Penticton Utilities

[my5cents]

I just heard of a collections situation regarding the City of Penticton, that seems a bit strange.

A family member, early 20's female lived common law with a boyfriend, in Penticton in 2010. They rented an apartment in her name, the utilities were also in her name. She had a baby.

They left town for him to work elsewhere.

After one more baby, they split and she moved back to Penticton, and in April 2015, she rented an apartment in her name. She also obtained utilities, no problems.

She later moved to another apartment in late 2015, again in her name, with utilities in her name.

On Friday, she got a letter advising her that she had unpaid utilities from the address of the apartment she lived in in 2010. The notice went on to say if she did not pay the debt in 3 weeks her current (fully paid) utilities would be cut off.

OK, so far, I have no problem. A bit heavy handed. But didn't pay, they sold you utilities for 2 years, didn't make the link, then did, good, go after the dead beat. Personally I would have started off with a softer approach since she has been a "good" customer now for two years. But certainly go after her.

BUT,,, when she went in first thing Monday morning she finds that, yes there were utilities left unpaid, but they were then collected from the property owner in full.

So, she does not owe Penticton, a cent, she does owe the property owner.

Penticton has some sort of arrangement that they will keep delinquent customers in their records (it took 2 years to identify her as one ???????), and if they make a collections it will be given to the property owner.

The other question, how long can / should Penticton sell her utilities (in her case two years) all the while, adding interest to a delinquent account that, presumably, she didn't know she had ? (she says dead beat boyfriend said he paid everything).

Is it proper for a utility that HAS been paid IN FULL by a third party to cut off a current utility, when that utility isn't owed anything by their customer (in good standing) for two years ?

Just seems kinda strange.

Nobody is disputing she owes the debt.

Just thought I'd throw it out there for discussion.

[Bunnyhop]

The city collects the unpaid utility account from the property owner. Then reimburses the property owner when they find and collect from the person that signed on the account, with interest.

Sure, the city should have notified her of the debt when she applied to open the account she has now but they didn't. Just like she didn't fess up about the unpaid account.

I don't think it was heavy handed at all. The city has no other leverage to collect other than to use the current account to motivate payment of the debt. As a property owner that has been forced to pay a tenant's unpaid account, I like that the city follows up and makes the collection. Its bad enough the property owner has to pay it, they shouldn't have to chase after a tenant that skips out on their utility bill too.

Sorry your relative got duped by her ex-boyfriend but she took that on when she signed up for everything in her name. Life lesson.

[my5cents]

The city collects the unpaid utility account from the property owner. Then reimburses the property owner when they find and collect from the person that signed on the account, with interest.

Sure, the city should have notified her of the debt when she applied to open the account she has now but they didn't. Just like she didn't fess up about the unpaid account.

I don't think it was heavy handed at all. The city has no other leverage to collect other than to use the current account to motivate payment of the debt. As a property owner that has been forced to pay a tenant's unpaid account, I like that the city follows up and makes the collection. Its bad enough the property owner has to pay it, they shouldn't have to chase after a tenant that skips out on their utility bill too.

Sorry your relative got duped by her ex-boyfriend but she took that on when she signed up for everything in her name. Life lesson.

Thank you for replying with your take on the situation, Bunnyhop. It's certainly informative to hear from a property owner who has rented property. I have never rented out property and haven't even rented as a tenant since the mid seventies.

If you've bear with me and look at the facts from the perspective of the debtor.

Sure, the city should have notified her of the debt when she applied to open the account she has now but they didn't.

Yes, they didn't. Should that then allow them to charge (and later extort payment under threat) the interest from that time on ? What if the city didn't advise her of the debt for 5 years, instead of 2 years, 10 years ? When do you cut the interest accruing time off or do you ? How much interest should they be allowed to accrue when they knew, or should have known they had located her and could have advised her.

Just like she didn't fess up about the unpaid account.

Yes, in a perfect world a 20 year old, who had just had her first baby, moving to a new province, would check in detail and confirm that her boyfriend had paid all bills before they left town together.

The city has no other leverage to collect other than to use the current account to motivate payment of the debt.

I agree cutting off a utility is great leverage. With respect, if we agree that the city is not owed anything, because they were paid in full by the property owner, then what right does the city have to cut off the utility ?

In that the city is not owed anything, they've put themselves in the position of debt collector.

If the city had conducted due diligence and identified her as a former, bad client, they certainly were within their rights to refuse to sell her utilities without, perhaps a guarantee of some sort. But actually, being a public utility, if they had realized she had been a bad debtor, do they even have the right to require her to pay a third party before they would open up an account ? If she still owed the city, no problem, but they are using the withdrawal of service to enforce a debt owed to a third party. The fact that cutting off, or the threats of same, is a good tool, doesn't make it right, or perhaps legal.

As a property owner that has been forced to pay a tenant's unpaid account, I like that the city follows up and makes the collection. Its bad enough the property owner has to pay it, they shouldn't have to chase after a tenant that skips out on their utility bill too.

I'm sure you would appreciate the collection efforts. Having never rented property, I had no idea that unpaid utilities could be attached to a property. If I was renting property, after inspecting the property for condition, before returning the damage deposit a call to the city would be on my list.

[fluffy]

For every thing entioned here that the city cold have done, there is also something the tenant could have done to make sure her responsibility to cover her debt to the city was met. Something as simple as asking boyfriend for the receipt could have prevented the whole mess.

I do have a question regarding the interest collected though, does that money get returned to thr property owner with the reimbursement of the bill money? There is something a littl iffy about keeping interest money collected on a debt they have tecgnically been paid for, and the property owner is the one who is out of pocket.

[my5cents]

For every thing entioned here that the city cold have done, there is also something the tenant could have done to make sure her responsibility to cover her debt to the city was met. Something as simple as asking boyfriend for the receipt could have prevented the whole mess.

I do have a question regarding the interest collected though, does that money get returned to thr property owner with the reimbursement of the bill money? There is something a littl iffy about keeping interest money collected on a debt they have tecgnically been paid for, and the property owner is the one who is out of pocket.

Yes, fluffy I have the question too. I suspect some of the interest will go to the landlord and some will be retained as a collection fee.

As for asking the boyfriend to see the receipt, you'd have to meet the boyfriend.

I'm not saying there aren't things she could have done, I'm really questioning to areas.

No money owed to the city but they are threatening to cut off power to a person who had (this time) paid on time for two years. Demanding the interest for a period of time that they should have advised her.

[Bunnyhop]

As far as I know, all of the interest goes to the property owner.

Making the property owner pay for the tenant's utilities debt and repaying them *IF* the debt is ever collected, totally stinks in my opinion.

There are too many ways for the tenant to get around paying the debt, and the property owner has no recourse but to sit back and wait for the city to maybe collect one day.

The city does allow property owners to check the status of the tenant's utilities account though and if it falls into arrears the property owner will know about it right away. Its super easy for the landlord to set up, though they have to actually check, they don't get notifications of accounts in arrears. I don't think that was available in the time frame the OP is talking about though.

[my5cents]

As far as I know, all of the interest goes to the property owner.

Making the property owner pay for the tenant's utilities debt and repaying them *IF* the debt is ever collected, totally stinks in my opinion.

There are too many ways for the tenant to get around paying the debt, and the property owner has no recourse but to sit back and wait for the city to maybe collect one day.

The city does allow property owners to check the status of the tenant's utilities account though and if it falls into arrears the property owner will know about it right away. Its super easy for the landlord to set up, though they have to actually check, they don't get notifications of accounts in arrears. I don't think that was available in the time frame the OP is talking about though.

It's still a bit unusual, but as long as the landlord had the "task" (check that utilities are paid in full) before they release the damage deposit.

Sorta a double wammie if the landlord had real bad tenants, they trash the place and skip with utilities due.

My take on the collection, is probably viewed best by exchanging to goods of another type....

Let's say you rent a car and you park illegally and get a ticket. You either don't mention the ticket, forget or it blew off the car, whatever. You take the car back, pay the rental. A month later the city advises the rental company that there is an overdue ticket. The rental company pay the ticket. They can't locate you, they remain "out" price of the ticket.

So, the government isn't owed for the ticket, just the rental car company.

(Now this doesn't happend, but for our scenario) The City obtains your name from the rental car company and they file it away. 5 years later, you park your own car legally in a parking space in the same city, when the bylaw officer checks your plate they become aware that 5 years previous, you had a ticket and it was paid by the rental company, so they impound your legally parked car and hold it ransom until you pay the "unpaid" parking ticket.

To me that would be outrageous, but the scenario is very similar to what has happend here.

-> Over due utilities paid by third party
-> City has no monies outstanding, but continues to add interest on to the amount that was overdue when paid by the landlord (I'd love to see the books for the city on that assest)
-> Threats to cut off fully current utilities to resolve a third parties debt.
-> The monies are owed to the landlord. What if any contract was there between the former tenant and the landlord for interest on unpaid utilities
-> How can a city assess interest on an amount they are not owed ?