Estate agent in Leicester excluded from The Property Ombudsman for non-payment of award

Upon request from The Property Ombudsman, Sun Properties Leicester failed to provide a case file which members of TPO are obligated to do if a complaint is made about them, although there was evidence of some letters from the agent to the complainants. The Ombudsman found that the agent's referencing checks were reckless. They had failed to carry out even basic checks on the tenant and had only obtained one landlord reference. There had also been insufficient checks on the tenant’s guarantor, and consequently the tenant failed to pay rent shortly after taking up the tenancy.

The landlords managed to secure a court order for the unpaid rent and their costs plus interest against the tenant, which amounted to £2,720.14. The Ombudsman considered that the costs were unrecoverable, given that the tenant had failed to make payment in the 12 months since the court judgement and the guarantor could not be contacted.

The landlords also had to rectify damage to the property at the end of the tenancy costing £500. The Ombudsman could not determine whether the agent had collected any deposit from the tenant or whether that had been used to offset unpaid rent.  However, TPO granted the landlords an award for the aggravation, distress and inconvenience caused by the actions of Sun Properties Leicester in failing to respond to their complaint or provide any information about the collection and whereabouts of the deposit.

An award of £3,220.14 was made to reflect the court order of £2,720.14 plus £500 compensation.

Sun Properties Leicester failed to pay the award made and the Ombudsman referred them to the scheme’s independent Compliance Committee, which ruled that they should be excluded from The Property Ombudsman scheme.

The website of Sun Properties Leicester remains active but has limited information on it and the phone number is no longer in service. However, TPO has identified a linked company (Sunrise Properties Leicester) which shares the same partners as Sun Properties Leicester and, up until December 2020, appeared to be trading via Facebook. The company also attempted to join The Property Ombudsman.

As part of TPO’s process, notification of this expulsion has been shared with all relevant bodies, including both Local and National Trading Standards.

Gerry Fitzjohn, Non-Executive Director and Chairman of TPO’s Finance Committee: “As a member of TPO, agents are obliged to fulfil direction and comply with awards made by the Ombudsman, which Sun Properties Leicester failed to do. There were several fallings on the part of the agent from the outset of this tenancy and the complainants should have received an award to compensate for this. Whilst this is extremely frustrating for these landlords, we would highlight the point that of the thousands of awards made by TPO in consumers’ favour every year, less than 2% go unpaid. Most agents will fulfil their obligation to pay an award made by TPO.

This is why it is imperative that consumers always use an agent which is a member of a redress scheme (The Property Ombudsman or The Property Redress Scheme) and that holds Client Money Protection*.”

N.B. Every sales and lettings agent in England is required to register with a Government-approved redress scheme, which enables consumers to have their complaint reviewed independently in the event of a dispute arising that the consumer is unable to resolve with the agent directly.

*Full list of Client Money Protection schemes, is:
Money Shield, Client Money Protect, safeagent Client Money Protection, Propertymark, RICS, UKALA Client Money Protection

ENDS

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NOTES TO EDITOR:

What is The Property Ombudsman?

The Property Ombudsman (TPO) scheme offers an independent and impartial dispute resolution service to consumers who have been unable to resolve their disputes with a registered agent. The scheme was established in 1990. The Ombudsman can provide redress to place the consumer back in the position they were before the complaint arose, achieving a full and final settlement of the dispute and all claims made by either party. Where appropriate, the Ombudsman can make compensatory awards in individual cases up to a maximum of £25,000 for actual and quantifiable loss and/or for aggravation, distress and/or inconvenience caused by the actions of a registered agent.

TPO is funded through membership subscriptions and case fees and is free to all consumers.

At 31 December 2018 over 15,897 sales offices and 14,746 letting offices were registered with TPO.

Independence

Whilst TPO charges registered agents an annual subscription, the Ombudsman is accountable to the TPO Board which is chaired by a member of the House of Lords and with the majority of its members being independent from the industry.

The Ombudsman is not a regulator and does not have the authority to take regulatory or legal action against a registered agent.

Consumer Protection

Awards made by the Ombudsman in 2018 were paid by agents to consumers in 97% of cases. In the few cases where awards remain unpaid, agents are referred to the TPO Compliance Committee, which has the power to expel agents from the scheme. Expelled agents are reported to the appropriate authorities who have the power to ban agents from carrying out agency business.

If TPO becomes aware that an agent under investigation has ceased trading, complainants are promptly informed and, where an award is made, are provided with the necessary documentation to make a claim against that company. TPO’s agreement with the Property Redress Scheme, means that not only will expelled agents not be able to register for any form of redress, but any new company set up by the same directors will not be accepted for redress membership, until the Ombudsman’s award is paid.

Further information

The Ombudsman's Terms of Reference, Codes of Practice, Consumer Guides and other documents about the operation of the scheme are available on our website (www.tpos.co.uk), together with previous annual and interim reports, case summaries, further explanation of governance arrangements and a full list of registered agents.

For more information about TPO, please visit our website at www.tpos.co.uk