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Oldham Metropolitan Borough Council (20 002 089)

Category : Environment and regulation > Licensing

Decision : Upheld

Decision date : 10 Jun 2021

The Ombudsman's final decision:

Summary: Mr B complained about the way the Council operated a selective licensing scheme. He said as a result of a series of failures by the Council he incurred considerable expense. He also said his property lost value and he lost future rental income. There was fault which caused injustice to Mr B. The Council will apologise where it has not already done so and make a payment.

The complaint

  1. I call the complainant Mr B. He complained about the way the Council operated a selective licensing scheme. He said as a result of a series of failures by the Council he incurred considerable expense. He also said his property lost value and he lost future rental income.

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What I have investigated

  1. I have investigated events from January 2019.

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The Ombudsman’s role and powers

  1. We cannot investigate late complaints unless we decide there are good reasons. Late complaints are when someone takes more than 12 months to complain to us about something a council has done. (Local Government Act 1974, sections 26B and 34D, as amended)
  2. We investigate complaints about ‘maladministration’ and ‘service failure’. In this statement, I have used the word fault to refer to these. We must also consider whether any fault has had an adverse impact on the person making the complaint. I refer to this as ‘injustice’. If there has been fault which has caused an injustice, we may suggest a remedy. (Local Government Act 1974, sections 26(1) and 26A(1), as amended)
  3. We cannot question whether a council’s decision is right or wrong simply because the complainant disagrees with it. We must consider whether there was fault in the way the decision was reached. (Local Government Act 1974, section 34(3), as amended)
  4. If we are satisfied with a council’s actions or proposed actions, we can complete our investigation and issue a decision statement. (Local Government Act 1974, section 30(1B) and 34H(i), as amended)

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How I considered this complaint

  1. I considered the complaint and documents provided by Mr B and spoke to him. I asked the Council to comment on the complaint and provide information. I sent a draft of this statement to Mr B and the Council and considered their comments.

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What I found

Summary of the relevant law and guidance

  1. Councils have the power to introduce selective licensing of privately rented homes in order to tackle particular problems in their areas. An area designated by a council for such an approach is called a Selective Licensing Area (SLA). Landlords renting out properties in a SLA must obtain a licence from the council for each of their properties. An SLA licence contains conditions which landlords must meet.
  2. Section 90 of the Housing Act 2004 specifies that Councils can impose licence conditions which the Council consider appropriate for the regulation of the management, use or occupation of the property. In addition, the Act provides mandatory licence conditions that the Council must include. These include amongst other mandatory conditions, a condition requiring the licence holder, if gas is supplied to the house, to produce to the local housing authority annually for their inspection a gas safety certificate obtained in respect of the house within the last 12 months.

What happened

  1. The Council operated a number of SLAs for five years between 2015 and 2020. Mr B owned a property in one of the SLAs which he rented out.
  2. In 2017 the Council wrote to Mr B to say he needed to apply for a special licence. Mr B applied for the licence immediately. The Council granted the licence 13 months later, in May 2018.
  3. In early 2019 a Council officer inspected Mr B’s property. Two weeks later the Council wrote to Mr B and explained it had found three breaches of the licence conditions and two defects with the property. The letter said both breaches and defects had to be rectified within 12 days of the date of the letter.
  4. Mr B replied to the Council in early February 2019, shortly before the deadline. He said the Council had not notified him of the inspection, he asked for a copy of the Council’s policy for inspections and timescales for actions, he objected to the belligerent nature of the letter, he asked for details of the inspecting officer’s qualifications. He gave information about the three breaches and said he was arranging for the defects to be addressed.
  5. Mr B had rectified most of the issues a week after the deadline provided.
  6. Mr B chased the Council four times for a full response to his letter. The Council responded in May, 13 weeks after receiving the letter. The Council apologised for its delay. It explained why it had written in the way it had.
  7. Mr B replied saying he was considering legal action. In early June 2019 the Council responded and provided further explanation of its approach. It confirmed the breaches and defects had been rectified so the Council would not take any enforcement action against him.
  8. In March 2020 the Council wrote to Mr B again, saying the three breaches and two defects still needed addressing. Mr B replied to say the issues were resolved and he was outraged the Council had written to him again. He asked for a full apology and confirmation the matter was closed. After three days Mr B’s solicitor wrote to the Council requiring a response. The Council responded the next day. It explained the letter had been sent in error, apologised and confirmed the matter was closed.
  9. In the summer Mr B sold the property. And at the end of December the Special Licensing Area stopped operating expired as a result of the provisions of the Housing Act. Mr B said he sold because of the selective licensing requirements imposed by the Council and his difficulties with the way the Council operated the licensing scheme.
  10. After Mr B sold the property the Council considered a complaint from him. The Council upheld Mr B’s complaints about its delay responding to his letter in February 2019 and its error sending out another letter in March 2020. It offered to pay him £250 to acknowledge his time and trouble dealing with those two issues.
  11. The Council did not uphold Mr B’s other complaints but gave detailed explanations about them. These complaints were about:
    • a failure to tell him of the SLA;
    • delay processing his licence application;
    • the nature of the licence conditions, the way the Council decided on breaches and property defects and how/when they should be rectified;
    • failure to advise about legal redress or appeal rights; and
    • the overall manner of its correspondence regarding the SLA.
  12. Mr B was dissatisfied with the Council’s response and put the complaints to us. He said he considered the Council’s failures in connection with the selective licensing scheme had lost him almost £112,500. He calculated that from adding up the cost of meeting licensing requirements, the cost of engaging a solicitor to get a reply from the Council in March 2020, the property’s decline in value over the selective licensing period and lost future income.

Analysis

  1. Mr B considered the Council’s whole approach with him was unreasonable. For the period I am considering from January 2019 the first key event was the letter informing him of the defects and breaches. This letter is written in clear terms about what works need to be done and the consequences of not doing so. It also asks the recipient to tell the officer of their intentions. It is clear it is not a formal notice although that could follow if the works are not done. It also wrongly said that Mr B was aware of the recent inspection. I understand Mr B considers the tone of the letter is too strong and threatening but I do not consider there is fault. It is for the Council to decide on the tone to adopt in its correspondence and this is an important document which needs to be clear about the action required.
  2. Mr B considered the timescales for action were unreasonably short. The Council has commented it considered they were reasonable for the works required, and there was the invitation to make contact with the officer. I do not consider there is fault here – the Council was entitled to decide on the appropriate timeframe.
  3. There was fault in the delay in responding properly to Mr B’s letter of 4 February for which the Council later apologised in its complaint response to him.
  1. There was also fault when the Council sent the letter in March 2020 saying the works were still outstanding. The timing of this was particularly unfortunate as it was at the beginning of the lockdown for the pandemic. Mr B asked for a swift clarification from the Council and when this was not received he instructed a solicitor who wrote to the Council. The Council did then respond confirming that it was an error and the matter was closed.
  2. I understand why Mr B was concerned and worried when he received the letter. And also why he wanted a quick response from the Council to put his mind at rest that there were not outstanding issues. But the email from the solicitor was sent on the Monday after the letter from the Council on the preceding Thursday. There was not delay by the Council in responding to Mr B’s correspondence such that he was left with no other option other than to instruct solicitors. I cannot, therefore, say that the Council should reimburse Mr B’s legal costs.
  3. The Council apologised for the mistakes I refer to above and also offered Mr B £250 in recognition of the faults and the impact on him. That is a fair response and in-line with our guidance.
  4. There is no basis to ask the Council to provide any remedy for the costs Mr B incurred in doing the works to the property because there was no fault by the Council in requiring them to be done.

Sale of the property

  1. Mr B asked us to consider the financial consequences of the selling of the property. He had anticipated a rental income from the property for many years to come and said it was the Council’s actions that forced him into selling the property. It was also on the basis that he believed the property would be in a special licensing area until May 2023 when his license expired.
  2. The SLA expired on 31 December 2020. The Council said it was a mistake Mr B’s license was granted to May 2023.
  3. I accept the letter in March 2020 was a factor in Mr B’s decision to sell the house, as was the fact that the property was in a SLA which he understood would remain in place until at least May 2023. We will look to a Council to provide a remedy where we can see that fault caused some significant injustice to the complainant. The Council was entitled to form a SLA and that could make matters more onerous for a landlord. But that is not as a result of any fault. There was some fault by the Council as I have identified above but I cannot say that they meant Mr B was forced into selling the property.
  4. Moreover, Mr B was asking for a remedy for his declared future economic losses. Our role is to provide a remedy for injustice sustained, it would not be possible for us to come to any view on anticipated loss of profit or to seek a remedy for it from public funds. Such a claim would be better pursued in the courts.

Agreed action

  1. If the Council has not already done so it will pay Mr B the £250 offered as part of the consideration of the complaint. It will also apologise to him for the incorrect date in the license. It will complete this within a month of the final decision.

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Final decision

  1. The Council will apologise where it has not already done so and make a payment.

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Parts of the complaint that I did not investigate

  1. I did not investigate the setting up of the SLA or the handling of Mr B’s application for a licence because these events happened too long ago and it would have been reasonable for Mr B to have complained about them before.

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Investigator's decision on behalf of the Ombudsman

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