Deemed contract

j.a.mcguire

Hello, I've just moved into a new property and a few days after moving in I received a letter from the current energy supplier Utility Warehouse addressed to the 'Present Occupier' and a demand for '£100 deposit' to maintain the Gas and Electricity supply. I ignored it.

About 14 days after I moved in, I calculated my energy consumption based on meter readings signed up with NPower as they seemed to offer the cheapest rate for Gas and Electric, which turns out to be about £50 a month.

About a week after that I received a threatening letter from Utility Warehouse with a demand for 'a deposit of £200' otherwise they would take steps within the coming days to fit a Pre-payment meter. I ignored it.

2 weeks after I had signed up with NPower I received my welcome pack with my account number, I had been living in the property for over 4 weeks at this point. I signed up online and entered my account details but my account states 'account closed' and I cannot submit meter readings.

I called up NPower and they told me that it can take up to 6 weeks to activate the account and switch the supply over.

In the meantime they advised that I must pay the existing energy company as even though I have no agreement with them verbal or otherwise, if I am using energy I have a 'deemed contract', and this will mean I have incurred costs with them and will be charged at a higher rate although they are not allowed to charge rates which would be considered 'onerous' whatever the legal definition of that is.

My expectation was that as soon as I had my NPower account, I would supply the meter readings which were taken at the point I moved in, and the meter readings taken today, and pay them whatever money I owed for my energy consumption at the agreed rate. After all, nothing has really changed, it's not like they're physically digging the gas lines up to switch them to another supplier, I would expect it's still the same gas shipper supplying the gas, who would then bill NPower who would in-turn bill me.

Now I find I am in a situation whereby I am obliged to pay the previous supplier at whatever excessive rate they deem fair.

This by any measure would seem to me to be an unfair contract. I am reluctant to enter any agreement with Utility Warehouse due to the nature of their deposit demands alone. What should I do? Can I hold off payment until NPower have taken over?

HappyMJ

Yes continue to hold off until NPower have taken over. It's not far off.

You'll have to pay UW at some point but you can sort that out later. By the time your account is in arrears you will have switched and they won't be able to cut you off or change your meter.

naedanger

j.a.mcguire wrote: »

Hello, I've just moved into a new property and a few days after moving in I received a letter from the current energy supplier Utility Warehouse addressed to the 'Present Occupier' and a demand for '£100 deposit' to maintain the Gas and Electricity supply. I ignored it.

About 14 days after I moved in, I calculated my energy consumption based on meter readings signed up with NPower as they seemed to offer the cheapest rate for Gas and Electric, which turns out to be about £50 a month.

About a week after that I received a threatening letter from Utility Warehouse with a demand for 'a deposit of £200' otherwise they would take steps within the coming days to fit a Pre-payment meter. I ignored it.

2 weeks after I had signed up with NPower I received my welcome pack with my account number, I had been living in the property for over 4 weeks at this point. I signed up online and entered my account details but my account states 'account closed' and I cannot submit meter readings.

I called up NPower and they told me that it can take up to 6 weeks to activate the account and switch the supply over.

In the meantime they advised that I must pay the existing energy company as even though I have no agreement with them verbal or otherwise, if I am using energy I have a 'deemed contract', and this will mean I have incurred costs with them and will be charged at a higher rate although they are not allowed to charge rates which would be considered 'onerous' whatever the legal definition of that is.

My expectation was that as soon as I had my NPower account, I would supply the meter readings which were taken at the point I moved in, and the meter readings taken today, and pay them whatever money I owed for my energy consumption at the agreed rate. After all, nothing has really changed, it's not like they're physically digging the gas lines up to switch them to another supplier, I would expect it's still the same gas shipper supplying the gas, who would then bill NPower who would in-turn bill me.

Now I find I am in a situation whereby I am obliged to pay the previous supplier at whatever excessive rate they deem fair.

This by any measure would seem to me to be an unfair contract. I am reluctant to enter any agreement with Utility Warehouse due to the nature of their deposit demands alone. What should I do? Can I hold off payment until NPower have taken over?

Strange as it may seem you do have a deemed contract with Utility Warehouse. (Presumably the law is like this to ensure people have continuity of supply when they move, since setting up a new contract can still take time, even if nothing physical needs to be done at the premises.)

Re "I am obliged to pay the previous supplier at whatever excessive rate they deem fair." There will be limits (vaguely defined alone the lines of what npower said) on the rates they can charge but what they are actually charging will almost certainly be within those limits. They will nevertheless be high (as you will be on their standard rates, which are usually higher than their other rates).

Cardew

Welcome to the forum.


Agree totally with the post above.

In days of yore, you could have been cut-off unless prior to moving in you had visited/contacted the gas/electricity showrooms and made arrangements for payment of your accounts.

When competition was allowed the 'deemed contract' provision was introduced(by Act of Parliament) to enable us to have continuity of supply - a provision that works totally in the customer's favour. i.e. the existing supplier has to supply gas/electricity without even knowing our name.

You could of course not pay UW anything. Just do not move into the house and thus do not use any gas/electricity until Npower have taken over the account.

UW will like any firm charge you their highest standard tariff for the 6 to 8 weeks it takes for the switch to be completed.

It appears to me that you have made an error in not contacting UW with your meter readings on the day you moved in. If the previous occupant has not given accurate meter readings on leaving, it could be a disputed matter.

I would write to UW tell them your meter readings when you moved in, explain that you are switching to Npower and will pay your bill when the switch is completed.

chanz4

Their is a flaw to the switch plan, if a debt is o/s utility warehouse may object

Hedgehog99

So the OP couldn't have avoided this by arranging in advance to be supplied by NPower from day 1?
Thanks OP for raising this because I wouldn't have known about it otherwise. Haven't moved since these new rules came in.

Cardew

Hedgehog99 wrote: »

So the OP couldn't have avoided this by arranging in advance to be supplied by NPower from day 1?
Thanks OP for raising this because I wouldn't have known about it otherwise. Haven't moved since these new rules came in.

The rules are 20 years old.

Npower or any other company will not instigate switching procedures unless the customer is the occupant of the house. He has to give meter readings on date of occupancy; and of course the move might not even take place or be delayed.

Can you imagine - 'Hallo Npower, my name is Ed Miliband and I am moving into 10 Downing Street on May 20th - please arrange to take over supply on that date.';)

In many cases these days the existing supplier has some cheaper tariffs without cancellation fees. It can be a good idea to move immediately to that cheaper tariff and instigate switching, if required, later.

The UW threat to install a pre-pay meter is something of a bluff. Unless you allow them to fit a such a meter, it will take a court order and locksmith etc to attend.

Bluebirdman_of_Alcathays

Cardew wrote: »

'Hallo Npower, my name is Ed Miliband and I am moving into 10 Downing Street on May 20th - please arrange to take over supply on that date.';)

I bloody well hope not!



(and not even Ed Miliband is stupid enough to go with npower!)

matelodave

You think?

joncombe

naedanger wrote: »

Re "I am obliged to pay the previous supplier at whatever excessive rate they deem fair." There will be limits (vaguely defined alone the lines of what npower said) on the rates they can charge but what they are actually charging will almost certainly be within those limits. They will nevertheless be high (as you will be on their standard rates, which are usually higher than their other rates).

The main problem it seems to me hear is the demand for a £100 (and then £200) deposit. That seems to be on top of energy used and I don't think should be allowed (if indeed it is).

System

joncombe wrote: »

The main problem it seems to me hear is the demand for a £100 (and then £200) deposit. That seems to be on top of energy used and I don't think should be allowed (if indeed it is).

You are the supplier of energy. You suspect that the house is occupied but you have yet to hear from the new occupier. If the occupier has asked to switch, then UW will by now know the details of the present occupier, and my advice would be to pick up the phone and talk to them. They are only seeking reassurance that somebody will pay what is owed. A Deposit is exactly what it says on the tin. I do not think for a moment that UW is trying to charge the occupier £200 more for the energy that they are supplying in good faith.

That said, I agree that UW's approach is somewhat OTT.