Summary: There was fault by the Council in its handling of a property matter. The Council will apologise and do the legal property work at a reduced fee to remedy the injustice caused.

The complaint

1. Mr X complains that the Council:
• Delayed unreasonably in responding to his request to be released from a covenant attached to land he had purchased
• Told him there would be no charge but then later changed its mind and quoted substantial legal fees for the legal work to release the covenant
• Delayed in responding to telephone calls and emails over a long period.
2. Mr X says as a result of the delay he lost a purchaser who was interested in developing the land, incurred legal fees and he has been put to additional time and trouble.

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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 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

5. I have considered information provided by Mr X and the Council. I have also spoken to Mr X by telephone.
6. I have written to Mr X and the Council with my draft decision and considered their comments.

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What I found

7. On 24 May 2018 Mr X asked the Council to release a covenant put on land he purchased form the Council thirty-seven years previously. The covenant required Mr X to erect a fence boundary and use the land only as garden land. Mr X wanted to sell the land for development.
8. Mr X says the Council told him it would only deal with a Solicitor so he had to instruct one. Mr X says the Council then refused to talk to his Solicitor and wanted the request in writing. Mr X says his Solicitor wrote to the Council but received no reply.
9. To avoid more legal fees Mr X says he contacted the Council directly himself and the Council asked him to send the Solicitor’s letter again. Mr X says he was passed around various departments for many months and the Council said it was waiting for a new property lawyer to start. When the new person started Mr X says they failed to act on the matter and then also left the Council. Mr X says he demanded a meeting and the Council told him to make a formal complaint and refused to take his calls or reply to emails.
10. Eventually the Council told Mr X it would release the covenant but Mr X would have to pay charges for the legal work. Mr X says the Council had not previously mentioned any charges but the Council said that he would have known about costs from the start.
11. Mr X was unhappy the Council would not waive the costs. The Council said it would have to outsource the work. It agreed it would get Mr X three quotes. Mr X found the quotes too expensive. They were between £800 plus VAT and £950 plus VAT. The Council provided these quotes in October 2019.
12. Mr X complained to the Ombudsman and wanted:
• An apology
• Compensation for the poor handling of the matter
• The Council to pay at least half the charges and accept responsibility for the delay.
13. Mr X told me his legal costs amounted to £1000 but he is unable to provide a client care letter, work in progress information, an invoice or receipt. I understand Mr X has not yet been billed for the work.
14. In response to my investigation the Council said:
• It is standard for it to charge legal fees for property matters and it also charges costs incurred by the property team.
• It publishes a schedule of fees and charges annually
• It told Mr X there was no property cost for the release but that agreement did not cover legal fees
• A release would not have been straightforward as the fee-earner would need to retrieve and review deeds, prepare a deed to remove the restriction and liaise with the Land Registry.
• The Council previously had to outsource commercial property work because of recruitment difficulties and these were the quotes given to Mr X.
• The Council now has a property locum in-house and in order to resolve the matter the Council is willing to undertake the work for a reduced fee equivalent to two hours work at the 2018 rate of £220 per hour, so £440 in total. This is on the basis Mr X liaises with the Land Registry himself to register the deed.
15. Mr X has provided evidence from an auction house that was selling the property at auction on 12 June 2018. There were twelve people who expressed interest in the legal pack and one who made an offer subject to the legal documentation being in order.

Analysis

16. There was delay by the Council in dealing with Mr X’s correspondence at various stages.
17. There is no evidence the Council agreed to do the release for no charge.
18. Mr X initially said he would pay half the commercial quote which would be a minimum of £400 plus VAT. The Council is offering to do it for £440. This is in line with what Mr X said he would pay in 2019.
19. Mr X suggested to me he would now pay only half of the Council’s offer (£200), but I consider the Council’s offer is fair. Mr X will be able to sell land which was previously restricted to garden land. It is reasonable Mr X should have to pay legal costs when he is going to receive a commercial benefit. He would have paid these costs even if there had been no delay. The Council is only charging for two hours work although the actual work involved will be more than this. It is reasonable for Mr X to pay the Land Registry charges as he is the person requesting the change.
20. I will not require the Council to ‘compensate’ Mr X beyond the reduced fee. I consider the Council’s offer is fair and proportionate to the injustice incurred.
21. I acknowledge that but for the delay Mr X may have had a successful sale at an earlier point, however there is no evidence the delay has caused financial loss, for example there is no evidence the land had diminished in value. It may be the opposite is true and the land value has increased. I am not therefore persuaded that there is a basis for asking the Council to make a financial payment over and above that for the inconvenience of the delay.
22. I will not ask the Council to pay Mr X’s legal costs as there is no evidence Mr X has ever been charged by his Solicitor and there is no paperwork supporting that he will be liable for legal costs.
23. Mr X told me it was an error the covenant was ever put on the land, but I find that this is a standard clause when land adjacent to houses is incorporated into residential gardens.

Agreed action

24. Within four weeks of my final decision the Council will provide a written apology to Mr X for its delay in handling this matter.
25. The Council should complete the legal work promptly and for no more than £440 on confirmation from Mr X that he wishes to proceed. Mr X should contact the Council with his decision within four weeks of my final decision.

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Final decision

26. I have completed my investigation on the basis the Council has offered a suitable remedy during the course of the investigation which I am satisfied is fair and proportionate. There was fault by the Council in its handling of a property matter. The Council will apologise and do the legal property work at a reduced fee. The complaint is upheld.

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Investigator's decision on behalf of the Ombudsman