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Lambeth Council (202004383)

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REPORT

COMPLAINT 202004383

Lambeth Council

30 April 2021


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:
    1. decision to withdraw its offer of damages and reasonable legal costs,
    2. complaints handling.

 

Background and summary of events

  1. The resident is a secure tenant of the local authority landlord. The property is a one bedroom third floor flat.
  2. The landlord’s corporate complaints policy says that the following are outside the remit of the policy: complaints that involve legal proceedings, court or tribunal action by or against the council. This includes decisions made by the council, court or tribunal in those proceedings.
  3. The Pre-action Protocol for Housing Conditions Claims says that the parties should consider whether some form of alternative dispute resolution procedure would be more suitable than litigation and if so, try to agree which form to use. Options for resolving a dispute include, for council tenants, the council’s own complaints and/or arbitration procedures.
  4. On 13 March 2018 the resident’s solicitors sent an email to the landlord saying that they were advising the resident under the Housing Disrepair Protocol. The letter said that the property was suffering from various disrepairs, attached a schedule of the disrepair, asked the landlord to inspect the property and let them know what repairs it proposed to carry out and the anticipated completion dates. The resident’s solicitors concluded by saying that they would write further with details of the history of the defects along with details of the resident’s claim for general and special damages.
  5. Following an inspection of the property the landlord carried out various works. On 3 July 2018 the resident’s solicitors wrote to the landlord saying that some works were still outstanding and asking that they be completed within a week and that the landlord pay the resident £5879 damages (equivalent to a reduction of 40 % of rent from the start of the tenancy agreement) and the resident’s legal costs.
  6. On 2 August 2018 the landlord made a without prejudice save as to costs offer to the resident’s solicitors of £876 (5 % of the resident’s rent since the start of the tenancy) and her reasonable legal costs. The landlord said that the offer was intended to have the consequences of a Part 36 Civil Procedure Rules (CPR) offer. The landlord said that the resident had 21 days to respond to the offer, which was the relevant period in the CPR. After 21 days the offer would be withdrawn. During the relevant period the landlord accepted liability for the resident’s reasonable costs in accordance with CPR rule.
  7. In its letter the landlord set out in detail the following reasons for why it had made this offer:
    1. that all the repair work had been completed,
    2. that it did not agree with the resident’s solicitor’s assertion that a 40% reduction of rent was appropriate as the cases cited by the resident’s solicitors in its letter dated 3 July 2018 were “not helpful to this case because they concern different items of disrepair and are much more severe in nature than the present case.” and most of the cases cited were County Court judgments so were non-binding,
    3. that it had considered the case of Murray v Kelly, December 2008 Legal Action 31; Housing Law Casebook para P17.58 where the trial judge had awarded less than the 10% reduction of rent claimed by the tenant. The landlord said that the circumstances in that case were more severe than in the resident’s case, so it considered a 5% reduction in rent to be more appropriate,
    4. that it had calculated quantum as follows: for the 121 week period from 4 February 2016 to 6 June 2018 a refund of 5% rent (£646.75), £150 for the disrepair to the balcony and a 10% uplift to this figure ((to give effect to the judgment of Simmons v Castle) to arrive at the award of £876.43 which it rounded to £876.

 

  1. On 3 August 2018 the resident’s solicitors replied making a counteroffer of £5,500 plus costs.
  2. On 8 August 2018 the landlord replied to the resident’s solicitors saying that it wouldn’t change its offer of 2 August 2018 and that after 21 days from 8 August 2018 the offer would be withdrawn. The landlord repeated that it accepted liability for the resident’s reasonable costs if the offer was accepted.
  3. On 11 October 2018 the resident’s solicitors wrote to the landlord saying that the resident would accept the offer of £876, set out their legal costs and said that there was still outstanding disrepair resulting from a leak from the flat above the property. The landlord replied the same day saying that its offer had expired and asking if the resident would agree to pay the landlord’s legal costs from the 29 August 2018 in accordance with the CPRs. The resident’s solicitors replied the same day that the resident would not be willing to pay the landlord’s legal costs.
  4. Following further correspondence, the landlord wrote to the resident’s solicitors on 16 October 2018 saying “If you client is willing to accept the [landlord’s] offer of £876 late we expect her to agree to pay the [landlord’s] costs from 29 August 2018 onwards. This should be fairly straight forward as our costs are likely to be offset against her costs so in essence she would not be paying anything.”
  5. Following further correspondence on 21 November 2019 the resident’s solicitors wrote to the landlord asking for damages of £2,310 and their legal costs.
  6. The landlord wrote to the resident’s solicitors on 22 November 2019 saying: “If you still wish to accept the offer of £876 then please confirm if you will agree to pay the [landlord’s] costs from 29 August 2018 onwards. Alternatively, if you wish to accept £876 damages please confirm if you will agree to cap your client’s costs so that the [landlord] would only pay her reasonable costs up to the 29 August 2018 date.  The [landlord] will then agree not to recover its costs from 29 August 2018 onwards.” The landlord also explained why it considered no further compensation was payable over and above the £876.
  7. On 19 December 2019 the resident submitted a formal complaint to the landlord about how her compensation claim had been dealt with.
  8. On 2 January 2020 the landlord sent the resident its stage one complaint response. In its response the landlord did not uphold the complaint and said that:
    1. its letters of 2 August 2018 and 8 August 2018 had made it clear that the offer of £876 together with the resident’s reasonable legal costs was open for 21 days in accordance with part 36 of the CPRs,
    2. its 2 August 2018 letter had set out in detail the background to her claim, how the landlord’s offer had been calculated and set out the case law that supported the level of damages offered,
    3. the offer had not been accepted during the 21 day period,
    4. the resident’s solicitors had tried to accept the offer on 11 October 2018 and therefore the landlord assumed that the resident’s solicitors did not consider the offer to be unreasonable,
    5. the landlord had written to the resident’s solicitors on 11 October 2018 explaining that the offer had expired on 29 August 2018 and requested they take instructions from the resident as to whether she would agree to pay the landlord’s legal costs from the date of expiry of the offer onwards, which at that time would have been negligible,
    6. the resident’s solicitors had continued to write to the landlord, the last email being on 22 November 2019,
    7. that if the resident was unhappy with the complaint response, she was entitled to make a stage two complaint.
  9. On 23 January 2020 the resident wrote to the landlord saying that she was unhappy with the complaint response saying that she wanted the compensation previously offered paid without her being liable for any costs.
  10. On 20 February 2020 the landlord wrote to the resident with its review of the complaint. The landlord said that it noted that “legal representatives are involved in this matter” and therefore the complaint fell “outside of the corporate complaints jurisdiction to investigate any of the issues you have raised.”
  11. The landlord’s letter of 20 February 2020 was its final response to the complaint confirming that the complaint had exhausted the landlord’s internal complaints process.

Assessment and findings

  1. In reaching a decision about the resident’s complaint we consider whether the landlord has kept to the law, followed proper procedure and good practice, and acted in a reasonable way. Our duty is to determine complaints by reference to what is, in this Service’s opinion, fair in all the circumstances of the case.

The landlord’s decision to withdraw its offer of damages and reasonable legal costs

  1. The offer made by the landlord in its letters of 2 August 2018 and 8 August 2018 was for specific and general damages in accordance with the Housing Disrepair Protocol.  If the resident wishes to challenge the amount of the landlord’s damages offer, then this would be by way of a legal process and the resident should seek independent legal advice. The Ombudsman’s role is not to assess whether the landlord’s offer was an appropriate one but to consider whether the landlord acted reasonably in deciding to change the offer.
  2. For the reasons set out below the landlord acted reasonably in changing its offer to pay £876 and the resident’s reasonable legal costs:
    1. the landlord made it clear in its letter dated 2 August 2018 to the resident’s solicitors that after 21 days from the date of the letter the offer would be withdrawn.
    2. the landlord made it clear in its letter dated 2 August 2018 that if the offer was accepted it accepted liability for the resident’s reasonable costs,
    3. the landlord re made the offer in its letter to the resident’s solicitors dated 8 August 2018 and again made it clear that the offer would be withdrawn after 21 days and that if the offer was accepted it accepted liability for the resident’s reasonable costs,
    4. the resident’s solicitor informed the landlord that it was accepting the offer 64 days after the offer was remade on 8 August 2018 and 43 days after the 21 day time limit had expired,
    5. the landlord demonstrated a resolution focused approach in still being willing to pay the resident the £876 previously offered if she would pay its legal costs from the 29 August 2018,
    6. when the landlord informed the resident’s solicitors on 11 October 2018 that it would be willing to pay the resident the £876 if she would pay the landlord’s legal costs from 29 August 2018 the costs would have been negligible.

The landlord’s complaints handling

  1. As set out in paragraph 18 in its final response to the resident’s complaint the landlord said that “legal representatives are involved in this matter” and therefore the complaint fell “outside of the corporate complaints jurisdiction to investigate any of the issues you have raised.”
  2. The landlord’s response was inappropriate as, although legal representatives were involved in the matter, no legal proceedings had been issued and so the matter did not fall within the provisions of the landlord’s corporate complaints policy as an issue that was outside the remit of the policy (see paragraph 3 above).
  3. The landlord’s response was unreasonable as:
    1. it had previously considered the resident’s complaint under its corporate complaints policy at stage one and had concluded its stage one response by saying if the resident was unhappy with the complaint response, she was entitled to make a stage two complaint,
    2. as set out in paragraph 4 above the Pre-action Protocol for Housing Conditions Claims specifically says that one of the options for alternative dispute resolution is a landlord’s complaints procedure. The Ombudsman would therefore expect a landlord to allow a tenant to access this, unless it had good reason not to.

 

Determination (decision)

  1. In accordance with paragraph 54 of the Housing Ombudsman Scheme there was no maladministration by the landlord in respect of the complaint about its decision to withdraw its offer of damages and reasonable legal costs.
  2. In accordance with paragraph 54 of the Housing Ombudsman Scheme there was service failure by the landlord in its complaints handling.

Reasons

  1. The landlord had made it clear that its offer would be withdrawn after 21 days.
  2. The landlord acted unreasonably in not considering the complaint under stage two of its corporate complaints policy.

Orders

  1. The landlord is ordered within four weeks of the date of the determination to pay the resident £100 for the distress and inconvenience caused by its failure to consider the complaint at stage two of its complaints process.

Recommendation

  1. That the landlord consider contacting the resident to remake the offer set out in its letter to the resident’s solicitors dated 22 November 2019 (see paragraph 14).