Summary: The Ombudsman will not investigate this complaint about income arising from a legal agreement relating to a housing development. It is unlikely he would find evidence of fault by the Council causing significant injustice to the complainant.

The complaint

1. The complainant, who I refer to here as Mrs C, has complained on behalf of a community group with an interest in an area of public land. She says the Council is obliged by a legal agreement to use rental income from a property (‘the Property’) on the land for the upkeep and improvement of the land. The agreement does not require any rental income to be paid directly to the community group.
2. Mrs C says the Council failed to achieve any rental income from the Property for over a year and has not used recent income as it should have done.

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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’.
4. We provide a free service but must use public money carefully. We may decide not to start an investigation if, for example, we believe:

• it is unlikely we would find fault;
• the fault has not caused injustice to the person who complained; or
• any injustice is not significant enough to justify our involvement. (Local Government Act 1974, section 24A(6), as amended)

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How I considered this complaint

5. I have considered what Mrs C said in her complaint. She also commented on a draft before I made this decision.

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What I found

6. An area of public land was created as part of a housing development. A legal agreement between the Council and the developer says any rental income from any occupier of the Property will be used by the Council to maintain and improve the public land.
7. Mrs C represents a community group which aims to protect and improve the area of public land. She says the Council has not used any rental income referred to in the legal agreement for the benefit of the land.
8. The Council says there had not been a tenant in the Property so it received no rental income. For this reason, there has been no breach of the legal agreement. The agreement did not require the Council to maximise any rental income and I consider it was for the Council to decide how to manage the Property.
9. More recently, the Council has used the Property to temporarily house a tenant of another property where building work is being carried out.
10. Mrs C has argued the Council is receiving rent paid for the other property from the occupier of the Property so it should be used in accordance with the legal agreement. The Council’s view is there has been no breach of the agreement.
11. While Mrs C’s view may be arguable, the agreement is between the Council and the developer. It specifically states no third party has a right to enforce the terms of the agreement. While ultimately the courts are best placed to interpret a legal agreement, I consider the Council is entitled to come to the view it has and it is not fault that it has done so.

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Final decision

12. While I recognise the community group’s genuine concern for the public land, I have decided we will not investigate this complaint. This is because we are unlikely to find fault by the Council has caused significant injustice to the community group.

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Investigator's decision on behalf of the Ombudsman