Q. I sold my home over a year ago and have just recently discovered that the hot water heater that I was renting was never transferred to the purchasers and that I have been having the monthly charge taken out of my bank account. When I approached the rental company, they indicated that I should have had the contract assumed by the purchaser. I then contacted my lawyer who contacted the purchasers’ lawyer. The response back was that the purchasers were not willing to sign the assumption agreement. I think that my lawyer should have been aware of this but regardless, I am still stuck paying for a water heater that I haven’t had the benefit of for over a year. What should I do?
A. The first point I would like to make is that how is your lawyer supposed to know that you have a rental agreement for your water heater if you don’t make them aware of this before closing. As a matter of course, we deal with the assumption of water heater contracts on closing of a transaction if our clients make us aware of this. Otherwise, we assume you own the equipment and this ownership transfers with the house. Generally, there is a clause in the Agreement of Purchase and Sale where your realtor will insert any items that are rental and in most cases the hot water heater is assumed. If this is not indicated, your realtor should be put on notice.
The second concern I have is how you could not be aware of these types of ongoing charges on a monthly basis coming out of your account for over a year? Surely, most people monitor their accounts. The problem here is that the new owner is now facing a large charge. If this problem had of been caught early on, the purchasers would probably be more likely to agree to the transfer. Faced with an ever mounting invoice, one can understand their reluctance to pay this amount.
The reality is that the purchasers have had the benefit of the hot water rental tank for over a year and should be forthcoming with payment. However, people do not always ‘play fair’ and you may have to proceed to a more formal forum such as Small Claims Court to have this matter addressed. Of course, hindsight is twenty-twenty but if you had of informed your lawyer that the hot water heater was a rental this could have been dealt with on the closing of the transaction.
Best of luck.
– Jeffrey D. Cowan is the principal of Cowan & Taylor, Barristers & Solicitors, email@example.com. The information contained in this article should not be relied upon as legal advice.