By Pemphero Malimba & Isaac Salima:
The High Court sitting in Blantyre has ruled in favour of Electricity Supply Corporation of Malawi (Escom) in a case in which a businessperson was demanding over K400 million in refunds and damages.
In 2022, businessperson Zhang Di, of Yangtse Company, dragged Escom to court, where he sought over K400 million after the electricity provider had reversed 801,621 kilowatts of power from his meters.
The case dates back to 2017, when the company purchased subsidised electricity units from former Escom employees.
The ex-Escom employees are said to have sold the units to the company as they were moving to Electricity Generation Company following the unbundling of Escom in 2017.
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Escom argued that the former workers were not supposed to sell the units but, instead, use them.
Escom went on to reverse the units from the firm’s meters, prompting Di to take the matter to court, where he sought compensation.
Court documents indicate that the company wanted Escom refund all electricity units deducted from its meter numbers 37154496220 and 371543863 or to pay the money value of the deducted units, interest at 5 percent above National Bank of Malawi commercial rare for the wattage unfairly confiscated.
The claim also included damages for alleged loss of business at K300 million and aggravated damages for inconvenience estimated at K100 million plus legal collection charges and costs of the action.
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However, the defendant denied all the claims and the matter went through unsuccessful mediation proceedings whose scheduling conference was adjourned in December 2024 due to challenges beyond the parties’ control.
As such, Escom filed for application to dismiss the action, arguing that the company’s action was akin to abuse of the court process.
In response, the claimants, through their lawyers, argued that it was not right to permit the defendant to seek a dismissal of the proposed action.
But in his ruling, Judge Chifundo Kachale faulted the company for purchasing units below the legal commercial rate and through illegal means, saying the action flouted provisions of the Electricity Act and Escom’s by-laws.
“In the first place, the tariffs which were being collected under meter numbers 37154496220 and 37154384863 were below the permissible rates for a commercial entity. There is ample proof for present purposes that the reduction of tariffs could not have been possible without several illegalities and irregularities being committed by or for the benefit of the claimant,” he ruled.
“There is further evidence to the effect that the meters were tampered with in order to permit such illegal consumption. All these actions and activities flouted the statute and bylaws under which electricity is traded in this jurisdiction,” he added.
He further indicated that applicable laws were violated.
“All these actions and activities flouted statutes and bylaws under which electricity is traded in this jurisdiction,” the ruling reads.
Reacting to the ruling, Escom Chief Executive Officer Kamkwamba Kumwenda is quoted by the company’s official Facebook page as saying that the ruling is a significant victory in the fight against electricity transactions.
“We, as Escom, welcome the ruling in its entirety. It affirms that the mandate of supplying and selling electricity in Malawi rests solely with Escom,” he said.
He said the ruling sends a strong message to the public that Escom would not tolerate activities that undermine the integrity of electricity distribution in Malawi.
“This judgement not only protects Escom’s operations but also safeguards law abiding customers who access electricity through proper channels. It’s a warning to anyone involved in these illegal schemes, including former staff and commercial entities, that such practices are not only unethical but criminal,” he said.
