Oil co. cancelled my account...

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ylomnstr

ylomnstr

Feeling the Heat
May 28, 2008
348
Staatsburg, NY
So last June I locked into a price plan with auto delivery with Love Effron fuel. They recorded a verbal agreement with me over the phone. Apparently in the agreement it says if I did not take oil, they had the right to cancel my account and charge me a $500 cancel fee. They also sent me a contract to sign which I never actually did sign and send back to them.

Well, based on the fact that I still had a balance from the year before which I was still paying off, they didn't come and deliver as they were scheduled to in November. I get a letter last week saying they cancelled my account and added that fee on top of it.

I spoke to them and they aren't willing to work with me. So I have a couple of questions.....

1) Since this isn't really a credit account, will it effect my credit if I don't pay the cancel fee and they send it to collections?
2) Do I have any sort of case here since I never actually signed the contract and sent it back, even though they have my verbal agreement?

I don't mind paying them for the rest of my balance, but I am not paying the $500 cancelation fee since I did not request to cancel it. They're just pissed off that since I got the pellet stove, I haven't used any oil.

Comments/suggestions?
 
You absolutely have a case, but it won't need to come to that. Contact the better business bureau for your area, or simply threaten to. They won't bother you. Since you did not sign the contract, and since the cancellation is from them and not from you, this is 100% on them. If the BBB doesn't get it done, any attorney will take this one.
 
I agree with contacting your local BBB, and speaking to someone there. While not a cure-all, they can be very helpful sometimes.

You may also wish to consider contacting the oil company and ask for them to provide you a copy of the contract with your signature, under the pretense of your attorney needing a copy of the contract for his/her review. Once they realize that they don't actually have a contract with your signature, they might see the weakness inherent in their position, and the matter might just go away.
 
Well they know that I never sent back the signed contract. They said that was more of a confirmation of the contract and isn't really needed. The recorded verbal agreement is what they're going on now.
 
What? No handshake :lol: I would send them a certified letter asking for the balance and note that you have not violated any agreement and are not going to pay 500 for it. At least if they get crappy and run you to the courthouse you show a willingness and the big bad oil is preying on people!
 
I don't think what they have will hold water. You didn't refuse an oil shipment; they refused to ship you oil.
 
Normally, a judge will recognize an "implied contract" if you had in fact accepted oil deliveries without signing the paper contract. The fact that no oil was ever delivered may help you make your case.
 
Yes, there are plenty of providers here. Now knowing that the pellet stove can handle heating my home, I will not sign another contract with oil. If and when I need a deliver, I will call around and get the best price and just have them deliver at that time.
 
GaryS said:
Normally, a judge will recognize an "implied contract" if you had in fact accepted oil deliveries without signing the paper contract.
Click to expand...
Correct. A verbal contract should still be considered binding.
 
ylomnstr said:
Well they know that I never sent back the signed contract. They said that was more of a confirmation of the contract and isn't really needed. The recorded verbal agreement is what they're going on now.
Click to expand...
Call them and tell them you need a transcript of the verbal agreement that they recorded. They first have to inform you of the recording of the conversation, otherwise it is illegal to record a phone conversation. If you did agree to the recording, the transcript will show if they discused the cancellation fee. If they did, you are under contract with them. You could take a chance in small claims court. If they did not tell you verbally of the cancellation fee, they can not hold you to it.
 
Don't pay 'em.
 
But, didn't the company agree to deliver oil to you?
They violated the agreement when the failed to deliver your oil.

Also since they magically added a $500 fee for them cancelling your contract.
Why don't you charge them a $5K fee for breach of contract on the agreement that they didn't sign but had a verbal agreement with you to deliver your oil?
 
MishMouse said:
But, didn't the company agree to deliver oil to you?
They violated the agreement when the failed to deliver your oil.

Also since they magically added a $500 fee for them cancelling your contract.
Why don't you charge them a $5K fee for breach of contract on the agreement that they didn't sign but had a verbal agreement with you to deliver your oil?
Click to expand...

They did agree to deliver the oil. The funny thing is when we agreed to lock in the price, I still had an outstanding balance from last years oil. of course they didn't say anything about it at that time. So their reason for not delivering oil is because I still owed money from last year. Well if that was the case, how come the jumped on it when I agreed to lock in at $4.99? PROFIT!
 
I recommend that you pay the past due balance - whatever was outstanding prior to the $500 charge. Write them a polite letter stating that since no goods or services were ever exchanged you do not believe that you have any further obligation to them and thus have no intention of paying the additional $500 charge. Ask in this letter that if they believe that you indeed owe them the additional money, please forward a copy of whatever documentation they have proving the obligation so that you can have it reviewed by your attorney and get back to them.

I imagine that this approach should pretty much close the deal for you - send it certified if you really want to get their attention that you are serious. Keep a copy in any case (including a copy of the check you send settling the outstanding balance). IF the matter goes forward beyond this point, be sure you only allow it to do so via writing - i.e. if they call, ask them to write you "for your mutual protection in having things well documented." For example, if they choose to simply apply the check to your account, ignore the letter and send you another bill, you can return the bill to them (keep a copy) and send a copy of your letter along with a copy of the proof of receipt and another note stating "please review the attached correspondence as your billing department has apparently made an error here". Overall you are forcing them to contact you in writing and proceed with their case - more trouble than it will be worth for them and unless they really have a good system in place for documenting the verbal contract they claim to have with you it should end in your favor.

Mind you, IF you indeed knew the terms of the contract when you agreed to it verbally - i.e. if they explained clearly that you would be obligated to a minimum delivery with a charge if you didn't accept that amount of oil within some period of time, then you do have an obligation to pay. Ethically you simply should pay up what you agreed to.
 
Slow1 said:
I recommend that you pay the past due balance - whatever was outstanding prior to the $500 charge. Write them a polite letter stating that since no goods or services were ever exchanged you do not believe that you have any further obligation to them and thus have no intention of paying the additional $500 charge. Ask in this letter that if they believe that you indeed owe them the additional money, please forward a copy of whatever documentation they have proving the obligation so that you can have it reviewed by your attorney and get back to them.

I imagine that this approach should pretty much close the deal for you - send it certified if you really want to get their attention that you are serious. Keep a copy in any case (including a copy of the check you send settling the outstanding balance). IF the matter goes forward beyond this point, be sure you only allow it to do so via writing - i.e. if they call, ask them to write you "for your mutual protection in having things well documented." For example, if they choose to simply apply the check to your account, ignore the letter and send you another bill, you can return the bill to them (keep a copy) and send a copy of your letter along with a copy of the proof of receipt and another note stating "please review the attached correspondence as your billing department has apparently made an error here". Overall you are forcing them to contact you in writing and proceed with their case - more trouble than it will be worth for them and unless they really have a good system in place for documenting the verbal contract they claim to have with you it should end in your favor.

Mind you, IF you indeed knew the terms of the contract when you agreed to it verbally - i.e. if they explained clearly that you would be obligated to a minimum delivery with a charge if you didn't accept that amount of oil within some period of time, then you do have an obligation to pay. Ethically you simply should pay up what you agreed to.
Click to expand...

Thanks for the replys guys. I appreciate the help. I do need to get a copy of the transcript of the voice agreement. I'm pretty sure that the 'meat and potatoes' of the contract was the one that I was supposed to sign and send back, which I never did. I do like this approach though. I have filed the complaint with the BBB already and we'll see where it goes from here.
 
pinewoodburner said:
ylomnstr said:
Well they know that I never sent back the signed contract. They said that was more of a confirmation of the contract and isn't really needed. The recorded verbal agreement is what they're going on now.
Click to expand...
Call them and tell them you need a transcript of the verbal agreement that they recorded. They first have to inform you of the recording of the conversation, otherwise it is illegal to record a phone conversation. If you did agree to the recording, the transcript will show if they discused the cancellation fee. If they did, you are under contract with them. You could take a chance in small claims court. If they did not tell you verbally of the cancellation fee, they can not hold you to it.
Click to expand...

This is another good point to consider. If they did have an actual transcript and if it ever went as far as a trial, the outcome may hinge on a single word. If their statement was something to the effect of "If you cancel the account, there will be a $500 cancellation fee", I'd say you're off the hook, because you didn't cancel the account. If they worded it as "If we cancel your account..." that might present a different issue.
 
cozy heat said:
pinewoodburner said:
ylomnstr said:
Well they know that I never sent back the signed contract. They said that was more of a confirmation of the contract and isn't really needed. The recorded verbal agreement is what they're going on now.
Click to expand...
Call them and tell them you need a transcript of the verbal agreement that they recorded. They first have to inform you of the recording of the conversation, otherwise it is illegal to record a phone conversation. If you did agree to the recording, the transcript will show if they discused the cancellation fee. If they did, you are under contract with them. You could take a chance in small claims court. If they did not tell you verbally of the cancellation fee, they can not hold you to it.
Click to expand...

This is another good point to consider. If they did have an actual transcript and if it ever went as far as a trial, the outcome may hinge on a single word. If their statement was something to the effect of "If you cancel the account, there will be a $500 cancellation fee", I'd say you're off the hook, because you didn't cancel the account. If they worded it as "If we cancel your account..." that might present a different issue.
Click to expand...

That is a good point also. I'm going to call them back and ask for a transcript. Or do you think I should ask for it in writing, along with everything else from here on out as stated in the other post above?
 
Tell them you have been burning your stove and that you will accept oil when you need it. If they don't like that then they can cancel the contract but you will not pay the $500 fee because you are still willing to accept oil when needed. They are the ones refusing to deliver and canceling the contract, Not you! They have no leg to stand on. Also report to BBB as said above. Chances are they think you will not fight them and just pay. Lots of companies do this. How many times have people been billed from a doctor or hospital for a procedure that should have been paid by your insurance?
 
ylomnstr said:
cozy heat said:
pinewoodburner said:
ylomnstr said:
Well they know that I never sent back the signed contract. They said that was more of a confirmation of the contract and isn't really needed. The recorded verbal agreement is what they're going on now.
Click to expand...
Call them and tell them you need a transcript of the verbal agreement that they recorded. They first have to inform you of the recording of the conversation, otherwise it is illegal to record a phone conversation. If you did agree to the recording, the transcript will show if they discused the cancellation fee. If they did, you are under contract with them. You could take a chance in small claims court. If they did not tell you verbally of the cancellation fee, they can not hold you to it.
Click to expand...

This is another good point to consider. If they did have an actual transcript and if it ever went as far as a trial, the outcome may hinge on a single word. If their statement was something to the effect of "If you cancel the account, there will be a $500 cancellation fee", I'd say you're off the hook, because you didn't cancel the account. If they worded it as "If we cancel your account..." that might present a different issue.
Click to expand...

That is a good point also. I'm going to call them back and ask for a transcript. Or do you think I should ask for it in writing, along with everything else from here on out as stated in the other post above?
Click to expand...

Although this is an 'exciting' event of sorts, it sounds like you have already initiated at least one avenue of relief (the BBB complaint). To go off calling/writing/etc may be a bit excessive. Unless they are threatening other action at this time, I would let the BBB complaint take its course and see where it goes. BBB may investigate, during that time you can ask them for a copy of the transcript. Firing off so many requests and giving so many responses may be counterproductive to a rapid resolution.
 
Bubbavh said:
Tell them you have been burning your stove and that you will accept oil when you need it. If they don't like that then they can cancel the contract but you will not pay the $500 fee because you are still willing to accept oil when needed. They are the ones refusing to deliver and canceling the contract, Not you! They have no leg to stand on. Also report to BBB as said above. Chances are they think you will not fight them and just pay. Lots of companies do this. How many times have people been billed from a doctor or hospital for a procedure that should have been paid by your insurance?
Click to expand...

Well the contract I agreed to was for auto-delivery and for the rate lock in. So their issue is because i had an outstanding balance from the previous year, they were unable to deliver until that was paid off. If that was the case, why did they ever agree to a new contract with me before I paid off the previous balance? Simple answer is that they wanted to profit off of me because I locked in at $4.99.

The more I think about it and with all the replies on this topic, I really don't think they have much of a case.
 
ylomnstr said:
So last June I locked into a price plan with auto delivery with Love Effron fuel. They recorded a verbal agreement with me over the phone. Apparently in the agreement it says if I did not take oil, they had the right to cancel my account and charge me a $500 cancel fee. They also sent me a contract to sign which I never actually did sign and send back to them.

Well, based on the fact that I still had a balance from the year before which I was still paying off, they didn't come and deliver as they were scheduled to in November. I get a letter last week saying they cancelled my account and added that fee on top of it.

I spoke to them and they aren't willing to work with me. So I have a couple of questions.....

1) Since this isn't really a credit account, will it effect my credit if I don't pay the cancel fee and they send it to collections?
2) Do I have any sort of case here since I never actually signed the contract and sent it back, even though they have my verbal agreement?

I don't mind paying them for the rest of my balance, but I am not paying the $500 cancelation fee since I did not request to cancel it. They're just pissed off that since I got the pellet stove, I haven't used any oil.

Comments/suggestions?
Click to expand...
Don't call a lawyer as yet.Inform the company your going to send a written complaint to your Attorney Generals office.If they don't back off then,then contact your Attorney General's office and file a complaint regarding the $500.00 fee situation.
 
I once had a pretty bad car accident where I rolled my car down a major highway. The volunteer Fire Dept. cleaned up after the accident and 3 months later I got an itemized bill for $1870!!!! They charged me $25 a piece for flares, $80 to buy new brooms and a lot of other nonsense. I contacted my attorney and he told me not to pay it because a volunteer Fire
dept. is a government funded nonprofit and can't bill for a service you don't request. I asked him about my credit and he told me if they don't have your social security number they couldn't do anything to your credit report. They sent a couple of threatening letters saying they were going to turn me in to a collection agency but I just called them back and told them to contact my attorney. Never heard from them after that. That was 6 years ago and I still haven't paid that bill. No problems with my credit either.
 
GKG-MO said:
I once had a pretty bad car accident where I rolled my car down a major highway. The volunteer Fire Dept. cleaned up after the accident and 3 months later I got an itemized bill for $1870!!!! They charged me $25 a piece for flares, $80 to buy new brooms and a lot of other nonsense. I contacted my attorney and he told me not to pay it because a volunteer Fire
dept. is a government funded nonprofit and can't bill for a service you don't request. I asked him about my credit and he told me if they don't have your social security number they couldn't do anything to your credit report. They sent a couple of threatening letters saying they were going to turn me in to a collection agency but I just called them back and told them to contact my attorney. Never heard from them after that. That was 6 years ago and I still haven't paid that bill. No problems with my credit either.
Click to expand...

That's my major concern here is them going after my credit. I don't think I ever gave them my SS#, but I'm not 100% sure. If all they do is send me to a debt collector, then that's fine, but the credit is what I'm worried about. And by the way, your story is CRAZY. I can't believe they came after you for that!
 
I'd give some thought to contacting your local news/TV station and/or newspapers. Many of them have a "consumer advocate" reporter who likes to go after companies/businesses that try and pull crap like this. If there is a local TV news reporter that does stories like this, call them up and see if they're interested in looking into it for you. Even IF the oil company has proof of your agreement and a good chance of prevailing in court, the $500 they'd collect from you is in no way worth the bad publicity they'd receive if you go public with what they're trying to pull and they'd be wise to drop it.............

Sounds to me like it's sour grapes from them because all they want is your money and you're not giving them any!
 
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