23 Nov 2020
Southern Housing Group share their journey to tackle disrepair claims and implement a new process to deliver game-changing results.
Disrepair claims on the rise
In 2018, when reviewing a backlog of law firm invoices awaiting purchase order numbers for authorisation, we found the majority of bills related to disrepair claims. After searching the housing media, we discovered this was a sector wide problem, with a surge in spurious claims being made against social housing landlords. There has been no abatement with the introduction of the fitness for habitation law, so as lockdown restrictions are eased, the issue is as pressing as it has ever been.
We knew then at Southern Housing Group, we had an opportunity to improve how we handle our claims, ultimately to make sure we provide the best service to our customers and communities.
It took us well outside our comfort zone to tackle the surge in claims, as we had not done any of the work in-house before. The first step was to analyse disrepair claim files from our external law firms. Claims would begin with a letter of claim from the tenant’s solicitors alleging items of disrepair and purportedly invoking the pre-action protocol.
It was immediately clear to us that many claimants’ solicitors were ignoring the first part of the protocol, which explains it should only be used as a last resort; after all other avenues to resolve the matter have been explored.
Devising a new process
We decided to bring75% of new claims in-house as part of a work trial, and following the protocol’s guidance, we investigated the merits of each claim, before deciding how to respond to the letter of claim. This involved three key steps:
As each new claim came in, we tested this new approach and developed a template response letter, which could be populated with the results of the internal investigation. We focused in particular on the extent to which the Group had received notice of the disrepair and been given a reasonable time to resolve it.
Every case we brought in-house in the trial had one or more elements that did not comply with the letter or spirit of the protocol, or fell foul of applicable case law or legislation.
We realised then that we had an incredible opportunity to transform the way all disrepair and fitness for habitation claims were managed. We sprang into action, making a business case to expand the legal team so we had sufficient resource to take on the new caseload.
Working with repairs, housing management and customer services teams across the business, and providing training to front-line staff, we created a 10-step checklist to guide all the stakeholders on the new procedures, with the in-house legal team acting as lead co-ordinator for each claim.
The results have been dramatic. Cases in 2018 had cost Southern Housing Group £9,000 each. In contrast, for all the claims we have taken in-house since early 2019, there have been no costs to the business, other than the repairs themselves.
Needless litigation is avoided, and repairs are done more efficiently. The money saved is invested back into social housing provision and the delivery of our charitable objectives. We’ve shared our learnings with G15 members through the formation of the Disrepair Focus Group, so the value of our work can benefit the wider sector.