Countrywide defends switching energy suppliers while rental properties are empty

Countrywide has defended itself after a landlord complained that one of its agents had changed utility providers to Spark when the property was empty. Spark has also strongly defended itself.

The landlord, writing on a landlord forum, said the practice was a scam.

The landlord said they had signed a contract with Regal Lettings to find a tenant.

In the event, the tenant was found via another agent.

At that point, says the landlord, “I discovered that Regal Lettings had changed the energy supplier for both gas and electricity to Spark Energy.

“The only reason I can think of for doing this is to be paid by Spark Energy. Even small fees would mount up for a letting agent with many empty properties.

“Regal Lettings say that they change all empty properties to Spark Energy because it makes it easier to alert the company when a new tenant moves in.

“Two admin processes rather than one? That doesn’t make sense.

“. . . I’m appalled that letting agents are even allowed to change energy suppliers.

“Worse, no one is interested ­ not OFGEM or the Energy Ombudsman or ARLA.”

The landlord concludes: “As a landlord I don’t really care if energy is supplied by British Gas or British Airways.

“But I do care that my empty property was used to make money for Regal Lettings and they would have charged me for the privilege.”

The landlord acknowledged that the contract with Regal Lettings allowed it to switch gas and electricity supplier when the property was empty, by also posting up the clause in the agreement.

A spokesperson for Spark said: “We pay a small fee per property to cover the costs of administration involved in managing the utilities when properties are empty. For commercial reasons we are not willing to say how much.”

Asked if it was common practice for letting agents to switch empty properties over to Spark, the spokesperson said: “Every property needs an energy supplier. So like other energy companies we are asked by letting agents to become the default energy supplier for their void properties.

“This process saves the agent considerable time and effort and the new tenant moves into a cheaper price than they would inherit on average if the provider was one of the Big Six. Landlords benefit because we manage all the meter readings and admin that they would normally have to do when the property is empty.

“It’s worth noting that Spark receives fewer complaints than any of the Big Six (according to Ofgem Q2 2015 stats) and that tenants and landlords have the right to choose another supplier at any point with no penalty whatsoever.”

Sam Tyrer, MD for Retail at Countrywide, said: “Putting the customer at the heart of what we do is fundamental to our business.

“As part of our change of occupier process and, in accordance with beneficial property management practice, we will arrange to manage the energy supply for the property during a change of occupier.

“Permission from the landlord has to be sought before we can complete this process.

“By implementing the change of occupier process with a chosen energy provider we are able to identify the outgoing energy provider and provide accurate meter readings gained at occupier check-out.

“The chosen energy provider will manage the check-out meter readings with the outgoing energy provider, and this will ensure that accurate final billing is achieved to the outgoing occupier.

“We see this as a benefit to the landlord during void periods and for the tenant when they move in and out of the property.”

We also invited Spark to comment.

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5 Comments

  1. danny

    I think this is pretty shoddy. I’ve been approached by spark tons of times. The landlord should be asking if the tariff he was changed to was value for money . If it wasn’t (higher charges) then he can argue that this is an unfair contract ….

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  2. Will

    Any agent  sure can only change supplier if the landlord has consented other wise the agent would be responsible for all costs. ie the contract is between the agent and the energy supplier not the landlord. If the agent puts it into the landlords name it is sure mis representation. Perhaps the landlord will move to an agent who doesn’t behave in such a manner.

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  3. Beano

    I think this landlord has too much time on his hand and needs to get out more. Although interestingly he didnt seem to have enough time to absorb the terms he signed that stated this is what the agent does….

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    1. CGreyProperties01

      I’m indoors and got some time on my hands. Here’s how Countrywide Residential Lettings (CRL) ended up paying me £850 compensation (and believe me it wasn’t enough for having to deal with their blundering stupidity!):

      The wording of the contract was open to interpretation:
      Clause 2g  Utilities When a tenancy commencement date has been agreed or when a liability (tenancy end) date has been agreed, we will arrange for either an accredited utility price comparison service company or utility provider to provide a quotation and may (at our discretion) arrange for the utility provisions for the property to be changed to another utility provider during any period that the property is unoccupied.
       
      Ah! They will provide me with a quote. No. To CRL this means they will provide a quote to themselves and will not inform the landlord. A new tenant is presented with a fait accomplait – your energy supplier is Spark Energy (good luck transferring away!)
      However, CRL DO NOT use a price comparison service. They cannot as they have not got the information to do so. Spark Energy provide them a general quote that is irrellevant to any specific property or circumstances for tenant or landlord.
      CRL argued that the terms were clear, but said they would change them on their standard contracts to make them clear!??!!
      Just before this happened to me. CRL had already made a number of errors and ommissions when managing my properties (my original independent agent was taken over by them), so I terminated their services and received compensation from them for their shoddy work and rudeness. This co-incided with one of my tenants vacating, and I asked Countrywide not to make any more mistakes in the handling of the exit. Here is part of their reply:
      I also confirm that the management of the South Avenue property will cease as soon as administratively possible with the tenant remaining in place and that appropriate arrangements concerning notification to the tenant and the handling of the security deposit will be made.
      It is my view that the two alleged breaches of contract to which you refer did take place but I am also of the view that there was no malicious or deliberate intent and that the first alleged breach was rectified by way of refund when the contractual obligations where fully understood and that the second was an administrative error for which I offer my apologies.
      Your feedback on the meeting with Carly Richmond has been taken on board and is a matter for internal review. It is regrettable that a client relationship has broken down to the extent to which you state, for which I apologise.
       
      The above is in consideration of the overall experience to which you refer and I confirm that in order to bring this matter to an amicable conclusion that any fees that Entwistle Green Warrington branch have a contractual right too for the cessation of management will be waived.
       And then they switched my property to Spark Energy (SE) without my knowledge or consent and without informing me in order to take a payment from SE.
      Because CRL were no longer managing the property, no-one would inform SE when a new tenant moved in. I had seen a “sorry you’re leaving us” letter “to the occupoant” from the previous supplier that I thought was because the tenant had left them. My supplier then wouldn’t deal with me! It took some time just to get to the bottom of what had happened, and then revert to the previous supplier once I had read about SE’s business practices and regulator’s fines, and realised I didn’t want to deal with them.
      I complained to the Property Ombudsman and was awarded compensation. Here is part of the Ombudman’s conclusion:
      With regard to the wording of the Terms, I agree with CRL’s point that clause 2g does not specify that the client will be provided with a quote. It is clearly stated that the utility supplier may be changed at CRL’s own discretion.   That said, I can appreciate that a client may interpret the wording of 2g to mean that a detailed quote for comparison will be obtained, potentially shared with the client, and the utilities changed to the cheapest energy provider identified. There is no indication that any precise information regarding the Property was collected to make any judgement of this nature. Rather it seems the case that CRL have a business relationship with SE and will refer unoccupied properties on the understanding that the tariff set (initially, at least) will be cheaper than ‘the big six’.    In my view – and I must state that it is not my role to determine whether contractual wording is unfair or unenforceable – it would be a matter of best practice and fair treatment to detail CRL’s intentions and preference for SE in clearer terms, and this would ensure that the requirement to disclose any potential conflict of interest was met. I note CRL say that they are reviewing this wording, which I do not find definitive proof of the Complainant’s viewpoint, but does indicate that CRL acknowledge that they could improve clarity around the issue. The lack of clarity is further compounded by the fact that the Complainants were not advised at the time of referral, leaving them unaware until the transfer was completed (by which point it is undoubtedly more difficult to nullify).   My award includes compensation for this lack of clarity.   On balance, while the Complainants say they would have raised questions had the wording been clearer, I note that the Complainants had the opportunity to clarify prior to entering into the Agreement.    CRL have acknowledged that, in this case specifically, the change of supplier should not have taken place in light of the Complainants’ decision to cease management. It is this, in my view, that makes the transfer to Spark ‘erroneous’. The letter from SE dated 16 April 2015 is clearly a standard letter issued when a transfer occurs which should not have taken place, i.e. without the consent of the owner/occupier, and so is in the process of being reverted. It is explained that this scenario is an ‘erroneous transfer’. I do not consider it inappropriate or contradictory, that this industry term and the corresponding process of reverting supply has been applied in this instance (the transfer should not have been made in these circumstances, hence the use of this term).  
      Finally, it is not my role to assess the conduct of SE in this or any other instance (although I acknowledge the Complainants’ misgivings). Nor is it for me to make comment regarding CRL’s more general practice within this review, as its purpose is to examine the evidence presented in this case and propose a resolution for the dispute through compensatory redress (issues of best practice for CRL in their wider business will be addressed by me separately if necessary).   
      5   
      This brings me to the matter of the Complainants’ desired redress. I will firstly explain that I do not make awards for aggravation and inconvenience which correspond to a complainant’s perception of the value of their time personally. I am not able to fairly value one individual’s time and effort over another’s. Ultimately, this scheme offers a free service in order that consumers may pursue a complaint to independent review.    I will not make any punitive award – my role is to provide fair redress and, as stated at the beginning of this review, I am not a regulator of the industry. Nor will I consider putative loss or aggravation.   I shall propose a level of compensation that I deem is fair and reasonable and at a level that promotes a full and final settlement to the dispute.  It reflects the aggravation, distress and inconvenience caused, at a time when the Complainants were already dissatisfied, and in view of the fact that considerable time and energy was spent rectifying the error itself (not undertaking this complaint process). I have no reason to doubt the Complainants’ account that CRL failed to make any follow up enquiries regarding the rectification of their error, and this is reflected in my overall decision, but I have also considered that CRL have apologised for their shortcomings.
      Their apology wasn’t from the manager who was rude to me and kept speaking over me and telling me that “What you need to understand is…”  A bland, standard apology to fob me off? No thanks. Get things right and recompense me for my time spent rectifying YOUR errors.
      All landlords – if you use a letting agent (I don’t any longer, I do it myself better and cheaper), instruct your agent in writing that they are not to switch energy suppliers without your consent, and warn your tenants not to switch to the letting agent’s recommended one without investigating.

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  4. mat109

    Can someone please explain to me why it is reportable if the person paying the bills is a landlord, but noone seems to care if it happens to tenant?

    This sort of misselling is disgraceful and I cannot believe OFGEM allow it. Spark was fined a few years ago for not allowing bill-payers to leave!

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