RPA confused payment to farmer but did not cause him financial loss

What happened

In late 2005 Mr N bought 200 acres of land to add to the 40 acres he already owned. He decided to lease the 200 acres to a company he had, and transfer the Single Payment Scheme (SPS), a payment to farmers for land management, to the company until the end of 2007. RPA transferred the land and entitlements to the company (registered to Mr N's accountant's address) in time for the company to claim SPS for 2006.

In spring 2007 Mr N instructed a land agent to handle both his personal and company SPS claims and pay them into the same bank account. Mr N continued to receive statements and notices about payments

In autumn 2007 Mr N's accountant wrote to RPA asking it to extend the transfer of the 200 acres and its SPS entitlements to the company indefinitely, rather than just to the end of 2007. RPA never received that letter and so, under SPS rules, the 200 acres and its SPS entitlements reverted to Mr N's personal account at the end of 2007.

In winter 2007 Mr N discovered that RPA had overpaid his personal account and underpaid the company account. Mr N phoned RPA about this but did not receive a clear response, and its letters were unclear.

Mr N said he was still unaware of the mistake when he and the company made claims for SPS in 2008. As a result Mr N only claimed for the small portion of the personal entitlements he could, and more for the company's entitlements. But RPA rejected the company's claim because it had transferred all the entitlements to Mr N's personal account. . When Mr N challenged RPA about this in 2009, RPA advised Mr N to delete the 200 acres from the company's claim and add it to his own claim. He did and RPA fully paid for both personal and company SPS claims in 2009.

But he was still missing his entitlements for the 200 acres in 2008. He appealed against this but his appeal was unsuccessful. In early 2009 Mr N discovered RPA had sent letters for him to an incorrect address and he believed this had contributed to RPA's poor handling of his 2008 claim.

What we found

We partly upheld this complaint. RPA had made overpayments to Mr N's personal account, which it subsequently correctly claimed back from Mr N against future payments. It failed to explain this which caused Mr N frustration and inconvenience. RPA also continued to send mail to an incorrect address despite telling Mr N it had resolved that problem. However, it was not RPA's fault that it did not receive the accountant's letter in 2007 extending the lease and entitlements to the company indefinitely. Mr N should have queried with RPA why it had not confirmed the indefinite transfer to his company. We did not find any evidence of other financial loss to the company or to Mr N as a result of RPA's error and poor communication.

Putting it right

RPA apologised to Mr N for the failures we found and for the impact on him. It paid Mr N £250 for the frustration and inconvenience it caused him. RPA also agreed to look at the matter again should Mr N provide evidence of financial loss resulting from its overpayments.