An Essex-based Landlord has won a £900 compensation award against an Ilford Estate Agent for several failings in their conduct during a Rent Guarantee Scheme on four residential properties.
Industry Ombudsman The Property Ombudsman (TPO) cited several failings including;
- informing the landlord that a termination notice that was valid was invalid,
- failure to promptly provide rent renewal figures
- failure to promptly respond to emails
- failure to give notice to occupiers of property
- failure to pay rent promptly on time and missed monthly payments on may occasions.
- Attempts to renege on an agreement
- Seeking to unilaterally change a contract and failure to allow exit without penalty.
- There were also several failings regarding building repairs.
On 30th March 2023, after near 7 months of investigation The Property Ombudsman awarded Wilson Chowdhry, a compensatory sum of £900 after identifying several shortcomings in the business conduct of Anisten Homes (listed as Anistenhomes by TPO), who are based at 369 Green Lane, Seven Kings, Essex IG3 9TQ.
In the report a number of concerns were set out, including a system error which results in four whole months of rent not being paid, in September 2019, when Anisten Homes paid Mr Chowdhry four months rent in advance. When paying the advance rent, Anisten Homes failed to pay the last months rent in arrears for four of Mr Chowdhry's properties. It then took him a further two months to receive these payments as Anisten Homes initially rejected his appeals, later accepting that a system fault has resulted in these payments having been missed. Mr Chowdhry, said:
"Though TPO could not investigate this matter due to the length of time that had passed an officer at TPO was concerned about the system fault.
"This fault potentially means that 100's of other landlords on their books may also have had missing arrears payments - this could amount to an extremely large amount of money owed to unsuspecting landlords.
"I hope this report will trigger more landlords subscribed to their service to contact them, if they have similar concerns.
"The situation is extremely dubious as before I left their office in September 2019, I had specifically informed their contracts manager not to miss these payments.
"the whole situation seems contrived."
He added:
"Anisten homes have also identified a further 5 missed monthly payments amounting to over £5000.
"I only manged to get a review of missed payments after the TPO began investigating and have an ongoing complaint filed against Anisten Homes with the Information Commissioners Office.
"I regularly told Anisten Homes that letters stating they had paid my rent did not tally with my accounts and that I was paying income tax on rent not received."
A dispute arose when Mr Chowdhry, attempted to terminate his Rent Guarantee contracts with Anisten Homes by September 2022. They refused to accept his notice, they say this was due to confusion and the TPO have initially accepted this. However, Mr Chowdhry will be submitting an appeal and hopes to have this ruling overturned. Lucy Buckle the TPO Adjudicator for this case, wrote;
" I am critical of Anistenhomes for failing to contact the Complainant approximately three months before the expiry of the rent guarantee agreements (i.e. in June 2022) to obtain his instructions about how to proceed, given the previous mentions of termination..."
TPO has however, castigated Anisten homes for failing to accept a further termination notice submitted in August 2022.
"It is my view that Anistenhomes should have accepted a notice to terminate the contracts after the expiry of the fixed term of 36 months in September 2022 at any time after the agreements commenced up until the date that the fixed terms expired.
"I appreciate that Anistenhomes were restricted by the dates of the sub tenants’ tenancy agreements, but I would have expected the agent to have ensured that these tenancy agreements became periodic from September 2022 (i.e. by not entering the sub-tenants into a new fixed term tenancy agreement which expired after September 2022) unless they had the Complainant’s explicit instruction to renew the rent guarantee agreements."
Throughout the course of the contract with Anisten Homes, payments were made late without reason, and during the COVID-19 pandemic, this resulted in attempts by Anisten Homes unilaterally making changes to an agreed contract, declining Mr Chowdhry's request to terminate without penalty. TPO have upheld Mr Chowdhry's complaint regarding this matter. In her report Ms Buckle, wrote:
"The agreements for all four properties clearly set out in clause 2.1 that the rent was guaranteed during the period of the contract, but that after expiry of the agreement rent received from the sub-tenant would be paid only as collected by the agent.
"There was no provision in any of the agreements to allow Anistenhomes to vary the terms where a global pandemic or other force majeure has arisen, and therefore I am critical of the agent’s decision to take this course of action."
Ms Buckle also wrote:
"I have also identified some shortcomings in Anistenhomes’ service and communication after the Complainant contacted them to complain that rent payments had not been made.
"It appears that Anistenhomes failed to call back the Complainant on 24 March 2021 as agreed, did not provide the Complainant with an explanation for the delays in transferring rent payments by 10 August 2021 in line with their assurance, and incorrectly informed the Complainant on 27 April 2021 that the rent for 57b Green Lane was up to date when the payment for February 2021 was outstanding."
Mr Chowdhry, has stated that in emails he queried the autarchic demand to amend contractual terms mid-contract. He demanded in return copies of rent guarantee insurances that should have been in place but never received them. He also states that he had demanded immediate termination of the contracts without penalty and that this was refused by Anisten Homes, a fact that was accepted by TPO in their report.
Mr Chowdhry, also raised several complaints with Anisten Homes regarding building works and time where he felt that occupiers of the property, were not acting with appropriate tenant-like behaviour. The TPO could not investigate all these matters due to timescales and a belief that Anisten Homes were not entirely responsible for the tenants behaviour and the affect this had on the ground floor of the property below a residential flat. Mr Chowdhry, will be submitting an appeal against some of the decision, though some compensation has been awarded for other building repair failures.
Mr Chowdhry said:
"I am appealing against the decision by TPO, who have in their report found in my favour in almost every aspect of my complaint.
"I am concerned that the figures of compensation do not relate to the losses I have incurred, nor do they take into account for what I assert are 'illicit gains by Anisten Homes.'
"I'm also disturbed that the adjudicator has erroneously written that two renewal contracts I felt coerced to sign, were back-dated to October when they were actually back-dated to November.
"It was left for TPO to make a decision on that and they have failed - though it seems they are in favour of my position.
"I will be submitting further evidence and am hopeful of am improved offer."
Below is the full conclusion of the TPO report:
CONCLUSION AND PROPOSED DECISION
It is my understanding that the Complainant is seeking financial compensation in settlement of his complaint. I have identified shortcomings in Anistenhomes’ provision of service. In particular, I have found that:
Termination and Obtaining Possession
- Anistenhomes failed to contact the Complainant around three months before the expiry of the fixed term agreements to establish how he wanted to proceed;
- Anistenhomes acted inappropriately by initially informing the Complainant that his notice of 3 August 2022 was invalid;
- Anistenhomes did not promptly provide rent renewal figures to the Complainant and did not respond promptly respond to some of his emails;
- Anistenhomes initially failed to act on the Complainant’s instructions to give notice to the occupiers of 28 Gordon Road and 71 Sunnyside Road and did not update the Complainant when he requested information about the delays;
- Anistenhomes sought to renege on their agreement to honour the rent guarantee terms until the sub-tenants vacated; Delayed and Missing Payments
- Anistenhomes failed to pay rent promptly to the Complainant on multiple occasions;
- Anistenhomes sought to unilaterally change the terms of their contract with the Complainant to remove the rent guarantee aspect without seeking his agreement to this change or allowing him the opportunity to exit the contracts without penalty as a result of the changes to these terms;
- Anistenhomes did not follow up with the Complainant in line with their assurance after he complained that the ceiling of the commercial premises had not been repaired in July 2022; and 23
- Anistenhomes were unreasonable in asking the Complainant to forward an email copy of the invoice they had already received via WhatsApp.
It is my view that the shortcomings I have identified have caused the Complainant avoidable aggravation and inconvenience and therefore that an award of compensation is merited. When proposing a fair and reasonable level of award, I have taken into account that the impact on the Complainant is limited somewhat insofar as a degree of aggravation, inconvenience and stress is inherent to the process of letting properties.
I appreciate that the Complainant feels aggrieved about the damage to the commercial premises but remind him that Anistenhomes cannot fairly be held accountable for the actions of the sub-tenants they chose to occupy the properties. I have also taken into account that while Anistenhomes did not act in accordance with best practice after the Complainant sought to give notice to terminate the rent guarantee agreements, his instructions were at times unclear as he was considering renegotiating an agreement with the agent. I am also mindful that the amount of correspondence between the parties likely impacted Anistenhomes’ ability to keep track of instructions and the management of the properties.
There are a significant number of emails between the parties and most of
these were instigated by the Complainant – there are occasions where he sent multiple
emails to the agent on the same day and was having numerous protracted email
conversations with different members of staff.
Accordingly,
I propose an award of £900 compensation to reflect the aggravation and inconvenience caused by the shortcomings identified in Anistenhomes’ service. This is in full and final settlement of the dispute.
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