CH-2025-000101 - [2025] EWHC 2975 (Ch)

Mr MacLachlan’s submissions on behalf of SBL were well and persuasively argued. However, I am not persuaded that they lead to the right conclusion.

I consider it important to focus upon the fact that the key issue is as to whether Odeon, as an “owner” of “premises” is subject to a deemed contract because the “premises” are to be regarded as “unoccupied” for the purposes of paragraph 3(1) of Schedule 6 to the 1989 Act. The key word to be interpreted is “unoccupied”, albeit that such word requires to be interpreted in context, and by reference to, amongst other things, the purpose behind the paragraph 3(1), the Electricity Code as a whole within Schedule 6, and the other provisions of the 1989 Act.

As to the interpretation of “unoccupied”, the issue is as to whether it is limited to meaning unoccupied in the ordinary sense of nobody occupying the whole or any part thereof, or whether the meaning also extends to include, as contended by SBL, the situation in the present case where the whole is not occupied as a whole, but individual units making up the whole are occupied by individual occupants.

I take the point made by reference to what was said by Lady Rose JSC in Cornerstone Telecommunications v Compton Beauchamp (supra) at [106] that the particular word or expression sought to be interpreted should be informed by the purpose or intention behind the legislation, rather than the other way round, and that one does need to consider how the deemed contract regime provided for by paragraph 3(1) of Schedule 6 was intended to work, and the purpose behind it, before fixing on the meaning of “unoccupied”, or indeed the meaning of “premises” or “occupied”.

However, the starting point in statutory interpretation remains to consider the ordinary meaning (or meanings if there are more than one) of a word or phrase. As the passage fromRegina (O) v Secretary of State for the Home Department at [29] referred to in paragraph 26 above demonstrates, there is good constitutional reason for this in the importance of citizens, with the assistance of their advisers, being able to rely upon what they read in an Act of Parliament in seeking to understand what Parliament has enacted.

It is certainly true that the expression “occupied”, and therefore the expression “unoccupied”, might have different meanings according to the context. However, as a matter of ordinary parlance, it does, I consider, strain the language, if not contradict it, to describe premises that are occupied by a number of tenants, enjoying separate demised premises, as unoccupied. Indeed, as a matter of the application of the ordinary meaning of words, I find it difficult if not impossible to say that any part of the premises served by the relevant meter in the present case was “unoccupied” given that tenants were in occupation of the three units thereat.

As the authorities that I have been referred to demonstrate, a recognised canon of construction is the rule against absurdity, and therefore the courts will lean against a construction of legislation which produces absurd or unworkable results, if there is an available alternative construction which does not do so.

I regard it as a moot point as to whether, in the present case, an interpretation that might actually contradict the ordinary meaning of “unoccupied” is an “available alternative construction”. However, I am not persuaded that the interpretation as found by the Judge to be the correct interpretation does produce such an absurd or unworkable result that one is required to adopt an interpretation of the word “unoccupied” that at best strains the ordinary meaning of that word, and at the worst contradicts it.

The construction contended for by SBL certainly produces a more certain result so far as the operation of paragraph 3(1) of Schedule 6 is concerned, and one that is more helpful to electricity suppliers in a situation such as the present where it can simply proceed against the owner of the relevant premises in the event of non-payment for electricity charges. However, that is rather different from an absurd or unworkable result.

The other keywords within paragraph 3(1) are “premises” and “occupier”. If the interpretation contended for by SBL is rejected, then there are, as I see it, three possibilities:

Each of these scenarios, including the one as found by the Judge to be the correct analysis, does give rise to potentially difficult apportionment exercises as between the respective tenants, but does not, I consider, produce an absurd result or an unworkable one. As pointed out by Mr Shipley, the courts are used to having to apportion liability where necessary to do so.

Further, I consider it important to bear in mind that the present case provides something of an extreme example or edge case, with the invoices sent to Odeon remaining unpaid for a significant period of time without any objection with regard to its liability to pay being made by Odeon, for whatever reason. In this respect, I note that there is a dispute between the parties with regard to whether Odeon did, in fact, receive the relevant invoices. It says not, with matters only coming to a head after the Petition had been presented.

However, in most cases, one would expect matters to come to a head very much more quickly. Had Odeon objected more promptly, as one would expect would ordinarily be the case, then liability could have been asserted as against the individual tenants leading to a practical solution being achieved through either the provision of separate meters to the respective demised premises, or some arrangement come to as between the tenants as to how bills were to be shared. I note in this context the powers within the legislation to force a meter upon a user of electricity on threat of disconnection in paragraph 1 of Schedule 7 to the 1989 Act.

In particular, paragraph 1(5) of Schedule 7 provides that:

“(5)

If the customer refuses or fails to take his supply through an appropriate meter provided and installed in accordance with sub-paragraphs (2) and (3) above, the supplier may refuse to give or may discontinue the supply.”

This provision thus anticipates a situation where electricity is being supplied to a customer who does not have an individual meter, and effectively allows the supplier to say that unless a meter is installed, then the supply will be discontinued.

So far as the townhouse example is concerned, I would have thought it unlikely, in the real world, that problems regarding the operation of paragraph 3(1) would often arise. In practice, if the premises as a whole are served by only one meter, then one would have thought that the tenants are likely to have had in place an arrangement between themselves as to how electricity was to be paid for, or that there was an arrangement that the landlord would pay the bills and recoup the same through a higher rent or a service charge. It is difficult to see that tenants would commonly take a tenancy of part of a townhouse of the kind identified by Mr MacLachlan, or indeed any other premises, unless one of these regimes were in place.

In short, I consider that the practical considerations that are said by SBL to support its interpretation of paragraph 3(1) of Schedule 6 are overstated, and that they are insufficient to lead to the conclusion that the court should adopt a construction of the word “unoccupied” that does, frankly, do significant violence to the language of paragraph 3(1).

Further, I agree with Mr Shipley that other provisions of Schedule 6 to the 1989 Act, and elsewhere in the 1989 Act do, if anything, support the Judge’s interpretation. With regard to paragraph 2(2)(a) of Schedule 6, one would logically expect the legislation to be designed to ensure that notice was given to the parties most directly affected by the disconnection of supply, namely the party in occupation actually using the electricity. Similar considerations arise in respect of paragraph 7(5) of Schedule 6, relating to the power of entry on the part of an electricity supplier to enter premises to remove or install a meter. Again, provision is made for notice to be given to “the occupier (or the owner of the premises if they are unoccupied)”.

A further marked example is paragraph 6 of Schedule 6. Paragraph 6(1) creates an offence where a person intentionally or by culpable negligence damages or allows to be damaged any electrical line or electrical plant provided by electricity distributor, or an electricity meter provided by an electricity supplier. Paragraph 6(2) and (3) provide that where such an offence has been committed under paragraph 6(1), then the distributor or supplier (as appropriate) may disconnect the premises, and in the case of the supplier remove the meter. However, this is expressed to be the case where the offence has been committed by “the occupier of any premises (or by the owner of the premises if they are unoccupied when the offence is committed).” If SBL is correct in its interpretation, then this would mean that if a tenant committed the relevant offence, the powers under paragraphs 6(2) and (3) would not arise, which does not make a great deal of sense.