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Our binding decisions

Supply outage - unplanned (D/97/40)

Case number: D/97/40
Date of Decision: 15 June 1998
Decision accepted by the customer: Yes

A business customer contacted EIOV, stating an interruption to supply at his premises caused his computer system to malfunction, quoting $3630.00 to restore the system.

The customer's power company confirmed the three minute interruption, stating it the occurred during a company contractor testing operation. Power was disconnected from the company's network to the main transmission grid at three points. A manual load-shedding scheme was inadvertently operated by the grid maintenance subcontractor, cutting supply to approximately 28,000 customers.

The supply company claimed it was not responsible for the event and referred the customer to the contractor, who also denied liability, referring the customer to his insurer. The customer wasn't satisfied with this response, as he felt the company was responsible for the interruption, as his supplier of electricity.

EIOV investigated the customer's issues, including: analysis of reports from the customer's electricity company and the third party. EIOV took advice from an independent engineer, and sought clarification and explanation of the repair advice from the appliance repairer, and sought advice from the Office of the Regulator-General.

In determining this case, the Ombudsman took into account what is fair and just, industry practice and relevant law. Relevant law included the Supply and Sale Code, the Trade Practices Act 1974, the Electricity Industry Act 1993, the Office of the Regulator-General's Guideline No 5 on Connection and Use of System Agreements (issued pursuant to section 12 of the Office of the Regulator-General Act 1994) and clauses 4 and 6 of EIOV Constitution.

The Ombudsman found that it is the responsibility of electricity supply companies to ensure appropriate use of system agreements are in place, not the responsibility of the customer, and that it was fair and reasonable for the customer to rely upon the company to make appropriate arrangements with other parties to maintain supply. The Ombudsman considered the outage was a matter between the company, its contractor and their sub-contractors.

The Ombudsman further considered that it would have been prudent to have an uninterruptible power supply (UPS) installed, as power companies do not guarantee supply and damage to computer systems resulting from outages is well documented. As such the Ombudsman considered that the customer in this instance can be taken to have accepted some risk.

The Ombudsman determined therefore that the company pay the customer $2,722.50, being the total claim amount of $3,630.00 less $907.50 (25%) for the customer's contribution for the acceptance of some risk, in full and final settlement of the matter.