Can anyone tell me if this is an illegal contract?
Discussion
Contract for our domestic bulk LPG supply. We signed this a year ago, and it has another year to run. discussed it with them at the time but they wouldn't do a fixed price. We felt compelled (more accurately, bullied) into signing it - what do the legal experts think? Any help appreciated.
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By signing and returning this card to ########## you will enter into a renewal agreement with us for a further period to supply gas to the address to which the account number shown opposite relates. In is important that you read the general condition that will apply before signing
(lots of pages of rules eg do not damage tanks, syphon gas off to use in car etc - probably not relevant to this)
then Your price for gas is currently 46.00 pence per litre. the price is subject to variation in accordance with the general conditions.
Then the bit I really object to....
If you do not return this card within 30 days after we sent it to you any new agreement may have a different price.
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They increased the price (when we and most people started using it again in September) having kept it at 46p during Summer. It then went up again a couple of months ago to 51p. I've emailed them and said they should reduce it because oil/gas has plummeted. their reply (in part)
I have reviewed your account and pricing history. I have found that on 21 July 2019 your contract with ##### was renewed and was signed by ******( please see attached) at a Variable rate, you are therefore still in contract with #### until 20 July 21, so I am unable to offer you another price until you are nearing the end of your contract.
With regards to the price of our gas compared to the current global market; ##### always buys their gas in advance to ensure a constant gas supply to their customers, so therefore the gas that is currently being provided would not have been purchased at today’s prices, which is why it is not reflected in our customers current rates.
Please contact us directly by phone or email, a month before your contract is due for renewal and we can review your price for you.
I am sorry this is not the outcome you were expecting but hope it has answered your questions
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I'm trying to get my 'ducks in a row' to counter this with another email. Points I may use
1) Variable price, therefore you can reduce
2) What do other customers pay? (I know next door neighbour pays less, but don't want to quote as it wouldn't seem fair as they'de probably put hers up in price to match ours!)
3) You are taking advantage of the elderly!
4) As you've bought gas at the low price n the market, when can we expect the price to the customer to reduce, and to what price?
Again, any advice will be helpful.
TIA
------------------------------------------------------------
By signing and returning this card to ########## you will enter into a renewal agreement with us for a further period to supply gas to the address to which the account number shown opposite relates. In is important that you read the general condition that will apply before signing
(lots of pages of rules eg do not damage tanks, syphon gas off to use in car etc - probably not relevant to this)
then Your price for gas is currently 46.00 pence per litre. the price is subject to variation in accordance with the general conditions.
Then the bit I really object to....
If you do not return this card within 30 days after we sent it to you any new agreement may have a different price.
------------------------------------------------------------
They increased the price (when we and most people started using it again in September) having kept it at 46p during Summer. It then went up again a couple of months ago to 51p. I've emailed them and said they should reduce it because oil/gas has plummeted. their reply (in part)
I have reviewed your account and pricing history. I have found that on 21 July 2019 your contract with ##### was renewed and was signed by ******( please see attached) at a Variable rate, you are therefore still in contract with #### until 20 July 21, so I am unable to offer you another price until you are nearing the end of your contract.
With regards to the price of our gas compared to the current global market; ##### always buys their gas in advance to ensure a constant gas supply to their customers, so therefore the gas that is currently being provided would not have been purchased at today’s prices, which is why it is not reflected in our customers current rates.
Please contact us directly by phone or email, a month before your contract is due for renewal and we can review your price for you.
I am sorry this is not the outcome you were expecting but hope it has answered your questions
-------------------------------
I'm trying to get my 'ducks in a row' to counter this with another email. Points I may use
1) Variable price, therefore you can reduce
2) What do other customers pay? (I know next door neighbour pays less, but don't want to quote as it wouldn't seem fair as they'de probably put hers up in price to match ours!)
3) You are taking advantage of the elderly!
4) As you've bought gas at the low price n the market, when can we expect the price to the customer to reduce, and to what price?
Again, any advice will be helpful.
TIA
You signed the contract without asking about the variance clause specifically, so why would that make it illegal?
Or is there something in the 'small print' that details what/when this variance is implemented? Is it daily/monthly/quarterly/annually/randomly?
There's nothing defining what this variance will take into account...just that the price is variable. If it's not detailed, then it could simply be variable on the whim of the CEO's wife.
If you had a variable/tracker mortgage interest rate, then you'd probably also understand what factors could affect it - although some people were caught out when the rates went really low because they hadn't realised there was also a minimum rate that the lender wouldn't go below (even if the BoE rates went negative) or a maximum they wouldn't go above (i.e. the cap & collar).
Or is there something in the 'small print' that details what/when this variance is implemented? Is it daily/monthly/quarterly/annually/randomly?
There's nothing defining what this variance will take into account...just that the price is variable. If it's not detailed, then it could simply be variable on the whim of the CEO's wife.
If you had a variable/tracker mortgage interest rate, then you'd probably also understand what factors could affect it - although some people were caught out when the rates went really low because they hadn't realised there was also a minimum rate that the lender wouldn't go below (even if the BoE rates went negative) or a maximum they wouldn't go above (i.e. the cap & collar).
Breadvan72 said:
Fastpedeller said:
....We felt compelled (more accurately, bullied) into signing it -
...
What technique did they use? Hostage taking? Firearms, or just severe beatings? Paddington hard stares? Vernacular language? ...
If you do not return this card within 30 days after we sent it to you any new agreement may have a different price.
I don't consider that to be normal for a variable price - seems more like a threat
I'm far from a legal expert (in fact, I can't think of much I am an expert at) but surely you've simply signed up to a variable price contract - which in itself isn't unusual - and they've varied the price as the contract allows for.
Assuming there's nothing in the 'general conditions' referred to which states that they'll use the price of a particular index at a particular point in time and they didn't then then I'd think there's probably not a lot unfair about it.
Have a look at the ofgem website for the price indices if you'd like to double check what they're telling you. There will be a price index showing what contract prices looked like 3/6/12 months ago for the current season which might give an idea of how things were.
I used to work in an industry which was a very heavy consumer of natural gas and I know the prices we paid at any point in time had little in common with the current spot market price.
Assuming there's nothing in the 'general conditions' referred to which states that they'll use the price of a particular index at a particular point in time and they didn't then then I'd think there's probably not a lot unfair about it.
Have a look at the ofgem website for the price indices if you'd like to double check what they're telling you. There will be a price index showing what contract prices looked like 3/6/12 months ago for the current season which might give an idea of how things were.
I used to work in an industry which was a very heavy consumer of natural gas and I know the prices we paid at any point in time had little in common with the current spot market price.
mmm-five said:
You signed the contract without asking about the variance clause specifically, so why would that make it illegal?
Or is there something in the 'small print' that details what/when this variance is implemented? Is it daily/monthly/quarterly/annually/randomly?
There's nothing defining what this variance will take into account...just that the price is variable. If it's not detailed, then it could simply be variable on the whim of the CEO's wife.
If you had a variable/tracker mortgage interest rate, then you'd probably also understand what factors could affect it - although some people were caught out when the rates went really low because they hadn't realised there was also a minimum rate that the lender wouldn't go below (even if the BoE rates went negative) or a maximum they wouldn't go above (i.e. the cap & collar).
There was no 'agreement' (although we tried to negotiate) - this was a unilateral contract. The implication (if we didn't sign) being that the 46p wouldn't be the 'starting price' Or is there something in the 'small print' that details what/when this variance is implemented? Is it daily/monthly/quarterly/annually/randomly?
There's nothing defining what this variance will take into account...just that the price is variable. If it's not detailed, then it could simply be variable on the whim of the CEO's wife.
If you had a variable/tracker mortgage interest rate, then you'd probably also understand what factors could affect it - although some people were caught out when the rates went really low because they hadn't realised there was also a minimum rate that the lender wouldn't go below (even if the BoE rates went negative) or a maximum they wouldn't go above (i.e. the cap & collar).
Fastpedeller said:
This....
If you do not return this card within 30 days after we sent it to you any new agreement may have a different price.
I don't consider that to be normal for a variable price - seems more like a threat
That looks reasonable to me.If you do not return this card within 30 days after we sent it to you any new agreement may have a different price.
I don't consider that to be normal for a variable price - seems more like a threat
They know what they're paying for future supply contracts at that moment. In a month's time the price they're paying might be completely different. They'd be crazy to make an offer and leave it open ended for you to accept.
And It's no different to any other offer for utilities, is it?
You might sign up to Sky TV, for example, and they'd also say 'This is the current price if you sign up by XYZ date. After that date the price may change.'
I think you may be reading something into this '30 days' that isn't really there.
Its a standard contract, I dont see from the evidence provided what statute it may breach.
As you probably know there is a small pool of LPG suppliers for home heating and I’m pretty all will have similar terms and none will vary them for a single homeowner.
You can keep asking though and make a nuisance of yourself.
As you probably know there is a small pool of LPG suppliers for home heating and I’m pretty all will have similar terms and none will vary them for a single homeowner.
You can keep asking though and make a nuisance of yourself.
Fastpedeller said:
Breadvan72 said:
Fastpedeller said:
....We felt compelled (more accurately, bullied) into signing it -
...
What technique did they use? Hostage taking? Firearms, or just severe beatings? Paddington hard stares? Vernacular language? ...
If you do not return this card within 30 days after we sent it to you any new agreement may have a different price.
I don't consider that to be normal for a variable price - seems more like a threat
So do you agree this
If you do not return this card within 30 days after we sent it to you any new agreement may have a different price.
is a perfectly reasonable contract term?
If we didn't accept would we have been on 99p a Litre, and again no recourse. seems unfair to me. For info the industry price is generally between 35 and 45 ppL.
I'll now add that we can't move supplier, even when the contract ends.
The LPG industry was investigated by the OFT a few years back due to unfair contracts and tying customers to one supplier (who supplied tanks).
Upshot was they were forced to allow another supplier to buy tanks so customer could buy gas elsewhere, but told they could continue with self-regulating.
So why can't I move to another gas supplier?
2 years ago the industry changed the 'rules' (it appears it's not a law, just their whim for 'health & safety') which says the tanks must have no property, wall, face, shrub etc within 3m.
So our tanks don't 'comply' and none of their mates within this nice little cartel will supply the gas to the tanks (except the current supplier). They say they are safe (they are compelled by law to ensure they are safe), but to be compliant they need to be moved at the customer's expense.
What happens in a few years' time? Your tanks don't comply it's now a 5m rule?
Still fair???
If you do not return this card within 30 days after we sent it to you any new agreement may have a different price.
is a perfectly reasonable contract term?
If we didn't accept would we have been on 99p a Litre, and again no recourse. seems unfair to me. For info the industry price is generally between 35 and 45 ppL.
I'll now add that we can't move supplier, even when the contract ends.
The LPG industry was investigated by the OFT a few years back due to unfair contracts and tying customers to one supplier (who supplied tanks).
Upshot was they were forced to allow another supplier to buy tanks so customer could buy gas elsewhere, but told they could continue with self-regulating.
So why can't I move to another gas supplier?
2 years ago the industry changed the 'rules' (it appears it's not a law, just their whim for 'health & safety') which says the tanks must have no property, wall, face, shrub etc within 3m.
So our tanks don't 'comply' and none of their mates within this nice little cartel will supply the gas to the tanks (except the current supplier). They say they are safe (they are compelled by law to ensure they are safe), but to be compliant they need to be moved at the customer's expense.
What happens in a few years' time? Your tanks don't comply it's now a 5m rule?
Still fair???
Fastpedeller said:
Breadvan72 said:
Grow up, OP. You could have found another supplier.
If you think you have a beef, take it to the regulator.
Are you having a bad day BV? I've tried - they won't consider. They are running a Cartel. Grow up yourself.If you think you have a beef, take it to the regulator.
Edited by Breadvan72 on Sunday 24th May 14:40
Fastpedeller said:
This....
If you do not return this card within 30 days after we sent it to you any new agreement may have a different price.
I don't consider that to be normal for a variable price - seems more like a threat
On the contrary, if the market price is variable (due to inherent market fluctuations) then I would say it is entirely reasonable for the current offer to be time limited to say 30 days, with any new offer after 30 days being based on the prevailing market prices at that point in the future. If you do not return this card within 30 days after we sent it to you any new agreement may have a different price.
I don't consider that to be normal for a variable price - seems more like a threat
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