Business Energy Claims: What Companies Need to Know About Secret Commissions

Businesses across the UK are increasingly investigating whether they were charged hidden commissions when entering into energy supply agreements. These claims, often called “business energy claims” or “secret commission claims,” arise where an energy broker or intermediary acting for the business received commission payments from an energy supplier without the customer’s fully informed consent. The claim is usually brought against the energy supplier that paid the commission, rather than against the broker.

Although the legal principles are technical, the underlying issue is straightforward: if someone acting for a business stands to profit from a deal, the business is usually entitled to know about it, how much it is and how it is calculated.

The principles governing secret commissions are long-standing. They were restated by the Supreme Court in August 2025 in Hopcraft v Close Brothers Ltd [2025] UKSC 33 (often referred to as Johnson v FirstRand). How those principles apply to energy brokers is still being worked out by the courts.

What Is a Business Energy Claim?

Many businesses use energy brokers to help arrange gas and electricity contracts. Brokers often present themselves as acting in the customer’s interests by comparing tariffs and negotiating deals.

However, brokers are commonly paid substantial commissions by the energy supplier, often funded by an amount added to the customer’s unit rate.  Problems arise where:

• the commission was not disclosed at all;
• the amount of commission was hidden;
• the broker gave the impression they were independent while financially benefiting from recommending a particular supplier;
• the customer was unaware the broker’s recommendation was influenced by commission arrangements; or
• not told that the commission was added to its unit rate, or that the broker could set the amount.

A business energy claim usually seeks to recover the amount of the commission from the supplier that paid it or, alternatively, compensation for losses that the business can prove it suffered.

Why the Claim Can Be Brought Against the Supplier

The Supreme Court confirmed in Hopcraft that a person who pays a commission to someone who owes a duty of loyalty to another, without that other person’s fully informed consent, is treated as a primary wrongdoer. The business does not need to prove that the supplier or the broker acted dishonestly, that the commission actually influenced the broker’s recommendation, or that the business suffered any loss. If the claim succeeds, the supplier must pay the business the amount of the commission.

Some brokers have since ceased trading. The claim against the supplier does not depend on whether the broker is still in business.

Why the Law Treats Secret Commissions Seriously

The courts treat secret commissions as a serious breach of duty because a person acting for another should not secretly profit from that position. The legal principle is simple: an agent or fiduciary must not make a personal profit without fully informed consent.

This principle can apply in many relationships, including:

• brokers and the customers who appoint them to act on their behalf;
• agents and principals; and
• solicitors and clients.

However, the principle applies only where the broker owed the customer a fiduciary duty, meaning a duty to act in the customer’s interests rather than its own. The Supreme Court has held that there can be no claim of this kind without such a duty.

In Hopcraft, the car dealers who arranged their customers’ finance were found not to owe that duty, and the claims based on it failed.

In Expert Tooling and Automation Ltd v Engie Power Ltd [2025] EWCA Civ 292, a broker appointed under a letter of authority to act for its customer was found to be a fiduciary, but whether a particular broker owed the duty depends on what it undertook to do for the business.

A business that appointed a broker to search the market and negotiate on its behalf, particularly under a letter of authority, is likely to be in a stronger position than one that dealt with an intermediary acting in substance as the supplier’s own sales channel.

In the business energy context, a broker that is paid by the supplier it recommends is placed in a position of conflict between its own interest and its duty to the customer, whether or not the broker was in fact influenced by the commission.

What Counts as Proper Disclosure?

One of the key legal issues is disclosure.

The courts have made clear that vague or partial disclosure is not enough. In Expert Tooling, the Court of Appeal treated a statement that prices “may include commission” as materially different from telling the customer that commission had in fact been added to its unit rate.

For consent to be valid, the customer must receive full disclosure of all material facts. Information is material if it might have affected the customer’s decision.

That will ordinarily include:

• the fact commission is being paid;
• who is paying it;
• how much is being paid;
• how the commission is calculated, including whether it was added to the customer’s unit rate and whether the broker could set the amount;
• how the amount varied with the length of the contract and the customer’s consumption; and
• whether any part of it was paid to the broker up-front.

Importantly, the burden is on the supplier that paid the commission, as well as on the broker that received it, to prove that full disclosure was made. It is not enough to have said something that might have prompted the customer to ask questions.

The disclosure rules for suppliers changed during the period in which many of these contracts were made:

• From 1 October 2022, Ofgem’s supply licence conditions required suppliers to state broker charges as a sum of money in microbusiness contracts.
• From 1 October 2024, that requirement was extended to all non-domestic contracts.
• For later contracts, the question will usually be whether the basis of the commission, as well as its amount, was disclosed.

Even so, compliance with the licence conditions is not necessarily the same as fully informed consent.

What Are “Half-Secret” Commissions?

An important area of litigation concerns so-called “half-secret” commissions.

This is where a customer knows a broker receives some commission, but does not know the scale or details of the payment.

In Hopcraft, the Supreme Court rejected the approach in earlier case law under which a partly disclosed commission was treated as a separate and less serious category. Awareness that “some commission” exists does not mean the customer gave informed consent to the commission actually paid. Suppliers may argue that this part of the Supreme Court’s judgment was not strictly necessary to its decision and is therefore not binding.

This issue is particularly relevant in the energy sector because many businesses were told brokers were “paid by the supplier”, or that prices “may include commission”, without being informed of the actual sums involved.

What Remedies Can Businesses Seek?

Recovery of the Commission

The business may be entitled to recover from the supplier the amount of the commission it paid, without having to prove that it suffered any loss. Alternatively, the business may claim damages for the loss it can prove.

Rescission of the Contract

In some cases, the underlying agreement may be set aside or rescinded, which may give rise to greater claims for compensation to best put a business back in the position it would have been.

Constructive Trusts Against the Broker

The courts have confirmed that secret commissions received by an agent can be held on constructive trust for the principal. This is a remedy against the broker that received the commission, rather than against the supplier that paid it. In practical terms, this means the commission is treated as money that rightfully belonged to the customer.

Tracing and Insolvency Protection

A proprietary claim against the broker may allow businesses to trace the funds and potentially obtain priority over unsecured creditors if the broker becomes insolvent. Its practical value depends on whether the money can still be identified in the broker’s hands. Where it cannot, the claim against the supplier is likely to be the more effective route.

Why These Claims Are Increasing

Business energy claims have attracted increasing attention for several reasons:

• rising energy costs have prompted businesses to review historic contracts;
• disclosure practices in the broker market were often poor, particularly before Ofgem’s rules changed in 2022;
• businesses are becoming more aware of their legal rights; and
• recent decisions of the Supreme Court and the Court of Appeal have clarified the duties concerning hidden commissions and informed consent.
• Section 32 of the Limitation Act 1980 can extend the time limit where a relevant fact was deliberately concealed by the defendant

Many claims also mirror developments in other sectors involving undisclosed commissions, including financial services and motor finance.

What Businesses Should Look For

Businesses may wish to investigate further if:

• they used appointed a third-party energy broker to find or negotiate their contract, particularly under a letter of authority;
• they were not told how much the broker was paid, or were told only that prices “may include commission”;
• the broker claimed to be independent;
• their contracts were made before 1 October 2022 or, for businesses that were not microbusinesses, before 1 October 2024; or
• they were not told that the commission was added to their unit rate.

The business must also be able to bring the claim. A company that has been dissolved must first be restored to the register at Companies House, and an insolvent company will need the authority of its liquidator, administrator or other office-holder.

Relevant documents held by the business can include:

• brokerage agreements or broker’s terms of business;
• letters of authority;
• energy bills showing the unit rates charged;
• each supply contract, with the supplier’s quotation; and
• emails and other correspondence with the broker.

Businesses should keep all such documents, including emails, even where a contract has ended. Documents held by the supplier, such as its agreement with the broker and its record of the commission paid, can be requested from the supplier.

How RLK Solicitors Can Help

Specialists in civil fraud and bribery, RLK Solicitors will act for businesses in claims against energy suppliers for hidden broker commissions. We can review your letter of authority, the broker’s terms of business, your supply contracts and your energy bills to assess whether your broker is likely to have owed you a fiduciary duty and what you were told about its commission. We can identify which contracts and commission payments remain within the time limit, check your company’s position at Companies House, and request the supplier’s commission records on your behalf.

Where a claim is viable, we will explain the funding options available, including no-win-no-fee arrangements, and set out in writing what you would pay if the claim succeeds before you decide whether to proceed.

To arrange a review of your contracts, please contact Stephen Scott on 020 3318 2354 or at sscott@rlksolicitors.com.