top of page

The Ontario HVAC Scam

A scam involving home utilities and door-to-door marketers has been around in Ontario since 2017. This fall, it is back in full force. Beware of the Ontario HVAC Scam!

How Did the Courts Address This Consumer Concern? Some homeowners took scammers to court. The 2020 Skymark Finance Corporation v Toraman Small Claims Court decision is a success story, wherein a financing company sued an immigrant couple to recoup over $8,600 in unpaid rental fees for a water filter and ended up losing their battle in court. On the facts, the couple successfully argued through their representatives that Skymark used “unfair practices” in consumer transactions, which violated Part III of the Consumer Protection Act. While reviewing the contract provisions and its assignment, the court determined that “the door-to-door salesman engaged in both false, misleading or deceptive representations and unconscionable representations.” 2 Further, the court found that “the contract [was] unenforceable and rescinded.” 3 The court dismissed Skymark’s claim. As a result, the financing company ended up paying back the rental fee that the immigrant couple plus the fair market value of the unit itself, roughly $1,200. The company received possession of the rental equipment in exchange for the payments made to the consumers.

What is the Ontario HVAC Scam? Representatives of rental companies, turned scammers, go to people’s homes and use high-pressure tactics to get them to rent HVAC, electrical equipment, or plumbing at extremely high prices. Afterwards, they assign equipment rental contracts to a financing company which registers a notice of security interest or another instrument against the house. This is essentially a lien. Initially, homeowners have no idea there is a lien against their property. When they try to sell or refinance their home, their lawyer uncovers the lien and tells them about it. Homeowners are shocked when they are informed of the lien against their homes. Homeowners need to pay out the financing company to remove the lien. When the financing company sends out a predatory high payout statement, the homeowners are in yet for another shock. Despite this outrageous demand, it may not be worth it for the homeowners to take the financing company to court.

Who Gets Targeted in This Scam? Scammers target vulnerable homeowners such as older people or newcomers to Canada. As previously noted, they use deceptive and high-pressure sales tactics. They often need to pay several