Breaking Utilities Contracts

Noddy104

I have fixed rate contracts with British Gas for gas (happy with that!) and electricity (one year up to last month. Ok with that too!).
I own a pub and live above it, so the contract is "business" tho' allowance is made for the fact that part usage is domestic.
The original contract, in v. small print (I'm 60 for God's sake, and probably couldn't have read it if it was in normal print!), says that I should have given them 90 days notice if wanting to change and therefore I was now tied in at 50% increased rate for TWO YEARS.
Their notice of this arrived last August (5 months before the end of the contract) and is so obviously designed to look like an advertisement, and to be thoroughly misleading, with, emblazoned in large type, "WE'LL PROTECT YOUR NEW CONTRACT PRICES FOR 2 YEARS AND YOU DON'T HAVE TO DO A THING" and "NO PRICE INCREASES FOR THE NEXT 2 YEARS". On a separate sheet in "contract print" are the new rates. Beautifully designed so as to be put immediately to one side or into the bin.
Now, I know that we landlords are always !!!!ed and are thorough wastrels, and I should have read the small print (does anyone?) and that I should have told them to remove that clause (big chance. Find a utilities contract without the same!) but I feel that BG are taking the !!!!.
Energywatch say that there are regulations for domestic utility contracts but businesses are on their own (which is probably fair). However, I feel agrieved that they can arbitrarily pick a rate out of the air (incidentally, 50% greater than that for "new business") and choose to tie me in for TWO years when that wasn't even mentioned in the original contract which was for one year.
I've told BG I want out (on the expiry date of the original contract) and they say "No".
Unfortunately there is no genuine competition and I'm sure other suppliers won't take me on until BG agree.
Inclined to stop direct debit and let them chase their money in the hope that the domestic supply will have to be maintained.
Any ideas?
Sorry to go on at such length, but we landlords have no friends and I've no-one else to talk to!:beer:

hurrah

Welcome Noddy104


See this thread in small business forum,perhaps the people mentioned might be able to help/advise.

http://forums.moneysavingexpert.com/showthread.html?t=49333

tripled

A domestic supply doesn't have to be maintained, they just have to jump through more hoops before they can disconnect you.

Unfortunately as it was in the small print in your original contract, and as it does say 'we'll protect your new prices for two years' (abiguous maybe but not completely misleading) I think it's safe to say you've been professionally shafted.

Have you asked BG what the penalties are for terminating the contract early? If you can get a cheaper contract elsewhere it may work out cheaper for you in the long run, depending on how much you would have to pay to buy yourself out.

VLA_2

Noddy104 wrote: »

I have fixed rate contracts with British Gas for gas (happy with that!) and electricity (one year up to last month. Ok with that too!).
I own a pub and live above it, so the contract is "business" tho' allowance is made for the fact that part usage is domestic.
The original contract, in v. small print (I'm 60 for God's sake, and probably couldn't have read it if it was in normal print!), says that I should have given them 90 days notice if wanting to change and therefore I was now tied in at 50% increased rate for TWO YEARS.
Their notice of this arrived last August (5 months before the end of the contract) and is so obviously designed to look like an advertisement, and to be thoroughly misleading, with, emblazoned in large type, "WE'LL PROTECT YOUR NEW CONTRACT PRICES FOR 2 YEARS AND YOU DON'T HAVE TO DO A THING" and "NO PRICE INCREASES FOR THE NEXT 2 YEARS". On a separate sheet in "contract print" are the new rates. Beautifully designed so as to be put immediately to one side or into the bin.
Now, I know that we landlords are always !!!!ed and are thorough wastrels, and I should have read the small print (does anyone?) and that I should have told them to remove that clause (big chance. Find a utilities contract without the same!) but I feel that BG are taking the !!!!.
Energywatch say that there are regulations for domestic utility contracts but businesses are on their own (which is probably fair). However, I feel agrieved that they can arbitrarily pick a rate out of the air (incidentally, 50% greater than that for "new business") and choose to tie me in for TWO years when that wasn't even mentioned in the original contract which was for one year.
I've told BG I want out (on the expiry date of the original contract) and they say "No".
Unfortunately there is no genuine competition and I'm sure other suppliers won't take me on until BG agree.
Inclined to stop direct debit and let them chase their money in the hope that the domestic supply will have to be maintained.
Any ideas?
Sorry to go on at such length, but we landlords have no friends and I've no-one else to talk to!:beer:

I am so relieved to find someone else that has had the same issues with British Gas as me.

I run a public house and have just recieved my monthly electric bill which has gone up by £200.00, on talking to my account manager at BG I was told that because I did not reply to a letter sent to me in September 2007 I was automatically entered into a fixed two year contract with them. I have now been speaking to energy watch, but fear that British Gas and I may be partners untill sep 2009, with this and increase in beer prices it is making me wonder why I bother!!!

Noddy104

Badar Khan,
British Gas Business,
Lakeside West,
30, The Causeway,
Staines,
TW18 3BY.

Noddy104

Write directly to the MD
Badar Khan,
British Gas Business,
Lakeside West,
30, The Causeway,
Staines,
TW18 3BY.

You'll get a bland reply, but if you persevere they give in. If you want copies of my correspondence with them e-mail me on noddy104@birminghamirish.com. I'm not sure if you can do personal messages on this site.
I'll try to post full correspondence on this thread if I'm allowed.

Noddy104

Following is correspondence mentioned above.
I paid regular amounts calculated at the original rates during the period of correspondence.
Eventually BG agreed to free me from my contract and settled at the original rates.
They gave me 30 days to find a new supplier - I've gone with E4B, and wait with bated breath to find out what dirty tricks they have up their sleeves. One is to penalise you if you don't give them readings when required.
Took 11 months but, on the bright side, I ended up with nearly a year at very low rates.
Energywatch, lovely people that they are, are toothless and seem to just publicise occasional shock horror statistics.
Ofgem, FTA legislation and local business associations are pathetic and should be given a kick up the !!!!.

All the best.



WITHOUT PREJUDICE
Badar Khan,
British Gas Business,
Lakeside West,
30, The Causeway,
Staines,
TW18 3BY.
Dear Sir,
How consoling that you have no concerns with your Contract Renewal Notices and the fact that they may be thought misleading.
I presume, from the tenor of your letter, that you did not read the correspondence forwarded to you, since you or any of your staff have addressed none of the points I raised.
I do not believe that the Managing Director of such a prestigious company would be so careless of the concerns of his customers, so I will assume that all of the documentation was not forwarded.
I take the liberty of reproducing two letters, which were sent to your staff, raising a number of issues.
I would appreciate it if you would address each point.
Like you, I am under extreme pressure of work and have not had time to re-draft the contents, so some of it may be repeated. However, I am sure that the points I raise should be clear.
Your contention that there have been no other complaints appear not to be supported by Energywatch or the following:Energywatch website: “If you experience a problem with your energy supply, you should first contact your energy supplier and give them an opportunity to resolve the problem (we advise 10 working days, but please allow more time for British Gas due to the very high number of complaints being received by them).”
http://money.guardian.co.uk/utilities/story/0,,2062011,00.html#article_continue
Google Results 1 - 100 of about 2,150,000 for british gas complaints. (0.19 seconds)
I think that argument that you have more complaints because you have more customers is beginning to wear a bit thin with many of your customers. But why should that bother such a large company?

Yours faithfully,
29 January 2007
Dear Sir,
With reference to your letter of 23 January 2007, and your insistence that the “renewal pack” was “clearly” a Renewal of Contract Notice, I have taken legal advice and have been informed that, in the opinion of my legal advisors, the so-called “Renewal Notice” was a clear attempt to deceive, contrary to numerous areas of Consumer Legislation including the following:
Ofgem – Standard Licence Conditions;
Unfair Terms in Consumer Contracts Regulations, 1995;
Consumer Protection Regulations, 1987;
Unfair Commercial Practices Directive, 2005.
General Contract Law.
They are aware that most of this legislation relates to domestic consumers and that you have taken full advantage of that fact.
They are, however, willing to present an argument, in front of an independent arbiter, that you have not fulfilled the terms of the original contract, and deliberately so, by:
Making no serious attempt to reach agreed terms for renewal;
Not clearly indicating that the “Renewal Pack” was what you claim it to be;
Not including the revised terms in the main body of the notice;
Not including all changes in the contract on the revised terms page (viz. increasing term to 2 years)

Stating, in bold headline, on 29 August 2006 that, “We’ll protect your new contract prices for 2 years”. Which clearly indicates your intention to maintain the prices at those agreed in the original contract until 28 August 2008, there being no other contract in existence at that time.
Clearly, involving legal representation will be time consuming and expensive. Thus, my advisors have suggested that I write terminating the contract with immediate effect or by a date 28 days from the end of the contract, pointing out to you that any prevarication by British Gas will be an infringement of my rights to negotiate a contract on more beneficial terms and will result in my being eligible for compensation.
However, as a gesture of goodwill, I am using similar terms to yourselves and giving you up to 90 days notice of termination of contract.
Since the situation has arisen through your own attempt at subterfuge, I have cancelled my direct debit and will be paying by cheque; I cannot agree to termination charges and I will settle outstanding utility usage at the initial contract prices.
In line with your letter of 23 January 2007, I expect a reply by 15 February 2007 so that this matter is resolved forthwith.
I might add that, as a businessman, running a small business honestly, I consider that your activities are disgraceful. That a National Utilities Company should stoop to such underhand methods to cheat and mislead customers is despicable. It is quite obvious that you would still be doing the same to domestic consumers if it were not for mountains of legislation preventing you from so doing.

20 June 2007.

WITHOUT PREJUDICE
Mr Stewart Smith,
Customer Relations Advisor,
British Gas Business,
PO Box 7687,
Leicester,
LE19 1ZT.

Dear Sir,
How ironic that, a few days after receiving your letter of 27 April 2007, I should come across an Ofgem Consultation Document - “Removing a supplier’s right to object to customer transfer on the grounds of insufficient termination notice. March 2000”. Paragraph 6.11 states “It is also not uncommon for the supplier sometimes to deny receipt of the customer’s termination notice - even when … sent in good time and by recorded delivery.”
I am resending a copy of my letter - by recorded delivery – I presume that this won’t prove a futile exercise. I will also copy all correspondence to Energywatch and request that they ensure that you have received yours.
Would it be cynical of me to think, as has been suggested to me by my legal advisors, that your policy will be to delay resolution of this matter as long as possible and then claim “deemed contract” prices for the maximum period of time possible?
I believe from other Suppliers that they cannot apply to take over supply from British Gas unless I first agree to a contract. This would lead to my being liable to pay for the same supply twice in the circumstances of your, presumably inevitable, objection. Cosy arrangement! I’m sure that you could all get together and contrive a situation where you could charge every customer and supply nothing.
I have paid for supply up to 31 March 2007 at the only mutually agreed price.
It is now 6 months since I first informed you that I intended to transfer my custom elsewhere because of your devious practices in attempting to rollover my contract. My letter of 29 January 2007 summarises the reasons why I deem you to have breached the terms of the contract. May I add to these, the following?
OFFICE OF FAIR TRADING APPROVED CODES OF PRACTICE FOR CONSUMERS - “Firms displaying the OFT approved logo will use clear and fair contracts; will offer free or low-cost dispute resolution, such as arbitration or an ombudsman; will offer you more rights than the law gives”;
DTI CONSULTATION ON THE DRAFT CONSUMER PROTECTION FROM UNFAIR TRADING REGULATIONS, 2007, (of which you will be aware, since British Gas is on the Consultees list) – “A commercial practice is unfair if it materially distorts or is likely to distort the economic behaviour of the typical consumer with regard to the product”;
“A commercial practice is a misleading action if it or its overall presentation in anyway deceives or is likely to deceive the typical consumer in relation to any of the matters in that paragraph even if the information is factually correct”;
“A commercial practice is a misleading omission if, in its factual content, [it] provides material information in a manner which is unclear, unintelligible, ambiguous or untimely, or fails to identify its commercial content, unless this is already apparent from the context”
The DTI Regulations, as you no doubt know, are not to be implemented until next year. However, how would your supposed “Renewal Pack” (copy enclosed) be judged in the light of these recommendations? Do you think that the format of your renewal packs will change when these regulations are adopted? Presuming you are not in a position to comment on such things, would you check with someone, further up the hierarchy, who is qualified to comment?
British Gas Terms and Conditions, paragraph 1.7 “End of Supply Period” states “(A) At the end of the Initial Period, this agreement shall remain in full force and effect for successive periods of one year or such other period as notified by the Supplier and agreed by the Customer …”.
Your contribution to an “agreed” renewal of contract comprises the enclosed letter, identical in layout to your periodic self-aggrandising mailshots, stating, in bold headline “We’ll protect your new contract prices for 2 years and you don’t have to do a thing” and “No price increase for the next 2 years”.
I enclose a copy of “No nonsense gas bills and a new reference number” for comparison. How odd that such an important document as a “Contract Renewal” should have the same format and appear so innocuous!
For further comparison I enclose copies of two more of your notices: “Your account is overdue” and “Overdue Account A725755 Overdue amount £1,008.76”. No possibility of mistaking these last two as mailshots, is there?

Can you explain why the “Renewal Contract” :
-Doesn’t state “Renewal Contract” as a headline?
-Arrived seven months into the contract, three months after your first correct invoice (that took 11 phone calls to sort out!) and referred to “your new contract” when the only contract in existence was the initial one?
-Had the increased prices on a separate sheet that doesn’t mention “Renewal Contract” rather than in the main body of the letter?
-Didn’t include the initial contract prices for easy comparison?
-Didn’t mention an increased period of contract to two years on the same sheet as the increased prices?
-Should not be interpreted as a guarantee to keep prices the same for two years from the date of the letter?

Should the answer to any or all of the above be “our intention was to deceive”, do not be afraid to say it. I’m sure all will understand!

I see from Daily Telegraph and BBC articles that British Gas appears to be immune to any feeling of embarrassment that one would expect from the widespread condemnation of its contract-renewal practices. Distorting statistics and misquoting renewal figures is neither clever nor admirable. It is corrupt. Taking advantage of the fact that Energywatch and Local Trading Standards or Weights and Measures cannot act on behalf of small businesses is neither clever nor admirable. It is corrupt. Taking advantage of the fact that Ofgem, The Office of Fair Trading and The DTI will not act on behalf of individual small businesses is neither clever nor admirable. It is corrupt.
I have expended an inordinate amount of time on this problem, time that I can ill-afford. Further consultation with my legal advisors on the subject will lead to my incurring costs, costs that I can ill-afford. Please bring this to a conclusion by agreeing to allow a transfer of contract to another Supplier or by instigating proceedings to recoup what you consider to be your dues.