The conflict at the heart of the market
The commercial energy brokerage market was built on a conflict of interest that very few businesses ever spotted. When a broker helped arrange a commercial energy contract, they needed to be paid. The question was how, and by whom, and whether the business that was supposedly being helped ever found out the answer.
In a properly disclosed arrangement, the broker charges the client a fee for the service of finding a suitable contract. The client knows what the fee is, can assess whether it represents good value, and can factor that cost into their decision. That is the transparent version of a brokerage relationship, and it is the version the law contemplates.
In the version that became widespread across the commercial energy market, the broker was paid by the energy supplier through a commission embedded in the unit rate. The supplier offered the broker a base rate. The broker presented the client with a higher rate. The difference, sometimes fractions of a penny per unit but significant in volume over a multi-year contract, went straight to the broker as undisclosed commission. The business never saw the base rate and had no way to know it existed.
Why it was not just a commercial arrangement
The argument sometimes made on behalf of brokers is that all commercial intermediaries earn money somehow and that there is nothing inherently wrong with being paid by a supplier rather than a client. In isolation, that argument has some surface plausibility. But it ignores the crucial element: the commission was not disclosed. The broker was presenting themselves as acting in the client's interests while secretly being incentivised by the other side to inflate the price.
That is not a standard commercial arrangement. It is a breach of fiduciary duty. The law is clear that an agent cannot secretly benefit from a transaction at the client's expense, and the energy brokerage market operated precisely in that way for a very long time.
The scale across the market
This was not confined to a handful of rogue brokers operating at the margins of the market. The practice of undisclosed commissions was widespread. Businesses of all sizes and across all sectors were affected. For many of them, the inflated rates ran across multiple contracts and multiple renewals, compounding the total cost over many years.
The businesses that have successfully recovered money through legal claims represent a fraction of those who were affected. A significant number of those who tried to claim were let down by the solicitors they instructed, and their losses went unrecovered as a result. For those businesses, the negligence of their solicitor is the next question to be answered.
What happened when businesses sought legal help
Some businesses instructed solicitors to pursue undisclosed commission claims and received competent representation that led to successful recoveries. Others found that their claims were mishandled in a variety of ways: deadlines missed, the wrong legal basis pleaded, inadequate evidence gathered, offers accepted without proper analysis. When that happens, the loss does not simply sit with the energy broker. It sits with the solicitor who failed to handle the claim properly.
A professional negligence claim against that solicitor is a separate and distinct legal action. It does not require the energy commission claim to be reopened. It asks a different question of a different defendant, and it is a question that many businesses are only now beginning to ask.
The practical question for affected businesses
For businesses that used an energy broker and now suspect that undisclosed commissions were involved, the first practical question is whether the limitation period for a direct claim against the broker still has time to run. If it does, a claim against the broker directly may still be viable. If it has expired, or if a claim was attempted and failed through solicitor error, the professional negligence route against the solicitor is where attention should turn.
Either way, the starting point is a clear and independent assessment of what happened, when, and what options remain. That assessment costs nothing through Sold Short and is the only way to understand with any certainty which doors are still open and which have closed.
Sold Short helps businesses whose energy commission claims were mishandled pursue professional negligence claims against the solicitors responsible. Free review. No win no fee.
