LBW Lettings Is Expelled from the Property Ombudsman Scheme, following 'Serious' and 'Flagrant' Code Breaches & Its Failure to Pay Landlord Award

Published on Thursday, 29 May 2014. Posted in Press Releases

LBW Lettings Is Expelled from the Property Ombudsman Scheme, following 'Serious' and 'Flagrant' Code Breaches & Its Failure to Pay Landlord Award

The Property Ombudsman has expelled a Hampshire letting agent from its redress scheme following a landlord complaint.

Whytehead Property Management, which trades as LBW Lettings in Fleet, refused to pay an award made by Christopher Hamer, the Ombudsman, after he upheld a complaint concerning several issues, including the management of repairs to the landlord’s property and failing to reference a tenant.

LBW Lettings, which operates from a branch based at Units 1 & 2, Heritage House, Grove Farm, The St, Crookham Village, Fleet, GU51 5RX, provided no written response or representation regarding the case.

TPO is the UK's largest property ombudsman scheme and operates a free and impartial dispute resolution service for consumers. More than 28,500 sales and lettings offices have registered with TPO and follow its Codes of Practice. TPO recently received government approval to operate a redress scheme under legislation that will require all agents to register with such a scheme later this year.

Case summary and findings

The Ombudsman upheld a complaint made by a landlord after finding LBW Lettings committed several breaches of TPO’s Code of Practice for Letting Agents.

The complainants instructed LBW to manage a claim against their insurance, for flood damage to the property following a previous tenancy and asked the agent to oversee the repairs to the property to bring it up to a standard suitable for renting again, prior to finding a new tenant and managing the property.

Approximately three months after the start of the tenancy, after receiving no rental income from LBW, the complainants discovered that LBW had used the l payments to cover the cost of repairs to the Property which were not covered by the insurance money. The complainant went on to dispute charges for incomplete and unauthorised plumbing repairs, for the unauthorised purchase of various items including a washing machine and kitchen unit, and for managing the repair work.

The Ombudsman was critical of LBW’s poor written communication with the landlord, which breached several sections of TPO’s Lettings Code of Practice. The lack of agreed written Terms of Business for the letting of this particular property, a detailed breakdown of expenditure on the property together with supporting receipts and invoices were failings by the agent.

The Ombudsman was also extremely critical of LBW for agreeing the tenancy on the complainants’ behalf without first carrying out any appropriate referencing of the tenant, which the Ombudsman considered to be reckless and was this reflected in the award.

Action taken

The Ombudsman upheld a number of aspects of the complaint and instructed LBW Lettings to pay an award of £2,850. The case was then referred to TPO's Disciplinary and Standards Committee (DSC) by the Ombudsman after LBW Lettings failed pay the award and fulfil its conditions of membership.

After providing LBW Lettings with further opportunities to account for their actions, the DSC recommended to TPO’s independent Council that the agent be expelled from membership. The Council agreed with the DSC’s recommendation and subsequently expelled the firm from full TPO membership for a period of two years.

TPO has provided the complainants with guidance to seek payment of the award by alternative means, such as the small claims court.

TPO response

Gerry Fitzjohn, TPO’s chief operating officer, said: “LBW demonstrated several serious failings in this case where the agent was found to be not acting in the best interest of the landlord. The Code of Practice makes it very clear to agents that consumers must always receive fair treatment and clear, transparent communication.

“Many of the complications and issues that arose in this case could be attributed to the lack of proactive, written communication. Letting agents should always provide written and agreed Terms of Business before entering an agreement, which was missing in this case. Landlords must also insist they see a schedule of works before allowing an agent to manage any maintenance work at their property so they can see itemised expenses before they occur, which must be discussed and agreed to avoid any disputes arising.

“LBW’s lack of tenant referencing also fell considerably short of the requirements outlined in TPO’s Code of Practice, which recklessly left the landlords open to risk.

Christopher Hamer, Property Ombudsman, said: “Where I consider agents are reckless in their approach to referencing my award will generally include the unpaid rent on the basis that the landlord’s losses can be a direct consequence of that recklessness.” Consumers can check if an agent is registered with TPO by using the ‘find an agent’ search tool to ensure they have full peace of mind that their complaint will be reviewed independently by TPO if a dispute arises. The TPO website also includes a checklist for complainants, letter templates and a number of free downloadable consumer guides for landlords, tenants, sellers and buyers.