For some time, utilities have paid substantial commissions to brokers who procure energy supply contracts for them. These practices — which have been described in The Times as a “mis-selling scandal that may prove bigger than PPI” — have generated a substantial number of claims that are working their way through the courts against utilities and the brokers. The Court of Appeal today delivered judgment in Expert Tooling and Automation Limited v Engie Power Limited [2025] EWCA Civ 292 on a “half-secret” commission claim against a supplier that had paid commission to a broker that was later dissolved.

There, a broker had procured five electricity supply contracts for a manufacturing business in the north of England. The fact that a commission would be paid to the broker had been disclosed to the customer and the commission was, therefore, characterised as “half-secret” rather than “fully-secret”. However, unbeknownst to the customer, the supplier permitted the broker to nominate their own rate of commission that the supplier then added to the per kWh rate that the customer would pay for its energy. That is to say, the more energy consumed by the customer or the longer the contract, the greater the commission that would be “earned” by the broker. The overall result was that the broker earned a commission in excess of £100,000 that was ultimately paid by its principal (in one contract, 38% of the per kWh rate was an uplift for commission).

The Court of Appeal’s judgment is likely, among other things, to have a substantial impact on brokers and the disclosure that they give to their principals, and makes clear the liability that the broker has to pay a half-secret commission over to their principal unless they obtained the consent of their client after giving disclosure that would bring home to them the extent of the conflict of interest that they faced.

The Court of Appeal also determined (contrary to the Appellant’s case) that a half-secret commission-payer must be found to have acted dishonestly in order to be liable for paying a commission (in contrast to the liability of a “fully-secret” commission-payer); and that dishonesty for this purpose requires more than simply the payment of commission with knowledge that the recipient is a fiduciary.

Thomas Grant KC of Wilberforce Chambers, Ryan Turner of Maitland Chambers, and Professor Paul Davies of Essex Court Chambers were instructed for the appeal by Boris Cetnik and his specialist team at BC Legal on behalf of the Appellant.

David Lord KC and Stuart Cutting of Three Stone were instructed throughout the proceedings by Walker Morris LLP on behalf of the Respondent utility.

The judgment can be viewed here