Collection agencies hunt down seniors for rental water heaters they never accepted

When Herman and Patricia Bucking purchased a 40-hectare farm outside of Orangeville, Ontario in 2010, they built their dream home from the ground up. a perfect oasis of peace for retirement.

That peace was cut short seven years later, when the couple received a letter from a collection agency demanding $692.43 for a Reliance Home Comfort rental water heater they had never seen.

“The amount … is required TODAY to prevent this matter from escalating,” the letter warned. “Your response will determine how far this process will go.”

It didn’t fit.

“I was shocked and couldn’t figure out why and what it was about,” Patricia Bucking said in an interview with Go Public.

A photo of the first letter from the collection agency the Buckings received in 2017. They had not received any bills for rental equipment prior to the notice. (Mark Bochsler/CBC)

When the couple bought the property, they got a permit to demolish the previous owner’s old farmhouse and build their own. They knew nothing about a rental water heater or the contract that came with it.

The affidavit at the time of closing – a standard document signed by a landlord on the day of the sale – stated: “There is no rental agreement relating to any of the systems or their components on the property.” The real estate ad for the property made no mention of the rental.

“There was absolutely nothing in there to say there was anything attached to the property in terms of rental equipment, or any equipment at all,” she said.

The Buckings are among dozens of landlords who have contacted Go Public over struggles to back out of leases they never signed for HVAC equipment, such as furnaces, air conditioners and more.

The Buckings sift through the pile of documents they’ve been keeping track of since the collection agency first wrote. None say there is rental heating on the property. (Mark Bochsler/CBC)

The couple’s attorney, Harjot Gill, says he’s heard of cases where people are stuck with these contracts after buying a house with existing agreements that no one has told them about – or investigated.

“People are bidding blindly and continuing…no strings attached on houses,” he said.

A $700 bill may not seem huge in the context of a home sale — and far less than the legal fees could add up if the Buckings fight it. But Gill took the case pro bono, saying Reliance took advantage of the couple.

For Patricia Bucking, the thought of their credit rating taking a hit keeps her awake at night.

“We worked really hard and missed a lot of wonderful things because we made sure all our bills were paid, and I wanted to make sure that was clear,” she said.

another letter

She called Reliance in 2017 thinking it was a misunderstanding, but the company didn’t budge.

So the couple asked their then-attorney, who is now retired, to write to the collection agency that sent the letter, explaining that there was no contract between Reliance and the Buckings and that “payment for any water heaters was the sole responsibility”. from the previous owner.

WATCH | Why the Buckings refused to just pay the bill:

‘I just want it done’: Homeowners worried about their credit rating

Patricia and Herman Bucking explain why it was stressful to receive a bill for a water heater they didn’t rent and why they refused to pay. 1:05

It appeared that the previous owners had signed a water heater contract and this was not mentioned in the property purchase agreement.

The Buckings thought the problem was gone, until last October.

That’s when they received another letter in the mail, this time from a law firm representing another collection agency demanding payment for the same Reliance water heater.

“I thought, damn it,” she said. “He raised his head again.”

After hearing from Go Public, Reliance said it will ensure the couple never hear from a collection agency again.

No reason to go after the Buckings

According to terms and conditions of Reliance’s own contractsthe Buckings could only be held responsible for the rental water heater if the seller disclosed it in the purchase agreement and if the Buckings agreed to assume future payments, which they did not.

“[Reliance doesn’t] have reason to go after the Buckings because [the] Buckings did not sign the contract, [they] did not assume a contract,” Gill said.

The lawyer says the previous owner has since died, so the only way Reliance can recover the lost payments is to go after his estate.

“And that’s all they can do. They can’t prosecute these innocent people,” Gill said.

Bucking’s attorney, Harjot Gill, said Reliance had no reason to sue the couple for payment. (Craig Chivers/CBC)

He says companies owed money for rental appliances would normally register a notice of lien on the land title of a property to alert anyone viewing the property that they have an interest in it.

Gill says he pulled the title to make sure there was nothing recorded on the property, like a lien. He came back clean.

“If it’s not on the title, you don’t know it basically exists,” said Gill, who added that you wouldn’t necessarily know by looking at a water heater if it was a rental.

Confidence is declining

Reliance says he did nothing wrong, but agreed to call the collection agency.

“Our records show that a Reliance rental water heater was installed…and was rented by the previous owner,” Mike Kolatschek, corporate communications manager for Reliance Home Comfort wrote in a statement to Go Public.

In 2011, the Buckings demolished the existing farmhouse on the land they purchased. Reliance says the previous owner of this property had a rental agreement with the company. (Submitted by Patricia Bucking)

“Upon the sale of the property, Reliance was advised that the new owners would assume the rental asset and we opened the rental account and began charging for the use of our equipment accordingly.”

Kolatschek did not provide details on who notified the company, or when.

“We had no knowledge of this transaction,” Herman Bucking said. “I don’t know what kind of correspondence is going to them, but our lawyer certainly didn’t know.”

Kolatschek added that when the account is not paid, it is referred to collections.

He said Reliance was unaware that the previous owner had not informed the Buckings of the rental of the water heater and that Reliance had not received the contract to purchase the property until recently. .

“With this new information…Reliance will absolve Mr. and Mrs. Bucking of the $692.43 debt related to this rental equipment,” Kolatscheck wrote.

A bird’s eye view of Bucking’s farm in the present day. Reliance says the company only recently received the contract to purchase the property. (Kimberly Ivany/CBC)

While this is good news for Patricia Bucking, she says she’s not ready to let the company off the hook just yet.

“We want to get it over with, but I also want answers,” she said. She wants to know that Reliance will ensure that her credit rating and that of her husband are not affected.

She says this situation has caused her a lot of stress in the midst of an already difficult pandemic.

Get it in writing

Gill says unfortunately some homeowners in the same situation will go ahead and foot the bill, even if it’s not their debt to settle.

“There’s a chance people will just say, OK, I want to get rid of this. I don’t want them to keep calling me. I’m busy with work,” he said. “And you know what? It’s a win for the company.”

Patricia and Herman Bucking say they thought about it, but decided to fight.

“I won’t give money to someone I don’t owe it to,” he said. “We have been wronged and I think we should apologize for that.”

WATCH | Due diligence can protect homebuyers from surprises, says one lawyer:

How Landlords Can Avoid Surprise Rental Equipment

Real estate attorney Harjot Gill advises what to do before buying a home so you won’t be surprised to learn that the HVAC or other equipment is rented and not owned. 1:00

Gill says it’s the seller’s responsibility to disclose if a device is rented, but sometimes people forget. He says that’s why it’s important for real estate agents to question their clients, and for homebuyers to ask questions too, and keep track of them.

“I always tell a lot of my clients to keep their correspondence in writing,” Gill said.

He said if you spend money on a house you should pay a lawyer to remove the title to make sure there are no liens and review the bill of sale .

“There are solutions…talk to your lawyer or have your realtor dig deeper,” Gill said. “I know it’s a crazy market, but you know, at the end of the day, you don’t want to be stuck with a lemon, do you?”

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