Electricity (Supply) Act, 1927

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Procedure on acquisition of authorised undertaking by the Board.

39.—(1) Whenever the Board proposes to acquire under this Act the undertaking of an authorised undertaker (hereinafter in this section called the former undertaker) the Board shall send or deliver to such undertaker a notice in writing (hereinafter in this section called the notice of acquisition) of such proposal specifying the date on which the Board proposes to acquire the undertaking (hereinafter in this section called the date of acquisition).

(2) The Board shall on the date of acquisition by special order (hereinafter in this section called the vesting order) constitute itself or some other person to be the authorised undertaker (hereinafter in this section called the new undertaker) for the area of supply of the former undertaker and shall transfer to and vest in the new undertaker all the property, assets, and liabilities as hereinafter provided of the former undertaker in relation to the undertaking.

(3) The vesting order, in so far as it purports to constitute the new undertaker to be an authorised undertaker, shall have the like operation and effect as a special order made by the Board under the appropriate section of this Act either (as the case may require) declaring the Board to be the authorised undertaker for an area of supply or constituting a person to be the authorised undertaker for an area of supply.

(4) The vesting order, in so far as it purports to transfer to and vest in the new undertaker the property, assets, and liabilities of the former undertaker, shall be expressed and shall operate:—

(a) to transfer to and vest in the new undertaker free from all charges and encumbrances all the property and assets of the former undertaker owned and used by him (including property out on loan or hire to consumers) on the date of the vesting order for the purposes of the undertaking, and

(b) to transfer to and vest in the new undertaker all book debts and other moneys owing to the former undertaker on account of the undertaking on the date of the vesting order and the right to sue for, recover, and give good receipts for such debts and moneys, and

(c) to impose on and vest in the new undertaker the liability for and obligation to indemnify the former undertaker against all debts and liabilities owing by the former undertaker on account of the undertaking on the date of the vesting order save and except—

(i) capital liabilities, mortgages, loans, and bank over draft, and

(ii) any liability exceeding one thousand pounds incurred after the 31st day of March, 1927, and before the constitution of the Board without the consent of the Minister or incurred after the constitution of the Board without the consent of the Board.

(5) Immediately upon the service on the former undertaker of the notice of acquisition the former undertaker shall cease to be an authorised undertaker but (notwithstanding anything contained in this or any other Act or in any order) shall continue to carry on his undertaking until the date of the vesting order and shall until that date have and perform all such rights, powers duties, and obligations as were immediately before the service of the notice of acquisition conferred or imposed on him by this or any other Act or any order and are necessary for such carrying on of his undertaking.

(6) Whenever the former undertaker is a local authority the new undertaker shall as on and from the date of the vesting order become and be by virtue of this sub-section liable for and bound to indemnify and keep indemnified the former undertaker against all capital loans (including current bank overdraft) outstanding at the date of the vesting order and borrowed by the former undertaker for the purpose of the undertaking and all mortgages and charges on the undertaking or the assets thereof outstanding on the date of the vesting order (save and except loans borrowed and mortgages and charges created after the 31st day of March, 1927, and before the constitution of the Board without the consent of the Minister or after the constitution of the Board without the consent of the Board) and also the interest on such loans, mortgages, and charges from the date of the vesting order.

(7) Whenever the former undertaker is a local authority, and has before the 31st day of March, 1927, raised by means of the rates any sum in aid of the undertaking, the new undertaker shall as on and from the date of the vesting order become and be by virtue of this sub-section liable to pay such sum (less an amount equal to the portion (if any) thereof which has before the date of the vesting order been paid to the general revenue account of such local authority in relief of rates) to the former undertaker by ten equal yearly instalments, the first of which shall be payable twelve months after the date of the vesting order, and each of which shall when received by the former undertaker be paid into its general revenue account in relief of rates.

(8) Whenever the former undertaker is not a local authority the new undertaker shall within three months after the date of the vesting order pay to the Board or, if the Board is itself the new undertaker, shall put to a separate account a sum equal to the fair value on the date of the vesting order of the undertaking (with all the property, assets, and liabilities thereof transferred to or imposed on the new undertaker by the vesting order) as a going concern and interest on such fair value from the date of the vesting order at the rate of five per cent. per annum, such fair value to be fixed, in default of agreement, by an arbitrator agreed upon by the former undertaker and the new undertaker or failing such agreement appointed by the High Court, and as soon as may be after such payment or putting to a separate account the Board shall out of the moneys so paid to it or put to a separate account by it discharge so far as such moneys are sufficient for that purpose all mortgages and charges affecting the undertaking or any of the property or assets thereof on the date of the vesting order and shall pay the residue (if any) of such moneys to the former undertaker.

In fixing for the purposes of this sub-section the fair value of an undertaking the arbitrator shall not include any sum or allowance on account of any accretion of value arising directly or indirectly from the operation of the Shannon works.

(9) Every person who, immediately before the date of the vesting order, is in the employment of the former undertaker and is employed by him in relation to the undertaking and had been so employed before the 31st day of March, 1927, shall, on the making of the vesting order,(unless such person elects with the consent of the former undertaker to remain in the service of such undertaker in another capacity) become a servant of the new undertaker upon the same terms (including increment pension and superannuation rights) as he was on the 31st day of March, 1927, employed by the former undertaker, with such increases of salary and other benefits as may before the date of the vesting order have accrued to him from those terms by effluxion of time and such further increases of salary and other benefits as may have been conferred on him by the former undertaker, after the 31st day of March, 1927, and before the constitution of the Board, with the consent of the Minister or, after the constitution of the Board, with the consent of the Board.

(10) If any dispute or question shall arise as to whether any person was, immediately before the date of the vesting order, in the employment of the former undertaker, and was employed by him in relation to the undertaking, and had been so employed before the 31st day of March, 1927, such dispute or question shall, if the Board is itself the new undertaker, be determined by the Minister, and shall, if the Board is not itself the new undertaker be determined by the Board.

(11) Every person who, immediately before the date of the vesting order, is in the employment of the former undertaker and is employed by him in relation to the undertaking and was first so employed on or after the 31st day of March, 1927, shall, on the making of the vesting order, become a servant of the new undertaker upon the same terms (including pension and superannuation rights) as he was immediately before the date of the vesting order employed by the former undertaker if, but only if, his employment by the former undertaker in relation to the undertaking and the terms on which he was so employed immediately before the date of the vesting order were approved of by the Minister before the constitution of the Board or by the Board after its constitution.

(12) For the purpose of calculating the pension and superannuation rights against the new undertaker of a person transferred by this section from the service of the former undertaker to the service of the new undertaker, the periods of service of such person with the former undertaker and the new undertaker respectively shall be reckoned as continuous service with the new undertaker.

(13) Whenever the former undertaker is a local authority and any dispute arises between the new undertaker and any person transferred by this section from the service of the former undertaker to the service of the new undertaker in relation to any right of such person which dispute, if it had arisen between such former undertaker and such person before such transfer, might at the instance of such person have been referred to the Minister for Local Government and Public Health for his decision, such dispute shall, if such person so requires, be referred to the said Minister, whose decision thereon shall be final and conclusive.