Summary: Ms X complained the Council misrepresented, and failed to pass on, vital information about a tenant it introduced to her under its private landlord scheme. The Council is at fault for failing to keep notes of its involvement in the tenancy arrangement. This did not cause an injustice to Ms X but the Council will take action to prevent reoccurrence.

The complaint

1. Ms X complained the Council misrepresented, and failed to pass on, vital information about a tenant it introduced to her under its private landlord scheme.
2. She says this caused her to incur substantial losses because of the cost of repairs for the extensive damage caused by the tenant.

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The Ombudsman’s role and powers

3. 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)
4. If we are satisfied with an organisation’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

5. I have considered:
• The information provided by Ms X and discussed the complaint with her;
• The Council’s comments on the complaint and the supporting information it provided; and
• Relevant law and guidance.
6. Ms X and the organisation had an opportunity to comment on my draft decision. I considered any comments received before making a final decision.

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What I found

Law and guidance

7. Our published guidance sets out the standards of administrative practice we expect from councils when we investigate their actions. We expect the Council to be open and accountable. This includes:
• Ensuring any information provided is accurate;
• Keeping proper and appropriate records; and
• Maintaining transparency.

The Council’s private landlord scheme.

8. The Council’s scheme offers landlords incentives including:
• Assistance in completing sign up documentation,
• Free housing advice on tenancy issues, and
• Mediation.
9. The scheme says tenants are applicable under the scheme if they are eligible to claim either housing benefit or universal credit and be in need of a house due to low income and a lack of social housing.
10. The scheme provides a rent deposit guarantee which enables the landlord to claim for loss of rent or loss or damage to the property for the fixed term of the tenancy.
11. Tenancy agreements provide an assured shorthold tenancy. At the end of the tenancy landlords have the choice to renew or follow normal legal procedures to end the tenancy.
12. The landlord is responsible for all maintenance of the property.

What happened

13. Ms X owns a rental property which she rents using the Council’s private rental scheme. She inherited a three-bedroom property from her mother. She contacted the Council in 2019 to enquire about renting out this property through it. Following initial contact Ms X decided to use the Council’s private landlord scheme.
14. Ms X says the Council told her it would select a suitable tenant from its applicants following the tenants going through a ‘vetting system’. It would make sure the tenancy was set up from the outset. She says it also gave her reassurances it would provide support during the tenancy.
15. The Council says when contacted about its rent deposit scheme for landlords it carries out an initial inspection to determine if the property is suitable to rent. Where changes are needed it informs the property owner of these. It says all people who contacted the Council were given a landlord guide to private renting document, model agreements and it would answer any questions raised. It says if they chose to proceed it would have arranged potential tenants to view the property and escorted them round the viewing.
16. The Council has not kept any notes for Ms X’s initial contact with it or its arranging of tenants for the property.
17. Ms X was given the details of three proposed tenants (A, B and C) for the property. Tenant A concluded the property was not suitable for their needs. Ms X says tenant B was looking for a long-term rental and she had concerns she could not commit to the period they were looking for. She says she was told tenant C had been evicted due to the sale of the property.
18. She agreed to let the property to tenant C and entered into a 12-month tenancy agreement. Tenant C and their family moved in in mid-July 2019. The tenants first month rent was eventually paid by the Council as they had not paid. This was because their application for housing benefit had been declined and they were in the process of applying for universal credit. Once payments were set up Ms X received a payment from universal credit and a small payment from Ms X for the shortfall.
19. The Council also made an incentive payment to Ms X of £2,000 for signing up to its private landlord scheme.
20. In September 2019 the tenant denied an electrician access to the property.
21. In October 2019 Ms X inspected the property and became concerned the property had been damaged beyond the costs held as a deposit. She contacted the Council to ask for assistance in accessing the property, evicting the tenant and guaranteeing possession.
22. In April 2020 Ms X became aware that one of the tenant’s other children had begun living at the property and the house was being used as a four-bedroom property. She contacted the Council for assistance in increasing the rent to account for this change. The Council informed her it could not assist whilst there was not a new tenancy agreement in place.
23. Ms X solicitors issued the tenant with a section 21 notice in late April 2020.
24. Ms X contacted universal credit in June 2020 to discuss her concerns about rent. She was advised that the amount could be increased if she informed the tenant.
25. Ms X says she tried to visit the property in June and July 2020 but was denied entry. She contacted the Council for assistance in entering the property.
26. The tenancy was due to end in July 2020. Because of Covid-19 Ms X did not end the tenancy and allowed the tenant to stay on a monthly basis. This agreement was not inline with the Council’s private landlord scheme.
27. Ms X arranged a tradesman to fix a serious defect at the property in November 2021. The tenant denied them entry to the property.
28. Ms X obtained a possession order against the tenant in January 2022 and sought to evict them. The tenancy ended in late May 2022.
29. The Council carried out an inspection of the property in July 2022. It accepted that there was damage to the property and that the rent deposit was payable to Ms X to cover the costs of repairing the damage caused. The deposit was equivalent to four weeks rent.
30. Following the eviction Ms X says she became aware the tenant had been evicted from other properties due to the damage caused.
31. Ms X raised a complaint in November 2022. The Council responded in mid-January 2023. The response explained that any tenant put forward for private housing is someone the Council owes a housing duty to and would be entitled to apply for help with rent. It said it requires no other criteria.

Findings

32. The Council agrees it had conversations with Ms X prior to the tenancy commencing. This includes reviewing the property, introducing tenants and the signing of the tenancy. It has explained, during this investigation, that it doesn’t keep any records of initial conversations in case people do not go ahead with the scheme. At the point Ms X was going ahead with the scheme I would have expected the Council to retain notes of the conversations and exchanges which took place. Its failure to have any notes of its interactions with Ms X in setting up the tenancy is fault.
33. In these situations, we consider making a finding on the balance of probabilities. Weighing up the comments and evidence that is available to decide what we think is more likely to have happened. I consider it more likely than not the Council did not promise Ms X the proposed tenants had been vetted. The Council’s scheme and procedure does not vet any tenants and simply requires they are on a low-income, receiving benefits and in need of housing. It is unlikely the Council would make such promises when there is no procedure in place.

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Agreed action

34. Within two months of the final decision the Council will:
• Change its procedures to ensure it keeps records for its involvement in setting up tenancies under its private landlord scheme.
35. The Council should provide us with evidence it has complied with the above actions.

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Final decision

36. I have completed my investigation. I have found fault. This did not cause any injustice to Ms X. The Council will take action to prevent reoccurrence.

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Investigator's decision on behalf of the Ombudsman