By an amended summons filed 24 May 2018 the plaintiff seeks leave to appeal from part of a decision of the Appeal Panel of the NSW Civil and Administrative Tribunal made on 3 April 2018: Reckless v Silva Portfolios Pty Ltd t/as Ballina Waterfront Village & Tourist Park [2018] NSWCATAP 80. The appeal concerns the Appeal Panel's holding with respect to ground 5 of the appeal brought to the Appeal Panel by the present defendant.
Although the appeal expressly only refers to ground 5, the issues determined by the Appeal Panel concerned both grounds 4 and 5. Those grounds were these:
4. The Tribunal erred in not applying s 6(2) of the new Act so as to prevent the Park Operator from charging more for electricity than it was being charged;
5. The Tribunal erred in not applying s 77(3) of the new Act by permitting the Park Operator to charge for electricity in the way that it does, despite its finding that 'on the evidence it seems more likely than not, that the park operator is charging more for the electricity it is on-selling, than it is being charged'.
The "new Act" is the Residential (Land Lease) Communities Act 2013 (NSW) (the RLLC Act).
[2]
Background
The defendant is a resident in a residential park, being a caravan park, owned by the plaintiff at Ballina. In her application to the Tribunal, the defendant had asked the Tribunal to confirm that she was not liable to pay certain electricity charges to the Park Operator, and that she was entitled to a refund of amounts she had already paid. Her application was unsuccessful, with the Tribunal deciding that those charges and also some sewerage charges were validly imposed on her by the Park Operator, such that no refund was payable.
In April 2014 the plaintiff and the defendant entered into an agreement called a Site Agreement under which the defendant was entitled to occupy an identified site in the plaintiff's residential park. At that time residential parks were regulated by the Residential Parks Act 1998 (NSW) (the Old Act).
The Site Agreement specified who was to pay for a range of rates, taxes and other charges. Amongst the charges the defendant agreed to pay was:
"All electricity charges" in connection with the residential site (under clause 6), but only if, among other things, the residential site was separately metered.
Clause 6 of the Site Agreement provided:
The resident agrees to pay all electricity charges in connection with the residential site where:
6.1 The residential premises are individually metered in compliance with the Code of Practice for Electricity Supply to Long-Term Residents of Caravan Parks prepared by the Department of Energy, and
6.2 any charges for the supply or resupply of electricity to the resident are calculated in accordance with the Code (whether by reference to a published domestic tariff or otherwise).
In her application to the Tribunal the defendant claimed for a reimbursement of electricity charges on the basis that the charges the Park Operator was imposing on her were higher than the amounts charged to the Park Operator by the electricity provider in contravention of s 77(3) of the RLLC Act.
The Tribunal held that the electricity charges were valid under the old Act and continued to be valid under clause 6 of the Site Agreement and the transitional provisions of the RLLC Act. The Tribunal held they did not fall foul of s 77 of the RLLC Act because they continued to comply with clause 6 of the Site Agreement, and the Old Act and regulations.
The Appeal Panel upheld the defendant's appeal on grounds 4 and 5 and remitted the matter to the Consumer and Commercial Division of the Tribunal for the amount of the repayment to be calculated, with leave to the parties to adduce evidence about that matter. In doing so, the Appeal Panel overturned that part of the Tribunal's decision that the charges made by the plaintiff did not fall foul of s 77(3) because they were in accordance with the Site Agreement and the Old Act and regulations. The plaintiff does not challenge that determination of the Appeal Panel.
So that the judgment of the Appeal Panel can be understood it is necessary to set out some legislative provisions.
[3]
Legislative provisions
Section 6 of the RLLC Act provides:
6 Application of Act to site agreements
(1) This Act applies to all site agreements, whether existing immediately before or coming into existence after the commencement of this section, unless a provision of or under this Act provides otherwise.
(2) Where this Act applies to a site agreement, it so applies despite the terms of the agreement or any other contract, agreement or arrangement, whether made before or after the commencement of this section.
(3) This Act applies to a site agreement until it is terminated in accordance with this Act.
Section 77 provides:
77 Utility charges payable to operator by home owner
(1) This section applies if, under a site agreement, the home owner is required to pay utility charges to the operator for the use by the home owner of a utility at the residential site.
(2) The home owner cannot be required to pay for the use unless:
(a) the use is separately measured or metered, and
(b) the operator gives the home owner an itemised account and allows at least 21 days for the payment to be made.
(3) The operator must not charge the home owner an amount for the use of a utility that is more than the amount charged by the utility service provider or regulated offer retailer who is providing the service for the quantity of the service supplied to, or used at, the residential site.
Maximum penalty: 20 penalty units.
(4) The regulations may:
(a) provide for a maximum utility charge payable by home owners to the operator, and
(b) create an offence for an operator to request or receive more than that maximum charge (if any).
(5) The regulations may provide that a service availability charge for electricity payable by home owners to the operator of a community is to be discounted in accordance with the regulations where less than 60 amps are being supplied.
Schedule 2 to the RLLC Act dealt with Savings and Transitional provisions. Schedule 2 relevantly provided:
Part 1 General
1 Regulations
(1) The regulations may contain provisions of a savings or transitional nature consequent on the enactment of this Act or any Act amending this Act.
(2) Any such provision may, if the regulations so provide, take effect from the date of assent to the Act concerned or a later date.
(3) To the extent to which any such provision takes effect from a date that is earlier than the date of its publication on the NSW legislation website, the provision does not operate so as:
(a) to affect, in a manner prejudicial to any person (other than the State or an authority of the State), the rights of that person existing before the date of its publication, or
(b) to impose liabilities on any person (other than the State or an authority of the State) in respect of anything done or omitted to be done before the date of its publication.
Part 2 Provisions consequent on enactment of this Act
2 Definition
(1) In this Part:
repealed Act means the Residential Parks Act 1998.
(2) A reference in a provision of this Part to the Tribunal is to be read as a reference to the Consumer, Trader and Tenancy Tribunal or, if the provision becomes operative on or after the establishment day (within the meaning of the Civil and Administrative Tribunal Act 2013), the Civil and Administrative Tribunal.
3 General savings
Subject to this Act, each person, thing and circumstance appointed or created under the repealed Act or existing or continuing under that Act immediately before the commencement of the relevant provisions of this Act continues to have the same status, operation and effect as it would have had if this Act had not been enacted.
4 Existing registrations
…
5 Existing agreements
(1) Agreements entered into under the repealed Act that have not been terminated remain valid after the commencement of the relevant provisions of this Act.
Note. Accordingly, an existing agreement continues without the need to sign a new agreement once this Act commences.
(2) Without limiting subclause (1), a term of an agreement entered into under the repealed Act that provides for the increase of site fees by a fixed method (however expressed) remains in force after the commencement of the relevant provisions of this Act.
(3) A residential site agreement, moveable dwelling agreement or NPWS agreement (other than an excluded agreement) in force immediately before the repeal of the repealed Act is taken, on that repeal, to be a site agreement between the resident (as or on behalf of the home owner) and the park owner (as operator of the community in which the home is located).
(4) An excluded agreement in force immediately before the repeal of the repealed Act is taken, on that repeal, to be a tenancy agreement.
(5) This clause does not validate a term of an agreement entered into under the repealed Act that was void under that Act.
(6) In this clause:
excluded agreement means a moveable dwelling agreement or NPWS agreement under which a resident occupies a home that is owned by the park owner.
moveable dwelling agreement means an agreement of a kind referred to in clause 5 (1) (c) or (d) of the Residential Parks Regulation 2006 as in force immediately before its repeal by this Act.
NPWS agreement means an agreement of a kind referred to in clause 5 (1) (e) of the Residential Parks Regulation 2006 as in force immediately before its repeal by this Act.
[4]
The Appeal Panel's decision
Since the submissions of the plaintiff before the Appeal Panel and in the present proceedings rely on the history of the changes to the electricity market in recent years, it is necessary to set out briefly that history. It is conveniently summarised in the judgment of the Appeal Panel as follows:
[42] Although s 77(3) is not drafted particularly well, it is clear that it is trying to prohibit overcharging of residents, but specifically what is prohibited is somewhat difficult to fathom. The problem can be simplified by substituting labels for two of its critical components:
The operator must not charge the home owner an amount for the use of a utility that is more than the amount charged by Entity A for B,
where 'Entity A' is 'the utility service provider or regulated offer retailer who is providing the service'
and
'B' is 'the quantity of the service supplied to, or used at, the residential site'.
[43] The questions then are:
Who is Entity A?
What is the amount charged by Entity A for B?
[44] As for question (a), Entity A must be whoever is providing the service. There are only two possible candidates - the utility service provider, or the regulated offer retailer.
[45] It seems clear beyond argument that the first possible candidate (the utility service provider) is the supplier of electricity in the local area. This is Origin Energy - the supplier of electricity to the Park Operator, as shown in the invoices at pages 76-97 of the Appellant's bundle of materials.
[46] The second possible candidate is the regulated offer retailer. This is where it starts to get complicated.
[47] The Park Operator says that to understand s 77, and the significance of the reference to the 'regulated offer retailer', it is necessary to trace the recent history of the electricity market in New South Wales.
[48] When the new Act was passed by Parliament and subsequently assented to by the Governor (in 2013), pricing in the electricity market was still heavily regulated. The relevant legislation is the National Energy Retail Law (NSW) (NERL) (which is based on the National Energy Retail Law set out in the Schedule to the National Energy Retail Law (South Australia) Act 2011 (SA), and which applies as a law of New South Wales by the National Energy Retail Law (Adoption) Act 2012 (NSW) (the NERL Adoption Act - see in particular s 4 of that Act). In 2013, and for some time afterwards, the NERL imposed certain pricing obligations on a regulated offer retailer. In particular, and by way of example, s 37C of the NERL, as it existed during the period 3 January 2014 to 30 June 2014, provided as follows (the label 'AER' stands for the Australian Energy Regulator):
37C Obligations of retailers relating to regulated offers
(1) A regulated offer retailer for a regulated offer customer must make an offer (a regulated offer) to the customer to provide customer retail services -
(a) at the regulated offer prices; and
(b) under the retailer's form of standard retail contract.
(2) The regulated offer prices are the prices imposed by a regulated offer retailer in accordance with -
(a) any relevant determination of the Independent Pricing and Regulatory Tribunal under Division 5 of Part 4 of the Electricity Supply Act 1995; or
(b) any gas pricing order under Division 3 of Part 2 of the Gas Supply Act 1996 or any voluntary transitional pricing arrangement for gas agreed between the Independent Pricing and Regulatory Tribunal and the regulated offer retailer.
(3) A designated retailer (other than the regulated offer retailer) for a small customer must, if the customer requests the supply of energy under the retailer's standing offer, inform the customer of the customer's right to receive a regulated offer under this section and provide information about where to obtain particulars of the regulated offer retailer.
(4) A regulated offer retailer must -
(a) present its regulated offer prices (including any variation of those prices) in accordance with the AER Retail Pricing Information Guidelines; and
(b) without limitation, present those prices in accordance with those guidelines when publishing, advertising or notifying the AER of those prices or any variation.
(5) A regulated offer retailer must publish the terms and conditions of the retailer's regulated offer prices on the retailer's website.
(6) A regulated offer retailer must comply with the terms and conditions of the retailer's regulated offer.
(7) A regulated offer retailer is not obliged to make a regulated offer to a regulated offer customer if the customer's premises are not, or are not proposed to be, connected to a distributor's distribution system.
(8) The NSW regulations may apply (with or without modifications) to the provision of customer retail services by regulated offer retailers provisions of the Rules relating to the provision of customer retail services by designated retailers and to standard retail contracts of designated retailers.
(9) If a designated retailer for a customer is also the regulated offer retailer for the customer, the retailer must make an offer under this section and also an offer under section 22 (in the capacity of the designated retailer) if the retailer's standing offer prices differ from its regulated offer prices. However, the retailer is not required to make an offer under section 22 if the prices are the same.
(10) Sections 26, 27 and 30 apply to a standard retail contract between a regulated offer retailer and a regulated offer customer based on a regulated offer (a regulated offer contract) in the same way as they apply to a standard retail contract between a designated retailer and a small customer based on a standing offer.
(11) A regulated offer retailer may alter the standard retail contract specified under this Law to make any modifications necessary to reflect the regulated offer and regulated offer prices. Any such alteration is taken to be a required alteration.
[49] Section 2 (the Interpretation section) of the NERL directed the reader to s 37A for the meaning of the expression 'regulated offer retailer'. Section 37A provided that the 'NSW regulations' (defined by s 2 of the NERL as regulations made under the NERL Adoption Act) must nominate one or more retailers as the regulated offer retailer for customers within the whole or a part of New South Wales. That retailer, or those retailers, would each be a regulated offer retailer.
[50] Until 30 June 2014, clause 6(2) of the NSW regulations nominated the following retailers as the regulated offer retailers for electricity:
(a) Origin Energy Electricity Ltd for premises connected to the distribution system of either Essential Energy or Endeavour Energy; and
(b) EnergyAustralia Pty Ltd for premises connected to the distribution system of Ausgrid.
[51] Clause 6(1) contained corresponding nominations of regulated offer retailers for gas.
[52] Clause 6(2) was repealed with effect from 1 July 2014. (Clause 6(1) remained in force until 30 June 2017, when it, too, was repealed.)
[53] Meanwhile, the new Act dealing with residential parks (the Residential (Land Lease) Communities Act 2013), although having been assented to in 2013, was not proclaimed to commence until 1 November 2015. And between the date of assent and the date of commencement, the concept of 'regulated offer retailer' in relation to electricity was abolished (as it has since been abolished in relation to gas as well). Nevertheless, the expression is still there in the new Act.
[54] In light of that history, we accept that there is no longer an entity answering the description 'regulated offer retailer' in s 77(3). But that simply means there is no second candidate to fill the shoes of Entity A (see [42]-[46] above). (And even if there were, the second candidate would have been the same as the first candidate anyway - Origin Energy.)
The Appeal Panel then noted a submission by the plaintiff as follows:
The definitions of utility service provider and regulated offer retailer refer to the notional retailer who would be providing the service to the home owner if the home owner was connected to the main electricity grid. The limit in s 77 is the amount that the local area retailer would charge.
The Appeal Panel dealt with that submission as follows:
[56] In other words, the Park Operator asks us to depart from a consideration of the actual words of the statute - by which 'the utility service provider … who is providing the service' can readily be identified - and instead search for 'the notional retailer who would be providing the service …'. The Park Operator also asks us to identify not what is charged (which must be the sense in which the words 'the amount charged' are used in s 77(3)) for B by the actual provider, but what would be charged for B by a notional provider.
[57] The approach suggested by the Park Operator is at odds with all currently accepted rules of statutory interpretation. We need only refer to what the High Court said in Commissioner of Taxation v Consolidated Media Holdings Ltd [2012] HCA 55, at [39]:
This Court has stated on many occasions that the task of statutory construction must begin with a consideration of the [statutory] text" [Alcan (NT) Alumina Pty Ltd v Commissioner of Territory Revenue [2009] HCA 41; (2009) 239 CLR 27 at 46 [47]]. So must the task of statutory construction end. The statutory text must be considered in its context. That context includes legislative history and extrinsic materials. Understanding context has utility if, and in so far as, it assists in fixing the meaning of the statutory text. Legislative history and extrinsic materials cannot displace the meaning of the statutory text. Nor is their examination an end in itself.
[58] Despite the inelegant drafting of s 77(3), there is no ambiguity or lack of clarity in the language used. The 'utility service provider' still exists. It can readily be identified. There is no warrant for ignoring that entity and searching instead for a notional alternative entity that might have done what the actual entity in fact does, and then working out what that notional entity might have charged for that hypothetical service. The position is simply this - the Park Operator cannot charge Mrs Reckless for her consumption of electricity more than it is being charged by Origin Energy for the amount Mrs Reckless has consumed.
The plaintiff submitted to the Appeal Panel that a Facts Sheet published by NSW Fair Trading lent support for the plaintiff's construction of s 77. The Appeal Panel at [63] held that the commentary in the Facts Sheet diverged from the terms of s 77(3). The Panel held that the Facts Sheet was consistent with condition 7 in Version 4 of the Australian Energy Regulator's Retail Exempt Selling Guideline, but held that compliance by an exempt person with condition 7 did not necessarily equal compliance with the requirements of s 77(3). In that regard, the Appeal Panel said:
[67] Finally, it may be thought surprising that a park operator's pricing practices can comply with Condition 7 of the Australian Energy Regulator's Retail Exempt Selling Guideline and yet be in breach of s 77(3) of the new Act. But that outcome is not as unusual as it may appear. Park operators are not the only category of 'exempt person' subject to the Guideline: an 'exempt person' is any person 'who is exempted by the AER under a deemed, registered or individual exemption from the requirement to hold a retailer authorisation': Section 11 of the Guideline. Section 2 of the Guideline provides some examples of other categories of persons who may be on-selling electricity, but who are entitled to exemption from the obligations imposed on 'authorised retailers' - they may include landlords selling electricity to tenants of a residential apartment block, or persons selling electricity to builders working on a construction site. It is not hard to imagine why, as a matter of policy, more stringent pricing conditions might be imposed on some categories of 'exempt person' than on others. Section 77(3) of the new Act is simply one example of the implementation of those types of policy considerations.
Finally, the plaintiff drew attention to what was said in clause 3 of Schedule 2 to the RLLC Act. Its submission in reliance on that clause was set out in the Appeal Panel's judgment as follows:
[70] The Park Operator submits that its method of charging for electricity consumption is a 'circumstance' created by the standard terms of the old Act and therefore, in accordance with clause 3, it 'continues to have the same status, operation and effect as it would have had if this Act had not been enacted'. The Park Operator also notes that although the Site Agreement entered into in April 2014 is not in the same terms as the prescribed site agreement contained in either of the now repealed Regulations, clause 6 of the Site Agreement is for all practical purposes identical to the standard clause dealing with electricity charges in each of those prescribed site agreements.
[71] The Park Operator submits that its continued practice of charging Mrs Reckless for her electricity consumption in accordance with clause 6 of the Site Agreement is protected by clauses 3 and 5 of Schedule 2 to the new Act.
The Appeal Panel's conclusion in relation to that submission was as follows:
[72] We do not accept the Park Operator's submissions. If the existence of any term of a site agreement entered into before the commencement of the new Act were accepted as a 'circumstance' created under the old Act, or as a 'circumstance' that was existing or continuing under the old Act immediately before the commencement of the new Act, then there is little room for the operation of the new Act in relation to pre-existing site agreements at all, despite the apparent intention to bring all site agreements, whether old or new, into one modernised regulatory environment. We do not ignore the qualification in s 6(1) of the new Act - that the Act applies to pre-existing site agreements 'unless a provision of or under this Act provides otherwise' - but if all pre-existing terms of an agreement are saved by clauses 3 and 5 of Schedule 2, it is hard to see why the agreement would be brought into the new Act in the first place.
[5]
Grounds of appeal
The plaintiff appeals on one ground only as follows:
1. The Appeal Panel erred in law in construing s 77 of the Residential (Land Lease) Communities Act 2013 (NSW) ("the Residential Communities Act")
Particulars
a. The Appeal Panel failed to give any meaning and effect to the term "regulated offer retailer" for the purposes of s 77(3) of the Residential Communities Act: Decision at [42] - [46] and [53] - [58];
b. Section 77(3) of the Residential Communities Act does not prohibit "the overcharging of residents"; Decision at [42];
c. Section 77(3) of the Residential Communities Act does not prevent an operator from charging a home owner more for their consumption of electricity than an operator was charged for the amount of electricity consumed by the home owner at the residential site: Decision at [58]; and
d. The "label approach" taken by the Appeal Panel is a dichotomy which is not provided for by s 77(3): Decision at [42] - [46].
The plaintiff set out five reasons why leave should be given as follows:
1. There is a divergence of views amongst members of the body below in relation to the correct interpretation of the relevant provisions.
2. The error alleged is clearly arguable.
3. The proper interpretation of the relevant provisions has widespread implications throughout residential communities for both operators and residents.
4. The appeal raises novel and unsettled issues of statutory interpretation.
5. The appeal arises against a factual context which concerns the adoption and implementation of a technology, namely, 'smart' meters.
[6]
Determination
The defendant accepted that the issue raised by the appeal was of sufficient importance that leave should be granted to the plaintiff to appeal. Having regard to the principles in Zelden v Sewell; Henamast Pty Ltd v Sewell [2011] NSWCA 56 at [22] and Jaycar Pty Ltd v Lombardo [2011] NSWCA 284 at [46], I agree that leave should be granted. There is an important point of principle derived from the proper construction of s 77 of the RLLC Act. The issue is one which will certainly affect residents in the residential park owned by the plaintiff. Further, other owners and residents need to know what the limits are under s 77 on the rights of the owners to charge for electricity.
The difficulty in this case arises from the timing of the enactment of various pieces of legislation and, arguably, from the use of regulation to bring about a change in the way one Act, the National Energy Retail Law (Adoption) Act 2012 (NSW) (the NERL Adoption Act), operated without regard to other legislation, being the RLLC Act. The position developed in this way.
The NERL Adoption Act was an Act which adopted the Schedule to the National Energy Retail Law (South Australia) Act 2011 (SA) by virtue of s 4 of the NERL Adoption Act. The NERL Adoption Act was assented to on 21 June 2012 and commenced on 1 July 2013. However, s 4(a) of the NERL Adoption Act said that the South Australian law applied with the modifications set out in Schedule 1 to the NERL Adoption Act. That Schedule inserted a number of definitions and sections of the Act which dealt with the particular regime to be put in place in NSW during a transitional period. The definitions were:
"Regulated offer", "regulated offer contract", "regulated offer customer", "regulated offer price" and "regulated offer retailer".
It is the last of those definitions which has given rise to the dispute in the present proceedings.
On 20 November 2013 the RLLC Act was assented to. However, it did not commence to operate until 1 November 2015. Section 77(3) of that Act made reference to a "regulated offer retailer" in relation to a utility in respect of which s 77 was concerned.
Section 12 of the NERL Adoption Act relevantly provided:
12 Regulations
(1) The Governor may make regulations, not inconsistent with this Act, for or with respect to any matter that by this Act is required or permitted to be prescribed or that is necessary or convenient to be prescribed for carrying out or giving effect to this Act.
(2) The regulations may:
(a) amend Schedule 1,
…
Pursuant to the power in s 12 of the NERL Adoption Act, the Governor made the National Energy Retail Law (Adoption) Regulation 2013 (NSW) (the 2013 Regulation) which commenced on 1 July 2013. Clause 5 nominated local area retailers for both gas and electricity. Sub-clause (2) nominated Origin Energy Electricity Ltd as a local area retailer for premises in NSW connected to the distribution systems of Essential Energy and Endeavour Energy. Clause 6 nominated regulated offer retailers for gas and electricity. Sub-clause (2) provided:
The following retailers are nominated as the local area retailers for electricity for premises specified below in relation to each retailer:
(a) Origin Energy Electricity Ltd (ACN 071 052 287) for premises in this State connected to the following distribution systems:
(i) the distribution system of Essential Energy,
(ii) the distribution system of Endeavour Energy,
…
On 27 June 2014 the Governor made a further Regulation called the National Energy Retail Law (Adoption) Amendment (Retail Price Deregulation) Regulation 2014 (NSW) (the 2014 Regulation) which commenced on 1 July 2014.
The explanatory note relevantly said this:
The objects of this Regulation are as follows:
(a) To modify the operation of the National Energy Retail Law (NSW) so that the mandatory scheme in that Law requiring energy retailers to offer energy at a regulated price to certain small customers under regulated offer contracts no longer applies to the supply of electricity to those customers,
(b) To provide for the transition of electricity customers currently on regulated offer contracts to standard retail contracts at standing offer prices and for other transitional matters,
…
Clause 3 of Schedule 2 omitted cl 6(2) of the 2013 Regulation. That is, it abolished regulated offer retailers for electricity.
Clause 5 then inserted Div 7 into Pt 6 of the 2013 Regulation. It relevantly provided:
Division 7 Provisions consequent on National Energy Retail Law (Adoption) Amendment (Retail Price Deregulation) Regulation 2014
50 Existing regulated offer customers
(1) This clause applies to a customer who was, immediately before 1 July 2014, being the date of commencement of this clause, a regulated offer customer for the supply of electricity to the customer.
(2) On that commencement, the customer is taken to be a standing offer customer and the regulated offer contract is taken to be replaced by a contract between the customer and the designated retailer for that customer on the terms and conditions (including standing offer prices) applicable to a standard retail contract between a small customer and the designated retailer under the National Law.
(3) A payment plan, or an arrangement as to a payment method, in force in relation to the customer immediately before that commencement continues to have effect in relation to the customer, subject to any subsequent agreement between the customer and the designated retailer or another retailer.
(4) A notice that was given, and was in operation, under the contract for the supply of electricity to the customer immediately before that commencement is taken to be a notice given under the standard retail contract.
(5) A hardship policy applicable to the customer immediately before that commencement continues to apply to the customer.
(6) Rule 36 of the National Energy Retail Rules applies to a change of tariff that occurs when a contract is replaced by another contract under this clause with the following modifications:
(a) a meter reading or metering data is not required to be obtained at the time the type of tariff changes,
(b) the customer's bill is to be based on an estimation of the customer's consumption of energy in accordance with rule 21 of those Rules and, for that purpose, the customer is taken to consent to the use of estimation by the retailer,
(c) the date from which the new type of tariff applies for the purposes of calculating the bill is the date of commencement of this clause.
51 Revival of provision
Section 145 (4) of the National Law has effect on and from 1 July 2014, being the date of commencement of this clause, as if Schedule 1 [23] to the Act, as in force before that commencement, had not been made.
52 References to regulated offer customers
(1) A reference to a regulated offer customer in any Act or other instrument in relation to the supply of electricity is taken to be a reference to a person who was, immediately before 1 July 2014, a regulated offer customer within the meaning of the National Law.
(2) A reference to a regulated offer retailer in any Act or other instrument in relation to the supply of electricity is taken to be a reference to a person who was, immediately before 1 July 2014, a regulated offer retailer within the meaning of the National Law. (emphasis added)
By the omission of cl 6(2) and the provisions of clauses 50 and 52 of the 2014 Regulation, there ceased to be any entity known as a regulated offer retailer from 1 July 2014 when the 2014 Regulation commenced. However, no amendment was made to s 77(3) of the RLLC Act, which at the time of the amendments to the National Energy Regulations had not commenced to operate.
When the RLLC Act commenced to operate on 1 November 2015 the restriction on the operator, here the plaintiff, in s 77(3) was not to charge the home owner (here the defendant) an amount for the use of electricity that was more than the amount charged by the utility service provider (accepted as being Origin Energy) or the regulated offer retailer who is providing the service for the quantity of the electricity supplied.
The essence of the plaintiff's argument is that the Appeal Panel erred by not giving any meaning to the words "regulated offer retailer" when principles of construction require that all the words in a statute must be given meaning. The plaintiff submits, therefore, that the "regulated offer retailer" is now to be read as the entity that provides a standing offer to a small customer for whom it is the designated retailer: National Energy Retail Law (NSW) s 22. The plaintiff submits that this means that, provided the operator does not charge the home owner more than is contained in the standing offer, s 77(3) is not breached. In that way, the entity that was the regulated offer retailer is being referred to together with all that is now involved in that entity being a designated retailer.
This plays out in a practical sense in this way. The standing offer rate from 1 July 2016 from Origin Energy, as the designated retailer, as far as the plaintiff is concerned, is 26.620, 26.191 and 25.773 cents per kWh (see Court Book (CB) 293). The rate actually charged to the plaintiff by reason of the plaintiff having a smart meter that breaks down the charges into Peak, Shoulder and Off-peak rates is shown at CB 270. Those rates there are respectively 6.2377, 6.2372 and 4.2102 cents per kWh. Nevertheless, the plaintiff says it is entitled to charge the standing offer rate because s 77(3) only prevents it charging more than either the utility service provider or the regulated offer retailer charge. It is accepted by the parties that the regulated offer retailer is now the designated retailer.
The plaintiff eschewed any reliance on the argument based on the word "circumstance" in clause 3 of Schedule 2 of the RLLC Act dealt with in the Appeal Panel's judgment at [70]-[72] and set out above at [17]-[18].
The defendant submits that the words "regulated offer retailer" should simply be read as descriptive of the entity that is now a designated retailer, without importing the new arrangements of a standing offer that a designated retailer is obliged to make.
In my opinion the decision of the Appeal Panel was correct, although my reasons for reaching that conclusion differ to some extent from those of the Appeal Panel.
In the first place, I accept the principle of construction set out in Project Blue Sky Inc v Australian Broadcasting Authority (1998) 194 CLR 355 where the joint judgment of McHugh, Gummow, Kirby and Hayne JJ said at [71]:
Furthermore, a court construing a statutory provision must strive to give meaning to every word of the provision. In The Commonwealth v Baume Griffith CJ cited R v Berchet to support the proposition that it was "a known rule in the interpretation of Statutes that such a sense is to be made upon the whole as that no clause, sentence, or word shall prove superfluous, void, or insignificant, if by any other construction they may all be made useful and pertinent".
Notwithstanding that I am firmly of the opinion that the Legislature overlooked the fact that the RLLC Act, which had been passed and assented to in 2013, was not amended to take account of the changes made by the 2014 Regulation before the RLLC Act was proclaimed to commence, it is necessary to strive to give a meaning to the words "regulated offer retailer" although such an entity ceased to exist before the RLLC Act commenced.
Clause 52 inserted into the 2013 Regulation by the 2014 Regulation makes clear that a reference to a regulated offer retailer in any Act is taken to be a reference to a person who was a regulated offer retailer immediately before 1 July 2014. Further, the effect of clause 50 of the 2013 Regulation is, as both parties accept, to rename a regulated offer retailer as a designated retailer. Accordingly, the words "regulated offer retailer" in s 77(3) should be read as the designated retailer.
However, that does not resolve the dispute between the parties. As noted, the plaintiff asserts that, if the words are to be read as if they read "the designated retailer", that must carry with it the standing offer regime that cl 50 speaks of. I do not think that is correct in the circumstances of this case. I accept the defendant's submission that to import the standing offer regime would be to import a hypothetical into the true position in relation to the charging for electricity by Origin Energy, which happens to be both the utility service provider and the designated retailer.
In my opinion, s 77(3) is intended to ensure that the operator may not pass onto the home owner a charge for electricity greater than that which the operator has effectively been charged in respect of that home owner. That is supported by the words "is more than the amount charged" in s 77(3). The words do not say "that is more than the amount that could be charged". The evidence in the present case demonstrates that the operator is being charged by Origin Energy, not at the standing offer rate, but at the rate which is evidenced from the account from Origin Energy to the operator at pages 270 and 271 of the Court Book. Those charges are not charged at the rate of the standing offer that might have been charged.
Support for this construction comes also from the prescribed standard form of residential site agreement effected by cl 6 of the Residential (Land Lease) Communities Regulation 2015 (NSW). Clauses 8, 9 and 10 of the standard form agreement deal with payment for utilities where the operator is the re-supplier of the utility to the residential site. In particular, cl 10 provides:
10. We agree not to charge you any of the following:
10.1 An amount for the use of a utility that that is more than the amount charged by the relevant utility service provider for the quantity of the service supplied to, or used at, the residential site,
10.2 A service availability charge than is more than would be charged by the relevant utility service provider, if the service was supplied directly to you by the relevant utility service provider, divided by the number of sites in the community …
In the first place, cl 10.1 limits the amount that the operator may charge for the use of a utility to what the relevant utility service provider has charged the operator. Then, and by comparison, the service availability charge is posited on a hypothetical, namely, a charge that would be charged if the service was supplied directly to the resident by the utility service provider.
Clause 10.1 of the new standard agreement is not consistent with a reading of s 77(3) that incorporates a hypothetical charge that could have been made but was not made by the designated retailer. In saying that, I accept that the present defendant's site agreement is an agreement that was made prior to the enactment of the RLLC Act, and continues on its own conditions, subject to s 6(1) of the RLLC Act and, accordingly, s 77(3).
The significance of the word "charged" in s 77(3) as referring to the actual, as opposed to the hypothetical, position is also highlighted by the wording of s 78(1) of the RLLC Act dealing with unpaid utility charges. That sub-section provides:
78 Unpaid utility charges
(1) If a home owner is required to pay a utility charge to the operator of a community under this Part, the operator may charge a fee for late payment or a dishonoured payment, not exceeding the amount that could have been charged if the service was supplied directly to the home owner by the local utility service provider or regulated offer retailer. (emphasis added)
In a similar manner to cl 10.2 of the new standard form residential agreement, the charge being spoken of in s 78(1) is a hypothetical charge and not one that was actually imposed by the utility service provider or the designated retailer.
A further situation in which the words "regulated offer retailer" might have the meaning for which the plaintiff contends, is one where the arrangement between the designated retailer and the operator is based on the standard offer regime. If, as the plaintiff submits, "regulated offer retailer" in s 77(3) is to be understood as the designated retailer providing post-deregulation standing offer services, then the operator in that situation would be free to pass onto the resident the standing offer charges that the operator is required to pay with respect to that resident's use of electricity.
The plaintiff submitted that, as it happened, Origin Energy was not only the utility service provider wearing its market hat, but was also the designated retailer wearing its standing offer hat. However, it is still necessary to determine in which guise it has "charged" the operator "for the quantity of the service supplied to, or used at, the residential site". Furthermore, in this case, the designated retailer is not the entity as such "who is providing the service". Rather, that entity is the utility service provider. The fact that Origin Energy could have provided the service in either guise does not obscure the need to identify who is providing the service and on which basis.
In Federal Commissioner of Taxation v Consolidated Media Holdings Ltd (2012) 250 CLR 503; [2012] HCA 55 the Court said at [39]:
"This Court has stated on many occasions that the task of statutory construction must begin with a consideration of the [statutory] text" (Alcan (NT) Alumina Pty Ltd v Commissioner of Territory Revenue (2009) 239 CLR 27 at [47]). So must the task of statutory construction end. The statutory text must be considered in its context. That context includes legislative history and extrinsic materials. Understanding context has utility if, and in so far as, it assists in fixing the meaning of the statutory text. Legislative history and extrinsic materials cannot displace the meaning of the statutory text. Nor is their examination an end in itself.
There is much force in the defendant's submission that the plaintiff's construction of s 77(3) would import into the sub-section after the word "provider" the words "or in the case of electricity or gas would have been payable if the electricity or gas had been supplied to a small customer under a standard retail contract of the designated retailer at standing offer prices".
Had the Legislature intended to provide for that position it could have done so in a similar manner to what was done in s 78(1), cl 10.2 of the new standard form residential agreement, or regulation 13(1) of the Residential (Land Lease) Communities Regulation 2015 which provides:
13 Maximum service availability charge - electricity
(1) The maximum service availability charge payable, in respect of any period, by a home owner to the operator for the supply of electricity at a residential site is the amount that would have been payable for the period if the electricity had been supplied to a small customer under a standard retail contract of the applicable local area retailer at standing offer prices.
(emphasis added)
On the proper construction of s 77(3) of the RLLC Act, the plaintiff is not entitled to charge the defendant any more than the plaintiff has been charged for the supply or use of the electricity consumed by the defendant.
[7]
Conclusion
I make the following orders:
1. Leave to appeal from the decision of the Appeal Panel of the Civil and Administrative Tribunal given on 3 April 2018.
2. Dismiss the appeal.
3. Dismiss the Amended Summons.
4. The plaintiff is to pay the defendant's costs.
[8]
DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated.
Decision last updated: 04 September 2018
Parties
Applicant/Plaintiff:
Silva Portfolios Pty Ltd trading as Ballina Waterfront Village & Tourist Park
Respondent/Defendant:
Reckless
Legislation Cited (8)
National Energy Retail Law (Adoption) Regulation 2013(NSW)cl 50
National Energy Retail Law (Adoption) Amendment (Retail Price Deregulation) Regulation 2014(NSW)sch 2, cll
Residential Parks Act 1998(NSW)
Act, the National Energy Retail Law (Adoption) Act 2012(NSW)