The Electricity Supply Act restricts disconnection powers to scenarios of ongoing tampering; once resolved, disconnection demands are invalid.

[1] This is an appeal against the decision of the learned judicial commissioner ('JC') of the High Court at Kuala Lumpur delivered on 29 May 2015, allowing the plaintiffs' claim with costs of RM15,000 and dismissing the defendant's counterclaim with no order as to costs.

Background Facts

[2] For ease of reference, parties will be referred to as they were in proceedings before the High Court.

[3] A summary of the background facts is derived primarily from the learned JC's 'Grounds of Judgment'.

[4] Tenaga Nasional Bhd ('TNB'), the defendant in this action, is the sole provider of electricity in Peninsular Malaysia. TNB is a licensee under the Electricity Supply Act 1990 ('the Act') with statutory powers to take action for offences committed under the Act, in particular for the tampering of TNB's meters and the theft or pilferage of electricity.

[5] The first plaintiff is a customer of TNB and the owner of a hotel known as Good Hope Hotel ('the hotel') situated on the first plaintiff's premises at PTD 19887, No 1, Jalan Ronggeng 5, Taman Skudai Baru, Skudai, Johor Baru.

[6] Pursuant to a contract for the supply of electricity and the provisions of the Act, TNB supplied electricity to the hotel. At all material times, the second plaintiff leased and operated the hotel and made payments of the electricity bills issued by TNB. At the High Court, the learned JC referred to the first and second plaintiffs collectively as 'the hotel'.

[7] The salient facts which has given rise to this action may be briefly stated as follows. On 30 July 2009, the defendant's employees carried out an inspection of the meter installation at the premises of the hotel, and discovered that there had been tampering of the meter. As a consequence, the meter did not properly record the actual amount of electricity consumed by the hotel. This had resulted in a lower calculation of the use of electricity than the actual usage.

[8] In the circumstances, in accordance with the defendant's standard procedure, on the same day of the discovery of the tampering, the defendant's employees proceeded to dismantle and remove the tampered meter and replaced it with a new meter. Thereafter, the first plaintiff continued to be billed for electricity consumed as recorded by the new meter.

[9] Subsequently, the defendant did a recalculation of the quantum of loss of revenue due to the under-billing of the hotel account with the defendant. According to the defendant's recalculation, the loss of revenue due to the meter tampering was in the amount of RM1,100,350.98.

[10] On conclusion of the recalculation, the defendant issued a notice of demand dated 20 October 2009, ('the notice of demand') stating that unless the sum of RM1,100,350.98 is paid to the defendant within 24 hours, the supply of electricity would be disconnected on 21 October 2009.

[11] Apart from the notice of demand, the defendant also issued the statutory notice dated 20 October 2009 under s 38(1) of the Act ('the notice of disconnection') which states that the supply of electricity would be disconnected on 21 October 2009.

[12] Both the notice of demand and the notice of disconnection were issued about two months and 20 days after the initial inspection and removal and replacement of the tampered meter.

[13] It was not in dispute that when these notices were issued there was no longer any issue of meter tampering as the tampered meter had been replaced by a new meter by the defendant's employees.

[14] In response, by its solicitor's