Summary: Mr X complains on behalf of Mr Y about roadworks which the Council carried out in late 2017, which he says caused a significant financial loss to Mr Y’s business. He says the Council was wrong to deal with Mr Y’s wife when it came to offer grant funding to affected businesses. The Ombudsman finds the Council’s actions were not fault. There is no legal liability for costs caused by roadworks and the Council had no good reason not to consider the application from Mr Y’s wife.

The complaint

1. Mr X complains on behalf of Mr Y a roadworks scheme completed by the Council from October to December 2017 caused a significant financial loss to Mr Y’s business as there was no access for traffic for the whole time.
2. Mr X also complains the Council wrote to Mr Y’s wife with an application for grant funding and wrongly accepted she was entitled to act on behalf of the business. Mr X says Mr Y would have accepted the Council’s offer if he had known about it, but he did not.

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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. 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)
5. 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

6. I spoke with Mr X and read the information he sent the Ombudsman. It was not necessary for me to speak to Mr Y during my investigation.
7. I wrote to the Council and made enquiries about this complaint. I reviewed the material it sent in response. I have also seen information published on the Council’s website about the grant funding scheme. This can be found at https://www.herefordshire.gov.uk/info/200196/roads/723/herefordshire_road_investment/3
8. I shared a copy of my draft decision with Mr X and the Council and I invited them to comment on it. I carefully considered Mr X’s comments before issuing my final decision.

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What I found

9. In late 2017, the Council oversaw significant roadworks in part of its area which meant lengthy road closures were needed. It says although there is no legal obligation to compensate residents and business owners while roads are closed, it accepted the roadworks were arranged at relatively short notice. It says it had no other option as it was relying on government funding that had to be used before the end of the financial year.
10. On that basis, in October 2017, the Council agreed a grant scheme to offer some financial payments to businesses closest to the roads closed for the longest time, that did not have insurance to cover that risk. The Council says it decided on a scheme to pay affected businesses based on a percentage of their rateable value. It says it was not a compensation scheme and so no account needed to be taken of the true loss to any business. The Council says it published details of the grant scheme and the application form online.
11. Mr X owns a business in an area affected by the roadworks. Mr Y is his tenant and manages the business day-to-day. Mr Y is separated from his wife, who was not named on the tenancy, but she continued to help him with the books. The nature of the business means it relies to some extent on passing trade from people using the road. Mr X believes the business lost between £40,000 and £55,000 during the six weeks the road was closed.
12. The Council says it received a completed application for grant funding from Mr Y’s business in November 2017. The application form was filled out by Mr Y’s wife. When asked for her position in the business, she put ‘partner’. She explained the impact of the roadworks on the business and also referred to a complaint Mr X had made to the Council’s contractors about the way the roadworks were organised. The form concluded with Mr Y’s wife signing a declaration, which included confirmation, “…all the information contained in this application is complete and correct.”
13. The Council says it accepted the application and offered to pay just over £2,800. Mr Y’s wife was unhappy with the amount and wrote to the Council by email to complain. In March 2018, the Council replied by email saying the amount met the terms of the scheme and reminded her it was still available. The Council says it later wrote by post to the business address itself, reminding Mr Y and his wife the offer would expire in May 2018.
14. The Council says Mr Y’s wife wrote again, in early May, saying they could not accept the offer and would be complaining to the Ombudsman instead. The offer duly expired.
15. Mr X says throughout this time Mr Y was unaware of the application made by his wife. He says given Mr Y has separated from his wife, he believes she refused the offer out of spite. Mr X says Mr Y would have accepted the offer if he had known about it at the time. Mr X has since complained to the Council on Mr Y’s behalf, saying it was unreasonable to accept the application in Mr Y’s wife’s name. He says she was never legally able to accept or decline the offer as she had no formal role in the business. The Council says it acted in good faith, followed due process and will not revisit its position that the offer expired in May 2018.

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Analysis

16. As the law is clear local authorities do not have to provide compensation for the effect of roadworks, I have to consider the scheme in this case was completely discretionary. That is to say, the Council did not have to offer it and was free to decide who could apply for it and who was excluded. The Ombudsman would expect such decisions to be taken properly and there is no evidence to suggest they were not in this case.
17. Mr X is right to point out the losses caused to the business far exceed the payment offered by the Council, but it was clearly never the intention of the scheme to cover those. The final decision to put the scheme in place is available on the Council’s website for anyone interested to see.
18. I have seen the application form completed by Mr Y’s wife. I note she would have had to find it herself, as the Council says it did not send copies to affected businesses. She stated she was a partner in the business and signed a declaration confirming her application was true. She also provided the company’s VAT registration number and the date it started trading.
19. On the balance of probabilities, I believe Mr X had reason to know Mr Y’s wife was intending to apply for the grant funding. The evidence I have seen shows she was aware of a complaint Mr X had made about the roadworks, as she quoted the unique reference number for it on the form. Mr X is the only likely source for that information. However, I cannot be sure whether Mr X or Mr Y knew about the Council’s subsequent offer.
20. That said, I am satisfied the Council acted without fault in this case. It received the application, corresponded with the applicant and made an offer in line with the terms of its scheme. It also clearly told Mr Y’s wife the offer would expire and when. There was no reason for the Council to believe Mr Y’s wife was not the person it should deal with. In the absence of an application or challenge from Mr X, it was a matter of judgement for the Council as to whether to pay a particular applicant.
21. If Mr Y believes his wife caused his business a loss by not accepting the Council’s offer, it is matter between the two of them. The Ombudsman cannot resolve such a dispute.

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Final decision

22. There was no fault by the Council in the way it considered the application made by Mr Y’s wife for a grant in 2017.

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Investigator's decision on behalf of the Ombudsman