If you are a landlord in Malaysia, you might think that once you hand over the keys to a tenant, their utility usage is entirely their own responsibility. However, a common legal nightmare arises when a tenant tampers with the electricity meter to reduce bills. You might find yourself facing a massive claim for “loss of revenue” from Tenaga Nasional Berhad (TNB).
What does the law say about this? Does TNB have a remedy against you, even if you had no idea what your tenant was doing? Here is the breakdown of the legal position.
The Registered Consumer is Key
Under Malaysian law, the liability for electricity consumption and meter tampering primarily rests with the “Registered Consumer”. If you, as the landlord, kept the TNB account in your name instead of having the tenant apply for their own account, you remain the party contractually bound to TNB.
The courts have consistently held that TNB does not need to prove who actually did the tampering to succeed in a civil claim for loss of revenue.
TNB’s Remedy: Section 38(3) of the Electricity Supply Act 1990
TNB’s primary legal remedy is found in Section 38(3) of the Electricity Supply Act 1990 (ESA).
- Statutory Right to Claim: This provision allows TNB to require a consumer to pay for the loss of revenue and any expenses incurred due to offenses committed under Section 37 (which covers meter tampering and dishonest consumption).
- Prima Facie Evidence: Under Section 38(4), a written statement certified by a TNB employee specifying the amount of loss is considered prima facie evidence of the payment that must be made. This means the court will accept TNB’s calculation as correct unless you can prove it is “manifestly unreasonable, excessive, or wrong”.
Relevant Case Law: The “Thomas Thomas” Principle
The most important case on this subject is Thomas Thomas @ Mohan K Thomas v. Tenaga Nasional Berhad [2017] 6 MLRA 504 CA.
In this case, the landlord argued he was not liable because the premises were rented out to a tenant and he never occupied the property. The Court of Appeal rejected this, establishing several critical principles:
- Continuous Responsibility: As the registered consumer, it is your responsibility to ensure the meter is not damaged or tampered with throughout the duration of the agreement.
- Irrelevance of Knowledge: Even if the meter was tampered with without your knowledge or permission, you are still bound by the agreement to pay for the resulting loss of revenue.
- Unjust Enrichment: A landlord cannot avoid payment by claiming they did not “benefit” from the electricity. Since the landlord owns the premises and is the account holder, allowing them to escape liability would result in unjust enrichment.
Can a Landlord Protect Themselves?
While you may be liable to TNB, you are not necessarily without a remedy against the tenant.
In the case of Fun N Cheer World Sdn Bhd v. LDP Promotion Fair Sdn Bhd [2021] 1 MLRH 240, the court found that while the landlord (account holder) was liable to TNB, the tenant was liable to indemnify the landlord. This was possible because the tenancy agreement contained express clauses where the tenant agreed:
- To pay all electricity charges.
- Not to tamper with or damage the meter.
- To indemnify the landlord against any claims or costs arising from the tenant’s acts or omissions.
Practical Summary for Landlords
- TNB’s Remedy: TNB can sue the registered consumer (landlord) for loss of revenue under Section 38(3) of the ESA 1990.
- Your Liability: If you are the account holder, you are liable even if the tenant did the tampering secretively.
- Best Practice: Always insist that tenants register the TNB account in their own name before they move in. This shifts the status of “Registered Consumer” to them.
- Contractual Protection: Ensure your tenancy agreement has strong indemnity clauses regarding utility tampering so you can recover your losses from the tenant if TNB sues you.
Disclaimer: This post is for informational purposes only and does not constitute legal advice. Please consult a qualified Advocate & Solicitor for your specific legal needs.
