How to Deal w/ Dubious 'Contracts'?

phorm asks: "It seems that for almost every service out there nowadays businesses want to fix customers into a contract. Some are pretty obvious (cellphone service, etc), but others are downright sneaky. About a year ago, my grandparents signed up for internet service with one of the bigger ISP's (Telus). They were offered an lesser rate for the first year, followed by $10/month more for following years, as well as their DSL modem for free (to be returned when service ends). None of the documentation received with the modem indicated that any 'contract' was being entered, nor were any documents signed. However, when they recently tried to cancel their service, Telus has indicated they will be charged a fee due to being within the 'contract'." Similar to EULAs, sometimes companies will enter you into a "contract" without providing anything to sign and will hold you to terms you may not even know about simply by your use of the service. How can you deal with companies practices, especially if dealing with their representatives becomes...difficult? "On first questioning of this, they believed that they had somehow been contracted by agreeing over the phone when initial service was setup (despite that they don't remember being told about such a thing). However, when I called the ISP to dispute this, they indicated that upon connecting the service they would have been presented with a dialog indicating the contract terms and had to click 'OK' online.

My assumption would be that this was done through their setup CD, which comes with the modem. However, the ISP's software is not installed on their machine (I don't trust it not to have snoop-ware), as I had their machine manually registered through a web-interface (which did not indicate contracts at that time, I am not sure about now).

Despite this, calls to their hotline have indicated that they will not rescind the cancellation fee. Moreover, the last operator from the 'Loyalty Department' I talked to refused to separate the internet bill from the phone bill despite being told they would no longer be authorized to bill the given VISA account (they said they will not change that billing process unless given another account, and refuse to just 'send a bill' in the mail). When I questioned the legality of this the operator told me to 'get a lawyer and have them contact the legal department.' Obviously, this is an option but seems rather to be a bit extreme and I'm sure the company realizes it. So what does one do when a big company is bilking pensioners with contracts they have no proof of? Certainly there are no signed documents, and whether a particular button was clicked or not seems to have no proof except in the ISP's say-so, as well as the dubiousness of button-click legality under local law. My next step will likely be to explain the situation to VISA but then things can definitely get ugly as the ISP is also the local telco.

By the way, this is in Canada, so Canadian law would apply, but I would definitely appreciate suggestions as such cases seem more and more common."

Comments

You already have the answer.

[dougmc]

When I questioned the legality of this the operator told me to 'get a lawyer and have them contact the legal department.' Obviously, this is an option but seems rather to be a bit extreme and I'm sure the company realizes it.

Extreme or not, that IS the appropriate answer. They'll probably back off immediately with a simple letter from a law firm, and if that's all it takes, it won't even cost much.

If you really want to stick it to them, you might be able to get the local TV news to do a story on the practice (around here, Austin, TX, we have `[channel] 7 on your side' stories, where they go into detail about how somebody was being screwed and how the TV cameras made all the problems go away.

Re:You already have the answer.

[Kadin2048]

Bingo.

Basically, what these companies are doing, when they pull out these bogus contracts, is bluffing you. They're blowing smoke up your ass, and hoping that you won't have the balls* to actually call them on it.

Your options are basically:
1) Call their bluff: get a lawyer, and sue them; or make them think that you're going to.
2) Bend over and take it, and whine a lot. Whining includes going to the BBB and other toothless organizations. (No large corporation gives a shit about the BBB.)
3) Bend over and take it, and like it.

Lawyers are how you get business done in civil society. They are in many ways even superior to violence, because they can be used to attack vaporous legal constructs that you can't well go out and shoot if you wanted to. They're like samurai: have enough of them, and you can do anything you want. Don't have any, and you're just a peasant.

It helps if you happen to have a lawyer who's willing to work for you cheap, or better yet for free. Lawyers willing to work for free are notoriously hard to find (your best bet is probably to marry one, and even than it's not guaranteed to work). Short of actually having a lawyer, the next best thing would be someone who's familiar enough with the language of law to write a nasty letter that makes them think you're a Force To Be Reckoned With; of course, there's always the risk that they'll call your bluff, and then hang your lawyer-less ass out to dry. Or you could try suing them in small-claims directly, where you don't need a lawyer and can represent yourself; if you really haven't signed any contracts or agreed to anything, then they can't force you into arbitration (which is a normal stipulation in many sleazy contracts), and you can sue them in your own jurisdiction and force them to show up and defend their conduct. If you act like a reasonable, rational, average person, you might do well this way. (Particularly if they just don't want to bother to show up in court.)

All in all, your best bet of success is probably going to involve either the reality or at least substantial threats of spending quality time inside a courtroom somewhere. This is life; in our world, the conflicts that aren't solved with a gun or a knife are usually solved by well-paid guys in suits shuffling paper. (And depending on where you live, possibly someone in a wig.)

* In Capitalist society, see 'wallet.'

Re:You already have the answer.

[Mistlefoot]

With Telus, you MUST register your MAC address to use the service, whether or not you install any Telus software. Before you can browse you must visit http://oca.on.hsia.telus.net (substitute "on" with "bc" or "alta" if applicable). Pretty easy to have a once click "I agree" there.

But it wouldn't matter anyhow. Contracts are often made over the phone or computer. Have you ever made a change to your mobile service? Or added third party long distance? You are clearly not disputing the fact that you have an agreement with Telus, you are disputing whether or not you have a commitment.

As a Telus subscriber I can assure you that they are far from dubious. I was clearly "offered an lesser rate for the first year, followed by $10/month more for following years, as well as their DSL modem for free." I was also clearly advised that this would require a commitment. I chose not to take this deal as I WAS ACTUALLY PAYING ATTENTION TO WHAT THEY SAID to me. I chose not to commit.

I notice that you have not suggested paying the $10 more per month that you saved. I noticed that you aren't suggesting you pay for the modem you have been 'renting'. When you were saving money each month over a Telus subscriber like me I'm guessing you never once considered Telus dubious.

Re:You already have the answer.

[Eivind]

Actually, you don't need to take any legal action against them.

They are claiming you owe them some sum of money. You dispute the claim. You don't pay. If they want their money, they will have to take legal action against you. And they'll need to demonstrate that you actually do owe them money.

Re:You already have the answer.

[loraksus]

Whining includes going to the BBB and other toothless organizations. (No large corporation gives a shit about the BBB.)

I disagree. With so many companies staffing their 800 lines with people who really can't do anything, a quick bbb complaint often gets a call back within a day or so from someone who is actually empowered to fix your problem. It isn't really the BBB that companies are worried about, it is the reporter for a news startion saying something like, "So, Mr. Jones, why does your company have over 350 unanswered BBB complaints?"
Compusa got forcibly delisted from the BBB (mostly for the rebate bullshit the ftc later punished them for) a couple of years ago and it was a pain in the ass for them to get back on and their reputation suffered.
That said, if a company just doesn't care about negative PR - tiger direct comes to mind - yeah, filing a bbb report won't do shit.

One of your options can be to do amusing things to companies. Phillips was suposed to give me a refund on a set of headphones but were apparantly retarded and kept losing / not receiving the receipt (I think the shitbirds were hoping I would just go away, however I'm... passionate about getting my money when companies owe me something.)
So I called one day and informed them they were going to receive 1701* copies of the receipt if the cheque didn't ship that day. So that night, 1701 faxes of the receipt (ok, so a few errored out) were sent. Later that day, I received a polite call from an american woman (the fucking filipinos on their 800 line can't tie their own fucking shoes without approval from the us office) and they sent me a cheque.

*about 1701 - I used to watch star trek a lot and I did a quick estimate on how many faxes I could send while I slept - it was around this number, so I just used it. I suppose this made a lot more sense / was funny to me when I was full of angst over this. Not so much anymore.

Re:You already have the answer.

[UnHolier than ever]

Parent is right. To Visa, you are a much more important customer than Telus is. There is no way Telus is ever going to refuse payement via VISA cards, but you, on the other hand, could just as easily switch to MasterCard. If you simply refuse paying, the credit card company is on your side. If Telus request paymenet from VISA, they will ask for a copy of the contract, signed, and won't pay up until they see it. If you're right, they keep their loyal customer. If you're wrong, then you'll have to pay and they get their interest fee. VISA has a win-win situation if they're on your side, but have nothing to win being on Telus' side.

NOt really true..

[plasmacutter]

I could go on and on, but the point is, contracts are mostly one-sided. Why? Because we want their service.

this is only the tip of the iceberg..

the current legal and regulatory structure centering around incorporation and securities allows people to centralize power and resources while being spared the majority of the risks.

This results in an uneven playing field where incumbent corporate owners have tremenous amounts of market power, but the common man has none.

The ways to combat this are:
-from labor standpoint.. pro union laws which allow labor to do the same thing as the companies that employ them.. centralize power and resources without reprisal from anti-union companies.

-from a consumer standoint.. pro consumer laws which put a cap on contract demands. Consumer unions are not enough.. they will only be able to tackle "main stream" products.. regulation to balance out concepts like limited liability and corporate personhood are needed.

Cell Phone deals not one-sided as you think

[AHumbleOpinion]

What about a cell phone? Most of them have massive early-termination fees.

They have to, they subsidized that cool new feature laden cell phone you are carrying, US cell phone deals are not as one-sided as you think. If you take the phone and quit the service they lose big time. Some parts of the world do not subsidize, you pay full retail for your phone, and customers have an easier time changing providers. US consumers have voted with their dollars, they would rather have the Motorola Razor for $50 than have an easier time switching providers.

Re:Here's what I've done...

[XorNand]

Even better, reread this classic gem that ought to be bookmarked by everyone: The Art of Turboing

Re:Further explenation

[hazem]

My lawyer tells me a verbal contract is as good as the paper it's written on...

No, it's how you do it in the USA

[Moraelin]

No, the across-the-board "either you're rich enough to have lawyers or are a peon" doesn't apply to every capitalist country in the world, but seems to be largely a USA issue. In a sense it's the price you pay for the culture of not trusting your own government, or for that matter for ending up with a government which you can't trust. Unfortunately, then, yes, your only recourse are lawyers, and that's why in the USA they breed like rabbits.

Down here in Europe most things aren't solved by class action lawsuits, but by having a set of laws regarding the consumers' rights, and some government agencies whose job is to enforce those. If a company tried to screw me over, believe me, I wouldn't do any of the three options you describe. Instead I'd go to a consumer rights bureau ("Verbraucherzentrale") and see what they have to say about it. Because it's their job and are backed by the government. They can have a lot more teeth than a lawyer, if it's warranted.

In a sense, it's the difference between having an organized police force and wild-west each-man-for-himself vigilante justice. The USA seems still stuck at the point where your rights and protection are determined by whether you can hire a posse to fight for them. Only now it's the more expensive lawyers with ties and briefcases, instead of desperados with sombreros and Winchester guns. Most of the rest of the world moved over to more efficient model of having a centralized "police" equivalent.

And let me stress that again: it's not just that it's more fair (I could get help even if I didn't have a dime to pay for a lawyer's advice), it's also more efficient for society as a whole. You don't have to feed armies of lawyers when a handful of government officials can do the same job _and_ serve as a better deterrent. A company can imagine they'll smoke _me_ with legalese gibberish, or bully me into submission, or just hope that I don't want to pay a lawyer. But they will know from the start that they're never going to bully the government into submission, and that there'll be someone there who reads legalese as fluently as it gets and knows if what is in there is legal or not.

If you will, it's like in the police vs everyone-with-his-own-posse analogy again. A police is more efficient than everyone hiring his own desperados to guard his ranch, because it _doesn't_ have to actually send policemen to stand guard on every ranch. Just the knowing that that police force exists is enough of a deterrent for 99% of the population.

Downside: of course, you need to trust that the government is on your side and not just ruling for the highest corporate bidder. I.e., it comes in handy to have a real multi-party system where they have to work hard for their votes.

No signature = no contract

[Joce640k]

If they don't have a signature or a recorded conversation where you agreed to this then you don't have a contract with them. Stop all payments at the bank, tell them to come and collect whatever they consider is "theirs", then hang up the phone. End of story.

Re:No signature = no contract

[Anonymous Coward]

Hello. I am an attorney licensed to practice in Florida. It is false to say, "If they don't have a signature or a recorded conversation where you agreed to this then you don't have a contract". The requirement of a signature passed some time ago (as did the requirement of a seal). Similarly, no recording of the conversation is needed for an oral contract to exist.

That having been said, enforcement of an oral contract is not the easiest thing in the world, and I would be surprised to learn of a ISP that uses one with its subscribers. I suspect the terms of the contract in this case were contained in a document such as the application for the account.

My Personal Victory

[sl0play]

I had an Earthlink DSL account in the US, and although I was aware through common knowledge that all local DSL carriers considered a customer to be in a contract from the time the modem connected to the line, I made a point to look for one at every point in the set-up process. The only thing that vaguely resembled legal mumbo jumbo was in the software envelope which I never used.

I had nothing but problems with the service itself and cancelled within two months. They informed me that I would be charged $150 for early termination and another $200 if I didnt return their POS modem. I told them to stuff it and I refused to pay. They sent me to a collection agency and I immediately sent a letter disputing the debt and asking for proof of contract. The collection account was wiped clean and never appeared on my credit record. I even kept their crappy modem out of principle.

Although corporations can be a brick wall to deal with, collection agencies are held to very strict regulations and a quick stroke of the pen leaves them without option. These companies think they are screwing you when they send you off to collections, but infact they are playing right into your hands.