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In a case pretty much identical to one already posted back in 2022 (PreAction claim against breach of utility contract - LegalBeagles Forum), and similar to others (e.g. Ultility Bidder + PreAction breach of contract that never even started - LegalBeagles Forum), I have recently been pestered by PreAction over a contract I allegedly signed in December 2019.
I write this post to provide as many details as possible, in case it helps others in a similar situation. I also seek reassurance that I am doing the right thing.
PreAction telephoned unexpectedly a few weeks ago, claiming to have tried to send an email which I hadn't received. The lady informed me that I am in default of a signed utility contract that did not proceed and that I am liable for hundreds of pounds. I was a little taken aback as I very much doubted that I would have signed a contract for Gazprom to supply my business and as it was almost 6 years ago I would be unlikely to remember in any case.
An email came through later in the day with 4 attached documents:
1) A formal letter from PreAction detailing the case.
2) A copy of the broker's letter of authority I had signed (it does look like my signature).
3) A copy of the utility contract that had been signed by an employee of the broker.
4) A copy of an email that I apparently wrote to confirm that I wished to go ahead with the "updated terms", which detailed only the contracted supplier, contract start and end dates, the meter number, unit rate and standing charge and the supply address.
There were no terms and conditions supplied with the LOA (2) nor the contract (3). The letter (1) selectively quotes the supposed terms and conditions breached, and then provides a link to a website that shows the full alleged terms and conditions. As tesla6518 has already pointed out, this appears to make the claim legally "unenforceable as there is no reference to the website on the LOA, as required by law". Following the advice on these forums I decided to ignore the email, but recently PreAction telephoned again. I pointed out the lack of terms and conditions provided with the documents but the bullying lady was having none of it. Here is their emailed response (my company and the broker's names have been removed):
"Following our discussion
Whilst your comments are noted, they are without legal basis, erroneous and rejected.
Terms and conditions and causation
We are concerned that a fundamental issue between the parties has been overlooked.
For clarity and the avoidance of any doubt, this claim is straightforward, apparent and evidenced.
There were dealings between two businesses.
[Business name] instructed [broker] to act on its behalf.
Evidence by the signed Letter of Authority (attached).
In accordance with such instructions, [broker] acted on behalf of [business name]. Both parties clearly entered into that commercial relationship seeking profitable benefits.
Your client entered a contract with [broker] and your client did not (Due to duplicating with the current supplier) honour that contract.
The liability for your client to make good the commercial loss suffered is clear and not for debate or discussion. The matter here is quantum.
It is difficult if not impossible to conceive of a position whereby a party (here that is you) can choose to enter into contracts on behalf of the business, only to then wilfully breach such contracts and seek to avoid liability for doing so.
In the event, that this matter is not resolved through PreAction the role of this company will fall away leaving our client to issue proceedings through a law firm. If that happens so be it. At least the parties have enjoyed the opportunity to set out their positions and question those of the other side.
The agreement between [broker] and [business name] is evidenced by both the letter of authority and the actions taken by our client in accordance with the instructions given to it.
The parties dealt on a commercial basis and therefore instructing Our Client to provide services [business name] knew (or is treated as should have known) that these terms and conditions of [broker] governed the relationship.
Notwithstanding the above, it is trite law to suggest (in a flailing attempt to deny clear liability) that the Letter of Authority and incorporated terms and conditions of our client did not apply or were anything other than accepted; i) in commercial/business-to-business relationships there is no requirement for terms and conditions to be present/provided to the customer for acceptance, the law only requires limited transactions to be set out in writing (for example the sale or purchase of property or a will)
To suggest the terms and conditions that govern this relationship didn’t constitute a contract is bizarre and will not be entertained again.
In summary, every element of your defence is misguided, inaccurate and denied.
We respectfully request you reconsider your position in this matter, or, instruct a qualified legal representative to engage for a sensible transition to resolution.
We need not remind you that in the event of our client issuing proceedings not only will any potential discounts available through resolution with PreAction disappear but of course your client’s liability will materially increase.
PreAction remains open to bringing an end to this matter and we invite you to do so now by way of an offer to settle."
A couple of days later I received a letter from the broker which again quotes the supposed terms and conditions breached, and states that "as the Contract was not fulfilled and in breach, £332.20 plus VAT is now due and owing being the Non-Live Administration Fee agreed upon signature of the agreement." There is then the further threat of County Court proceedings and liability for interest at 8%, plus a statutory collection fee. The letter states that if I believe I "have genuine grounds for contesting the claim, then you must provide a full written reply to PreAction on or before 22nd July 2025" while also inviting me to make the payment of £332.20 + VAT on or before this same date.
I do not believe I have done anything wrong or breached any terms and conditions and so I would welcome advice on the best approach to take. How do I stop these people causing so much stress. I'm happy to provide full details of all of the correspondence of PreAction and the energy broker if necessary.
I write this post to provide as many details as possible, in case it helps others in a similar situation. I also seek reassurance that I am doing the right thing.
PreAction telephoned unexpectedly a few weeks ago, claiming to have tried to send an email which I hadn't received. The lady informed me that I am in default of a signed utility contract that did not proceed and that I am liable for hundreds of pounds. I was a little taken aback as I very much doubted that I would have signed a contract for Gazprom to supply my business and as it was almost 6 years ago I would be unlikely to remember in any case.
An email came through later in the day with 4 attached documents:
1) A formal letter from PreAction detailing the case.
2) A copy of the broker's letter of authority I had signed (it does look like my signature).
3) A copy of the utility contract that had been signed by an employee of the broker.
4) A copy of an email that I apparently wrote to confirm that I wished to go ahead with the "updated terms", which detailed only the contracted supplier, contract start and end dates, the meter number, unit rate and standing charge and the supply address.
There were no terms and conditions supplied with the LOA (2) nor the contract (3). The letter (1) selectively quotes the supposed terms and conditions breached, and then provides a link to a website that shows the full alleged terms and conditions. As tesla6518 has already pointed out, this appears to make the claim legally "unenforceable as there is no reference to the website on the LOA, as required by law". Following the advice on these forums I decided to ignore the email, but recently PreAction telephoned again. I pointed out the lack of terms and conditions provided with the documents but the bullying lady was having none of it. Here is their emailed response (my company and the broker's names have been removed):
"Following our discussion
Whilst your comments are noted, they are without legal basis, erroneous and rejected.
Terms and conditions and causation
We are concerned that a fundamental issue between the parties has been overlooked.
For clarity and the avoidance of any doubt, this claim is straightforward, apparent and evidenced.
There were dealings between two businesses.
[Business name] instructed [broker] to act on its behalf.
Evidence by the signed Letter of Authority (attached).
In accordance with such instructions, [broker] acted on behalf of [business name]. Both parties clearly entered into that commercial relationship seeking profitable benefits.
Your client entered a contract with [broker] and your client did not (Due to duplicating with the current supplier) honour that contract.
The liability for your client to make good the commercial loss suffered is clear and not for debate or discussion. The matter here is quantum.
It is difficult if not impossible to conceive of a position whereby a party (here that is you) can choose to enter into contracts on behalf of the business, only to then wilfully breach such contracts and seek to avoid liability for doing so.
In the event, that this matter is not resolved through PreAction the role of this company will fall away leaving our client to issue proceedings through a law firm. If that happens so be it. At least the parties have enjoyed the opportunity to set out their positions and question those of the other side.
The agreement between [broker] and [business name] is evidenced by both the letter of authority and the actions taken by our client in accordance with the instructions given to it.
The parties dealt on a commercial basis and therefore instructing Our Client to provide services [business name] knew (or is treated as should have known) that these terms and conditions of [broker] governed the relationship.
Notwithstanding the above, it is trite law to suggest (in a flailing attempt to deny clear liability) that the Letter of Authority and incorporated terms and conditions of our client did not apply or were anything other than accepted; i) in commercial/business-to-business relationships there is no requirement for terms and conditions to be present/provided to the customer for acceptance, the law only requires limited transactions to be set out in writing (for example the sale or purchase of property or a will)
To suggest the terms and conditions that govern this relationship didn’t constitute a contract is bizarre and will not be entertained again.
In summary, every element of your defence is misguided, inaccurate and denied.
We respectfully request you reconsider your position in this matter, or, instruct a qualified legal representative to engage for a sensible transition to resolution.
We need not remind you that in the event of our client issuing proceedings not only will any potential discounts available through resolution with PreAction disappear but of course your client’s liability will materially increase.
PreAction remains open to bringing an end to this matter and we invite you to do so now by way of an offer to settle."
A couple of days later I received a letter from the broker which again quotes the supposed terms and conditions breached, and states that "as the Contract was not fulfilled and in breach, £332.20 plus VAT is now due and owing being the Non-Live Administration Fee agreed upon signature of the agreement." There is then the further threat of County Court proceedings and liability for interest at 8%, plus a statutory collection fee. The letter states that if I believe I "have genuine grounds for contesting the claim, then you must provide a full written reply to PreAction on or before 22nd July 2025" while also inviting me to make the payment of £332.20 + VAT on or before this same date.
I do not believe I have done anything wrong or breached any terms and conditions and so I would welcome advice on the best approach to take. How do I stop these people causing so much stress. I'm happy to provide full details of all of the correspondence of PreAction and the energy broker if necessary.
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