ARMS Ltd customers who believe they have overpaid for energy consumption would need to open their own court case despite the court ruling that the utility company breached the law when calculating bills.
This could be done by individual customers or by a group of clients, known as class action.
On Monday, a court ruled that ARMS, the company that bills consumers for water and electricity, breached the law when it issued bills for Darren Cordina and Melvin Polidano on a pro-rata basis rather than on an annual cumulative consumption basis.
The court ordered the utility company to revise their account from 2017 and refund Cordina and Polidano the amount they have overpaid since.
Was the billing system set up in this manner to make money off citizens?- Darren Cordina
Since 2010, ARMS has been issuing bi-monthly bills using a staggered calculation system. The first 2,000 units of electricity are charged at one rate and further consumption at higher rates.
For every kWh of the first 2,000kWh consumed in a year, residents should be charged 10.47c and then pay 12.98c for every kWh for the next 4,000kWh, 16.07c per unit on the next 4,000kWh and so on.
However, ARMS splits up this allocation pro rata according to the number of bills a consumer receives in the same year. This means that if a residence is billed every two months, the first 2,000 units are split between six bills, amounting to an allocation of 333 units per bill at 10.47c per unit.
If a residence consumes fewer than 333 units in a two-month billing period, the remaining units at the cheaper rate are not brought forward to the subsequent bills. The allocation is therefore lost.
Billing system still the same
In January, Energy Minister Miriam Dalli had said a new billing system would be introduced to allow consumers to benefit from cheap units all year round.
However, the legal notice regulating this new system is not out yet.
A lawyer and scientist by profession, Cordina told Times of Malta that Monday’s ruling – which could be appealed by ARMS – did not automatically apply to all other customers, despite being billed in the same manner.
Customers will, therefore, not be able to turn up at ARMS claiming a refund and would need to institute their own case in court.
For others to benefit from this ruling automatically, the law would have to be changed and, of course, this could only be done by the government, he explained.
What Monday’s ruling did do, however, was set a precedent in favour of future plaintiffs, Cordina noted.
While the court had a right to rule differently, it was now more difficult to do so, considering it had already decided ARMS Ltd breached the law in the manner in which it calculated bills.
“It is frustrating that the issue – which started under a PN government and continued under a PL administration – was turned into a partisan ball,” Cordina and Polidano said.
“It is even more frustrating that the government – irrespective which party – is elected by the people to take care of them and clarify any grey areas in the law.
“Was the billing system set up in this manner to make money off citizens? Why does it have to be citizens themselves who challenge the government’s ways,” he asked.