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Tenant hasn`t paid EPCOR - now they want us to pay!!

Nicola

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I've just found out that our tenant owes EPCOR $900 and does not have the money to pay them. EPCOR wants to switch the bills back into our names (as owners). Can they do this??



Any suggestions on how to deal with this?



Thanks,

Nicola
 

Thomas Beyer

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Send tenant an eviction form as they are in breach of the lease (assuming your lease states that they have to pay utilities) .



Then they will either pay, or you must proceed to the next step of eviction which requires a detailed knowledge of the necessary legal steps.
 

Sherilynn

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Yes, Epcor can do this.



In the future, you could either have your tenants sign a release of information that authorizes you to check that their utility accounts are current, or keep the utilities in your name and have a utility agreement as a Schedule of your lease.



If utilities are in the tenants' names, you should check their balances before they move so that you don't get stuck with a bill. If a tenant moved and had a balance owing, you would be responsible for it and you would have no way to get reimbursed by the ex-tenant.
 

Nicola

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Thanks Thomas & Sherilynn,



Regarding EPCOR, in Edmonton, can they make us pay the outstanding bill if the tenant is still there? Surely the tenant has signed an agreement with EPCOR to get services, so they have the legal obligation to pay, and EPCOR should collect from them?



(And, yes, eviction is a definite possibility.)



Thanks,

Nicola
 

Nicola

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Sherilynn,



How would you work it if a utility agreement were in a schedule to the lease?



I've always assumed that it's better to have the utilities in the tenant's name, as then they are responsible. If they are not, then it seems rather pointless (except that, with a good tenant, there would be less hassle because you don't have to pay the bill yourself, and maybe they would try to conserve energy.)



Thanks,

Nicola
 

Thomas Beyer

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yes, many cities, including Edmonton allow utility providers to ultimately bill the home owner, as opposed to the tenant for unpaid bills, even if bill is in tenants name.



Thus, enforce the lease; i.e. ask them to pay it or leave the property by sending them an eviction notice. That frequently, but not always, does the trick.
 

invst4profit

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Just evict as advised and then take them to small claims court. If they have jobs it will be a simple matter of having their wages garnished.

In some cases simply informing them that court rulings will damage their credit is enough to get them to pay but often the type that walk on debts already have rotten credit.

Screening of tenant applicants is very important not only to insure rent payment but also to insure the ability to collect when they do not pay.
 

Sherilynn

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[quote user=Nicola]How would you work it if a utility agreement were in a schedule to the lease?
The utility agreement should say something like this:



"This payment is to accompany the standard monthly rent payment for the purposes of being applied to collective utilities (specifically: heat, electricity, water, & waste disposal) accumulated at the aforementioned address.

"Failure to provide payment is to be treated as an outstanding arrears amount that can be recovered by the Landlord just as if it were rent owing. (This is at the sole discretion of the landlord.) It is therefore agreed that default in payment may result in a breach of responsibility and enjoyment of use for fellow tenants. Furthermore, missed payments would be considered grounds for eviction.


"This agreement is not intended to omit any obligations by either party to the Lease Agreement."



(Wording could vary depending on province.)



We have had success getting utilities included in judgments in Alberta using this wording.



One nice thing about having utilities in your name and having the tenants pay is that you can have the utility payment accompany the rent at the start of the month, so you have the payment in advance. This works if you are billing a set amount based on the previous year's average and the figure must be subject to adjustment:



"This agreement is time-sensitive and the payment shall be reviewed and adjusted as required or at the end of the tenancy. For example, should utility prices be increased causing the average utility bill to rise, the utilities contribution paid by the tenant would be adjusted accordingly. Likewise, should usage increase (such as by heating the garage), the tenant's share of the total bills and/or amount of payment shall be adjusted."
 

Nicola

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Thanks very much, Sherilynn!



Just one question - from reading that, it sounds like you have a flat rate for the utilities, is that correct? Do you separate it out from the rent (rather than just having "rent with utilities included") so that rent looks lower and so that you can increase it more (in rent-controlled provinces) than the rent-increase guideline?



Have you ever tried to bill them the actual amount? (Might encourage energy-efficiency?)



Thanks,

Nicola
 

kir

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[quote user=Sherilynn]Yes, Epcor can do this.



In the future, you could either have your tenants sign a release of information that authorizes you to check that their utility accounts are current, or keep the utilities in your name and have a utility agreement as a Schedule of your lease.



If utilities are in the tenants' names, you should check their balances before they move so that you don't get stuck with a bill. If a tenant moved and had a balance owing, you would be responsible for it and you would have no way to get reimbursed by the ex-tenant.




Good idea!. I wonder how Epcor will enforce payment? Send it through collections or tranfer it to property tax arrears? I never had Epcor go after me for unpaid bills, if the tenants signed a contract with them in the first place.



Thanks for the info and caution.
 

Thomas Beyer

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I am not sure if Epcor will eventually lien the property if unpaid, but they will pursue the homeowner, report her/him to the credit bureau eventually (if unpaid) and of course, will cut off power, causing potential damage to property such as freezing, a powerful negotiating tool with any home owner !



So, do the smart thing: pay it and evict the tenant if unpaid !
 

Sherilynn

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Epcor may put the file in collections against the tenant, but ultimately they will go after the homeowner. The tenant may already have bad credit and a line-up of collection items, so Epcor will assume the tenant is a lost cause.
 

Nicola

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thanks everyone for your replies!



A clarification:

I have now seen the letter from EPCOR, and it seems to be only regarding water (Epcor Water Services Inc. - EWSI).



According to the letter, the tenant is now more than 60 days in arrears. Upon 90 days' notice to the owner, EWSI can open a new account in the name of the owner. However, the owner is only responsible for water services from the date the account is opened, not for the tenant's arrears. (City of Edmonton Waterworks Bylaw No. 12585, Schedule 2, Paragraph 3.1(d))



So basically, if the tenant doesn't pay, in about 90 days they will open a new account in my name, and I will be responsible for the water bills from then on.



Out of curiosity, what is the average monthly water bill for a townhouse in Edmonton?
 

Thomas Beyer

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[quote user=Nicola]

Out of curiosity, what is the average monthly water bill for a townhouse in Edmonton?
maybe $30 plus $40 / month for sewer ..
 

Nicola

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[quote user=ThomasBeyer]maybe $30 plus $40 for sewer ..



















wow, so it's either really in arrears or that $900 includes power as well as water...
 
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