Issue - meetings

DECLARATIONS OF INTEREST FOR THIS ITEM:

NONE

RESOLVED

It was recommended that the Cabinet Member:

That the Cabinet Member for Finance and Corporate Services approved, in accordance with the Council’s Contract Standing Order (CSO) 18.03, 2.01(d) CSO 0.08 and CSO 18.04.3, the variation and novation of the contract for the supply of natural gas from 1 April 2025 to 31 March 2029 by changing the name of the Supplier in the contract which is Corona Energy Limited to Corona Energy Retail 4 Limited (the Supplier that was awarded the contract (see Cabinet minutes - Appendix 1) by way of a Deed of Rectification and Novation to be executed by all the relevant parties in order to correct the error in the name of the Supplier in the executed contract.

Reasons for decision

Corona Energy Retail 4 Limited are the company awarded under LASER framework Y22008 and are the company named in the 12 March 2024 Cabinet decision to award the call-off contract for the supply of gas from 1 April 2025 to 31 March 2029 (Appendix 1). It was a clerical error that led to the company name Corona Energy Limited being used on the contract and this error must be corrected to reflect the correct details of the parties that have entered into the contract. 5.

Alternative options considered

Do nothing. A contract that does not reflect the correct details of both contracting parties or can lead to issues in enforcing the contract or resolving disputes. Further, the company currently named on the contract, Corona Energy Limited, is in Members Voluntary Liquidation so not rectifying the contract may lead to issues with the liquidators contacting the Council. This option was therefore rejected.

It was explained on 12 March 2024, Cabinet approved the award of a four-year call-off contract for the supply of gas under the LASER Framework Agreement (Y22008) to Corona Energy Retail 4 Limited (CER4), commencing on 1 April 2025 and ending on 31 March 2029, with an estimated value of £19.76 million.

Following contract preparation, it was identified that the supplier had been incorrectly named as Corona Energy Limited (CEL) instead of the intended contracting entity, Corona Energy Retail 4 Limited (CER4), as specified in the LASER Framework Agreement. Both companies formed part of the Corona Group.Subsequently, CEL entered Members’ Voluntary Liquidation as part of a corporate restructuring programme, with Ernst & Young LLP appointed as liquidator.

Although the proposed variation had no financial impact, the contract's total value remained £19.76 million, with approximately £16 million outstanding over the remaining term. In accordance with the relevant Contract Standing Orders, Cabinet approval was therefore sought to execute a Deed of Rectification and Novation. This action corrected the supplier’s name on the contract from Corona Energy Limited to Corona Energy Retail 4 Limited and ensured the contract accurately reflected the intended supplier.

DECLARATIONS OF INTEREST FOR THIS ITEM:

NONE

RESOLVED

It was recommended that the Cabinet Member:

That the Cabinet Member for Finance and Corporate Services approved, in accordance with the Council’s Contract Standing Order (CSO) 18.03, 2.01(d) CSO 0.08 and CSO 18.04.3, the variation and novation of the contract for the supply of natural gas from 1 April 2025 to 31 March 2029 by changing the name of the Supplier in the contract which is Corona Energy Limited to Corona Energy Retail 4 Limited (the Supplier that was awarded the contract (see Cabinet minutes - Appendix 1) by way of a Deed of Rectification and Novation to be executed by all the relevant parties in order to correct the error in the name of the Supplier in the executed contract.

Reasons for decision

Corona Energy Retail 4 Limited are the company awarded under LASER framework Y22008 and are the company named in the 12 March 2024 Cabinet decision to award the call-off contract for the supply of gas from 1 April 2025 to 31 March 2029 (Appendix 1). It was a clerical error that led to the company name Corona Energy Limited being used on the contract and this error must be corrected to reflect the correct details of the parties that have entered into the contract. 5.

Alternative options considered

Do nothing. A contract that does not reflect the correct details of both contracting parties or can lead to issues in enforcing the contract or resolving disputes. Further, the company currently named on the contract, Corona Energy Limited, is in Members Voluntary Liquidation so not rectifying the contract may lead to issues with the liquidators contacting the Council. This option was therefore rejected.