Summary: Mrs X complained the Council wrongly placed her in a temporary accommodation which was not properly set up for the individual billing of utilities and council tax. We found the Council at fault for placing Mrs X in the accommodation without ensuring it was properly set up for individual billing, and its failure to resolve the matters when she brought it to it and its Agent’s attention. The Council agreed to apologise and make payment to Mrs X. It also agreed for it, or its Agent, to take responsibility for her utility and council tax costs until the individual billing issues are resolved.

The complaint

1. The complainant (Mrs X) has a legal representative (Mr A) who complained on her behalf. Mr A said the Council and its managing agent:
• wrongly placed Mrs X in a temporary accommodation which was not properly set up to enable her to pay for her use of utilities and council tax; and
• failed to properly resolve the issues when she raised her concerns.
2. As a result, Mr A said Mrs X had financial loss and experienced distress as she has been responsible for the bills of another accommodation in her building.

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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 investigate complaints about councils and certain other bodies. Where an individual, organisation or private company is providing services on behalf of a council, we can investigate complaints about the actions of these providers. (Local Government Act 1974, section 25(7), 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. As part of my investigation, I have considered:
• Mrs X complaint and the information Mr A provided;
• the Council’s and its Housing Management Agent’s complaint responses, including the information it provided in response to our enquiries; and
• the relevant law and Council Policy.
7. Mr A and the Council 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

Council Policy

8. The Council discharges it duty to secure accommodation through a number of temporary accommodation suppliers, one of which is the managing agent in this case (the Agent). The nature of the arrangement is:
• temporary accommodation suppliers including the Agent notify the Council of vacancies;
• if a property is needed, the Council will rent this from the Agent;
• the Agent is responsible for repairs and maintenance, and managing any issues relating to the accommodation; and
• the applicant is responsible for paying rent directly to the Council with whom the applicant has a tenancy.
9. The Council’s contract with its Agent also says it will seek to recover any costs from its Agent, if the Council has any costs or liability as a result of the Agents failure to act as set out in their agreement.

Managing Agents

10. Local Government Act 1974 also says when a local authority decides to delegate its management and responsibilities to someone else, the action of its agent is treated as action taken:
• on behalf of the authority; and
• in the exercise of the authority’s functions.

What happened

11. In April 2018 the Council found it owed Mrs X a homeless duty, and secured accommodation for her.
12. In December 2018, Mrs X was transferred by the Council to temporary accommodation provided by its managing agent (the Agent). This was in a building which had been converted into two separate flats. Her flat was in a neighbouring council’s area. Mrs X agreed and signed the tenancy agreement, which explains she is responsible for council tax and utility bills for her flat.
13. In Autumn 2019 Mrs X received a council tax demand letter from her local council.
14. Mrs X told the Agent she believed her rent included council tax. She also said the council tax bill was for the whole building, which meant she had to pay for her neighbours flat (Flat 2).
15. Mrs X said the Agent told her she was liable for Council tax for the whole building. So, she paid the council tax demand to the local council to avoid further action.
16. In late 2019, Mrs X became aware the property only had one electricity meter. She told the Agent she was therefore also having to pay for Flat 2’s electricity use.
17. The Agent spoke with Mrs X and the occupier of Flat 2. They agreed to split the electric bills. This meant Mrs X would pay 70%, which was more than the other occupier as he was a single person.
18. In spring 2020, Mrs X asked a Solicitor (Mr A) to help her resolve the issues with the Agent. Mr A told the Agent the electric bills were being shared as agreed. However, she remained responsible for the council tax for the whole building. He also said the building only had one water meter, which meant Mrs X was also paying for flat 2’s water use.
19. The Agent told Mr A it would ask the landlord of the building to arrange for a water meter to be installed for each flat.
20. Mr A continued to ask the Agent to resolve the matter. However, in late 2020 the utility and council tax issues remained unresolved. So, he complained to the Council on Mrs X’s behalf.

Mrs X complaint

21. Mr A said the Council, or it Agent, had failed to:
• make proper arrangement for the separate billing of electricity, water and council tax before Mrs X moved into the flat;
• resolve the issues when she brought these to the Agent’s attention; and
• told Mrs X to pay the council tax charges for the whole building.
22. Mr A said Mrs X had costs and inconvenience as a result of its fault. This was 30% of the water and council tax costs, which amounted to £990. He said her costs continued at the rate of £39.90 each month until resolved. He also said, although Mrs X had agreed to be responsible for 70% of the electricity costs, it was an unfair arrangement. This was because she remained responsible for both flats in the event the occupier of Flat 2 did not pay their share.
23. In response the Council arranged for its Agent to pay back £990 to Mrs X for the water cost and council tax. However, it did not uphold her complaint. It explained:
• Mrs X had signed the Agents agreement and it advised her she was responsible for utility bills. It also advised her to sign up for council tax;
• she had lived in the flat for two years but she had never brought her concerns to the Council’s attention, and it first became aware of the issues in late 2020;
• it now understands there were two flats, which had not been registered with the local council. It is working with the landlord to do so and will update Mrs X;
• it found no records she had been told she had to pay council tax for the whole building;
• it has spoken with Mrs X about applying for council tax reduction as she was not claiming this;
• it had started a suitability review of Mrs X’s temporary accommodation due to her cost concerns. However, as it was resolving the issues, it would stop the review;
• it is looking into the split of the bills between the flats, it had asked the landlord to install separate meters for the two flats water and electricity, and it had asked the local council to register two separate council tax accounts; and
• its Agent would be responsible for any ongoing council tax and utility bills until these had been set up separately between the flats.
24. Mrs X was not happy with the Council’s response. Mr A told the Council:
• it was wrong not to have upheld her complaint. This was because it was required to ensure adequate arrangements had been made for Mrs X’s temporary housing but failed to do so. This includes when a property is owned or managed by another party;
• Mrs X brought her concerns to its Agent’s attention in late 2019 for water and electricity, and council tax in spring 2020;
• the separate meters for utilities had still not been installed;
• the Council had asked the occupier of Flat 2 to pay towards the bills, but the arrangement remains unreasonable as Mrs X remains liable and she should not have to ask the occupier of Flat 2 for money; and
• it had failed to consider the inconvenience she had experienced, including the outstanding costs she had incurred for water and council tax.
25. It its final response the Council agreed Mrs X should only pay her fair share of the costs, but it did not uphold her complaint. It said it was the landlord and its Agent’s responsibility to set up the separate utilities and council tax for the flats. If this was not possible it could transfer Mrs X to another temporary accommodation. It also said its Agent had apologised for the inconvenience and costs the Council tax bills caused.

Analysis

26. Mrs X’s complaint relates to matters which occurred more than 12 months ago. Her complaint is therefore late. However, I have found it appropriate to exercise my discretion and consider her complaint from November 2019. This is because, when she became aware of the issues, she has continued to bring these to the Council and its Agent’s attention. I am also conscious some of the issues have still not been resolved.
27. We cannot normally consider a council’s provision or management of social housing. However, in this case the Council housed Mrs X in temporary accommodation under its homelessness duty, as set out in the Housing Act 1996. Her complaint is therefore within our jurisdiction.

Who is responsible for ensuring a temporary accommodation is properly set up for billing of utilities and council tax?

28. The Council was entitled to secure accommodation through its Agent. Because the Council is the immediate landlord of Ms X, and the Agent is responsible for managing the property on behalf of the Council as set out in the Service Level Agreement, the Council remains responsible for the actions of its Agent, and should have the necessary monitoring and quality assurance mechanisms of its Agent in place.
29. The Council is therefore responsible for any action taken by the Agent on behalf of the Council in respect to managing the property.
30. Also, a landlord is the person who should arrange for the registration of Mrs X’s flat with the local council for council tax purposes. He should also ensure each flat has its own utility meters to allow for separate bills, unless if he retains responsibility for the bills and includes this in the rent. In this case the Landlord is the Council, this is because Mrs X’s tenancy is between her and the Council, and she pays rent directly to the Council.

Was the temporary accommodation properly set up before Mrs X moved in?

31. It is clear Mrs X’s flat was not properly set up before she moved in. This is because she should never have been put into a flat in which she was responsible for the costs of water, electricity, and council tax charges for the occupier of Flat 2.
32. However, I agree with the Council’s view it was not at fault for failing to ensure this was setup before Mrs X moved into the accommodation. In reaching my view, I am conscious:
• the issues were not known until Mrs X reported the issues to its Agent in Autumn 2019, and the Council in 2020;
• the property had meters for utilities installed, and it was on the council tax register. However, it was not clear the two flats had not set up for separate billing; and
• the Council agreed Mrs X should not be financially worse off due to the lack of individual billing setup for her accommodation.

Complaint’s handling

33. The Council and its Agent responded to Mrs X and Mr A’s complaints. Although, there were some minor delays, this was responded to as set out in its complaints policy.
34. However, the Council’s Agent failed to address Mrs X’s concerns from late 2019 until late 2020. This is fault. This is because it failed to:
• take suitable action to resolve the issues to have individual meters installed for the two flats, and ensure each was registered separately for council tax; or
• register and take responsibility for payment of the utility bills and council tax until the separate billings were set up for the two flats.
35. In late 2020, when Mr A complained to the Council, Mrs X received payment towards some of the costs she had experienced. The Council also asked its Agent and the owner to resolve the utility billing issues and to set up separate council tax accounts for the two flats.
36. I understand the Council was unaware of Mrs X’s issues until late 2020. However, as explained, it remained responsible for its Agent’s actions. I therefore consider any fault by the Agent’s to be treated as the Council’s faults from Autumn 2019.
37. I acknowledge the Council’s view Mrs X did not bring her concerns to its attention until two years after she moved into the accommodation. However, I found she had raised her concerns with its Agent in 2019 when she received her bills and became aware her charges included Flat 2’s utility use and council tax liability. I have therefore found she did not contribute to any delay in resolving the billing issues.
38. In addition, Mr A said the billing issues are ongoing as the matter has still not been resolved. This means Mrs X remains legally responsible for her and Flat 2’s utility use and council tax liability. The Council therefore continues to be at fault until this is resolved.

Injustice

39. I am satisfied the Council and its Agent’s faults caused Mrs X an injustice. These were:
• the financial costs she had towards Flat 2’s water, electricity and council tax charges since she moved into the accommodation in late 2018;
• distress due to the inconvenience and worry about her financial costs and responsibilities since autumn 2019; and
• unnecessary time and trouble to bring her concerns to the Agent and the Council’s attention since 2019.
40. I understand the Council may consider moving Mrs X to an alternative temporary accommodation if the billing issues cannot be resolved. In the event this happens, Mrs X may have a further claim for injustice against the Council. This is because such move would not have occurred, had the Council not been at fault for placing her in the accommodation in the first place.

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Agreed action

41. To remedy the injustice the Council caused to Mrs X, the Council should, within one month of the final decision:
4. apologise in writing to Mrs X, and pay her £300 to acknowledge the distress she experienced as a result of it and its Agent’s failure to resolve her accommodation’s utility and council tax billing issues when she brought it to its attention; and
5. Pay Mrs X £300 for the time and trouble she had to bring the matter to the Council’s, its Agent’s, and the Ombudsman’s attention;
6. pay Mrs X an amount equal to 30% of her utility bills and council tax from the date she moved into the accommodation until one month after this decision, and provide her with an email address to submit her evidence;
7. transfer the responsibility for Mrs X’s accommodation’s utility bills and council tax to it, or its Agent, and pay the costs until her accommodation has been set up for her individual billing.

For remedy c), the amount to be paid is less any payments already made by the Council or its Agent.

42. Within three months of the final decision the Council should also:
4. remind it staff the Council remains responsible for the actions taken by its Housing and Temporary Accommodation Agent on its behalf, or as part of the exercise of the Council’s functions; and
5. remind its Agent to ensure it only places individuals in temporary accommodations which have been set up to facilitate individual billing of utilities and council tax, unless in circumstances where such charges are included in the rent.

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Final decision

43. I have completed my investigation with a fault by the Council which caused an injustice.

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Investigator's decision on behalf of the Ombudsman