Legal Update 6 of 2017

Who bears the cost of loss of revenues resulting from meter tampering - the registered consumer of the premises or the tenant of the premises? 

 

CASE: 

Thomas Thomas @ Mohan K Thomas v Tenaga Nasional Berhad [2017] 1 LNS 25 CA


BRIEF FACTS:

  • Tenaga Nasional Berhad (TNB) is a licensee under the Electricity Supply Act 1990 (the "ESA").

  • Thomas was the owner of the premises known as No.34 Changkat Bukit Bintang, Kuala Lumpur (the "premises") and was TNB's registered consumer for the premises. 

  • In 2008, TNB carried out an inspection on its meter at the premises and discovered that the meter had been tampered with, subsequent to which TNB lodged a police report. 

  • Meter tampering, dishonest consumption of electricity and damaging any meter are offences under Section 37(1), (3) and (14) respectively of the ESA.

  • TNB's calculation of its loss of revenue as a result of the tampering was RM77,318.67 which covered the period between 22.09.2004 and 21.12.2007.

  • TNB then issued two notices of demand to Thomas to recover the loss of revenue. 

  • Thomas refused to pay, hence the proceedings commenced by TNB.

  • At the trial, Thomas's defenc was that the premises had already been rented out to a thrid party, namely The Moghul House Sdn Bhd ("Moghul House") at the time he purchased the property from one Straits Merchant Sdn Bhd.

  • He never occupied the premises and had nothing to do with the tampering of the meter.

  • The trial court found in favour of ("TNB") in its claim for loss of revenue as a result of meter tampering discovering at Thomas's premises. 


DECISION: Thomas's Appeal Dismissed

  • It was Thomas's contention that although he was the registered owner of the premises, he was not the consumer of the electricity.

  • Thus, he was not responsible for any electricity charges incurred by his tenant during the tenancy period. 

  • TNB's cause of action was simply based on the fact that the tampering of the meter had caused it to lose revenue. 

  • In addition, there is no requirement under the ESA that TNB must first prove that it was the registered consumer who damaged or tampered with the meter before it could succeed in its claim against the consumer under Section 38(3) to (5).

  • Since the consumer has a contract with TNB,they will be liable for the losses even if they did not tamper with the meter. 

  • Thomas can only be absolved of liability if he can show that no electricity was consumed at the premises during the period that the meter was tampered with. 

  • While it is true that the premises was rented to and occupied by a third party and Thomas never occupied the premises, the fact remains that the agreement for the supply of electricity to the premises was between him and TNB and did not involve any third party.

  •  Therefore, as far as consumption of electricity in the premises is concerned, it was Thomas's sole responsibility, being the "consumer" under the agreement to pay all the outstanding charges due to TNB.

  • The loss of revenue under the such circumstances cannot fall on TNB's head. That will be grossly unfair to TNB. 

  • If it was Thomas's case that it was Moghul house who should bear responsibility for the outstanding electricity charges, his resoure was to bring in Moghul House as a party in the suit and not to deflect liability away from himself and denying TNB of its rightful claim to revenue that was lost due to tampering or damage to the meter.

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