Warwick District Council (202201904)

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REPORT

COMPLAINT 202201904

Warwick District Council

27 September 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

The complaint is about the landlord’s handling of:
1. The resident’s rent account including his late mother’s arrears after the resident succeeded the tenancy.
2. The related complaint.

Background

The resident’s late mother had a secure tenancy with the landlord (a local council). The property is a 3-bedroom house. The resident’s mother died on 9 January 2021 and the resident succeeded the tenancy on 11 January 2021.
The resident began making rent payments a few weeks later once he received his universal credit (UC). However, he received payment demands from the landlord in relation to his late mother’s arrears, and the landlord applied for arrears deductions from his UC at approximately £40 per month. This was taken from the rental payment for 10 February to 9 March 2021. The resident contacted Citizen’s Advice (the representative) to advocate with the landlord on his behalf.
On 18 March 2021, the representative queried the resident’s liability for his late mother’s rent arrears. After further contact from the representative, the landlord advised it had emailed the Department of Work and Pension (DWP) to stop arrears deductions from his UC, however, the resident continued to receive payment demands and letters threatening possession.
On 5 May 2021, the representative raised a formal complaint via the landlord’s online complaint form. This stated:
1. The landlord had incorrectly passed on his late mother’s arrears on succession and deducted arrears from the resident’s UC when he did not have arrears.
2. This was causing hardship. The resident was a single parent who was having to now use a food bank for support.
3. The landlord had not responded to emails from the representative regarding this.
4. The resident felt ‘harassed’ by the landlord regarding leaving his home.
The resident asked the landlord to stop deducting arrears illegally and correctly assess arrears bearing in mind any delays from UC was not his fault.
In its stage 1 response dated 1 June 2021, the landlord said:
1. It had completed 2 reviews of the resident’s rent account which both found that payments were being made in arrears, not in advance, as per the terms of the tenancy agreement.
2. This was the predominant reason for the arrears on the resident’s account and not because it had transferred previous tenancy arrears to the resident’s account, as suggested.
3. It had acted within its rent arrears escalation procedure when taking steps to recover arrears as rent was not being paid when due. Therefore, the complaint about it harassing the resident was not upheld.
On 8 June 2021, the representative raised a stage 2 complaint. This stated:
1. The landlord had applied for direct payments from the resident’s UC account to clear the arrears, yet the resident did not have 2 months’ rent arrears.
2. This had caused distress and hardship to the resident at a time of bereavement, and he felt “hounded” by the landlord to leave the property.
3. In March 2021, the representative requested that any arrears accrued in the resident’s name to be paid at £3.70 per week. This was not considered and arrears deductions at £40 plus continued until May 2021. As a result, the resident had to rely on food bank vouchers.
4. There had been a lack of responses from the landlord to contact from the representative.
5. Any delays in rent payment being credited to the resident’s rent account was due to the landlord incorrectly requesting direct payment from UC and delays in the system. The resident should not be penalised.
On 14 September 2021, the landlord provided a stage 2 complaint response. Under the heading ‘findings’ the landlord stated:
1. The resident had legally inherited his late mother’s tenancy from 11 January 2021. It had not explained the contract to him or directed him to any contractual information. This lack of information included when regular rental payments should be made. Also, there was no acknowledgement of the resident’s bereavement and immediate circumstances in its dealing with him.
2. His mother’s rental account was left open until March/April 2021 and some of the resident’s payments were originally directed to it. No new account was opened for the resident until this error was identified.
3. When the resident’s account was opened it showed arrears because it commenced in March 2021. He was liable for rent from January 2021. It also showed arrears because residents were expected to pay rent in advance.
4. UC continued to be paid in arrears, all payments cover the rent in full. The resident therefore only owed his regular rental payments. His late mother’s account still had arrears showing that have not been transferred to the resident.
5. The resident was not made aware of the error on the account. Statements sent to him were confusing and did not clearly identify the position.
In its response the landlord concluded that:
1. The resident did not owe any money additional to his regular rental payments.
2. Confusion and uncertainty had caused the resident harm and financial hardship.
3. There was ‘patchy record keeping and communications’ by its housing team that had contributed to not addressing this situation sooner.
4. It was now arranging with the resident for him to move to a different property (he and his daughter were deemed to be ‘under-occupying’ the property). The current situation “should not be carried on.”
In its response the landlord recommended:
1. It apologised to the resident.
2. It explained the tenancy situation to the resident. The focus should be about how he could move forward. He should be provided with clear information about procedures affecting him. The preferred method should be to talk to the resident (or his nominated advocate) and to back this up with written information.
3. It should make “every effort” to ensure the resident moved promptly to the already offered alternative property.
4. Be clear about the status of the resident’s tenancy when he moved to his new property by providing a letter.
5. Begin the new rental arrangement with a “clean sheet.” From the start of his new tenancy, it will pay the resident a sum equivalent to his first month’s rent into his new account. This sum will be compensation for his hardship. It will also pay the resident’s moving costs as compensation for his hardship.
The representative contacted the Ombudsman in April 2022 and told us that the recommendations in the stage 2 response were not fully upheld by the landlord. They also said that the resident believed he had not been sufficiently compensated for his poor treatment by the landlord.

Assessment and findings

Scope of this investigation

Following the landlord’s final response, the representative raised new complaints with the landlord regarding the resident’s transfer to another property including the need for repairs and overlapping rent periods. This investigation is unable consider these new issues or events raised post the landlord’s final response. The focus of this investigation will be the period up to the date of the landlord’s final response on 14 September 2021. We have made the representative and resident aware that we are unable to investigate events, or any matters raised after this date until such time they have exhausted the landlord’s complaints procedure.

The landlord’s handling of resident’s rent account including in relation to his late mother’s arrears after the resident succeeded the tenancy.

It is acknowledged that the resident’s mother died on 9 January 2021 which the resident informed the landlord of on 11 January 2021. The landlord has not provided its succession policy, however information on the landlord’s website says on the death of a resident, its policy is to grant rights of succession to other occupiers in the property in accordance with legislation. Although the landlord has since confirmed that the resident succeeded his mother’s tenancy on 11 January 2021, it did not send the resident any written confirmation of this at the time. The landlord also failed to provide him with a tenancy agreement or confirm his liability for rent payment or the applicable rent charge for the property. This meant the resident was unable to confirm the rent amount to DWP who had to contact the landlord to establish this.
The lack of clarity provided to the resident regarding his succession and tenancy status is indicative of poor communication by the landlord. This caused additional distress to the resident at an already challenging time. In the circumstances it was reasonable to expect the landlord to have sent condolences to the resident in connection with his bereavement. Its failure to do so indicates no empathy was shown by the landlord for the resident and his situation.
It is noted that although the resident began making rent payments to the landlord from around 16 February 2021 after receipt of his UC (which covered the period from 11 January 2021), the landlord had not set up a new rent account for the resident. Consequently, the resident’s initial payments were allocated to his late mother’s rent account. It is also clear that within a few weeks of the resident becoming liable for the rent, the landlord applied to DWP to recover rent arrears from his UC and for rent to be directly paid to it from UC.
As it is clear its application stemmed from the arrears on his mother’s rent account which the resident was not liable for, this action was a serious failing by the landlord. Additionally, the landlord was contacting the resident during this period to chase the rent arrears and threaten possession.
These errors show that the landlord failed to follow proper procedure when the resident informed it of his mother’s death on 11 January 2021 and indicates there was a lack of oversight internally by the landlord regarding managing his succession. This Service recognises that the landlord’s actions had a detrimental impact on the resident. He was single parent who, because of the arrears deductions, was left in financial hardship and using a food bank for support. The resident also felt distressed and harassed by the landlord’s communications threatening possession.
It is evident that following 2 emails from the representative on 18 March 2021 and 29 March 2021, the landlord closed his late mother’s account and set up a new one in the resident’s name. As the landlord identified its error in this regard, albeit after contact from the representative, and took action to put this right, it acted appropriately. Nonetheless, its delay (of nearly 3 months) in taking these steps, was unreasonable. To rectify its errors, the landlord also contacted DWP to stop the rent arrears deductions from the resident’s UC which was also appropriate. However, it is clear that as at the date of the formal complaint on 5 May 2021, arrears deductions from the resident’s UC, were still being paid to the landlord as well as direct rent payments. The resident also continued to receive some communications from the landlord chasing arrears despite it having already confirmed to the resident that he did not owe this.
Therefore, while the landlord took some steps to rectify its mistakes after these were highlighted by the representative, these did not go far enough. In the circumstances it would have been appropriate for the landlord to promptly reimburse the resident for all the arrears deductions incorrectly taken from his UC including any further deductions until its request to reverse this had been processed by UC. We would also expect the landlord to ensure that payment demands were immediately stopped. Its failure to take either step shows an ongoing lack of oversight internally to manage the situation appropriately.
In the formal complaint, the resident complained about the issues experienced since 11 January 2021 and the impact of its action on him. Yet in its stage 1 response issued on 1 June 2021, the landlord did not accept there had been any failings on its part while handling the resident’s rent account. It stated the arrears on his account were predominantly caused by rent being paid in arrears while the tenancy agreement required payment in advance.
While the landlord has supplied this Service with a template secure tenancy which states rent payments are to be paid in advance, this was not given to the resident at the time. Furthermore, although there was a delay of approximately 5 weeks until the landlord received the resident’s first rent payment (after he received UC), as the level of the arrears did not reach 2 months, this did not warrant the landlord applying to DWP for arrears deductions from the resident’s UC or for direct rent payments. The landlord, in taking such action, had incorrectly considered the arrears on his mother’s rent account for which the resident was not liable. As previously mentioned, this was a serious failing in the service provided.
Rent statements seen by this Service (from 7 April 2021) indicate that the arrears deductions and direct rent from UC had stopped by the date of the landlord’s stage 1 response (1 June 2021). However, the resident’s complaint was an opportunity for the landlord to acknowledge the errors made while handling the resident’s rent account since succeeding the tenancy and set out the actions it had taken or would be taking to put these right. Its failure to do so shows an unwillingness by the landlord to take ownership of the issues and of it missing an opportunity at this stage to resolve the resident’s complaint.
The stage 2 complaint reiterated events since beginning of January 2021 and further explained the impact on the resident. The remedies requested by the resident included for the monies deducted from his UC to be returned to him. In the stage 2 response, the landlord acknowledged and set out its various failings since 11 January 2021. This included the delay in closing the resident’s mother’s rent account and opening a new one for the resident as well as applying for arrears deductions from the resident’s UC when he was not liable for these. While this should have happened earlier in the complaints process, by recognising the failings at this stage, the landlord demonstrated it was taking the resident’s complaint seriously and that it was willing to take ownership of the issues raised. This was appropriate.
The stage 2 response stated the failings were partly due to poor knowledge and information management (KIM) by the landlord, particularly the lack of any rent account set up in the resident’s name until 7 April 2021. The response also explained this issue had impacted on the investigating officer’s ability to assess the level of arrears owed by the resident applicable from 11 January 2021. By explaining the errors and being open about how the landlord’s poor KIM hindered the stage 2 investigation, it acted reasonably here.
It also said communications by the landlord had been “patchy” and had contributed to the situation not being addressed sooner. Given the errors made while handling the rent account, good communication from the landlord about how it intended to remedy the situation once it identified the errors was key. However, it is evident that the landlord did not always communicate effectively with the resident (or representative) which caused confusion and uncertainty. This compounded the problem and impacted on the resident. Nonetheless, it was appropriate that the landlord recognised these shortcomings in the stage 2 response and that poor communication had caused additional delays with addressing the issues.
The final response also acknowledged the impact caused to the resident because of the landlord’s behaviour. This does not excuse its previous failure to recognise this or consider his personal circumstance while handling his rent account. However, by recognising in its response that its actions caused the resident financial hardship and to him feeling distressed and harassed, this indicates the landlord listened to the resident’s complaint and understood the difficulties he experienced. This was appropriate.
In summary, the landlord incorrectly applied to the resident’s UC for arrears deductions based on his late mother’s arrears and not his own. It also unreasonably delayed closing her rent account and opening a new one in the resident’s name. This caused problems and confusion including for the landlord in terms of establishing the correct arrears, if any.
The final response found that the landlord needed to take further steps to resolve the resident’s complaint including:
1. Provide an apology to the resident.
2. To make “every effort” to ensure the resident moved promptly to the already offered alternative property (he and his daughter were deemed to be ‘under-occupying’ the property).
3. Be clear about the status of the resident’s tenancy when he moved to his new property by providing a letter.
4. Begin the new rental arrangement with a “clean sheet.” From the start of his new tenancy, it will pay the resident a sum equivalent to his first month’s rent into his new account. This sum will be compensation for his hardship. It will also pay the resident’s moving costs as compensation for his hardship.
It is noted that stage 2 investigation was carried out by a different team at the council, but it is clear from the landlord’s internal communications seen by this Service that it accepted the stage 2 recommendations and agreed to implement them. It also confirmed staff had been given additional training regarding managing succession cases and commented that its procedure was “very clear about the point of when arrears will be the responsibility of the successor and when they cannot.” This indicates the landlord considered what learning it could take from the resident’s complaint to avoid a similar situation occurring in the future. This was appropriate.
This Service finds that the redress offered in the final response went some way to putting right the failings identified in this report. However, having considered all the circumstances of the case particularly the number of failings by the landlord, its poor KIM and the significant detriment caused to the resident, the compensation of one month’s rent (£430.19) plus moving costs did not provide the resident with sufficient redress. An appropriate compensation amount in line with the Ombudsman’s remedies guidance (guidance) is detailed below.
This Service notes that the final response was also unclear regarding whether all the arrears deductions taken from the resident’s UC were traced and returned to the resident. This had been requested by the resident in the stage 2 complaint. Therefore, a finding of maladministration has been made with respect to this complaint.
As mentioned above while we are unable to investigate any new complaints or events post the landlord’s final response, we expect the landlord to demonstrate it followed through with the promises made during the complaints procedure. Based on the evidence seen by this Service, we are satisfied that the landlord took the required actions as set out in the final response. However, as it is unclear if the arrears deductions collected from his UC have been reimbursed to the resident, the landlord is required to provide evidence to demonstrate this. If the landlord is unable to do so it should reimburse the resident with all arrears deductions collected between 10 February 2021 and the last arrears payment up to May 2021 (exact date is unclear from the available evidence).
The landlord told us it does not currently have a compensation policy however that one was being developed and was due to be approved by October 2024. It said however that it followed our guidance when assessing compensation. Given the failings identified, it is reasonable for the landlord to pay the resident a further £600 in compensation for the distress, inconvenience, time, and trouble caused by its failing while handling his rent account. This amount is at the higher end of the range recommended for maladministration in our guidance which recognises the landlord’s failings had a significant impact on the resident.

Complaint handling

The landlord has not provided its complaints process that applied at the time of the complaint. However, under its current complaints policy, the landlord is required to acknowledge a complaint within 5 working days and provide a stage 1 response within a further 10 working days. At stage 2 it is required to provide a response within 20 working days. This is reasonable and in line with the Ombudsman’s Complaint Handling Code (the Code).
In the resident’s case, it took the landlord 9 working days until 18 May 2021 to acknowledge his 5 May 2021 stage 1 complaint. This indicates there was a delay by the landlord in acknowledging the complaint. This is a failing albeit a minor one due to the short delay.
In its stage 1 complaint response the landlord did not acknowledge any failings in its handling of the resident’s rent account during the previous 5 to 6 months since his succession of the tenancy on 11 January 2021. Given the serious failings found in this investigation in relation to the landlord’s handling of his rent account during this period, this shows its investigation was inadequate. The landlord’s failure to complete a thorough or comprehensive investigation or provide a complaint response which acknowledged what had happened or offer redress, prevented resolution at earliest opportunity. This demonstrates poor complaint handling by the landlord.
At stage 2 of its complaints process it is evident the investigating officer undertook a thorough investigation of the resident’s complaint, part of which was to meet with the representative to discuss the issues. The stage 2 response identified where things went wrong and detailed remedies to put things right and actions to be taken by the landlord. At this stage, the landlord more thoroughly and effectively examined the resident’s complaint, and its response was appropriate.
However, the representative raised the complaint on 1 June 2021 and the stage 2 response was not provided to the representative until 75 working days later on 14 September 2021. This delay significantly exceeded the timescales in the landlord’s complaints process. This was unacceptable. This delay prolonged the complaints process and ultimately the resident’s resolution of the complaint. This is further evidence of poor complaint handling by the landlord.
It is also noted that there was more than a 2-month delay by the landlord in responding to this Service’s request for information in relation to this complaint. This was unreasonable and led to us issuing a complaint handling failure order (CHFO). This is further evidence of poor KIM by the landlord and caused additional delay, extending the length of time to resolve the resident’s complaint.
The landlord did not acknowledge any complaint handling errors during its complaints process. Bearing in mind the landlord’s inadequate investigation at stage 1, delays and poor KIM, the landlord’s actions in respect of its complaint handling constitute maladministration.

Determination (decision)

In accordance with paragraph 52 of the Housing Ombudsman Scheme, there was maladministration by the landlord when handling the resident’s rent account including in relation to his late mother’s arrears after the resident succeeded the tenancy.
In accordance with paragraph 52 of the Housing Ombudsman Scheme, there was maladministration by the landlord when handling the resident’s related complaint.

Orders

The Ombudsman orders that the landlord within 4 weeks of the date of this report:
1. Provides a written apology to the resident for the failings identified in this investigation.
2. Pays the resident additional compensation of £900 made up of:
  1. £600 for distress, inconvenience, time, and trouble for failings when handling the resident’s rent account including in relation to his late mother’s arrears after the resident succeeded the tenancy.
  2. £300 for distress, inconvenience, time, and trouble for failings when handling the resident’s related complaint.
3. Provides evidence to show it reimbursed all arrears deductions collected from the resident’s UC for the period 10 February 2021 until the last payment in May 2021. If it is unable to do this, the landlord should reimburse the resident with all arrears deductions collected during this period.
4. Provides us with evidence of compliance with all of the orders.
In accordance with paragraph 54.g. of the Housing Ombudsman Scheme, the Ombudsman orders that the landlord within 8 weeks:
1. Provides us with a review carried out by a senior manager of its practice in relation to:
  1. Responding to succession of tenancy requests.
  2. Setting up a new rent account for a successor to a tenancy including where there are arrears on the original resident’s rent account.
  3. The criteria to apply for rent arrears deductions from a resident’s UC.
  4. What changes it can make to its knowledge and information management practices to avoid the same issues reoccurring when handling a succession request.