Summary of the Honourable Federal Court Coram
Azahar Bin Mohamed, CJM
Mohd Zawawi Bin Salleh, FCJ
Abdul Rahman Bin Sebli, FCJ
Zaleha Binti Yusof, FCJ
Rhodzariah Binti Bujang, FCJ
Grounds of Judgement
2. Tetangga Bahagia Sdn Bhd v TNB | [02(f)-23-03/2020(B)]
3. Megahock Pipes & Profile Manufacturing Sdn Bhd v TNB | [02(f)-8-02/2021(J)
4. Megahock Pipes & Profile Manufacturing Sdn Bhd v TNB |02(f)-6-02/2021(J)
8th September 2021
8th September 2021
On 8.9.2021, a 5 member panel of the Federal Court (FC) presided by YAA Tan Sri Dato’ Sri Azahar bin Mohamed, YA Dato’ Seri Mohd. Zawawi Bin Salleh, YA Dato’ Abdul Rahman bin Sebli, YA Puan Sri Dato’ Zaleha Binti Yusof and YA Dato’ Rhodzariah Binti Bujang delivered a landmark decision in respect of 4 appeals which were heard together on 6 common issues of law in claims by Tenaga Nasional Berhad ( TNB) for loss of revenue due to meter tampering pursuant to subsections 38(3) to (5) of the Electricity Supply Act 1990 ( ESA 1990).
Our team led by our Managing Partner, Dato’ Alvin John ( assisted by Rubachandran & Alvin Sigar Acho) acted as Counsels for TNB in the Tetangga Bahagia Sdn Bhd v TNB appeal.. The following were the common issues of law before the court:
Issue 1: Whether TNB can rely on Regulation 7 Licensee Supply Regulations 1990 ( LSR 1990) to enter a consumer’s premises in order to obtain a remedy under s. 38(3) ESA 1990 for loss of revenue due to meter tampering without complying with the requirements under s.5 & 6 ESA 1990 i.e whether it is a prerequisite that the Energy Commission must sanction and coordinate the inspection by TNB of the electricity meter at the consumer’s premises and secondly what would be a reasonable time for the inspection of the meter at the consumer’s premises ?
FC Answer: TNB is not required to comply with sections 5 & 6 ESA 1990 as the Energy Commission’s powers are restricted to criminal proceedings against perpetrators of electricity theft and is distinct from TNB’s right to inspect meter tampering ( Reg 7 LSR) for the purpose of civil claims for loss of revenue under s.38(3) ESA due to meter tampering. The court further stated that a reasonable time of inspection at the consumer’s premises is to be determined by TNB using its discretionary powers.
Issue 2: Whether TNB’s discovery of a metal clamp affixed to its meter at a consumer’s premises is sufficient in law for the court to hold that there was meter tampering for the purposes of s. 38(1)(3) ESA ?
FC Answer: The court answered in the affirmative in that a metal clamp at TNB’s meter leads to one logical conclusion/ inference ie that the meter has been tampered with.
Issue 3: Whether limitation under section 6 Limitation Act 1953 ( LA 1953) starts to run from the date the meter was alleged to be tampered or from the date the meter tampering was alleged to have been discovered?
FC Answer: Limitation Period under s.6 LA 1953 runs from the date the meter tampering was discovered by TNB during the inspection under s. 38(1) ESA 1990
Issue 4: Whether significant errors in TNB’s calculation for loss of revenue will lead to a dismissal of TNB’s claim or whether the court should substitute an alternative amount for the claim?
FC Answer: If there exist significant errors in the TNB calculation , the courts must in the alternative order damages suffered by TNB to be assessed and not dismiss the action outright.
Issue 5: Whether aggravated or exemplary damages must be pleaded for the Court to order it as a relief to the successful party?
FC Answer: The court answered in the affirmative, that aggravated or exemplary damages must be pleaded if relief of the same is sought by a party.
Issue 6: Whether in adjudicating the fairness and reasonableness of TNB’s claim for loss of revenue, the Energy Commission Guidelines and compliance thereof in computing the loss of revenue is an overriding consideration which excludes other contrary evidence which may vitiate the sum claimed by TNB?
FC Answer: It is axiomatic that a consumer must pay for the electricity consumed and cannot be allowed to benefit from the tampering of meters to pay less. TNB’s claim for loss of revenue is a civil claim under s.38(3)-(5) ESA 1990 to be proven on balance of probabilities.
Stay tuned for follow up articles and webinars by AJP discussing the importance and implication of this Federal Court decision to consumers of electricity.