Orbit Group Limited (202207994)

REPORT

COMPLAINT 202207994

Orbit Group Limited

29 September 2023

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 concerns the level of compensation offered by the landlord following a leak into the leaseholder’s property from the property above.

Background

2. The leaseholder is a leaseholder of the landlord, which is a housing association. The property is a flat in a communal building. The leaseholder had sublet the property to her own tenants at the time of the complaint.
3. In April 2022, a leak from the property above caused damage to the leaseholder’s property. The landlord raised several work orders to locate and repair the leak following this. The landlord and leaseholder then corresponded between May 2022 and July 2022 about the damage caused to her property. The landlord explained that it was not its responsibility to repair the damage as it was an insurance matter and noted that as part of the service charge the leaseholder paid insurance. It also provided contact details for the insurance provider.
4. The leaseholder wrote to the Ombudsman in July 2022 and stated her dissatisfaction with how the landlord had handled the issue. She described the elements of her complaint as:
   1. She had informed the landlord two years ago of a slow leak from the property above which had caused water damage to communal areas. An operative investigated the matter, but no further action was taken.
   2. The leak worsened in April 2022 and caused significant damage to the walls and kitchen of her property.
   3. She had made an insurance claim, but was expected to pay a £250 excess. She did not believe that this was fair as the cause of the damage was due to the landlord not repairing the slow leak two years previously.
   4. As a resolution to the complaint, the leaseholder requested that the landlord pay compensation to cover the cost of the excess.
5. The Ombudsman advised the leaseholder to contact the landlord and raise a formal complaint. A complaint was opened on 28 July 2022 and the landlord sent a stage one complaint response on 19 August 2022. It explained that it had no record of any concerns relating to the leak being raised two years ago. It informed the leaseholder that it would only consider offering compensation if the cause of the leak was the result of negligence from either it or its contractor. The landlord then informed the leaseholder that it was satisfied that the cause of the leak was the result of general wear and tear and it had therefore declined her request for compensation to cover the excess.
6. On 31 August 2022, the leaseholder reported that water was leaking into her property again. The landlord raised several work orders to resolve the leak and it was finally repaired on 13 October 2022. In November 2022, the landlord arranged for a structural survey of the building to take place to determine what work was required to repair the damage the leak had caused to balconies and communal walkways in the building.
7. The leaseholder escalated her complaint and the landlord sent a stage two complaint response on 17 October 2022. In its response, the landlord:
   1. Stood by its position that as there was no evidence that the cause of the leaks was as a result of any action or inaction taken by either it or its contractor. Therefore, the damage would be the responsibility of the leaseholder’s insurer to resolve.
   2. Accepted that due to issues with gaining access to the property above, there had been delays in stopping and repairing the second leak.
   3. Apologised to the leaseholder for the inconvenience the delay had caused and offered £350 compensation as a goodwill gesture towards the cost of the insurance excess.
8. In referring the case to the Ombudsman, the leaseholder described the outstanding issue of the complaint as the level of compensation offered by the landlord. As a resolution to the complaint, the leaseholder requested that the landlord increase its compensation offer to take into account the costs of running a commercial dehumidifier, the loss of rent for the period her tenants were not able to stay in the property, and for the delay, distress and inconvenience the two leaks had caused.

Assessment and findings

Relevant policies and procedures

9. Section 1 of the lease defines the parts of the building that are considered the leaseholder’s premises. Section 3 of the agreement states that the leaseholder is responsible for repairs and maintenance to the premises. Section 6 of the agreement sets out the landlord’s responsibilities and states that it is responsible for repairs and maintenance to the structure of the building.
10. The landlord’s repairs policy categorises its repair types as “Emergency/Essential” (attend within 24 hours) and “Routine” (complete within 28 calendar days). The landlord states that a leak from water or heating popes, water tanks or cisterns are considered essential repairs.
11. The landlord’s compensation policy sets out its position on paying compensation for damage and states that “It is the customer’s responsibility to have home contents insurance and we expect them to claim on this insurance where it is appropriate to do so. We may award compensation in exceptional circumstances if there is damage to a customer’s property or their personal belongings”. The landlord describes these circumstances as:
    1. “The damage is a direct result of something we have done or failed to do;
    2. the damage is the result of an incident in another property we own, and the incident is our fault; and
    3. we have proof of ownership of the damaged item (or items) from the customer and a value for each item.”
12. The policy also states that the landlord will consider offering discretionary compensation for service failure “if the standard of service we provide is considerably below the standard customers could reasonably expect”. The policy recommends a payment of up to £400.

Scope of investigation

13. When raising a complaint, the leaseholder referred to reports she made to the landlord in 2020 relating to damage to the communal areas of the building and that she suspected that this was water damage from a slow leak. The Ombudsman encourages residents to raise complaints with their landlords in a timely manner, so that the landlord has a reasonable opportunity to consider the issues whilst they are still ‘live’, and whilst the evidence is available to reach an informed conclusion on the events which occurred. As the substantive issues become historical it is increasingly difficult for either the landlord, or an independent body such as the Ombudsman, to conduct an effective review of the actions taken to address those issues.
14. This is in accordance with paragraph 42(c) of the Housing Ombudsman Scheme, which states that we will not consider elements of a complaint that were not brought to the attention of the landlord as a formal complaint within a reasonable period, which would normally be within six months of the matters arising. In view of the time periods involved in this case, taking into account the availability and reliability of evidence, this assessment does not consider any specific events prior to January 2022. The historical issues provide contextual background to the current complaint, but the assessment is focused on the landlord’s actions in responding to the more recent events and, specifically, to the formal complaint made in July 2022.

The level of compensation offered by the landlord following the leaks

15. On receipt of the reports, the landlord had a duty to investigate where the leaks were coming from and ensure that the necessary repairs were completed. The landlord has not disputed that it was responsible for repairing the area where the leaks originated from.
16. The landlord’s repair logs show that it raised an emergency repair on 19 April 2022. The available evidence indicates that the landlord first gained access on 22 April, after the leaseholder reported that the leak had got worse, and turned off the water supply in the property above. An order for follow on works was raised on 25 April 2022. The landlord raised another order for the follow on works on 28 July 2022 but could not gain access to the property. Several further orders were raised in September and October but the repairs were not completed until 13 October 2022.
17. Therefore, there was a failure to carry out a make-safe repair within 24 hours of the leak being reported again in August 2022, and a failure to complete the follow on work within the landlord’s 28 calendar day timescale from when this was first identified in April 2022. Although it is acknowledged that the landlord experienced difficulties in gaining access to the property above, it has not provided evidence to show that it made robust enough attempts to gain access at the earliest opportunity in order to effect a permanent repair.
18. The landlord recognised this delay in its final complaint response. It apologised to the leaseholder and offered £350 to cover the insurance excess she paid in relation to the internal remedial repairs to her property. While the landlord has taken steps to put things right, its offer did not go far enough considering the distress and inconvenience caused by the leaseholder by the delay in completing the necessary repairs. The ongoing leak was likely to have had a significant impact on the living conditions in the property and it is clear from the evidence provided that the leaseholder went to considerable time and trouble in pursuing the matter with the landlord.
19. The Ombudsman’s remedies guidance (which is available on our website). recommends a payment of £100 to £600 in cases of considerable service failure or maladministration by a landlord which adversely affected the leaseholder. To put things right, the landlord is ordered to pay the leaseholder £600 compensation, inclusive of the £350 compensation offered by the landlord.
20. Furthermore, it is not clear from the landlord’s complaint responses that it has taken any action to improve its service delivery as a result of the leaseholder’s complaint. Therefore, the landlord is ordered to carry out a review of its handling of the reports about the leak and access issues, and implement any necessary remedial action to ensure that the same service failures do not recur.
21. In her complaint to the Ombudsman, the leaseholder has requested further compensation to cover her expenses in running a commercial dehumidifier and for the loss of rent paid by her tenants as they moved out after the leak started. The Ombudsman is unable to confirm whether the landlord should reimburse the leaseholder these costs. This is because liability for these costs is unclear and such claims are best dealt with as either an insurance claim or via the courts, as liability will be established as part of those processes. It is therefore recommended that the landlord provides the leaseholder with details of its liability insurance so that the leaseholder can make a claim for these costs. If the claim is not successful then the leaseholder will need to seek legal advice.
22. It is also noted that the leaseholder raised concerns with the Ombudsman in January 2023 that the leak had reoccurred. It is therefore recommended that the landlord contacts the leaseholder about this and conducts a thorough inspection of the property above if the leak has not been resolved.

Determination

23. In accordance with paragraph 52 of the Housing Ombudsman Scheme, there was maladministration by the landlord in respect of how it handled repairs to the leak.

Orders

24. The landlord is ordered to do the following within 4 weeks of the date of this report:
    1. Pay the leaseholder £600 compensation for the distress and inconvenience caused by its handling of the reports about the leak. This is inclusive of the £350 compensation offered by the landlord during its complaint process, which can be deducted from the amount if it has already been paid.
    2. Carry out a review of its handling of the reports about the leak and access issues, and implement any necessary remedial action to ensure that the same service failures do not recur. A copy of the report’s findings should be provided to the Ombudsman.

Recommendations

25. It is recommended that the landlord does the following within 4 weeks of the date of this report:
    1. Writes to the leaseholder to explain how she can make a claim on its liability insurance for the costs she says she has incurred in connection with the leak.
    2. Contacts the leaseholder to establish if the leak is ongoing and conducts a thorough inspection of the property above if the leak has not been resolved.