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Notting Hill Genesis (NHG) (202305853)

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REPORT

COMPLAINT 202305853

Notting Hill Genesis (NHG)

30 April 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. This complaint is about:
    1. The landlord’s handling of the resident’s requests for information about her service charges.
    2. The resident’s dispute with the landlord about the nature and reasonableness of some of her service charges.

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.

The resident’s dispute with the landlord about the nature and reasonableness of some of her service charges.

  1. Paragraph 42(f) of the Scheme sets out that the Ombudsman may not investigate complaints which 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.
  2. Much of the resident’s complaint to the landlord centres on her concern that the variable service charges levied on her are unreasonable, inappropriate, or that the services commissioned by the landlord were not properly commissioned. The Ombudsman can investigate how a landlord has responded to enquiries about service charges, or requests for relevant information. However, any actual dispute about the level of a service charge, its reasonableness, or whether the appropriate consultation processes were followed are more appropriately considered by the First Tier Tribunal (Property Chamber). Because of that, such aspects of the resident’s concerns are not considered in this report. Contact details for the Tribunal can be found online.

Background and summary of events

  1. The resident is a tenant of the landlord. In addition to her rent, she also pays variable service charges.
  2. At the end of December 2022 the resident asked the landlord for a wide range of information about the variable service charges she was being invoiced for. She presented this request as a complaint, because she said the landlord had been continually overcharging her, and that there were errors and problems with the charges.
  3. The landlord responded to the resident at the start of January 2023. It explained its service charge system was undergoing changes and consultation, and that she would need to raise her complaint after that process was complete. Nonetheless, it would respond to her request for information in due course. Several days later it said the information would be sent by the end of January.
  4. Not having received the information by the promised deadline, the resident complained about the delay on 1 February.
  5. The landlord sent the requested service charge information on 16 February 2023.  It apologised for the delay. Some of the charges information was not yet available because it related to the current accounting year which had not yet been calculated. Other information was not available for sharing, as the landlord said it related to commercial contracts across the whole organisation.
  6. The landlord sent its complaint response on the same day. It acknowledged its reply to the resident’s information request had been delayed. It apologised, recognised that the complaint showed the need for better internal communication, and offered £50 compensation for the inconvenience caused.
  7. A copy of the resident’s request to escalate her complaint has not been provided for this investigation. However, the landlord sent a final complaint response to her on 4 April 2023. It addressed the information queries she had raised in December 2022, and provided further information to that it had given in February.
  8. The resident remained dissatisfied with the landlord’s explanations and brought her complaint to the Ombudsman.

Assessment and findings

Investigation scope

  1. This investigation considers the resident’s request for service charge information and her complaint in December 2022 and the landlord’s responses in early 2023. The resident made further enquiries following the landlord’s final complaint response in April 2023, and through the rest of the year, culminating in a further complaint about the landlord’s decisions and actions towards the end of the year. That second complaint was also about service charges, but centred on further developments in 2023. Because of that, the second complaint must be treated separately and needs to be the focus of its own Ombudsman investigation. A new case has been opened to do that. This investigation considers the landlord’s actions until April 2023 only.

The landlord’s handling of the resident’s requests for information about her service charges

  1. The resident’s tenancy agreement sets out that variable service charges are part of the tenancy. It confirms that service charges are based on actual costs and “any reasonably known or estimated costs”.
  2. The landlord’s service charge policy explains that estimated charges are set with consideration towards previous years’ expenditure.
  3. The Leasehold Advisory Service confirms that variable service charges can be based on actual or estimated costs of services. Tenants paying variable service charges are entitled to ask their landlord for a summary of service charge costs incurred in the last accounting year or previous 12 months. The landlord must provide the requested information within 1 month of the request, or 6 moths of the end of the period in question, whichever is later.
  4. The Ombudsman’s Complaint Handling Code (the Code) sets out that one of the important aspects of complaint handling is for a landlord to recognise the difference between a complaint and a service request. It explains that “A service request is a request from a resident to their landlord requiring action to be taken to put something right. Service requests should be recorded, monitored and reviewed regularly. A complaint should be raised when the resident raises dissatisfaction with the response to their service request.”
  5. The resident’s email to the landlord in December 2022 was presented as a complaint. However, most of it was requests for information about her service charges. There is no dispute that the email clearly conveyed her frustration with the landlord’s handling of the charges over a lengthy period, and her requests for information, such as invoices, was part of her concern that the charges she had been billed for might not be correct. Nonetheless, she did not provide any specific issues of complaint at that stage. The landlord responded initially on 5 January 2023. It explained it could not accept a complaint at that stage, and gave an reason related to a consultation process. It is not wholly clear what it meant. What it should have explained was the difference between a service request and a complaint, in line with the Code.
  6. The information asked for by the resident comprised of the actual and estimated service charges for the 2022/2023 and 2023/2024 financial years. Her request was made in December 2022. The landlord was not in a position to provide the actual charges for 2022/2023 at that stage, and informed her of that in its response in February 2023. Given that the 2022/2023 financial year was not yet over, its explanation about the actual costs for the period was reasonable.
  7. The resident asked the landlord for information supporting the estimated service charges for 2023/2024. The landlord explained in February 2023 how estimates were calculated and why they were needed – primarily as the actual costs were not known at the start of the accounting period, and so estimates were used. This included charges for services which may not be required in the subsequent period. In such cases it said the unspent funds would be credited to the service charge account. The resident’s tenancy agreement confirms that service charges are based on actual and estimated costs, but is silent on how such estimates are calculated. The landlord’s service charge policy explains that estimated charges are set with consideration towards previous years’ expenditure. The landlord did not specifically explain that, which might have added to the comprehensiveness of its response. Nonetheless, its explanation about the estimated costs for the services queried by the resident were in line with the tenancy, its policy, and general practice.
  8. Other information asked for by the resident included contracts with suppliers. In response to the resident’s request the landlord said it was not obliged to provide that information, and gave some explanation as to why that information would not prove useful – mainly as the contracts covered the whole organisation, not just the resident’s property. A tenant or leaseholder paying variable service charges has the right to ask their landlord for a summary of service charge costs, and to inspect the relevant accounts, receipts, and supporting documents. However, nothing has been seen in this investigation indicating a resident is entitled to ask for specific contractual documents between the landlord and its service providers. Accordingly, the landlord’s response to the enquiry was reasonable.
  9. The resident asked the landlord for evidence of its consultation with tenants about commissioning its services. It explained in reply in February 2023 that consultations had not been required because the level of the relevant service charges were below that required for consultation. It said there was a potential for future qualifying works in relation to fire risk assessments, but as there had not yet been a consultation any charges to tenants would be capped at £250. It also explained how its electricity services had been commissioned. Tenants paying variable service charges must be consulted before a landlord carries out ‘qualifying works’ over the value of £250, or enters into a long-term agreement with a contractor or similar for the provision of services where the amount payable for the service by any one tenant is over £100 per financial year. The landlord appropriately responded to the resident’s enquiry about this and its explanations were reasonable and reflected the reality of lease commissioning processes.
  10. In her original information request the resident stated that charges for the communal door intercom had been included in the estimates for multiple years but never actually incurred in the actual costs, because the system had never needed maintenance. She asked that the estimate charge be removed. The landlord did so, but explained why the charge existed. The resident explained to this Service why she believed the landlord was wrong to make estimates for the same service over numerous years without incurring actual costs, but that specific concern was not put to the landlord in the complaint, and no evidence has been seen here suggesting the landlord had acted incorrectly.
  11. In its final complaint response the landlord explained further how the services for communal electricity and the fire risk assessments had been commissioned and how they related to the resident’s charges. It provided evidence of its attendance for fire safety maintenance and emergency lighting, as requested by the resident. It addressed the queries raised by the resident, although not always in the specific form she posed them, meaning that it was sometimes not as clear as it should have been which requests were responded to and which were not.
  12. The evidence provided by the landlord of its attendance for fire safety maintenance and emergency lighting was basic, and showed only the name of the contracting company and the date of attendance. It appears to be appropriately signed and dated, but gave no details of any work undertaken, and refers only to emergency lighting, not the additional fire safety maintenance the landlord said was done in the same visit. The document’s format appears to be designed to need details only when defects are identified. It may be that the record meets any relevant statutory reporting requirements, but it cannot reasonably be said to be informative. Nonetheless, the dates on the document align with the landlord’s explanations. Within the parameters of the Ombudsman’s remit, the landlord’s response on this particular aspect does not appear wholly unreasonable. The arbiter of whether the related service charges were reasonable is, ultimately, the Tribunal.
  13. Landlord’s usually have a one month deadline to respond to a tenant’s request for a service charge summary (assuming the data is available at the time). In this case the resident made her enquiries with the landlord at the end of December 2022, and it provided its response on 16 February 2023. It had given her an update on 20 January, but that had confirmed it would issue its response by the end of that month. As the landlord did not meet the relevant timeframe, or the date it had confirmed to the resident, it was appropriate that it acknowledged and apologised for its delay in its first complaint response. It explained what learning it had taken from its poor handling, and offered £50 compensation for the inconvenience caused. These remedies were in line with the Code and were proportionate to the nature and scale of the delay.

Determination (decision)

  1. In line with paragraph 53(b) of the Housing Ombudsman Scheme, the landlord has offered redress to the resident prior to investigation which, in the Ombudsman’s opinion, resolves the complaint satisfactorily.

Reasons

  1. The landlord’s handling of the resident’s requests and complaints were somewhat disjointed because it did not initially identify the difference between a service request and a complaint. It should have done so, and clearly explained to the resident why her requests for service charge information was not a complaint. That would have managed her expectations and allowed her to clarify her concerns in specific relation to making a complaint if necessary. Nonetheless, the landlord did explain promptly that it would not consider a complaint, albeit for confusing reasons. It was appropriate for the landlord to consider the resident’s subsequent complaint about its delayed response to her information request, because that was clearly a complaint about its service.
  2. The information provided by the landlord in its response to the resident’s request and in its final complaint response was appropriate and addressed the resident’s queries. It explained why it could not provide actual costs as the accounting year was not over, and explained how the estimates had been calculated. Its explanations were in line with the tenancy agreement and basic practice. It addressed the resident’s queries about tenant consultations, and about its service commissioning. It provided evidence of attending for some of the services the resident queried, although a recommendation is made below about the level of information it includes in such evidence. Within the scope of this investigation, the landlord handled the resident’s enquiries reasonably, and where it was delayed it provided appropriate remedies.


Recommendations

  1. The evidence provided to the resident by the landlord for its fire safety and emergency lighting maintenance was without specific details or clarity as to what actions were taken as part of the maintenance. The landlord should consider this, and any other services for which charges apply, to identify any options it has to provide more meaningful information. This would better allow any service charge payer to be able to understand what they are paying for.