A new case study published by the New Homes Ombudsman Service (NHOS) demonstrates the need for developers to follow through on support they offer to customers.
The case study, the second to be published by the NHOS (we wrote about the first one here), also serves as a reminder of the requirements that the New Homes Quality Code (NHQC) imposes on housebuilders' internal complaints processes.
The facts
A customer who had recently moved into a new build home contacted the developer with concerns that a neighbour was using an area of shared access in a way which did not comply with the restrictive covenants (known as real burdens in Scotland) which applied to homes in the development.
The developer offered to send a letter to the neighbour to remind them about the restrictive covenants. After several weeks without taking any action, however, it said that it would instead send a general circular to all residents about their obligations.
The complaint
The customer complained about the time the developer had taken to respond to the issue and the uncertainty that had been created by the developer changing its mind on what action it would take.
The Ombudsman's decision
The Ombudsman found that the way in which the developer had handled the situation fell below the standards of transparency in the NHQC. They also found that the developer took too long to act and the customer should not have had to chase repeatedly for progress.
The Ombudsman concluded that the developer should pay the customer £200 in recognition of the delays and inconvenience the customer had been caused.
The Ombudsman also commented that it may be helpful for developers to provide customers with written information about restrictive covenants / real burdens during the initial reservation phase so they can understand more about their purpose and how they are enforced.
Complaint handling
The customer also complained that, when they followed the developer's complaints process, they had to chase the developer for responses and their complaint was not fully addressed.
The Ombudsman found that some aspects of the way the complaint was handled did not meet the timescales for complaint handling in the NHQC, and that the developer had not addressed all of the customer's concerns.
Key takeaways
There are three key takeaways from this case for developers:
- Where an offer is made to support a customer with an issue they have identified, the developer should ensure that it delivers this support within a reasonable time without the customer having to chase for progress.
- Developers should consider the Ombudsman's suggestion – though it is only a suggestion - that customers be given written information about restrictive covenants / real burdens at reservation.
- Developers should ensure that their internal complaints process meets the requirements of the NHQC and that complaints are handled in accordance with that process.
For more advice on complying with the requirements of the NHQC, developers can get in touch with our Real Estate Litigation team or their usual contact in the Brodies Living team.
Contributors
Partner
Associate
