Scottish and Southern Energy loses sales appeal

A "big six" energy company found guilty of using doorstep salesmen to mislead potential customers lost an appeal against conviction today.

Three judges at the Court of Appeal in London rejected a challenge by Scottish and Southern Energy (SSE), announcing that they were "not persuaded that this conviction was unsafe".

In May last year the company was found guilty of two counts of "engaging in a misleading commercial practice" in a prosecution brought by Surrey County Council Trading Standards.

The prosecution was believed to be the first of its kind against one of the big six energy firms.

Following today's decision, SSE is now due to be sentenced at Guildford Crown Court in Surrey on May 4.

Surrey's trading standards said salesmen from Scottish and Southern Energy had used a sales script and a print out to convince customers to switch suppliers.

After a five-day trial at Guildford Crown Court, SSE was found guilty of the two counts of taking part in misleading selling practices relating to the script between September 2008 and July 2009.

At the time of its conviction SSE said it wanted to reassure customers, and potential customers, that the case related to sales aids used in February 2009 which were no longer in use, and added that it was "confident that our sales processes continue to be fair and responsible".

Steve Playle, of Surrey's trading standards, said after today's ruling that as a result of the case five of the big six, including SSE, have now stopped doorstep selling altogether.

He described it as a classic case of "David and Goliath" - with SSE having a "turnover something like £28 billion" and Surrey Trading Standards having a budget of "just £2 million".

Mr Playle called on SSE to write to every customer they signed up using the "illegal script" to "make a serious offer of compensation".

Surrey County Council said the sales script led householders to believe the salesperson knew they were overpaying with their current energy supplier, when in fact they did not have such information.

Kay Hammond, Surrey County Council's cabinet member for community safety, said: "This case shone a spotlight on the dubious practice of doorstep selling.

"Five of the big six energy firms have now stopped doing it because they recognise it's not in the best interests of their businesses or their customers.

"We'll continue our work in ensuring people, especially the vulnerable, get a fair deal.

"Our advice, as always, remains the same - never deal with cold calling doorstep traders."

Audrey Gallacher, director of energy at Consumer Focus, said in response to the Court of Appeal's decision: "This is an important judgment for consumers and hats off to Surrey Trading Standards for its persistence and dogged pursuit of SSE through the courts."

She said: "Consumers need clear rules on selling energy to be burned into the minds of energy companies and to know that these will be enforced vigorously.

"Only then can consumer trust start to grow again in this market.

"Doorstep energy selling could work if done properly, but the truth is that the behaviour of companies means that it has been thoroughly discredited.

"Five of the big six have already dropped it and now we would call on E.ON to see sense and stop it immediately."

Stephen Forbes, SSE's director of sales, marketing and energy services, said: "We are very disappointed with the outcome of the appeal today, having lodged what we believe were very strong grounds to have the Crown Court verdicts overturned.

"We will now consider our next steps, but it is highly likely we will not seek to take this issue any further.

"This case was initially brought over two years ago and since then we have ceased all doorstep sales activity in Great Britain, becoming the first energy supplier to stop commission-based doorstep selling of electricity and gas.

"We have also implemented a sales guarantee for household energy customers which will ensure that any customer who shows they switched their energy supply to SSE after being given inaccurate information, or being misled, will have any resulting financial loss made good.

"This guarantee gives additional reassurance for customers choosing SSE as their energy supplier in the future.

"High standards in energy sales are absolutely essential and the recent steps we have taken demonstrate SSE's commitment to them."

SSE will be sentenced for the offences at Guildford Crown Court in May.

PA