London Borough of Tower Hamlets (18 012 138)

Category : Housing > Council house sales and leaseholders

Decision : Not upheld

Decision date : 18 Oct 2019

The Ombudsman's final decision:

Summary: Ms D complains that the Council has not properly dealt with the purchase of her flat. The Council was not at fault.

The complaint

  1. Ms D complains that the Council did not properly deal with the purchase of her property because:
  • it had not registered the freehold to the property.
  • it could not locate documents to prove ownership to enable it to register the freehold to the property.
  • Ms D had to borrow money to employ a specialist solicitor.
  • there was a lack of communication from the Council.
  • it was unable to complete the purchase without significant unnecessary cost and delay to Ms D.

Back to top

The Ombudsman’s role and powers

  1. 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)
  2. When considering complaints, if there is a conflict of evidence, we make findings based on the balance of probabilities. This means that we will weigh up the available relevant evidence and base our findings on what we think was more likely to have happened.

Back to top

How I considered this complaint

  1. I have spoken to Ms D about her complaint and considered the information she has provided to the Ombudsman. I have also considered the Council’s response to her complaint and its response to my enquiries.
  2. I gave the Council and Ms D the opportunity to comment on my draft decision.

Back to top

What I found

Registration of land

  1. The compulsory registration of land became a requirement under the Land Registration Act 1925, amended by the Land Registration Act 2002. Land or property must be registered for the first time if it is unregistered when you take ownership of it or mortgage it.
  2. Records are maintained by HM Land Registry, who set out the process for registering land for the first time. Where it is necessary to register land, proof of ownership such as the deeds to the land are commonly required. HM Land Registry also allow for land to be registered where deeds have been lost or destroyed.

The Council’s complaints process

  1. The Council has a two-stage complaints process.
    • The first stage is local resolution, the Council will try to deal with a complaint straight away or it will give a detailed reply within 20 working days.
    • The second stage is review, a senior council officer not involved in the case will reconsider the complaint and send a response within 20 working days.

What happened

  1. Ms D owned a leasehold flat. The Council held the freehold for the block of flats. Ms D wanted to sell her flat back to the Council and the Council agreed to this.
  2. Both Ms D and the Council instructed solicitors to act for them to complete the sale. During work conducted by the solicitors to complete the sale, a problem was found with the freehold title to the flat which was owned by the Council.

Ms D’s complaint

  1. Ms D complained to the Ombudsman in early November 2018.
  2. On 9 November 2018, Ms D complained to the Council that the sale of her flat was delayed because the Council could not locate ownership documents. The Council replied to her complaint informally the same day and said it would provide an update. The Council provided a further update to Ms D five days later.
  3. In early December 2018 the Council confirmed to the Ombudsman that Ms D’s complaint had not been through its complaints process and said it would register the complaint and respond direct to Ms D.
  4. In late December, the Council completed the purchase of Ms D’s property.
  5. In January 2019, the Council responded to Miss B at stage 1 of its complaints process. It did not uphold her complaint and said there was no undue delay caused to the sale.
  6. Miss B asked to escalate her complaint to stage 2. She said she was not happy with the Council’s response because:
    • it could not produce ownership documents.
    • It had communicated with her second solicitor before 11 December, despite saying the Council had not received formal written confirmation from her second solicitors that they were acting on her behalf until then.
    • it had not contacted her about a property inspection.
    • the sale had been delayed by her initial complaint.
    • she was not happy about the Council’s response that there had been no undue delay and she had suffered stress and anxiety.
    • the Council had not taken her complaint seriously.
  7. The Council responded to Ms D at stage 2 of its complaints process. It said it did not uphold her complaint because the length of time taken to complete a sale could vary and it did not believe the time taken was unreasonable.

Analysis

The freehold

  1. The block of flats containing Ms D’s property was built following a slum clearance program after the second world war. Land Registry plans dated 1961 and 1988 show the historic buildings that were cleared and the existing block of flats respectively.
  2. The Council says that 95% of the block of flats is now registered under two titles. It believes that when the flats were built, the land did not exactly match existing Land Registry titles due to the more complex site ownership before the slum clearances. This led to parts of the block of flats being unregistered as freehold with the Council.
  3. There is insufficient evidence now to be certain how the freehold for the site became fragmented between registered and unregistered sections. On the balance of probabilities, I consider that the Council’s explanation of the site history and the makeup of the freehold title is accurate.
  4. HM Land Registry anticipate the existence of unregistered land and provide a process to deal with it. The Council was not at fault because there was an unregistered element to the freehold interest for the property.

Availability of ownership documents

  1. The Council does not maintain a database of all land it owns. The Council says its legal services department stores all the Council’s deeds and manage the archiving of those documents.
  2. The Council followed the usual practice when it started to deal with the sale of Ms D’s flat. When it became apparent this was not possible, the Council tried to help Ms D’s solicitor to deal with the unregistered land. The Council searched its archives but was unable to locate the original deeds for the property. The Council then told Ms D that they would put together an application to register the land without the deeds.
  3. HM Land Registry anticipate applications to register land without documents proving ownership and provide a process to deal with it. The Council was not at fault because it was unable to locate deeds for the property.

Specialist solicitor and cost

  1. It was Ms D’s decision to engage a second solicitor to act on her behalf. It is not the Council’s fault that Ms D’s second solicitor followed a different strategy to complete the sale of her flat to the Council. The Council was not at fault because Ms D incurred costs in instructing a second solicitor.

Communication

  1. Evidence from email exchanges show that the Council and its solicitors engaged extensively with both Ms D’s first and second solicitors concerning the sale of her flat. It was the responsibility of Ms D’s solicitors to communicate with her regarding the sale of her flat.
  2. Ms D made her complaint to the Council before the sale of her flat was completed. The Council initially responded to Ms D on the same day she made her complaint, giving her information about how matters were being dealt with. It sent her further information before Ms D decided to change solicitors.
  3. The sale of Ms D’s flat was completed just before Christmas 2018. The Council responded to Ms D’s complaint at stage 1 of its complaint process in January 2019, shortly after the sale had been completed.
  4. The Council responded to Ms D’s complaint in so far as it was able at the time she made her complaint and responded at stage 1 very soon after the sale.
  5. The Council exceeded the deadline for its stage two response to Ms D’s complaint. The sale of her lease had already been completed by that time. This was not fault by the Council.

Delay caused to the sale of Ms D’s flat

  1. It is the responsibility of the seller to prove their title to land to the purchaser as part of any land sale. Ms D’s first solicitor attempted this by:
    • asking the Land Registry for more information.
    • informing the Council’s solicitor that Ms D was talking to the solicitor who dealt with the initial purchase of her flat.
    • asking the Council for consent and help to register the remaining freehold.
  2. The Council tried to assist Ms D’s first solicitor to register the freehold title, first by searching for deeds proving ownership of the unregistered freehold title, and later proposing a method to register that title without access to the deeds.
  3. Because the sale was able to be completed without any action to register the unregistered freehold title, it is clear that was unnecessary. The strategy to register the freehold title was initiated by Ms D’s first solicitor, not the Council.
  4. The council responded to Ms D about her complaint in early November and provided a further update to her in mid November. At this time the Council were still working to the strategy proposed by Ms D’s first solicitors, to rectify the freehold title issue by registering it.
  5. In November 2018, Ms D instructed a second firm of solicitors to act on her behalf. Ms D’s second solicitor asked the Council to agree to a lease surrender without rectifying the freehold title issue. The Council agreed to do this.
  6. The Council also repeatedly asked Ms D’s second solicitor to provide a letter of instruction. Ms D’s second solicitor did not provide this until mid December 2018. The Council did not cause any delay to the completion of the sale because it continued to work with Ms D’s second solicitor during this time period.
  7. The completion of a property inspection did not cause any delay.
  8. The Council was not at fault because there was a delay to the sale of Ms D’s flat.

Back to top

Final decision

  1. I have found the Council was not at fault in the way it dealt with the purchase of Ms D’s property. I have now completed my investigation.

Back to top

Investigator's decision on behalf of the Ombudsman

Print this page

LGO logogram

Review your privacy settings

Required cookies

These cookies enable the website to function properly. You can only disable these by changing your browser preferences, but this will affect how the website performs.

View required cookies

Analytical cookies

Google Analytics cookies help us improve the performance of the website by understanding how visitors use the site.
We recommend you set these 'ON'.

View analytical cookies

In using Google Analytics, we do not collect or store personal information that could identify you (for example your name or address). We do not allow Google to use or share our analytics data. Google has developed a tool to help you opt out of Google Analytics cookies.

Privacy settings