Protect business from shock bills

Demands: Michael Peacock
Demands: Michael Peacock
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A SHEFFIELD-based specialist in contract law is urging the Government to step up protection for companies that are undercharged by their energy suppliers and then belatedly faced with demands for huge payments.

The call comes from Michael Peacock, partner at Sheffield-based hlw Keeble Hawson, who recently saved Doncaster-based Coolcare Logistics almost £500,000 for alleged underpayment going back five years.

Coolcare, which stores and transports frozen goods for household names, was facing the bill because of a clerical error when its energy supplier, nPower, set up its account.

Michael Peacock explained: “Whereas householders are protected by codes of practice and cannot be charged for energy used more than 12 months prior to the presentation of the bill, businesses of every size are vulnerable to such claims.

“This issue has plagued businesses – especially small business – for some time. It is understood that the industry itself has proposed the introduction of a three-year limit. However, unless and until such a cap is implemented, businesses will continue to remain vulnerable.”

Mr Peacock succeeded in getting Coolcare’s bill reduced to £80,000 by employing a combination of legal arguments and precedents during negotiations with nPower.

Coolcare’s managing director, Sharon Goulding, said: “When we started out we had no real idea of the energy costs we might incur. We relied on the invoices to be accurate and our business shouldn’t therefore be held liable. The business community must unite to challenge a supplier’s right to back payments that could amount, as in our case, to nearly half a million pounds.

“That said, following Michael Peacock’s intervention nPower took a very reasonable stance and we’re immensely relieved that Michael was able to save Coolcare the equivalent of more than 20 staff members’ salaries.”