[BETA] Fortnightly

In his article, "Entering the Appliance Repair Business" (Feb. 1, 1995), Gordon Canning paints a bleak picture for independent contractors seeking to prevent utilities from entering the appliance repair business. However, contrary to Mr. Canning's suggestion, at least one utility has been forced to withdraw from this business.

On October 23, 1990, BC Gas, a local distribution company that supplies gas to most residential customers in British Columbia, asked the British Columbia Utilities Commission to approve a furnace repair insurance plan (FRP) for 450,000 of its residential customers. The plan covered parts and labor for specified gas furnace repairs, but did not include safety inspections or annual maintenance. On December 6, 1991, the Commission approved the plan with certain stipulations. However, on September 17, 1993, after significant efforts on the part of certain local independent contractors, the Commission announced:

.Pp

"Based on the evidence in this hearing, the Commission concludes that BCGUL is engaged in a business in direct competition with existing independent contractors undertaking furnace repairs. The Commission had previously had the expectation that BCGUL would work with the trade interests to develop mutually acceptable programs. This has not occurred¬ . [T]he Commission is not convinced that BCGUL has demonstrated that the FRP has been operated

truly on a 'stand-alone basis' with the avoidance of any 'predatory market pricing' with respect to other industry sponsored programs¬ . This results in a specific market advantage for BCGUL."

Based on these and other findings, the Commission found the plan not in the public interest.

Although the BC Gas experience may not be useful as a precedent in the United States, it may nonetheless offer a glimmer of hope to those independent contractors who feel dragged into such partnerships out of a need to survive rather than a true spirit of cooperation.

A.W. Carpenter

Partner, Lawson, Lundell,

Lawson & McIntosh

Vancouver, BC, Canada

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