Deemed contract terms

As a lawyer, I've come across numerous instances where gas and electric consumers have seemingly had contracts imposed on them.

The Gas Act and the Utilities Act 2000 provide that an existing supplier shall have the right to continue the supply to a supplied premises when an occupier moves out and another moves in.

It has come to my notice that certain companies, and British Gas being the main offender, are using a set of words to consumers that suggests the supplier is entitled to impose a contract on the consumer at the property. This is not the case. Neither the Gas Act nor the Utilities Act provide for any form of imposed contract, often referred to by suppliers as a "deemed contract" upon the consumer.

In case this information should be relevant to viewers of this forum, I outline here a real case scenario that may help viewers who have had a "deemed contract" imposed on them by the supplier.

Example real life scenario:

A tenant of a property reached an agreement with the landlord that the rent the tenant paid would be inclusive of gas.

Almost 3 years after the tenant moved in, British Gas sent a letter to "The Occupier", stating that urgent contact with British Gas was required to avoid disconnection of supply.

The tenant contacted the phone number on the letter, whereby the call centre operative started to take details of the tenant, his name & address and how long he had been at the property.

A few weeks later the tenant received a bill in his name. The bill included estimated bills for previous periods.

I looked at this case and advised the tenant that as he had not agreed to any terms, or been shown a contract, or been told that it was the supplier's intention to bind the tenant into legal relations, he was not liable to pay any money to the supplier.

Obviously individual cases vary on the respective facts, but what this shows is that consumers are being hoodwinked into continuing supply with an existing supplier without being told of their rights. This applies not only to the right to choose a different supplier but also in relation to the Unfair Terms in Consumer Contracts Regulations. For a contract to be good between the supplier and the consumer, it is imperative that the consumer is informed of all the terms that apply BEFORE the contract can be formed and made good between those parties, and irrespective of any suppliers' claimed rights to continue to supply.

The important point is that a supplier's claimed right to continue supply does not impose any contract terms upon the consumer or create legal relations between those parties. In particular there is no provision for the payment of money, and in such circumstances alone, no money is therefore payable.

Simply speaking, if you have not reached an agreement which sets out terms and specifically your liability to pay for the supply, and you have not responded to or acknowledged any so-called terms, and have not been told you do not have to continue the supply with the supplier, or been told you have a cooling off period (which is statutory), then you have no liability for payment to supplier. The position is similar to unsolicited goods. The risk lies and must remain with those who imprudently supply goods or services without having reached any agreement with the recipient to take or receive those services on the terms that must be made clear BEFORE the supply is made or continued.

Any person who seeks to create a legal relationship with you, must make that clear and where there may be money involved, the terms relating to payment must be clear and must be accepted by you in writing.

I would be interested to know whether any other consumers on this forum have had similar experiences to those several of my Clients have experienced.