Notting Hill Home Ownership Limited (202004800)

REPORT

COMPLAINT 202004800

Notting Hill Home Ownership Limited

16 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 concerns the landlord’s handling of the resident’s outstanding arears.

Background and summary of events

2. The resident has a shared ownership lease with the landlord.
3. On 27 April 2020 the resident received an email from the landlord which said that her “account [was] currently in arrears”. It is unclear whether these were rent arears, service charge arears, or a combination of both.
4. On 3 May 2020 the resident emailed the landlord to highlight outstanding issues that she had with the property (these issues are not part of this investigation). She also asked the landlord to explain why it thought she was in arrears, and asked whether the arrears email from 27 April was legitimate. She said that although the email said it was an arrears reminder, she had not received any similar earlier communications.  
5. The landlord responded to the resident’s email on 4 May 2020. It confirmed that the email from 27 April was correct, and provided an account statement. It said that there was a “repeated history of underpaying the monthly charge and monthly payments varying in amount which [had] led to the current level of debt”. It explained that payments must be made in line with the annual rent and service charge notifications. It advised the resident of how she could check her rent account online, and said that if she was experiencing financial difficulties, it could discuss a payment arrangement or signpost her to external assistance.
6. It concluded by explaining how the resident could refer her complaint to this Service if she remained dissatisfied with the outcome.
7. On 19 July 2020 the resident emailed the landlord and said that it had not responded to her previous emails asking for details of the arrears.
8. The landlord emailed the resident on 3 or 4 August 2020 (the specific date is not clear). It said that it had previously provided a rent account statement on 4 May and also provided an updated version. It explained how the arrears had accrued, and said that if the resident had any questions, she could contact it.
9. On 9 August 2020 the resident responded to the landlord’s email from 3 August. She said that she knew that she had “underpaid [it] on a number of occasions, for good reasons, all of which were fully explained to [it] at the time”. She said that as the landlord had not responded or confirmed acceptance, she “assumed” that [it] was happy with these underpayments”. She asked the landlord to explain why it was now unhappy with the underpayments and why it had not communicated this with her beforehand, she believed that “not to have done so contemporaneously is not professional”. She said that she had not received the email from 4 May.
10. The landlord wrote back to the resident on 13 August 2020. It said that it had not taken enforcement action on the arrears as it had focused on resolving the other issues that the resident had with her property at the time. It said that her lease required payments, and it would “look to take further action where necessary”.
11. This Service contacted the landlord on 30 November 2020. The landlord explained that the resident’s complaint about the arrears had not exhausted its complaint procedure. However, it acknowledged that its email from 4 May had referred the resident to this Service, and said that its position would not change even if it reviewed the complaint further. The complaint was therefore brought for investigation by this Service.

Assessment and findings

12. According to the landlord’s “income collection leasehold policy” a leaseholder is responsible “for paying their rent, ground rent and service charge”. The resident acknowledged that she had been underpaying the landlord since 2017. However, she queried why it had not taken any action in light of her arrears up until that point. The landlord explained on 13 August 2020 that it had not taken enforcement action as it had wanted to focus on resolving the other issues that she had raised with her property. According to its policy, the landlord will only take enforcement action “when all reasonable efforts to tackle the debt have been attempted”. From the evidence provided for this investigation, it is apparent that the landlord used its discretion not to raise with the resident the arrears prior to April 2020, and did not seek to take enforcement action. The landlord was therefore acting in line with its policy.
13. The resident was aware that she was not paying the full amount owed. She explained that she believed the landlord had accepted her underpayments. In a sense, the landlord had accepted them, because it chose at the time not to pursue the arrears. However, while the resident believed the landlord’s silence indicated its tacit agreement, nothing supporting that believe had been provided by the landlord.
14. The resident was right to say to the landlord that it could have alerted her to the fact she would need to make up the underpayment at some point. It would also have been good practice for the landlord to consider making a formal arrangement at the time the underpayments started, so that there was no room for confusion. Nonetheless, it used its discretion reasonably, and to the benefit of the resident, and the resident was properly liable for the full arrears amount.
15. Following the resident’s concerns the landlord explained how she had fallen into arrears, provided her with statements, explained how she could pay, and offered her support in case she was experiencing financial difficulties. These were reasonable responses from the landlord and in accordance with its policy, which states that it will “communicate with [residents] to inform them that they have arrears and encourage them to pay the debt”. This in no way undermines the distress and frustration faced by the resident from having received such a notification. However, in the circumstances of this complaint, the landlord acted reasonably, and in line with its policy. 

Determination (decision)

16. In accordance with paragraph 54 of the Housing Ombudsman Scheme, there was no maladministration by the landlord in respect of the complaint.

Reasons

17. The landlord offered the resident an explanation for her arrears and also offered her support. Its actions and responses were reasonable and in accordance with its policy.