CHAPTER ONE – ESTATE MANAGEMENT, TENANCY AGREEMENTS, POLICIES AND PROCEDURES
Given the target audience of this book, I do not anticipate that it will be read by many landlords who do not have up-to-date management policies. Registered Providers must have policies and procedures in place, and they must be fit for purpose. In my experience, up-to-date tenancy agreements are another matter entirely.
Why are they relevant to disrepair claims?
Although ‘Estate Management’ might include tenancy and environmental management, antisocial behaviour, successions, allocations and so on, this chapter is mainly concerned with maintenance, investment and improvement policies, and the systems needed to support them.
The terms of the tenancy agreement create the basis of the relationship between the landlord and the tenant and govern their respective expectations. Tenancy agreements control much more than the respective duties of each in relation to the repair and condition of the property, so there is no point in this book in trying to address the numerous ways that policies drafted 10 years ago need to be amended.
For the purposes of this book, I assume that landlords will not draft agreements which exceed the requirements of the various statutes governing those duties. In my view, it is poor estate management to go beyond those requirements in the agreement. Policies can always provide that the organisation strives to exceed legal minimums, but the propensity to exploit any such promises cannot be underestimated.
It creates a significant litigation risk to overpromise. See Chapter Thirteen for an example – the experience of Greenwich LBC which generously included the word “condition” in its maintenance standards. The 2018 Act has meant that their tenancy now adds nothing to the 1985 Act. Many agreements still refer only to an obligation to remedy to section 11 (structural etc) defects.
Policies help employees to make decisions without management involvement and they ensure that there is a sufficient degree of consistency to avoid a haphazard approach to the control of the estate. When somebody complains that they have not been treated properly, the existence of a realistic and relevant policy benefits both parties.
The landlord can maintain an objective approach and will find it easier to be fair to all tenants. Tenants know the standards they can usually expect, and employees will be able to respond consistently to similar issues. Since the pandemic and Brexit, it has been more difficult to stick to time limits in policies and it is necessary to deal with that matter in evidence
The degree of detail in these policies and procedures is a matter of judgement. In general, the larger the organisation, the more extensive the policies and procedures it needs. Staff members are more numerous and the number of properties in the estate will mean that there are more likely to be untoward or unusual events which need to be approached by all employees in the same way.
It is a question of maintaining a balance between an overly rigid or bureaucratic approach and giving staff the ability to be practical and use their judgement. In terms of the repairs policy, the fundamental guiding principle will be the standards which the landlord is set by the social housing regulator and therefore sets itself as a housing provider.
Policies will need to be reviewed and updated, both at regular intervals and following changes to key legislation, regulations or best practice guidelines. The aims of a landlord may change, and the policy may become outdated, or on a performance review a housing provider may find that it is under-delivering and needs to tighten or improve policies.
In housing conditions law this is particularly pertinent. The coming into force of the Homes (Fitness for Human Habitation) Act 2018 has completely changed the landscape in terms of repairs and improvements. Policies are almost certain to require change, to reflect the fact that merely repairing properties is no longer sufficient to avoid legal liability for substandard living conditions.
The Ombudsman has had something to say about this in his “Spotlight on: Damp and mould-It is not lifestyle” on damp and mould. He hopes that the word ‘lifestyle’, when it may be a consequence of limited choices, is banished from the vernacular.
He also argues for an entirely proactive approach to damp and mould, saying even when landlords should go out and look for problems “when all indicators suggest there may be issues.” The report is essential reading for every practitioner. It can be found at: https://www.housing-ombudsman.org.uk/wp-content/uploads/2021/10/Spotlight-report-Damp-and-mould-final.pdf.
The requirement to amend policies from reactive to proactive behaviour in respect of damp and mould imposes a substantial financial and administrative burden on landlords. Some claimant lawyers attempt to capitalise on it but in my experience, judges have agreed that it does not impose any new legal duty to pre-empt complaints. Nevertheless, it is clearly good estate management to recognise that property construction type and the nature of the tenant. The question is where such proactive behaviour comes in an already overtaxed repairs policy.
Updating policies
Providers need to take into account properly the changes imposed by the 2018 Act and other related legislation, including the Social Housing (Regulation) Act 2023, the Higher-Risk Buildings (KPI) (England) Regulations 2023, the Building Safety Act 2022, the Code of Conduct for Registered Building Inspectors, the Ombudsman’s Complaint Handling Code and the Review of the Decent Homes Standard. That will result in new regulations to action the conclusions in the HHSRS review. The failure to update is evident from the fact that many still use the phrase “disrepair” when they should be referring to “housing conditions”.
The greatest danger to landlords is the setting of a quality standard which is too low to satisfy the law, or too high to be affordable. The Welfare Reform and Work Act 2016 forced social landlords to reduce their rents by 1% each year over the following four years. That led to numerous problems and many landlords suffered significant budgetary issues as a result.
In early 2019, the government agreed that social housing rents would be allowed to increase by the consumer price index measure of inflation +1% for the following five years from 2020. Almost every social landlord has raised its rent by the maximum permitted amount. The last financial year (23–24) was an exception to the normal five-year rent settlement, and in November 2022 the Department for Levelling up, Housing in Communities capped rent increases at seven percent. The cap for 2024–2025 was 7.7% and there is a service charge increase.
The National Housing Maintenance Forum is the best source of good practice for maintenance and asset management policies. It helps landlords both with policy and practical guidance to assist housing maintenance professionals.
Rather than discussing policies in detail, the purpose of this section of the book is to concentrate thought on the consequences of the wording of the landlord’s repairs and maintenance policies.
Changes caused by the 2018 Act and other new statutes
Most important, such policies can no longer separate repairs and maintenance from improvements. The 2018 Act has required a change to the underlying approach to estate management. A property may not be reasonably fit for human habitation even though not in disrepair as defined by the 1985 Act. This means that works may be necessary even though they result in an improvement to the property rather than merely a repair to those parts of the property which a landlord has agreed to maintain (“the structure and exterior” etc).
The International Standard for Asset Management, ISO 55001, updated in 2024 to include a new “strategic asset management plan”, sets a high bar, specifying requirements for the establishment, implementation, maintenance and improvement of an asset management system which can be used by any property owner. It does not mandate any financial, accounting or technical requirements for managing property, but gives guidance on the issues which need to be addressed in a policy.
Repairs and improvements policies
In general, social landlords encounter challenging issues caused by the combination of the nature of the housing stock with some peculiarities of construction, with many tenants who struggle to make ends meet or otherwise to administer their tenancy. Outdated policies give rise to a risk that staff will not properly understand the extent of their duties, particularly as to improvements to address defects under the fitness provisions.
Given the scope of the subject, I cannot go into sufficient detail here to provide a framework for such policies. Realistically, that is the subject of another book.
Complaints Policies
But, for the purposes of responding to claims, the Complaints Policy is of paramount importance. It is therefore essential to operate an efficient and competent policy. In Chapter Nine I look at these policies, in the light of the updated, 2024 Complaints Handling Code.
I will assume that you either have a credible and efficient policy, or that, having read my advice, you are making all efforts to put one in place / update it!
Such policies are important because of the part they should play in the relationship between social landlords and their tenants. Disrepair claims should not be fought out in County Courts all over the country as a matter of course. The legal system should be reserved exclusively for those cases where landlords have been asked, formally, to repair and have failed or refused, and where the Internal Complaints Process has been exhausted yet has not provided a satisfactory resolution for the tenant.
But rather than starting with a detailed examination of the policies or the complaints process, we need to look at things from the point of view of a Letter of Claim. After all, this book is intended for people responding to claims rather than formulating policies. That is nearly always how a landlord is alerted to dissatisfaction on the part of their tenant. It is only in rare cases that a claimant tenant has repeatedly complained or even used the ICP and is still unhappy. Apart perhaps from suggesting that they go to the Ombudsman, in those cases there may be no alternative but to follow the steps in the Pre-Action Protocol and litigate if necessary.
Chapter Summary / Key Takeaways
- Policies set the tone of the organisation
- They need to be updated regularly and in line with developments in the law, statute and society
- Setting the repairs standards in the policy will underpin most decision making in the asset management team
- Social landlords’ internal complaints processes are now regulated by statute and controlled by the Ombudsman and the RSH. They must comply with the Complaint Handling Code.
- Creating a customer-friendly Complaints Policy which is efficient and accurate in its determinations can and will save very substantial sums in legal costs and damages. The money that is saved can be spent on the repairs and improvements which you and the tenants both want carried out.
In the remaining chapters you will learn how your asset management policy and your Complaints Policy help to determine how you answer the Letters of Claim which you will inevitably receive, and they also influence how you defend any subsequent claim.