Tenaga Nasional Berhad v Chan Lee Lee (BA-11BNCvC-23-06/2023)

The Appellant is licensed to supply electricity under the Electricity Supply Act 1990 (“ESA”). The Respondent is a registered customer and has an account with the Appellant for the supply of electricity to 80-1, Jln Lestari Perdana 7/4, Tmn Lestari Perdana, 43300 Bdr Putra Permai, Seri Kembangan, Selangor (“Premises”).

On 28-11-2018, the Appellant’s servants conducted an inspection of the electricity meter at the Premises (“Meter”) and claimed that the Meter had been tampered with, resulting in loss of revenue for the period from 13-10-2016 to 28-11-2018 and operational costs in the total sum of RM188,320.06.

The Appellant filed a suit against the Respondent for recovery of the said sum premised on section 38(5) of the ESA and in the alternative, on the basis of unjust enrichment. The Respondent denied the allegation of meter tampering and further asserted that the Premises was vacant and without any electricity supply from October 2016 until August 2018. The Respondent also denied receiving any notices from the Appellant.

For completeness, the Respondent had taken out a third party claim against the tenant who occupied the Premises for three (3) months prior to 28-11-2018. The tenant did not respond to the third party notice and did not testify at the trial.

On 22-5-2023, the trial judge dismissed the Appellant’s claim with costs after trial. The Appellant appealed to the High Court.

Although the Appellant pleaded unjust enrichment, it was not seriously pursued in the conduct of the trial. The Appellant focused on its rights as a licensee under s. 38 of the ESA. The law on such claims is well settled.

In TNB v Ichi-Ban Plastic (M) Sdn Bhd & Other Appeals [2018] 3 CLJ 557, the Federal Court clarified the following points:

TNB’s statutory right to recover its loss of revenue under s. 38(3) of the ESA is not dependent on a conviction of an offence under s. 37(1), (3) or (14) of the ESA;

If TNB relied on s. 38 of the ESA, they need not prove that the customer tampered with the meter. It is sufficient if TNB could show that the meter had been tampered with;

TNB can rely on a certified written statement pursuant to s. 38(4) of the ESA as prima facie evidence of the quantum of revenue lost, but it is not conclusive as the burden shifts to the consumer to present rebuttal evidence;

TNB cannot rely on the certified written statement as prima facie evidence of its lost revenue if it does not comply with the conditions of s. 38(4) of the ESA, in which case TNB must satisfy the usual civil burden of proof;

The quantum of revenue loss is necessarily an estimate and need not be precise. However, the estimate may be rebutted if the consumer can show that there is manifest error in the calculation or that the estimate is manifestly unreasonable, excessive or wrong;and

TNB must prove both liability and quantum before TNB can succeed in its claim. Appellate Intervention [8] In dismissing the Appellant’s claim, the key findings of the trial judge were as follows:

Regarding the allegation of meter tampering: i) the Appellant failed to prove that the meter inspected on 28-11-2018 was the Meter installed at the Premises; and ii) photographs of the “tampered” meter from the inspection on 28-11-2018 did not reveal the alleged tampering

Regarding the allegation of revenue loss claimed by the Appellant: i) the Appellant’s calculated loss was only an estimate; ii) the Respondent proved that the Premises were not occupied during the claim period from 13-10-2016 to 28-11-2018; iii) an adverse inference was drawn against the Appellant for failing to tender the actual stopwatch used to time the meter run during the said inspection on 28-11-2018 into evidence; and iv) the Appellant failed to comply with s. 38(4) of the ESA in that the Respondent had not been served with a notice of claim by the Appellant under that provision. [9] It is well settled that an appellate court will not generally speaking intervene with the decision of a trial court unless the trial court is shown to be plainly wrong in arriving at its decision. A plainly wrong decision can happen when the trial court fails to properly appreciate the evidence before it. [10] In this case, documentary evidence tendered included:

the report of the inspection carried out by the Appellant’s servants/agents on 28-11-2018 (“Report”);

computer printouts of the Respondent’s account information (“Respondent’s Customer Information”);

history of usage and account statements (“Customer Meter

charts and tables showing electricity consumption recorded by the Meter before and after 28-11-2018 (“Calculations of

notices of demand from the Appellant to the Respondent dated 18-12-2018 and 23-6-2021 (“Notices”). [11] The trial judge also heard from four (4) witnesses for the Appellant, two (2) technicians who were present at the inspection on 28- 11-2018 and two (2) others who assisted with and carried out the calculations on lost revenue. There were two (2) witnesses for the Respondent, namely the Respondent and a director of the corporate “tenant” procured by the developer under a scheme for guaranteed rental returns for the Premises. Analysis of the Issues Proof of Meter Tampering [12] The trial judge found insufficient evidence that the meter inspected was the Meter installed at the Premises. The meter inspected is identifiable from photographs in the Report of both the Meter itself and the Premises where it is attached. The meter bears the Serial No. 414422813 as seen from the photographs. [13] The Respondent’s Customer Information with the Appellant show the details of the Respondent’s account. Among these is a printout identifying the Meter at the Premises to which the account related. The device number 414422813 appears in that record and corresponds with the serial number of the meter inspected on 28-11-2018. [14] There were also photographs taken during the inspection on 28- 11-2018 depicting the front of the Premises with the meter attached to the wall. The Respondent did not assert that those were not photographs of the Premises. In fact, the transcript of the trial show:

no evidence was led through the Respondent challenging the identity of the Meter with the meter in the Report in question

no case was put to witnesses for the Appellant that the meter in the Report is not the Meter belonging to the Premises [15] Based on the above, the identity of the Meter as that referred to in the Report appears to be unassailable. [16] As for the evidence that the Meter had been tampered with, the Report and the testimony of SP3 and SP4 all say that:

the seal on the Meter had been removed; and

there were additional cables installed which bypassed the Meter (i.e. “Didapati terdapat sambungan terus ke DB pengguna tanpa melalui meter bagi ketiga-tiga fasa”)(“Bypass Cables”) [17] Based on a review of the evidence:

The Bypass Cables were cut from the installation in the vicinity of the Meter, photographed and exhibited in Court;

The “before and after” photographs in the Report show the existence of the Bypass Cables which were no longer present after rectification by cutting the said cables, as reported;

Photographs of the measuring device in use on the Meter showed a 98.46% disparity in the true reading vs the displayed reading before and after the removal of the Bypass Cables based on data recorded in the “Ujian Perbandingan Arus” section of the Report; and

Evidence of the 2 technicians that the meter seal had been removed when it was inspected, and replaced after the Bypass Cable was removed on 28-11-2018. Other than to cast doubt as to the authenticity of the evidence, no other evidence was offered to explain what the eyes can observe from the above evidence. [18] To my mind, there was no basis to suggest that the whole inspection and all the evidence adduced by the Appellant were fabricated and quite rightly, no such suggestion was made. The burden was also put too high by the trial judge who drew an adverse inference because the stop watch used at the inspection and its calibration certificate was not produced. [19] Thus, short of branding the evidence as a fabrication, it is unclear why the trial judge concluded that photographs of the “tampered” meter from the investigation by the Appellant’s servants/agents on 28-11-2018 did not reveal the alleged tampering. I am of the view that on a proper judicial appreciation of the evidence, the trial judge ought to have been satisfied on a balance of probabilities that the Meter was tampered with. [20] As summarized in paragraph [7] (b) above, the law as it stands is that if the Appellant relied on s. 38 of the ESA, they need not prove that the Respondent tampered with the meter. It is sufficient if the Appellant could show that the Meter had been tampered with. Proof of Revenue Loss [21] I deal first with the question of whether the Appellant complied with s. 38(4) of the ESA which affects the onus of proof in relation to a licensee’s claim of revenue loss due to meter tampering. Section 38(4) of the ESA provides as follows: “(4) A written statement by an employee of the licensee duly certified by the licensee or any person authorized by the licensee specifying-

the amount of loss of revenue or the reasonable expenses incurred by the licensee; (aa) the manner of calculation of the loss of revenue and items of expenses; and

the person liable for the payment thereof, shall be prima facie evidence of the payment that has to be made by the consumer under subsection (3) and such written statement shall be notified to the consumer within fourteen working days or any period as extended with the written approval of the Commission after the disconnection.” [22] A notice of disconnection of supply of electricity was issued on 28-11-2018 and left at the Premises. It stated that the supply of electricity would be disconnected on 18-12-2018 and that a written statement would be issued in due course. a) The Notice dated 18-12-2018 from the Appellant was a notice of demand that did not set out the manner of calculation of the loss of revenue and so, it would appear that it does not qualify as a written statement pursuant to s.38(4) of the ESA. b) The Notice dated 23-6-2021 did include tables for the Calculations of Loss, but it was issued well after the 14-day timeline stipulated in s. 38(4) of the ESA. [23] Although arguments were made that the Respondent never received the Notice, it is my view that the issue is moot because the content of the Notice did not include any information that explained how the quantum of lost revenue was derived. Thus, the Appellant did not have the evidential advantage and had to prove the quantum in the usual way. [24] To this end, the Appellant adduced evidence of the Calculations of Loss which were explained by two (2) witnesses called to give evidence. The main witness for this purpose was SP2, a member of the Appellant’s Analytic & Performance Management Team. He explained why he chose the method used to ascertain the average unbilled consumption of 466.99kWh per day or RM7,130.87 per month, calculated based on a chosen load factor and the data recorded on the day of the inspection on 28-11-2018. [25] The trial judge did not find SP2’s evidence to be credible because he admitted that the Calculations of Loss were an estimate and because contrary to what he stated in his witness statement, the Calculations of Loss were not done on his instructions as he had transferred to another department a few months prior. I will only state that it was clarified by the Federal Court in the Ichi-ban cases, that calculations for lost revenue due to meter tampering are necessarily estimates and need not be 100% accurate. [26] SP2 maintained that the figure of 466.99kWh average unbilled consumption per day was accurate and only the total claim was estimated. There was no substantive challenge put forward by the Respondent to show that the maximum load factor method of calculation was manifestly wrong or that the data recorded on 28-11-2018 was manifestly wrong. [27] Much ado was made over who instructed the Calculations of Loss to be carried out. As this has nothing to do with the veracity of the Calculations of Loss, this Court takes the view that there was insufficient cause to impeach the credibility of SP2 just because he had transferred to another department when the report of the Calculations of Loss was printed out. [28] As admitted by the Respondent, the meter was installed since 2016 and there was electricity connection to the Premises since 2016. There was no assertion of disconnection of electricity supply at any time since 2016. The fact that the Meter was connected since 2016 is of course not proof that electricity supply was consumed. Neither is it proof that there was no electricity consumption if the Bypass Cable had concealed low (not zero) consumption. [29] To resolve this issue, the onus was on the Respondent to prove that the Premises was in fact unoccupied since 2016 until August 2018. The Respondent relied on the following evidence:

A 2-year Tenancy Agreement with Estet Etos Sdn Bhd which was entered into purely as an agent for the Developer under a guaranteed rental scheme when the Respondent purchased the Premises from the Developer;

Testimony of the director of Estet Etos Sdn Bhd who testified that the Premises was left vacant until the Respondent found a real tenant (i.e. the Third Party) who started renting in August 2018; and

The history of electricity consumption at the Premises according to the Appellant’s own records which showed consumption from 14-7-2016 to 14-9-2016 based on estimated readings and subsequently, zero from 13-10- 2016 until 15-8-2018 on all actual readings taken, consistent with the Respondent’s case. [30] On this, the trial judge made a finding of fact based on the evidence that the Premises were vacant and I find no reason to interfere with that finding. Thus, I find that the Appellant failed to prove its loss of revenue as claimed. [31] However, the matter does not end there as there is an alternative plea that damages be assessed at such rate and for such period as the Court deems fit and proper. To recap, I have determined that:

the Appellant had successfully proven that the Meter had been tampered with;

there was an average daily loss of revenue from average unbilled consumption of RM7,130.87 per month; and

the Premises were occupied by the Respondent’s tenant after 15-8-2018. [32] For these reasons, the Respondent should be liable to pay RM7,130.87 per month for the 4-month period from 15-8-2018 until 18- 12-2018, the date in the notice from the Appellant for the disconnection of supply. [33] I therefore allow the appeal in part and order that Judgment be entered against the Respondent as follows:

Loss of revenue calculated from 15-8-2018 to 18-12-2018 in the sum of RM28,523.48;

Operational Costs of RM200.00;

Interest at the rate of 5% on the aggregate sum from paragraphs

and (b) from the date of the judgment of this Court until date of full settlement;

No order as to costs and all costs ordered by the Sessions Court which have been paid, to be refunded. Bertarikh : 22 Oktober 2024 SGD ELAINE YAP CHIN GAIK PESURUHJAYA KEHAKIMAN MAHKAMAH TINGGI MALAYA SHAH ALAM Peguam Untuk Plaintif : Zainurulfarah Binti Zainol, Messrs Shahinuddin & Ranjit Untuk Defendan : Kevin Ngu Heng Xu (with Nam Shiu Hui), Messrs Heng Xu &