REPORT

COMPLAINT 202227292

MHS Homes Ltd

29 May 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 management of the resident’s rent account.
    2. The resident’s report that the landlord discriminated against her.

Jurisdiction

  1. 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.
  2. Paragraph 42f states: “The Ombudsman may not consider complaints which, in the Ombudsman’s opinion… concern matters where the Ombudsman considers it quicker, fairer, more reasonable, or more effective to seek a remedy through the courts, other tribunal or procedure”.
  3. In this case, the resident stated that the landlord had discriminated against her. The Ombudsman cannot make a finding of discrimination under the Equality Act 2010 or otherwise, since this is a legal matter that would have to be determined by a court. This Service therefore considers the resident’s report that the landlord discriminated against her to be outside of its jurisdiction. The Ombudsman has therefore not investigated this element of the resident’s complaint.

 

 

Background

  1. The property is a 2-bedroom, first floor flat and the resident has an assured tenancy which began on 7 December 2020.
  2. The landlord has advised this Service that it has a vulnerability indicator recorded for the resident for generalised anxiety disorder.
  3. The tenancy agreement states:
    1. “You need to pay your rent and other charges every Monday in advance for the week ahead”.
    2. “You must talk to us – and work with us – to work out a way for you to pay any money you owe if you get into debt by not paying your rent or other charges. And if we offer support you must take it”.

Summary of events

  1. On 2 and 8 November 2022, the landlord wrote to the resident to advise her that she was behind with her rent payments and attached a rent statement. The landlord also texted the resident with the same message on 8 November 2022.
  2. The landlord texted the resident again on 22 November 2022 to advise her about her rent account being in arrears. The landlord then left a voicemail message for the resident on 2 December 2022 asking her to ring the landlord.
  3. The landlord sent further letters about her rent account on 2 and 22 December 2022. The letters advised the resident of the amount her account was in arrears and advised her to ring the landlord if she was unable to make the necessary payments. The letter sent on 22 December 2022 also warned the resident that failure to pay could result in being taken to court and losing her home.
  4. The resident wrote to the landlord on 22 December 2022 in response to its letter dated 2 December 2022. The resident said she had explained “numerous times” that she was receiving Universal Credit (UC) and that the rent was paid on the 28th of each month in arrears. She stated that the landlord was not listening and was discriminating against its tenants.
  5. The landlord replied on the same day (22 December 2022) and stated that it was aware the resident was receiving UC but said it had explained to the resident in July 2022 that her account was in arrears and had not been in credit since December 2021. The landlord stated that the Department of Works and Pensions (DWP) paid UC every month during the month the rent was due. The landlord added that it would serve a Notice of Seeking Possession (NSP) as there had been an outstanding balance for a year. The landlord offered to send the resident a rent statement dating back to when the rent account last had a zero balance.
  6. On 22 December 2022, the resident submitted a complaint to the landlord about one of its staff, who she stated was discriminating against her. The resident stated that she had already advised the landlord that she paid her rent on the 28th of each month and that Universal Credit was paid in arrears. The landlord acknowledged the stage one complaint on the same day.
  7. The landlord replied on the same day (22 December 2022) and attached a rent statement dating back to December 2021. The landlord stated that it had advised the resident in July 2022 how to calculate correctly the amount of rent due per calendar month. Since then, although the resident had paid the correct rent, she had not contributed to the clearance of the rent arrears. The resident sent further emails on the same day and disputed that her account was in arrears.
  8. On 23 December 2022, the landlord sent a stage one reply in which it stated the following:
    1. The resident had an obligation to pay her rent every Monday in advance, regardless of the method of payment used by her. However, since November 2021 the resident had not kept her rent account in credit by one week’s rent.
    2. The landlord had not found any evidence of discrimination by its staff member and therefore it did not uphold this part of the resident’s complain.
    3. The landlord requested the resident to work with its Income team to set up a payment plan to bring her account back in line with her tenancy.
  9. On 3 January 2023, the landlord wrote to the resident to advise her that her account was in arrears and sent her a rent statement. The landlord advised her that it had made an appointment to visit her at home on 27 January 2023 to discuss the rent account. The landlord stated that if the resident was not at home or did not make contact, it would serve an NSP.
  10. The resident wrote to the landlord on 9 January 2023 and stated that she did not believe the landlord was taking her complaint about a staff member seriously enough. The resident reiterated that Universal Credit was paid in arrears. She sent a further email on the same day and stated that she did not wish to discuss the matter. The landlord acknowledged the resident’s stage 2 complaint on 10 January 2023.
  11. The resident wrote to the landlord on 10 January 2023 and advised that she did not want the planned home visit to take place.
  12. The landlord wrote to the resident on 10 January 2023 and stated the following:
    1. The resident’s rent account should be at zero balance or have a credit balance at least once during each calendar month. Therefore, the account could be in arrears but the arrears would need to be cleared when the UC payment was received.
    2. As the resident had declined to have a home visit or receive support from the landlord, the landlord stated that she would be served with an NSP.
    3. The landlord stated that during the period January to June 2022, the resident had not paid sufficient rent to cover the rent due. It listed the shortfall in payments for each of the 6 months.
    4. The landlord agreed to contact the DWP to check they were paying her the correct amount of benefit.
    5. The landlord said it would ask the local authority to independently review the resident’s rent account.
    6. The landlord requested the resident to moderate the language she used in her emails.  
  13. An internal email sent by the landlord on 10 January 2023 stated that it would postpone the service of the NSP because the resident had a stage 2 complaint pending.
  14. The landlord’s records show that it had booked an appointment for the resident to attend a ‘homeless prevention’ interview with the local authority’s Housing Options team on 23 January 2023. The interview took place and the interview notes stated that the resident had explained that the £749 arrears on her account were due to the DWP paying UC in arrears every month. The council advised the resident to apply for a Discretionary Housing Payment to help clear the arrears.
  15. The landlord sent a further letter to the resident on 31 January 2023 regarding arrears on her rent account. The landlord’s notes stated that the resident was not paying the full monthly rent.
  16. The landlord sent its stage 2 reply on 6 February 2023 in which it stated the following:
    1. The landlord did not uphold the complaint because the resident was responsible for paying her rent in advance as per the tenancy agreement.
    2. The landlord said it was its normal practice to pursue rent arrears when benefits were paid in arrears.
    3. In order to bring her rent account into line, the landlord was requesting the resident to pay a small amount extra each month.
    4. As requested by the resident, the landlord had added a note to its system that she suffered from anxiety so that its staff would be aware.
    5. The landlord said it would arrange for a manager in its Income team to ring the resident by 13 February 2023 to arrange a home visit. During the home visit, the manager would provide debt advice, signpost the resident so she could access additional advice and help her to make an application to the landlord’s hardship fund.
  17. The landlord’s records state that it phoned the resident on 13 February 2023 to arrange a home visit as per its stage 2 complaint reply. However, the notes state that the resident terminated the call without agreeing to the home visit.
  18. On 15 May 2024, the landlord provided this Service with a copy of the rent statement for the resident’s account showing the account balances from 30 June 2022 to 30 March 2023. The statement showed that on 30 March 2023 the resident made an additional payment of £145.36 and this cleared the arrears, leaving her account showing a zero balance.

Assessment and findings

The landlord’s management of the resident’s rent account

  1. The landlord’s Income Policy states: “To ensure effective collection of our income we will…promptly advise customers of their arrears, using a range of contact methods to prevent debt escalating…[and]…Signpost to suitable external agencies for debt, welfare, housing and legal advice”.
  2. The Government’s UC website states: “In most cases Universal Credit is a single, monthly payment which is paid in arrears directly into the claimant’s bank account…If rent is paid weekly, a monthly amount will be calculated by multiplying the weekly rent by 52, then dividing by 12”. It goes onto say: “Tenants will be expected, where possible, to arrange their own rent payments”.
  3. The landlord wrote to the resident on 2 and 8 November 2022 to advise her that her rent account was in arrears and attached a rent statement. The Ombudsman has reviewed the rent statement for the resident’s rent account and it shows that during the period from 30 June 2022 to 7 November 2022, the account had been in arrears.
  4. As the resident’s rent account had not been in credit or had a zero balance at any time during the period June to November 2022, the landlord had acted in accordance with its policy by notifying the resident that her account was in arrears. The tenancy agreement states that rent must be paid in advance and although the resident was receiving UC, the Government’s website makes it clear that residents are responsible for paying their rent. Therefore, the landlord had acted reasonably by contacting the resident about the arrears.
  5. The landlord made further attempts to contact the resident by texting her on 22 November 2022, leaving a voicemail message on 2 December 2022 and sending further letters on 2 and 22 December 2022. This was appropriate as the landlord had continued to act in accordance with its policy by using a range of contact methods to advise the resident about the arrears.
  6. The resident responded to the landlord on 22 December 2022 and stated that she had previously advised the landlord on numerous occasions that she was receiving UC and the rent was paid on the 28th of each month. The landlord replied on the same day and explained that it was aware she was receiving UC but her account had not been in credit since December 2021. It was appropriate that the landlord had responded promptly to the resident and had explained that her account had not been in credit for some time.
  7. The landlord’s explanation for contacting the resident about the arrears was reasonable because the rent statement seen by this Service shows that even on the 28th of each month after the rent had been paid, the resident’s account was still in arrears. For example, on 28 September 2022 it was £145.36 in arrears, on 28 October 2022 it was £95.22 in arrears and on 28 November 2022 it was £195.50 in arrears.
  8. The resident submitted a complaint on 22 December 2022 and repeated that she was receiving UC, which was paid in arrears, and she paid the rent on the 28th of each month. The landlord replied on the same day and attached a rent statement dating back to December 2021. This was reasonable as it provided the resident with clear information about her rent account to demonstrate why the landlord had written to her about the balance of her rent account.
  9. The landlord reiterated in its stage one reply on 23 December 2022 that the resident was required to pay her rent every Monday in advance. The landlord advised the resident to work with its Income team to agree a payment plan to bring her account in line with the tenancy agreement. It was reasonable for the landlord to advise the resident that she could agree a payment plan because it recognised that she might not have been in a position to clear the arrears immediately.
  10. The landlord wrote to the resident on 3 January 2023 to advise her that it had booked an appointment to visit her at home on 27 January 2023 to discuss the rent account. This was reasonable as a face-to-face meeting would give the resident an opportunity to discuss and agree an appropriate repayment agreement to bring the account into credit. It would also allow her to ask any questions or seek clarification. However, the resident declined the offer of the home visit.
  11. On 10 January 2023, the landlord wrote to the resident to explain that the arrears had built up during the period January to June 2022 when she had not paid sufficient rent to cover the rent due. This was reasonable as it provided the resident with further information about why her account had fallen into arrears. The landlord said it would contact the DWP to check they were paying the correct amount of benefit and it would ask the local authority to independently review her rent account. These were positive steps by the landlord and showed that it was prepared to assist the resident by checking details with the DWP and the local authority.
  12. The landlord booked an appointment for the resident to attend an interview with the council’s Housing Options team as part of a homelessness prevention initiative. The resident attended the interview and was advised by the council to apply for a Discretionary Housing Payment to help clear the arrears. It was positive that the landlord had arranged the homeless prevention interview as it was another mechanism for the resident to receive support and to obtain independent advice about her situation.
  13. In its stage 2 reply dated 6 February 2023, the landlord explained once again that the resident had not met the terms of her tenancy agreement to pay the rent in advance and therefore it did not uphold her complaint. The landlord reiterated that it was asking the resident to pay a small amount extra each month to bring her rent account into line. The landlord stated that it would arrange for one of its managers to ring the resident to arrange a home visit to provide debt advice, signpost her to access additional advice and help her to make an application to its hardship fund. These were again positive steps taken by the landlord to ensure it was offering support to the resident to assist her in clearing the rent arrears. However, the evidence seen shows that the resident declined the home visit.
  14. In summary, the evidence shows that the landlord correctly followed its procedures in managing the resident’s rent arrears and took reasonable and proportionate steps to bring the matter to her attention. The landlord sent various letters and texts, left voicemail messages and offered home visits. The landlord was proactive by attempting to address the matter using a range of contact methods. The landlord also offered support by arranging a homeless prevention interview, offered debt advice and offered to help with an application to its hardship fund.
  15. The landlord followed good practice by keeping in regular contact with the resident, sending rent statements and offering support. The landlord advised the resident on different occasions that it was prepared to agree a repayment plan for her to bring the account in line with the tenancy agreement. Given that the resident suffered from an anxiety disorder, it was particularly appropriate that the landlord had taken a proportionate and supportive approach in seeking to address the rent arrears on the resident’s account. Therefore, the Ombudsman has found there was no maladministration in the landlord’s management of the resident’s rent account.

Determination (decision)

  1. In accordance with paragraph 52 of the Housing Ombudsman Scheme, there was no maladministration by the landlord in its management of the resident’s rent account.
  2. In accordance with paragraph 42f of the Housing Ombudsman Scheme, the resident’s report that the landlord discriminated against her is outside the jurisdiction of the Ombudsman.

Reasons

  1. The landlord correctly followed its procedures in managing the resident’s rent arrears and took reasonable and proportionate steps to bring the matter to her attention using a range of contact methods. The landlord offered support by arranging a homeless prevention interview, offered debt advice and offered to help with an application to its hardship fund.
  2. The Ombudsman cannot make a finding of discrimination under the Equality Act 2010 or otherwise, since this is a legal matter that would have to be determined by a court.