Unfairly placed under deemed contract.

[DeemedContract]

Hey guys,

 

I'm really frustrated with this long dispute I've had with my electricity supplier and would really really appreciate some advice.

 

Thanks in advance for any help!

 

For some background, the property was purchased about a year and a few months ago, and the electricity company were contacted first 2-3 months after purchase. Electricity was being used during that time, but minimally, although I would say it would be fair to charge that time under a deemed contract.

 

At the time, I was not aware of the existence of deemed contracts and perhaps was naive in assuming that I would be charged at a normal rate.

 

When I spoke to them, I specifically asked for terms of the contract, unit prices, monthly statements, and for the contract to be changed from whatever was being charged at business rates (the former owners ran the property as a business) to a new, domestic, contract. I contacted them many times with the same requests to no avail.

 

They finally phoned me over a year after purchase with a massive bill, charging me with a large standing charge (79p a day), which I was extremely unhappy with, especially as the property has been empty most of the time and electricity has been used very minimally.

 

In summary:

 

1) Despite contacting them several occasions since purchase to request terms and conditions of our contract as well as a bill, this was never provided, nor was there any communication regarding the cost of electricity at all (again this was also specifically requested).

 

2) The business tariff proposed has a high standing charge. We expressly informed them that we did not wish to carry on with any business rates that the prior occupiers of the house were using (they were business owners, and the house is now domestic). Additionally, had we been informed of there being any standing charge (as we should have been from our requests for pricing information) we certainly would have either changed tariff or supplier as not much electricity is used at the property. The company, I believe was very wrong in not sending me this information or bills.

 

3) As yet I have still not received a statement with the amount of electricity that was used as was repeatedly requested over the last year.

 

They have now replied to me claiming that a number of bills were sent to the property (blatantly a lie, no such bills were received, on top of this when I spoke to them before this on the phone after repeated questioning the man told me "A (single) letter was sent 9 months after the property was purchased" (This I also believe to be untrue).

 

They have also agreed to potentially change it to domestic rates, but there is still a very high standing charge as it is still a deemed contract. If they had been open about this and sent me information regarding this when I requested it this problem would not have happened as I would have immediately changed supplier.

 

Does anyone have any advice as to what I can do from here? I am planning to take this to the ombudsman.

 

Thanks again, this is really stressing me out and I cannot afford the charges they are proposing, especially with so little electricity used!

[rebel11]

Hi Deemed

 

Welcome to CAG

 

Who is the Utility provider as we have Rep's from some of the Utility companies who can look into the matter?

 

Write a Formal Letter of Complaint, mark it as such. Explain what's happened, how they have let you down and what you want them to do. Send it to the CEO of the Utility company.

 

Complaint Procedure - https://www.ofgem.gov.uk/information-consumers/domestic-consumers/making-enquiry-or-complaint

 

BackBilling code - http://www.energy-uk.org.uk/publication/finish/43/412.html

[Surfer01]

Deemed contracts only exist for business users as far as I am aware and the charges can be quite high. They can be challenged as the utility should have notified you at the earliest opportunity of the deemed charges as they have a duty of care. It may be worthwhile asking them if they are prepared to lower the charges if you agree to a year or two year contract with them, however shop around for rates first but avoid a company called BES.

There is a very good valid reason for deemed charges but it can be very long winded and complicated to explain. Briefly in a nutshell suppliers buy in advance and in bulk based on estimated usage for the coming year. If they are forced to buy "soon" they may have to pay a premium price.

[DeemedContract]

Thank you for the replies.

 

The company is Southern Electric. A complaint has already been opened but it seems only one person is dealing with it. I have now emailed the CEO of the company.

 

Deemed contracts can exist for domestic users according to what I've searched, and I understand that they exist. If I knew they existed and that there were standing charges when I first talked to Scottish Power I would have immediately changed tariff. I feel they should have done that when I phoned them asking for the contract to be changed from business to domestic - why would I want to change from one deemed contract to another?

 

As you say, surely they have a duty of care to the customer and should have informed me of these charges by sending this information to the property even if I didn't phone them several times asking for this (which I did, very explicitly).

 

Thanks again for the help.

[rebel11]

Mr Alistair Phillips-Davies

Chief Executive

SSE

[email protected]

 

Also to create a paper trail, best to communicate via e-mails, letters, keep off the phone.

[Surfer01]

Thank you for the replies.

 

Deemed contracts can exist for domestic users according to what I've searched, and I understand that they exist. If I knew they existed and that there were standing charges when I first talked to Scottish Power I would have immediately changed tariff. I feel they should have done that when I phoned them asking for the contract to be changed from business to domestic - why would I want to change from one deemed contract to another?

The majority of domestic users have no contract in place as there is no obligation for them to have a contract and they cannot be penalised for not having a contract. Not sure where you got the info about "deemed contracts" and domestic users, but I would say the info is suspect. When i worked in the industry there was no such thing as a deemed contract for a domestic user, but things may have changed recently.

[rebel11]

Scroll down:-

 

http://www.legislation.gov.uk/ukpga/2000/27/schedule/4

[Surfer01]

Scroll down:-

 

http://www.legislation.gov.uk/ukpga/2000/27/schedule/4

 

Thanks for refreshing my memory on "Deemed contracts". There are two types on "Deemed contracts" in the industry, one being for domestic customers and the rates basically are the same as every one else which is why most domestic customers do not bother with having any sort of contract i.e. agreeing to a fixed rates etc. The supplier cannot charge a domestic customer more than they are charging the average user. With a business contract they can charge whatever they like and they use this as leverage to get a business user to agree to a contract with them.

[DeemedContract]

Again thanks for the replies.

 

Would you know if there is any law / guideline which states:

 

i) That they should have sent me the terms/bills when I asked for them

 

ii) That a deemed contract to a domestic user can't exceed the normal tariff?

 

Sorry for asking here, I've spent hours searching for regulations but they all seem so unspecific and open to interpretation...

 

EDIT: Additionally thanks for the advice regarding leaving a paper trail; this is what I have been doing recently, although at first much of our communication was via phone (they called me) as no doubt they know they're in the wrong and don't want to leave too much evidence.

 

Also, they lied about sending letters to the property, surely this isn't legal/ethical?

Edited March 28, 2014 by DeemedContract