Even if you hardly ever watch the news on TV you cant help but be aware of the energy price rise crisis, threatening to engulf much of the world this autumn and winter..
At Safer Renting we are seeing a rise in reported incidents of cases where tenants pay their rent inclusive of bills, only to have their landlord approach them demanding more money for increased supply costs.
Do you have to pay the proposed increases?
Well it depends in part on what your written agreement says and in the absence of a written agreement, what the actual circumstances are in connection with payment of utilities.
Legal and contractual.
It is perfectly normal for a tenancy arrangements to include payments for utilities as part of the deal but as with all contractual matters you have to look to the specific wording in the contract. For instance a clause saying “£500 inclusive of bills” is an all encompassing term and suggests that the £500 covers all of it.
In such cases it would be difficult for a landlord to argue that you need to pay them more, just because their bills have risen. The overall sum stated in the contract is £500.
This is not good wording from a landlord’s perspective because it doesn’t protect them from price rises or excessive use by tenants, perhaps because they are now working from home where previously they weren’t.
Similarly where a clause says that the rent is £500 per month + £20 a week for bills on top. The contractual demand for utility costs is £20, so cannot be increased just because the landlord’s bills have increased. The contractual provisions weren’t designed for the current crisis.
Clauses allowing for rises in price and usage would allow a landlord to increase charges but are virtually unheard of.
There is nothing to stop a landlord and tenant mutually agreeing to increase payments for utilities beyond the contractual provision but difficult for a landlord to impose such an increase unilaterally.
And where there is no written contract?
In rogue landlord world, where rent inclusive is widespread, particularly in HMOs, there may not even be a tenancy agreement, in which case you have to look to evidence what the practical arrangements have been since the tenant took up occupation, which isn’t always easy, particularly if payments were made in cash without receipt, which again is very common in rogue landlord world.
Any arrangements can only be confirmed by the say so of the landlord and tenant, or if you have evidence perhaps in the form of bank statements or receipts that might back up what the parties are claiming.
Where disputes like this arise we tend to see 2 different approaches employed by landlords wanting to increase payments for utilities:-
· The landlord simply tells the tenant that the bills have gone up and demands payment, or
· As we are increasingly seeing, the landlords contact the energy supplier and transfer the supplier account into the tenant’s name, for them to take over the bills.
Claiming bills have risen.
In this scenario it is rare for the landlord to actually produce evidence to convince the tenant that there has been a massive rise in utility bills. Indeed it is more common for rogue landlords to make unsupported claims and simply demand more money.
Problems are compounded because usually the tenant is completely unaware who the energy supplier is, so they cant get the proof they might need of increased use or charges but this can be rectified quite easily.
There are websites available where you can find out which energy supplier the landlord is using. As the tenant isn’t the account holder the energy supplier wont confirm any account detail but in a sense you don’t need that to verify whether the amount of increase being proposed is genuine.
Before explaining how this works we need to clarify something that often causes confusion.
There is a difference between energy network suppliers and energy billing companies.
The electricity cables and gas pipes in the street and leading to the house are fitted and maintained by energy network suppliers. Companies like SGN or UK Power Networks. These are the people you call when there is a gas leak or power cut, not the billing company.
If there is a problem with the internal electricity then the landlord is responsible for repairing it, not UK Power Networks.
Energy billing companies are only responsible for matters relating to billing and debt and when a tenant is being approached for increased costs it’s the billing companies they need.
www.findmysupplier.energy is a good website to use for this. You just put the postcode of the property in and find the house number. This will reveal both the meter number and the name of the energy billing company.
It is common in the criminal end of renting for landlords to install stolen meters or meters that are not actually connected up to a supplier. You might be surprised to know that you can buy meters and items to tamper with them on ebay. They aren’t illegal to buy, they aren’t even illegal to fit, it is only illegal not to have them connected to an energy supplier.
A few years back I attended a multi disciplinary property action with police and EDF & British Gas revenue protection officers in Deptford High Street. We visited 44 properties in a day and didn’t find a single lawful meter in either the shops below or the residential units above.
We use www.selectra.co.uk which will tell you who your local network supplier is. Remember the network supplier is not the energy billing company but the company who supplies the mains in the street.
Armed with the knowledge of who is responsible for the local network you then contact them with your address and they can tell you who the current billing company is.
Verifying the amount demanded by your landlord.
So what do you do with this information? You look at the billing company website which will show you what their per unit energy tariff is. Take a meter reading once a week to record how much energy you are consuming and calculate the price of units used and how much the bills should be. If your landlord is demanding more, you can ask them why.
If your address or meter doesnt even come up, you can also ask them why.
Option 2 – Transferring the bill to the tenants name.
I cant tell you how common this is. The landlord, unhappy with the amount of money they can charge the tenants, contacts the energy supplier and says, the tenants are to be the new account holders and the energy supplier simply transfers the billing to the tenants.
Now I know this sounds completely daft but its what goes on and in our experience the energy companies have no issues with setting up a new account in someone else’s name who didn’t even ask to be their customer.
It is akin to putting your week’s shopping through the checkout and then telling the person on the till that the bloke behind will be paying
Energy billing companies even transfer debts that were previously the landlords, so the tenant ends up paying twice
In one Safer Renting case I recall EDF harassing a tenant for £5,000 debt when he had, for 9 years been paying his rent inclusive of bills. The landlord produced a fake contract to EDF showing ‘Rent NOT inclusive’ and argued that the tenant, who actually had been paying rent inclusive had run up the debt that was in the landlord’s name.
Initially EDF wouldnt talk to us because were weren’t the account holder but a series of complaints brought them to the table but trying to negotiate this nonsense took over a year and only ended when the tenant returned to his home country.
I’m no consumer law expert and I would imagine this practice by the energy suppliers would breach some form of consumer law but it doesn’t stop it happening.
In what other area of commerce would one person be able to set up and account and transfer a debt into the name of another without that person even knowing it had been done? I understand why rogue landlords do it but I don’t understand why energy suppliers just say “Oh…..ok then”.
So there we are. A few tools to help tenants who pay rent inclusive of bills, protect themselves from unscrupulous operators this coming winter.
By Ben Reeve Lewis