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Chapter 5 - Examining the Files of Public Bodies

Chapter Five

Examining the Files of Public Bodies

The Ombudsman has the statutory power to obtain the files or other records of public bodies in the course of the examination of complaints. Access to files and documents allows the Office to determine exactly how public bodies reach decisions affecting individual complainants. It can also unearth administrative errors which might not otherwise come to light. The next two cases illustrate the importance of this power.

Bray Urban District Council - Dispute Over Tenant Purchase Scheme

A couple complained to the Office about the valuation of �68,000 (�86,342) which the Council placed on their home when they purchased it under the Tenant Purchase Scheme (TPS). Under the regulations which governed the scheme the Council was obliged to assess the market value of the house but it should have deducted the value of any improvements carried out by the tenants on the house. Further deductions had to be made based on the length of time the tenants had been in the house.

The Council had valued the house in 1996 at �50,000 (�63,487) and �68,000 (�86,342) in February, 1998. The couple made the point that, over an eleven year period, they had made considerable improvements to the house at a cost of �20,000 (�25,395). These included the construction of an extension with a fitted kitchen and the installation of central heating. They claimed these works were not taken into account when the valuation on their house was made.

The Council said that the house, which was located in a very desirable estate, was a three-bedroomed end of terrace modern house. It claimed that the cost of building such a house would be of the order of �65,000 (�82,533), excluding site costs and professional fees. It had employed an independent recognised local valuer and said it did not specifically take into account the extension when valuing the house. The valuation did not specifically put a market value on the extension separately.

In view of the fact that the regulations required a deduction in respect of such improvements, the Office asked the Council to review its position. The Council subsequently indicated that it had carried out a further valuation on the property but the result was the same. It emerged, however, that only an external inspection of the property had been carried out and this was not considered sufficient by the Office, given that many of the improvement works were internal. The Council was requested to arrange an internal inspection and to provide two separate valuations, based on February 1998 rates. One valuation would exclude the improvement works and the other would include them. The Council carried out a full inspection and reported that the original valuation of �68,000 (�86,342) still stood. It said this represented the value of the house without an extension or any other improvements as carried out by the tenants.

Having reviewed the matter the Office requested the Council to furnish copies of the reports of the valuations carried out by the independent valuer in 1996 and 1998.

The 1996 report stated that "In our opinion the present day value of the property, taking into account improvements effected by the tenant , is �50,000". The 1998 report stated that "... the tenant here has expended considerable sums on upgrading facilities such as kitchen/ dining room extension and the property is presented in pristine condition" (our emphasis).

It was clear from these Council records that the original valuations included the improvement works carried out by the tenants and the value of these should have been deducted from the 1998 valuation in arriving at the purchase price as was required under the statutory regulations. This point was put to the Council and the Council was asked to review its position again and apply the appropriate deductions.

The Council subsequently agreed to allow a deduction of �13,000 (�16,507) in respect of the improvement works and arranged a refund to the complainants. Taking other deductions into account as allowed under the regulations and also the complainants' eligibility for a New House Grant, the final purchase price was �35,500 (�45,076).

Department of Agriculture and Food - Overpayment of Pension

In late 1994 the Department approved a farmer for the Scheme of Early Retirement from Farming (ERS). This scheme is one which grants a pension to farmers who take early retirement and transfer their land to young farmers.

In late 1998 the applicant was informed by the Department that, because her husband had been in receipt of a Social Welfare Non-contributory Pension since 1996, she had been overpaid, as her ERS pension should have been reduced by the amount of the Social Welfare pension. The Department said that an overpayment in excess of �19,046 resulted and this would be recovered by reducing her monthly ERS pension for a period of six years. The applicant said that she had always kept the Department fully informed of the couple's financial situation and that she should not have been held liable for arrears. She gave the Ombudsman a copy of a letter which had issued from the Department which indicated that she and her husband had qualified for the scheme under a "Joint Management" application and that the Department was not aware until September 1998 that her husband was in receipt of a pension.

In its initial report to the Office the Department indicated that the application was originally treated as one of "Joint Ownership" which, in effect, meant that the ERS pension would not be affected by any payment the applicant's spouse would receive. However, during the course of a routine compliance inspection carried out in 1998, the Inspector recommended that the application be treated as one of "Joint Management". The Department said that this was because the Folio details indicated that the applicant's husband was the sole owner of the transferred land whereas the Deed of Transfer was drafted to infer that the applicant had a beneficial interest in the lands.

The Department said that while it was aware that her spouse was in receipt of a pension from 1996, this was not deducted from her ERS pension at the time because the application was initially categorised incorrectly and it was only when it was re-categorised that her husband's pension became relevant.

It was decided to obtain the Department's files in order to ascertain how precisely the re-categorisation took place. The files showed that the Inspector had indicated in his report that the application should be re-categorised but did not indicate why this was to be done. However, it was clear from the files that the application was one which should have been categorised as "Joint Management" from the outset as the original application form indicated that the complainant's husband was the sole owner of the transferred land. The files also confirmed that the Department was aware from 1996 that the applicant's husband was in receipt of a pension. As a result the Department further examined the application in 1996 and again in 1997 and it was determined at the time that, as her application was considered to be one of "Joint Ownership", her spouse's pension would not be taken into account.

Having considered the contents of the files the Office then met with officials from the Department and subsequently wrote to the Department asking it to review its position. It was clear that the applicant had acted in good faith at all times and had provided full and clear information to the Department. The difficulty had arisen because the Department had incorrectly categorised the application at the outset and had then retrospectively re-categorised it four years later. The Office considered it unreasonable in the circumstances that the complainant should pay such a heavy penalty through no fault of her own.

The Department agreed to refund �5,097 to the complainant representing the total deduction made from her ERS pension in respect of the Social Welfare pension her spouse had received for the period from 1996 up to late 1998, the date on which the routine compliance inspection took place. The Department also agreed that the recategorisation of the complainant's application would take effect only from the date of the compliance inspection.

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