District heating standing charge when disconnection is impossible

maki

I've just bought an apartment and I'm hoping someone could help me understand the legalities around district heating in particular.

In the case of my building, hot water (for taps and central heating) is boiled in the basement and pumped around to the apartments, each of which has their own heat meters. The heating system is technically owned by the property management company, and have a third-party company handling billing on their behalf. It's my understanding that it's not possible to disconnect individual apartments from the supply as the only cut-off points are on the riser between floors.

I was reading through the district heating supplier contract and noticed that while I'm allowed to cancel the contract at any time, the daily standing charge remains liable to the apartment owner regardless, perhaps because disconnection is impossible.

Could someone help me understand how that compulsory standing charge works from a legal perspective, if no contract is present? Is it enforceable via leasehold, or could it something else?

District heating is currently unregulated, so as far as I can see there's nothing in law from that perspective.

For a practical example, if whoever sets the standing charge decided to increase it to something crazy like €1000 per day, would each owner actually be legally liable for that amount, and be unable to avoid it via cancellation of the contract?

28064212

https://www.boards.ie/discussion/2058334687/district-heating-standing-charge-when-disconnection-is-impossible

I was reading through the district heating supplier contract

...

Could someone help me understand how that compulsory standing charge works from a legal perspective, if no contract is present?

Is there a contract or isn't there?

maki

https://www.boards.ie/discussion/comment/121721937#Comment_121721937

I meant if I terminate the contract. And that's where I'm a bit confused.

The contract itself says that if the contract is terminated, the owner is still liable for the standing charge, which is why I'm wondering if the standing charge is somehow attached to some other legal instrument?

28064212

https://www.boards.ie/discussion/comment/121721959#Comment_121721959

Is this a contract directly between you (personally) and the supplier? Or is it a contract between the supplier and the management company?

maki

https://www.boards.ie/discussion/comment/121721972#Comment_121721972

This particular contract is between me and the supplier.

I'm unsure of what's going on exactly between the supplier and management company. To quote the initial lines of the contract:

"The Operator has been appointed and licensed by the DHS System Owner to operate and maintain the DHS System at the development and to supply and sell heat via the DHS System to the premises.". (DHS System Owner here is the management company)

It could well be that the supplier is just collecting these monies, passing them onto the management company, and taking a cut.

If that's the case, could it be that I'm effectively obliged to pay the standing charge by the management company?

28064212

You need to distinguish between the Owners' Management Company (OMC) and the Property Management Company (or agent). You own the OMC - the actions of the OMC are directed by the owners via the appointment of directors. The OMC may appoint a management company (agent) to do (some of) the actual management tasks, and the agent may have suppliers that they engage with to provide services. There are contracts between all of these entities.

Even if the direct contract between you and the supplier is terminated, the remaining contracts exist. There may well be terms in the other contracts covering the application of a standing charge. The only way to know is to read the wording of all the contracts.

Del2005

https://www.boards.ie/discussion/2058334687/district-heating-standing-charge-when-disconnection-is-impossible

if whoever sets the standing charge decided to increase it to something crazy like €1000

You set the standing charges at your AGM, or EGM. What did your solicitor say about the contact when you bought and have you reviewed the minutes of the OMCs last AGM?