Smartestenergy Business Limited v Odeon Arcade Limited

For statutory interpretation, the ordinary meaning of the enacted words remains the starting point. Context, legislative purpose and the mischief addressed may inform that meaning, but practical convenience or greater certainty for one party cannot justify a construction which strains or contradicts the statutory language. The rule against absurdity applies only where the proposed alternative is genuinely available and the ordinary construction produces an absurd or unworkable result.

Under paragraph 3(1) of Schedule 6 to the Electricity Act 1989, premises occupied by separate tenants are not thereby “unoccupied” merely because they are served by one electricity meter. The owner therefore does not become liable under the statutory deemed-contract provision on that basis.

Smartestenergy Business Limited petitioned to wind up Odeon Arcade Limited over an alleged electricity debt of £106,914.25. Odeon owned an arcade divided into three let units. The units were occupied by separate tenants but served by a single electricity meter.

The Deputy ICC Judge restrained advertisement of the petition and dismissed it, holding that paragraph 3(1) of Schedule 6 to the Electricity Act 1989 did not impose a deemed contract on Odeon because the premises were occupied. Smartestenergy appealed on the ground that the metered premises should be treated as a single whole and as “unoccupied” because no single person occupied the whole. The central issue was the proper interpretation of “premises”, “occupier” and “unoccupied” in paragraph 3(1).

1. Appeal dismissed. The lower court was entitled to restrain Smartestenergy from giving notice of or advertising the winding-up petition and was correct to dismiss it.
2. The court approached paragraph 3(1) of Schedule 6 to the Electricity Act 1989 by starting with the ordinary meaning of the statutory language, read in its context. Legislative purpose and the mischief addressed by the provision were relevant, but could not displace the enacted words without sufficient justification.
3. In ordinary usage, premises occupied by separate tenants are not “unoccupied”. It would strain, and potentially contradict, the language of paragraph 3(1) to treat premises as unoccupied merely because no one person occupied the whole area served by a single meter. Odeon therefore did not become subject to a deemed contract as owner.
4. The rule against absurdity did not require Smartestenergy’s construction. The possible apportionment difficulties arising from separate occupiers and a single meter were not so absurd or unworkable as to justify departing from the ordinary meaning. The practical advantages of proceeding against the owner did not alter that conclusion.
5. Other provisions of the statutory scheme supported the lower court’s interpretation. The notice provisions concerning disconnection and entry to install or remove meters were naturally directed to the person actually occupying and using the premises. The offence and disconnection provisions in paragraph 6 of Schedule 6 also made more practical sense if an occupying tenant could be the relevant person.
6. Paragraph 1(5) of Schedule 7 permitted the supplier to discontinue supply where a customer failed to use an appropriate meter. Separate meters therefore provided a practical means of resolving the difficulties identified by Smartestenergy.

• Chancery Appeals (ChD): The appeal from the order dated 19 March 2025 was dismissed.
• Deputy ICC Judge Agnello KC: Restrained advertisement of the winding-up petition and dismissed the petition with costs.
• Permission to appeal was granted by Richard Smith J on 16 July 2025.