Residential tenancies – High Court water re-selling test case could see water refunds for tenants
Following a High Court water-reselling test case, tenants of councils and housing associations could be entitled to receive millions of pounds worth of refunds.
The case of Royal Borough of Kingston-Upon-Thames v Moss, centred on the water supply to a tenant, Mr Moss.
Since 1990, Thames Water Utilities (“Thames”) has been the water and sewerage undertaker for properties within the Royal Borough of Kingston-Upon-Thames, with Kingston Council (“the Council”) owning a significant number of houses and flats, many of which are let to tenants on ‘secure tenancies’.
Thames is entitled to charge for the supply of water and sewerage services on properties that benefit from those services, including those occupied by the Council’s tenants. The case focused on premises in which the water supply is not metered.
A written agreement between Thames and the Council, known as ‘the 2003 agreement’ provides that Thames does not bill the Council’s tenants for provided water and sewerage services but bills the Council who then bill their tenants.
Under the 2003 agreement, the Council pays the charges to Thames but the amount is reduced to reflect a ‘voids allowance’, which is 3.5 per cent of the charges. The 2003 agreement also provides the Council is entitled to a commission of 9.3 per cent, resulting in a reduction in the sum paid by the Council to Thames.
Mr Moss argued that the fact that both he and the Council are governed by the Water Resale Orders 2001 and 2006 meant the amount he is charged by the Council for water services should be reduced to reflect the fact that the 2003 agreement meant the Council benefitted from the voids allowance and commission.
The court held the 2003 agreement meant that the Council was a re-seller in accordance with the Water Resale Orders 2001 and 2006, and was bound by the maximum charges provisions of those orders. That as a result, Mr Moss was charged sums in excess of the maximum charges and Mr Moss has a right to recover his overpayments
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