Case studies 2020

When we receive a complaint, our aim is to resolve it as soon as possible. When we recognise common issues coming through our complaints processes, we take the opportunity to write case studies, summarising the issues, how the decision was reached and how to avoid it happening in future, to offer the reader a greater understanding of specific areas.

Topic:

Maintenance and poor service

Resolution requested:

Compensation for poor service and costs for additional maintenance required as a result of neglecting to manage the property properly

Award:

Complete the 'Decision' section to find out

Complaint

The landlord said:

  • at no time during the tenancy did the agent propose a rent increase in line with the market rates, and the term in the tenancy agreement
  • whenever the agent was sent an email, it took some time before a reply was received
  • the agent carried out no inspections during the four year tenancy, and didn’t check the condition of the property, despite being paid full management fees
  • no maintenance, other than the statutory gas safety, was done on the property and as a result it is now in need of some considerable work

Agent

The agent responded that:

  • the landlord was well aware of the rent he was receiving each month and the agent was never asked to increase the tenants’ rent
  • the property needed work carried out from the start, which the landlord knew, so it would not have been appropriate to increase the rent
  • they did visit the property several times however as there were no obvious issues, they had nothing to report to the landlord
  • no maintenance issues were raised by the tenants. Had they been aware of any, they would have informed the landlord and taken action

What evidence was provided?

  • Agency agreement, tenancy agreement, emails, inventory report, estimate for work required

Decision

What decision was made?

Based on what you have read, what do you think the solution was?

  • No compensation was awarded as both parties were jointly responsible
  • A detailed apology from the agent was the most appropriate solution
  • Compensation was awarded for poor service and not acting in their client’s best interest
Well done! That is correct!
Nice try! It was actually

What was decided and why?

  1. Maintenance – While maintenance is the responsibility of the landlord, the agent has a duty to minimise costs for their landlord. The landlord’s check-in inventory shows the property was in reasonable condition when the tenant moved in. Over a period of four years, it is likely that some maintenance would have been required.
  2. Inspections – While periodic property inspections are not expected to be thorough, agents have a duty to provide the landlord with an update on the condition. With no evidence of the periodic inspections, the dates they were carried out, or communication with the landlord about the condition of the property, both natural and wilful damage would allow for a greater level of deterioration.
  3. Market rent – The tenancy agreement clearly provided a term allowing for annual rent increases which the agent should have brought to the landlord’s attention. There is no reason for an agent to not comply with their duty of explaining the option of increasing the rent to the landlord. However, it would not be possible to quantify the landlord’s potential loss of rent for the years it could have been increased, or what impact this may have had on the length of the tenancy. Additionally, at no time during the tenancy did the landlord make any enquiry about increasing the rent.
  4. Delays in responding to communication – It is also clear from the landlord’s emails to the agent, that there were considerable delays in many responses.
  5. Summary – The length of the tenancy compounded all the issues above and led to an increased compensation award of £1,825 payable to the landlord for not acting in the best interest of their client, with no audit trail and lack of inspection reports, no evidence of any maintenance carried out and a lack of communication in all areas.

Future

How can you avoid this happening in future?

  • All agents have a duty of care and to provide a good service to both their landlord and tenant
  • In any management contract or tenancy agreement, make sure you communicate regularly with your landlord and tenant
  • Property inspections should always be carried out and documented, where they are agreed in the terms of business, even if nothing is found. Agents should remind their landlords that these are just health checks on the property and all written comments are important to highlight, while photos can support the written comment but you should ask permission from the tenant before taking them
  • Basic maintenance will always be necessary the longer the tenancy goes on, as well as any damage that happens

 For more information please follow the links below:

Topic:

Leaseholder and poor service

Resolution requested:

Refund overpayment of service charges, provide copies of outstanding service charge accounts and pay compensation for poor service

Award:

Complete the 'Decision' section to find out

Complaint

The leaseholder said:

  • the agent has been emailed so many times for the service charge accounts with either no replies or holding emails
  • the service charge accounts have been sent consistently late, for the three years the property has been owned
  • for the last period, the agent overcharged for the service charges which has still not been refunded
  • the agent needs to make sure these problems do not keep happening

Agent

The agent said:

  • they are very busy and the number of emails from the leaseholder was excessive, but they always replied and provided what was asked for
  • they are aware of the discrepancy with the amount paid for the last period and are looking to rectify it

What evidence was provided?

  • Complaint form, letters and emails

Decision

What decision was made?

Based on what you have read, what do you think the solution was?

  • The leaseholder was not compensated
  • The leaseholder was compensated with £100
  • The leaseholder was compensated by the agent with £100 and a detailed written apology
Well done! That is correct!
Nice try! It was actually

What was decided and why:

  1. The complainant’s email communication, over a considerable period of time, was clear in what it was asking for
  2. The agent’s replies were either very late, abrupt to the point of rudeness or did not provide the information required at the time, leading to more delays
  3. The agent could have been more efficient, and timely, in providing the service charge accounts on time and this would have meant the complainant had no need to send regular email enquiries
  4. The delays and poor service led to unnecessary stress and inconvenience which could have been avoided resulting in a decision to award £100 in compensation and a detailed written apology
  5. The agent has accepted that there was an overpayment on the last period’s accounts and was direct to refund the agreed amount to the leaseholder
  6. The agent was advised to make sure their practices are reviewed and these problems are not consistent in future

Future

How can you avoid this happening in future?

  • Keep service charge records up to date so they can be sent out on time and when needed, or requested
  • Agents are expected to provide their services to an acceptable standard so accept when there are mistakes and if they are consistent/common, consider reviewing your practices to reduce these problems in the future
  • When making an apology, make sure it is detailed, in particular accepting what you have done wrong. See our guide to apologising for more information
  • Make sure you have a quality formal complaints process and that those dealing with complaints are fully trained and aware of the process
Topic:

Misrepresentation of particulars and delays

Resolution requested:

£2,100 to compensate for cost spent on surveys and solicitors

Award:

Complete the 'Decision' section to find out

Complaint

The prospective buyer said:

  • the estate agent’s particulars described the property as having four balconies
  • when they viewed the flat, which was a conversion, they went out on to the balconies to see the views
  • at no time did the estate agent tell them that the balconies did not form part of the property
  • after agreeing a purchase price, they proceeded to engage a solicitor and surveyor, as well as secure a mortgage
  • it was the developer’s solicitor who highlighted that the property did not include the balconies, which they had walked out to. These remained the property of the freeholder
  • the floor plans were misleading and not transparent. Had this been made clear at the outset, they would not have proceeded with the transaction
  • this was a misrepresentation of the particulars of sale which has resulted in financial loss of £2720 + VAT which should be compensated
  • the agent did not return their calls and emails for a number of days which did not help things

Agent

The agent said:

  • they accept that the particulars were unclear
  • the person conducting the viewing should have been aware of the situation and made it clear to any prospective buyer
  • that while the prospective buyer was inconvenienced, the compensation amount being asked for is unreasonable

What evidence was provided?

  • Floor plans, emails, invoices

Decision

What decision was made?

Based on what you have read, what do you think the solution was?

  • No award was made - the buyer should have checked this themselves
  • The agent accepted misrepresenting the facts and compensation was awarded by agreeing an early resolution
  • The agent did not accept misrepresentation and the case went through the full decision process with an award being made to the prospective buyer
Well done! That is correct!
Nice try! It was actually

What was decided and why:

  1. The case assessor made it clear to the complainant that our authority is limited to dealing with the poor level of service provided by the agent and not for damages
  2. Having reviewed the emails of communication between the parties the agent was found responsible for supplying misleading particulars and not being fully informed when carrying out the viewing
  3. The emails from the complainant asking for more information about the balconies should have been responded to much sooner than they were
  4. The recommendation by the case assessor was for the agent to compensate the prospective buyer with £770 for the misleading marketing and the delays in communication
  5. This was accepted at the early resolution stage

Future

How can you avoid this happening in future?

  • Agents must act in line with the Consumer Protection from Unfair Trading Regulations 2008 (CPRs) to avoid any unfair or misleading practices
  • Agents must do all their due diligence and check all their facts, making sure all the information is checked and accurate, when marketing a property
  • If new information comes to light, agents have a duty to make sure the misleading information and material is corrected as soon as possible, and disclosed to a prospective buyer if they are not aware
  • Floor plans should contain accurate information
  • Agents should respond to all communications in a reasonable and timely manner

For more information please follow the links below:

Consumer Protection from Unfair Trading Regs 2008 (CPRs)

National Trading Standards – Guidance on property sales Aug 20 helps all those in property sales businesses to comply with the CPRs