Contextual matters
101 Rule 31 is in Part 2, Div 4 of the Retail Rules which is headed: "Customer retail contracts - billing" and AGL relies on the fact that the heading to a Division is part of this Law: Sch 2 to the NGL, cl 4. It submits that the inclusion of rule 31 in a Division concerned with billing provides a strong statutory indication that rule 31 is concerned with billing such that it follows that rule 31 is concerned with a situation where a customer has received a bill from a retailer which includes an incorrect charge which, in turn, gives rise to an overpayment. In this regard, AGL also relies upon the fact that Part 3 of Sch 3 to the Retail Rules, which schedule sets out the Savings and Transitional Rules, is headed "Billing-related transitional rules". This part contains, at rule 5, the transitional rule relating to rule 31 of the Retail Rules.
102 AGL also emphasises other rules in Div 4 which it contends are "singularly concerned" with billing such as rules 21(4) and 23 which, it submits, directly connect the concepts of "overcharging" and "billing". However, that these rules refer to both bills and overcharging only serves to highlight that rule 31(1) does not contain the same connection between these concepts or refer to billing at all. This supports an interpretation that "overcharged" and "overcharging" within the meaning of rule 31(1) is not confined to a situation where a bill has been issued. Further, it is apparent from rule 32 (which deals with payment methods) and rule 33 (which deals with payment difficulties) that Div 4 is also concerned with the payment of bills.
103 Indeed, the starting point for construing the terms "overcharged" and "overcharging" in rule 31 is to recognise that these terms are used to describe a circumstance where a retailer has received payment of an amount of money that properly belongs to a customer. This can be seen from (for example) the direction in rule 31(2)(a) that, where "the amount overcharged" is equal to or above the overcharge threshold of $50 (rule 31(6)), the amount is to be repaid as reasonably directed by the customer. Thus, "the amount overcharged" is speaking of an amount received by the retailer which has been paid by the customer and which must be returned to the customer. The terms are therefore directed to the receipt of payments, not the issue of bills.
104 By reference to the overall scheme of Div 4, the way in which a retailer becomes entitled to receive money from a customer is through the issue of a bill. However, when one is considering money which is in the hands of a retailer that is more than what it is entitled to receive (that is, "the amount overcharged"), the comparison must be between what has been billed, what is entitled to be billed and what has been paid.
105 This conclusion is fortified through the other uses of the term "overcharging" in Div 4 which illustrate how "overcharging" can occur where a customer makes a payment for a bill that is based on an estimate of usage which results in the retailer having received an amount that exceeds (once actual usage is ascertained) that to which the retailer was entitled, namely:
(1) rule 21(4) which addresses what must happen if a retailer issues a bill based on estimated usage (permitted under rule 21(1)) and then subsequently issues a bill based on an actual meter reading or metering data. Subrule (a) requires the retailer to include "an adjustment on the later bill to take account of any overcharging of the customer that has occurred". If the first (estimated) bill had not been paid, then no adjustment would be required. It is only if the first bill has been paid that the customer has been overcharged and an adjustment is required. This emphasises that the term "overcharging" is directed to the payment by a customer of more than the retailer is entitled to charge, and that "overcharging" occurs through payment, not billing.
(2) rule 23 which addresses bill smoothing arrangements. It allows bills to be issued for a 12-month period (if the customer gives explicit informed consent: subrule (2)) based on estimated usage (using either historical usage or a comparable customer), recalibrated in the seventh month. Rule 23(1)(d) provides that, at the end of the 12-month period, an actual meter is read or metering data is obtained "and any undercharging or overcharging is adjusted under rule 30 or 31". Thus, if the customer has paid the retailer more during the 12-month period than the retailer was entitled to charge, the customer has been "overcharged", and "the amount overcharged" must be repaid or credited as required by rule 31, depending on its quantum. Again, this illustrates that the term "overcharging" is directed to the payment by a customer of more than the retailer is entitled to charge, and that "overcharging" occurs through payment, not billing.
106 The following additional matters detract from AGL's posited construction.
107 First, rule 31(1) refers to a circumstance where the customer "has been" overcharged. It is to be construed in context, which includes both rules 31(2) and 31(3). Those sub-rules make clear that the "overcharge" is a sum of money which has been received by the retailer, because those sub-rules assume that money is in the hands of the retailer because they impose an obligation to repay, refund or credit the money. That supports the conclusion that a customer has not been "overcharged" when a bill is issued for more than a retailer is entitled to charge; rather, a customer is "overcharged" when the retailer has received a payment that exceeds that which the retailer is entitled to receive from that customer. If the conduct was confined to assertions through billing in the manner contended by the AGL Entities, one would expect to see some reference to the issuing of a corrected bill in rule 31. However, there is no such reference, and the only reference to bills is to the crediting of the amount overcharged "to the next bill" in rules 31(2)(b) and 31(3)(a), reinforcing that the rule is directed to the return or reallocation of money obtained from a customer that exceeds what the retailer is entitled to charge the customer at that point in time.
108 Second, the term "overcharged" in rule 31(1) is used in the passive voice: "has been overcharged", as compared to the active voice "the retailer has undercharged" in rule 30(1). This indicates that the intention of the drafter was to impose obligations on the retailer irrespective of whether there had been some active step by the retailer. The language used is deliberately wider and does not depend on the retailer being the cause of the overcharge. This is reinforced by rule 31(5), which explicitly acknowledges that a customer can be "overcharged" through their own unlawful act or omission and overcharging that occurs in that way can still be subject to rule 31. That is, "overcharging" can occur without an act or omission by a retailer.
109 To counter this, AGL submits that rule 5 in Part 3 of the Savings and Transitional Rules uses the following language to describe rule 31 of the Retail Rules: "[t]he provisions of the Rules requiring a retailer to reimburse amounts the retailer has overcharged a small customer (rule 31…)" (emphasis in submissions). It submits that this provides significant contextual support for a construction of the term "overcharged" in rule 31 as requiring a positive action by the retailer and supports the construction of "overcharged" that is consistent with that word being used as a verb in rule 31(1).
110 However, the chapeau of rule 5, which uses the language of "amounts the retailer has overcharged", is used in a context where rule 5 is extending rule 31 to a particular form of overcharging which occurred before rule 31(1) commenced in the circumstances set out in rule 5(1)(a)-(b) (which is not this case). The identification of this confined set of circumstances described as "overcharging" for the purposes of the Savings and Transitional Rules does not overcome the differences in language between rule 30(1) and rule 31(1).
111 Third, AGL's construction would leave a significant lacuna in the operation of the Retail Rules in that there would be no rule which addresses the situation where a person had ceased to be a customer of an AGL Entity and received their final bill, but whose welfare payments continued to be diverted to and retained by AGL. This would be an absurd outcome in circumstances where the Retail Rules are otherwise highly prescriptive and detailed as to retailers' conduct vis-à-vis consumers, and in circumstances where it is the Retail Rules which provide for retailers to use Centrepay: see rules 32(2), 74.
112 That this would be an absurd outcome can be seen by reference to the following examples:
(1) rule 32(1) requires a retailer to accept payment inter alia by telephone. If a customer telephoned a retailer to pay a bill of $50, but through the error of the retailer, the amount of $500 was charged to the customer's credit card during the telephone call and processed through the retailer's system, then on the AER's construction, the amount charged in error of $450 would fall to be dealt with under rule 31, because it would be a payment that exceeds that which the retailer is entitled to receive from, or charge, the customer. However, the AGL Entities would contend that the retailer had not overcharged the customer, because, while it had received an amount of $450 to which it was not entitled, it had only issued a bill for $50.
(2) rule 32(5) provides that a retailer must accept payments by a customer "for a bill in advance". This allows a customer to make regular payments to a retailer in order to manage their expenses. If the payments made exceeded what was owed when a bill was issued, then on the AER's construction there would be "an amount overcharged" which, if it was equal to or above the overcharge threshold, would require notification under rule 31(1) and then fall to be dealt with under rule 31(2). However, on the construction advanced by the AGL Entities, the retailer would not have to do anything about the excess, because no bill had been issued for that amount, and it would fall outside the scope of the Retail Rules.
(3) rule 72 allows for the establishment of payment plans for a "hardship customer" which allows the customer to pay for their energy consumption in advance or in arrears by instalment payments. If a customer on a payment plan was to pay in advance by instalment payments, and the sum of these instalments was to exceed that which was due when a bill was issued then, on the construction of the AGL Entities, this excess amount would not be an "overcharge" because no bill had been issued for that amount, and it would fall outside the scope of the Retail Rules.
113 Each of these provisions appear to contemplate a mismatch occurring (either by reasons of error or timing) between the amount that a customer has paid for electricity or gas and the amount that the retailer is entitled to charge for that electricity or gas. Yet none of them have their own provisions regarding how this excess is to be dealt with. Such an absurd outcome provides strong support for a conclusion that any such excess falls within the concept of an amount "overcharged" for the purposes of rule 31 and must be dealt with in accordance with its provisions which seek to ensure the funds are repaid, credited or returned to the customer as required by its terms.
114 AGL submits that there is no absurdity and no lacuna in the fact that the excess amounts are not addressed under rule 31 or any other part of the Retail Rules because it is addressed comprehensively by the Centrepay Framework, rather than the Retail Rules. AGL contends that the Centrepay Policy and the Procedural Guide impose detailed obligations on Approved Businesses with respect to an "Overpayment" and "Overpaid Deductions" and that the absence of any additional direct obligations on retailers in the Retail Law and the Retail Rules in respect of Centrepay indicates that the Centrepay Framework exclusively governs the obligations on retailers in respect of any overpayments of Centrepay deductions. AGL also relies upon "material differences" between the obligations owed under the Centrepay Framework, and the obligations imposed by rule 31 on the AER's construction, in support of its construction of rule 31, on the basis that there would be "undesirable inconsistency" if rule 31 also applied to "overpayments".
115 However, the Centrepay Framework is a contractual agreement between Services Australia and the AGL Entities, which could (one assumes) be amended. It is not a document that constitutes "Rule extrinsic material" pursuant to cl 8 of Sch 2 to the NGL, and it cannot, therefore, be extrinsic material that can be considered in determining the proper construction of rule 31. Further, it would subvert the proper analysis if I construed a legislative provision more narrowly in order to conform to a private contractual agreement applicable in a particular case, whether because of inconsistency or otherwise. Further, the earliest version of the Centrepay Policy in evidence is dated 1 July 2015. The Retail Rules commenced in South Australia on 1 February 2013, New South Wales on 1 July 2013, and Queensland on 1 July 2015. It is difficult in those circumstances to see how the Centrepay Framework can form part of the "context" in which the Retail Rules could be considered or that, because Centrepay is referred to in the Retail Rules, the Centrepay Framework has somehow been "incorporated" into the Retail Rules, as AGL submits. Finally, there is no evidence that the obligations imposed on AGL by the Centrepay Framework were considered by or known to the drafters of the Retail Rules.
116 Other arguments were advanced by AGL in favour of its construction of "overcharged" and "overcharging" in rule 31(1), to which I now turn.
117 AGL emphasises rule 30(3) (which provides, in the context of undercharging that "to avoid doubt, a reference in this rule to undercharging by a retailer includes a reference to a failure by the retailer to issue a bill") and submits that this rule also supports its construction. However, rule 30(3) is an inclusive rule - that is, undercharging includes but is not confined to the situation where a retailer fails to issue a bill. Thus, the existence of rule 30(3) in the context of rule 30(1) which refers to where "a retailer has undercharged a small customer" does not take the resolution of the proper construction of rule 31(1) very far. That is especially because, as already observed, rule 31(1) does not use a similar phrase such as "where a retailer has overcharged" which indicates that rule 31(1) applies to a broader set of circumstances which extend beyond the overcharge being caused by the retailer. Further, rule 31(1) does not refer to overcharging in a bill, or that overcharging is confined to a situation where a customer has been issued with a bill which contains an excessive charge, which is then paid by the customer.
118 The term "overcharged" is used in rule 136 of the Retail Rules. Like rule 31, that rule is also entitled "Overcharging" but applies where a small customer with a prepayment meter market retail contract has been overcharged. It provides that where a customer has been overcharged as a result of "an act or omission of the retailer or distributor" or "without limitation, a fault in or incorrect operation of a prepayment meter system found following a check or test under rule 135", a retailer must "(a) inform the customer of that overcharging within 10 business days of the retailer becoming aware of that overcharging; and (b) ask the customer for instructions as to whether the amount should be: (i) repaid to the small customer; or (ii) added to the balance of the prepayment meter system account".
119 AGL submits that the explicit extension in rule 136 to where a small customer with a prepayment meter market retail contract has been overcharged as a result of "an act or omission of the retailer or distributor" is a statutory indicator that a bill must be issued by a retailer for an amount paid in relation to that bill to be considered an "overcharge" under rule 31. It submits that it is necessary in rule 136 to extend the concept of "overcharge" as something which occurs as a result of an act or omission of the retailer or distributor, because no bills are issued for prepayment meters. However, I do not accept this submission as it is plain that rule 136 is using the term "overcharge" in a narrower set of factual circumstances than rule 31 through the use of the causal limitation conveyed by "as a result of". It does not include overcharging arising from a customer's act or omission, lawful or otherwise (unlike rule 31(5)). Further, it provides a strong contextual indication that overcharging used in rule 31 is a broad concept, which encompasses a circumstance where a retailer has received and processed an amount from the customer as a payment of a bill that exceeds the retailer's entitlement because of the retailer's act or omission - here, a failure to cancel the deduction including after a final bill had been issued and satisfied.
120 For these reasons, I do not accept AGL's submission that the AER's construction is not supported by the statutory context.