Barbados Consumer Research Organisation Inc. (BARCRO)

• Jurisdiction: Barbados
• Court: Fair Trading Commission (Barbados)
• Judge: Sir Neville Nicholls,Mr. Gregory Hazzard,Mr. Andrew Brathwaite,Mr. Alfred Knight,Mr. Andrew Willoughby
• Judgment Date: 22 September 2010
• Docket Number: NO. 0001/10

In the Matter of the Utilities Regulation Act, CAP. 282 and the Fair Trading Commission Act, CAP. 326B of the Laws of Barbados;

In the Matter of the Utilities Regulation (Procedural) Rules, 2003;

And in the Matter of the Application by the Barbados Light & Power Company Limited (the Applicant) to the Fair Trading Commission for a review of electricity rates pursuant to Section 16 of the Utilities Regulation Act, CAP. 282;

And in the Matter of an Application for a Review by the Barbados Consumer Research Organisation Inc. of the Decision and Order of the Fair Trading Commission dated January 25, 2010;

Barbados Consumer Research Organisation Inc. (BARCRO)

Applicant

Before:

Sir Neville Nicholls Chairman

Mr. Gregory Hazzard Commissioner

Mr. Andrew Brathwaite Commissioner

Mr. Alfred Knight Commissioner

Mr. Andrew Willoughby Commissioner

NO. 0001/10

FAIR TRADING COMMISSION

DECISION

PART ONE – BACKGROUND

1 On May 8, 2009 the Barbados Light & Power Company Limited (BL&P) submitted an application to the Fair Trading Commission (Commission) for a review of its electricity rates. The Application was accompanied by Affidavits of the BL&P's witnesses; employees, Mr. Peter Williams, Mr. Hutson Best, Mr. Mark King and Mr. Stephen Worme and expert witnesses, Mr. Robert Camfield and Mr. Michael O'Sheasy.

2 During the pre-hearing process additional evidence was entered through the exchange of numerous interrogatories, requests for information and filings of documents. To determine the review of the electricity rates a hearing was convened from October 7, 2009 to October 23, 2009 at which all of the witnesses were thoroughly cross-examined.

3 Following the hearing, the Commission adjourned to deliberate on the issues and to consider all of the evidence before making its decision. On January 28, 2010 the Commission reconvened the hearing to deliver its Decision and Order dated January 25, 2010. The Commission ordered that all new tariffs should come into effect on bills issued from March 1, 2010.

Filing of the Motion for Review

4 The Commission received an application from the BARCRO on the 17 ^th day of February 2010 seeking a stay of the March 1, 2010 implementation of the Decision and review of the Commission's Decision and Order dated January 25, 2010.

5 The Commission, having reviewed BARCRO's Notice of Motion for Review (Motion) found that the Applicant was not able to establish sufficient grounds to support a stay of the Commission's Decision and Order. The Commission therefore denied the Application for a stay.

6 In addition to its Motion, BARCRO also filed with the Commission Affidavits of Mr. Malcolm Gibbs-Taitt and Mr. Carl Ince, which were not only unsigned and unsworn but failed to set out a clear and concise statement of the relief that BARCRO was seeking. In accordance with Rule 8 of the Utilities Regulation (Procedural) Rules, 2003 (Rules) BARCRO is required to submit a Motion which, inter alia, contains the decision or order being sought, the grounds upon which the Motion is made and an indication of any oral or other evidence it is seeking to present. The Motion should also be accompanied by a supporting Affidavit setting out a clear and concise statement of the facts.

7 The Commission notified BARCRO that it had failed to comply with Rule 8 of the Rules and requested that it amend and re-file its review application.

8 BARCRO filed an amended Motion and Affidavit of Mr. Malcolm Gibbs-Taitt, Director General of BARCRO dated March 18, 2010.

Duty of the Commission

9 By virtue of Section 36 of the Fair Trading Commission Act, CAP. 326B “FTCA” and Rule 53 of the Rules, the Commission has jurisdiction on an application from a party or on its own motion to review, vary or rescind any decision given by it. In instances where the Commission allows a review, the process is prescribed by the Rules. The Commission's discretion to review and vary or rescind a decision or order is exercised with a view to ensuring that there is consistency and predictability of the Commission's decision-making process.

10 A review is not a vehicle for applicants to re-argue their submissions made at an earlier proceeding simply because they do not agree with the decision. Under the FTCA, the authority of the Commission to allow a review is discretionary. An applicant must first demonstrate, on a prima facie basis, the existence of the permissible grounds of review; this is referred to as the threshold question.

11 Rule 54 (1) of the Rules sets out specific grounds on which the Commission can review a decision made in a utility regulation proceeding. Rule 54 (1) of the Rules states that:-

“ (1) Every Notice of Motion made under Rule 53 (2), in addition to the requirements of Rule 8 shall

• (a) Set out the grounds upon which the motion is made sufficient to justify a review or raise a question as to the correctness of the order or decision and the grounds may include

  • (i) error of law or jurisdiction;

  • (ii) error of fact;

  • (iii) a change in circumstances;

  • (iv) new facts that have arisen;

  • (v) facts that were not previously placed in evidence in the proceedings and could not have been discovered by reasonable diligence at the time;

  • (vi) an important matter of principle that has been raised by the order or decision;”

12 Rule 55 (1) of the Rules states that:-

“ (1) The Commission shall determine with a hearing, in respect of a motion brought under rule 53 the threshold question of whether the matter should be reviewed or whether there is reason to believe the order should be rescinded or varied.”

13 In accordance with Rule 55 (3) the Commission decided that it would combine the consideration of the threshold question and a review on the merits and would hold a consolidated written hearing. Rule 55 (3) of the Rules states that:-

“ (3) The Commission may adopt whatever procedures it deems to be just and expeditious in the individual circumstances of each motion including providing for the combining of consideration of the threshold question and the review on the merits.”

14 Pursuant to Rule 37 of the Rules, the Commission further determined that the review proceeding should be disposed of by way of a written hearing.

Burden of Proof

15 By virtue of section 133 of the Evidence Act, CAP. 121 the onus rests on BARCRO to prove its case in this review proceeding.

Evidence before the Commission

16 Following receipt of BARCRO's amended Motion and Affidavit on March 18, 2010 and prior to the commencement of the written hearing the Commission instructed BARCRO to submit further written submissions to help support its claim. BARCRO filed with the Commission a set of written submissions dated April 20, 2010. Following this, the BL&P was invited to submit a response to BARCRO's written submissions.

17 The BL&P filed with the Commission its written response on May 12, 2010. The BL&P in its response addressed the grounds postulated by BARCRO in its Motion and written submissions. The BL&P generally disagreed with many of the allegations set out by BARCRO. Overall the BL&P was of the view that BARCRO's Motion and subsequent written submissions were not supported by evidence and there was no contrary proof supplied by BARCRO which contradicted the evidence which the BL&P had submitted to support its rate review Application. The BL&P therefore concluded that BARCRO has not demonstrated any grounds for review.

18 After receipt of the BL&P's response BARCRO was invited to submit its final set of written submissions and it did so on August 09, 2010. In determining this matter, the Commission took into consideration the written submissions of both BARCRO and the BL&P.

PART TWO – THE THRESHOLD QUESTION

The Threshold Question

19 In its Motion and written submissions BARCRO contends that the Decision and/or Order of the Commission dated January 25, 2010 raises several grounds for review. These grounds have been grouped into the following categories:

• (a) The timing of the BL&P's Application and the interests of the consumer.

• (b) The increase in the rate base.

• (c) The role of Public Counsel.

• (d) The issue of standards of service as it relates to the review of rates.

• (e) Shifting of the 2.64 cents from the base energy rate to the Fuel Clause Adjustment.

• (f) Meter readings, interim billing, meter costs and customer charges.

• (g) The late production of transcripts.

• (h) Prohibiting BARCRO from bringing a witness.

• (i) Value of service arguments.

• (j) The installation of three new generators by the BL&P.

• (k) Cross examination of the Commission's consultants.

20 To discharge its first task vis-à-vis the threshold question of whether a review should be granted, the Commission considered BARCRO's Motion for Review and the Affidavit of Mr. Malcolm Gibbs-Taitt dated March 18, 2010.

21 BARCRO's Motion for Review and accompanying Affidavit contained the reasons why it believed that the Commission's decision should be reviewed.

22 The Commission approached the threshold question by considering whether BARCRO had established on a prima facie basis that any of the grounds set out under Rule 53 of the Rules exist. The Commission considers that BARCRO must place before the Commission specific references to aspects of its decision to demonstrate or justify the existence of such grounds.

23 According to Black's Law Dictionary, a prima facie case is:-

• (a) the establishment of a legally required rebuttable presumption;

• (b) a party's production of enough evidence to allow the fact-trier to infer the fact at issue and rule in the party's favour.

24 With the body of arguments before it, the Commission examined the allegations of error and all the grounds submitted in support of the Motion, to first determine whether BARCRO produced enough evidence to support the existence of grounds for review. BARCRO relied on three grounds of...