Negotiating with the water company
September 1, 2010 12:24 AM   Subscribe

Water company is about to chase me for money - it's their fault they didn't contact me about this for a year. Is my strategy for negotiating this issue sensible?

So, I moved in about a year ago. Prior to moving I called and informed the water company of my new address, which is also part of their supply area. They did a search and were unable to find the place in their records, so told me they'd have to do a full property search. I moved in and didn't think any more about this.

I got a letter yesterday asking me to supply information about when I moved in and set up a direct debit for the future. This was addressed to "The Occupier" and not me by name. I'm happy to pay for my water from this point, but I'm substantially less happy about the idea of having to pay for a full year all at once. So, I have a strategy for dealing with this. My goals are:

1. Pay the minimum possible amount for the year prior to them contacting me.
2. Avoid any hit on my credit rating.
3. Pay in full from this point onwards.

Water companies in the UK cannot cut people off for non-payment, so this isn't a concern.

So, in order to achieve this, I'm thinking about doing the following:

1. Call the water company, give them the information they want - dates I moved in, etc. State the following:

* I do not expect to pay anything for the time between the date I moved in and the date they first contacted me about this (yesterday). They are at fault for not contacting me after I informed them of my change of address.
* I will be willing to set up a direct debit to pay going forward as soon as the issue around the previous payment is resolved.

2. I think the response to the above will be that I'll have to pay the full amount. I'm going to escalate the call as far as I can until I get someone who's willing to negotiate and has the financial authority to do so.

3. If the answer's still no, which I suspect will be the case, I'll offer to pay 25% of the total owed. I'll state that this is the maximum amount I can afford to pay at once, and if more is needed we'll need to discuss some kind of payment arrangement.

4. If this offer is rejected, I'll take this to a formal complaint, advising them that if I cannot get a satisfactory outcome via their internal complaints procedure, I'll take this to the consumer council for water.

5. Escalate as above.

I've not really tried to do this kind of negotiation in the past, although I've had some training in negotiation via my job, so I'm interested in what people think of this strategy and what you'd do differently. (Having seen how similar questions have gone in the past, I'm not interested in being told that I have a moral duty to pay the whole amount because I've been using the water - yes, I've been using the water, but this is about negotiating the best possible outcome around that obligation.)

One point I haven't thought about is what to do if they ask for a payment arrangement for the full amount - how much should I offer to pay per month for this? I also think its probably best to deal with this issue as soon as possible rather than waiting for further chasing letters/investigation, but I'm open to suggestion.
posted by xchmp to Work & Money (19 answers total) 2 users marked this as a favorite
One point I haven't thought about is what to do if they ask for a payment arrangement for the full amount - how much should I offer to pay per month for this? I also think its probably best to deal with this issue as soon as possible rather than waiting for further chasing letters/investigation, but I'm open to suggestion.

You're certainly right to deal with it at once, I can't imagine that they would be willing to accept 25% as a final settlement, but I'm sure they'll agree to a payment plan (I think they might be legally obliged to).
I'd pay as much as I reasonably could per billing cycle, as you'll likely have to pay some interest on the balance.
posted by atrazine at 12:30 AM on September 1, 2010

The fact that they didn't contact you for payment for a year doesn't excuse you from paying for all the water you used - assuming you didn't shut the water off at the stop-cock while you waited for their decision.

A sensible thing to do would have been to put money aside each month in the expectation that, sooner or later, you'd have to pay for your water. It wouldn't have been hard to work out how much it was likely to be.

But it's easy to be wise in hindsight. Call the water company and patiently, pleasantly explain how you contacted them when you moved but that you didn't hear from them for all this time. Explain that you can't afford to pay them the outstanding amount in full, and request that they set up a payment plan for you so that you can pay off the extra along with your future bills. Decide beforehand how much extra you can afford to pay each month or quarter - i.e. can you afford double the monthly rate, paying off what you owe over the next year? Or would an extra 50% each month be better? Utility companies deal with this sort of thing every day, and they have processes in place to get things resolved. If you're really not happy with the way you're being dealt with, ask to speak to the person's manager, but try to avoid sounding angry or self-righteous; remember you're dealing with someone doing a boring job to feed their family, not some faceless corporate entity.

Being friendly gets results much more quickly than irate letters; it's better for your mood, and you have to weigh the cost of your time and energy against whatever discount you think you might eventually get. It's not really anyone's fault (unlike the time I found out I'd been paying for my neighbour's gas supply for two years) and technically you do owe the money.
posted by le morte de bea arthur at 1:07 AM on September 1, 2010 [3 favorites]

If you used the water, you should pay for it. Late fees or any fines should be removed as they are not your fault. I would think that giving you a year to pay whatever is owed back would be reasonable.
posted by wongcorgi at 1:08 AM on September 1, 2010 [4 favorites]

Obviously you should pay for the water you have used, but be aware that if you call up the water company and say that you moved in last week or last month then they will treat you as if that were really true: you will receive a bill for water from the date you give, and will never hear of the last year's worth again.

But you do want to make payment towards the year that you have used, and I am sure you will be able to come to some sort of arrangement. somewhere between steps 2 and 3 on your list.
posted by cincinnatus c at 1:34 AM on September 1, 2010

I would suggest your likely best outcome is that they will offer to negotiate payments over time to clear your debt. I assume there are no late fees? You may get a better offer if you can demonstrate hardship but even then I wouldn't bet on it.
posted by biffa at 1:50 AM on September 1, 2010

How does your water meter work? I'm just wondering whether there's there a risk that it might not have been read for a long time before you moved in. Did you take a reading when you started living there?

(obviously irrelevant if you pay a fixed charge and not by volume of water used)
posted by A Thousand Baited Hooks at 2:04 AM on September 1, 2010

Prior to moving I called and informed the water company of my new address, which is also part of their supply area. They did a search and were unable to find the place in their records, so told me they'd have to do a full property search. I moved in and didn't think any more about this.

You know, it's still your responsibility to arrange for payment for your water supply. This isn't really their fault. All of their systems will work off actual move-in dates. If you called them up prior to moving and then never called back to follow through with an actual move-in date, it's actually your fault.

That said, you can probably get them to tack your payments for last year on to your payments for this year (I did this with my council tax when I moved in across tax years and accidentally missed a month's payment due to not receiving their letter about it, so have paid £29 a month extra for the last four months). Maybe you can even bargain them down to 75% or 50% of the total. But the fact remains that you're expecting them to have sorted out your supply despite you never having done more than a pre-move speculative call and never followed it up yourself.
posted by Happy Dave at 2:32 AM on September 1, 2010 [1 favorite]

it's their fault they didn't contact me about this for a year.

posted by inigo2 at 4:36 AM on September 1, 2010 [5 favorites]

it's their fault they didn't contact me about this for a year.
I think they should have been more conscientious. But you still owe them for the water used. Ask them to waive any fees or interest, and make a payment plan. There are lots of things worth fighting over; this isn't one of them.
posted by theora55 at 4:53 AM on September 1, 2010 [1 favorite]

I'm going to be blunt here. This is not their fault - it is yours. Years ago, back when direct debits weren't the standard way of dealing with bills, the water company would tot up your charges and send you the bill at the end of the year. It was your responsibility to put aside money to cover this bill, and pay it when it arrived. Quite a few people, especially the elderly, still do it this way.

You have been using the water. That you didn't set up a direct debit or other method of paying for it over time is your problem, not theirs. You've hit the year-end account tot-up, and now they want to clarify when you moved in, and send you the bill. Stuff the moral obligation; you have a legalobligation to pay for the water and sewerage service you have used up to this point.

You didn't inform them in writing via recorded letter of your move in date. You don't specify if you have a water meter or not, but if you do, you should have taken a reading before moving in, and given them that too.

I'm being blunt here because this is exactly how a court will see it. This is how it will go if you do nothing (which is why you're taking the right course in doing something straight away).

Assuming you ignored all letters, which will go on for a few months and get increasingly threatening, they will eventually book a county court date. They will go there, present their records of your water/sewerage use, and how much that costs. The court will rule in their favour, and grant a county court judgement for the full amount, plus a hundred quid or so of costs, known as a CCJ. In addition to the hit your credit rating took for ignoring an overdue water bill (this stuff gets reported to rating agencies) you'll take another very big hit for having an unpaid CCJ. This will make it very hard to get any form of credit.

What happens next will depend upon the company. With a CCJ in hand, they have full right to collect what you owe them. Most likely, they'll spend another couple of months sending you letters, offering to set up some sort of payment scheme, with threats if you don't comply.

Assuming you ignore all that, they will probably sell it it off to a collections agency. They now owe your debt, and all they do is collect such debts. They will phone you. A lot. They will write to you. A lot. They will keep adding on collection fees. Eventually, they will go back to court for non-payment of a CCJ, and get the court to either attach your salary - which will involve your workplace - or literally send bailiffs round to take your property to pay for the debt. By this point, you can write off getting any credit at all (even a mobile phone contract) for several years, and it will likely show up for many years after.

I saw this not to bluster, not to frighten, but simply to give you the facts. By the law, you owe them the money. They can get it from you, if they're prepared to put the effort in. And they will. They certainly won't forget about it, as they have people who's entire job is to chase delinquent accounts.

So what next? The first thing is to call them to discuss the matter. You certainly welcome to ask them to reduce the bill owing under the circumstances, but they are under zero obligation to do so. If you can demonstrate true hardship, they may offer to downrate the bill. Getting 75% off? Not going to happen. Even if you were a 90 year old pensioner living on state benefits. Sorry, but it just ain't gonna happen. Short of declaring bankruptcy or dying, they'll get that money.

Realistic scenario, you're looking at waiving any late fees/interest (which I'd be surprised if they've added on this early in the process)and interest charges on payment going forward. If there's some wooliness around move in date, you may be able to get them to negotiate that in your favour, which might knock a month off the bill.

More realistically, you'll need to arrange a payment plan of some sort. *This* they will definitely do, as it's far easier and simpler than chasing through the courts. You'll be able to arrange a lump sum - which is not a bad idea - and then they will spread the rest over your future direct debits for your usage going forward. They will ask you what you can afford to pay. You will almost certainly be able to spread it over a year, going forward, and you could likely spread it over more than that if you profess hardship, though they'll likely add on interest if it's a very lengthy payback period.

Whatever you agree to, get it in writing. If you don't get it in writing, then you MUST write to them via recorded post explaining the details of your call, and your agreed arrangement, and you must get the payments under way. Otherwise it will continue to count as an unpaid debt, damaging your credit rating as it goes on. and the law will still see it as your responsibility to resolve, not the water companies.

TL;DR. You owe the debt under the law. You have to pay up, or the courts will make you. They will work with you to arrange a payment plan you can afford, but they will not wipe off the debt just because you forgot about arranging payment for what you were using after you moved.
posted by ArkhanJG at 6:13 AM on September 1, 2010 [3 favorites]

I would recommend getting the book "You don't need a lawyer", it has some great info on how to deal with situations like this.
If you have no posessions / money then I would fight them, but if you're worried about losing things, think it over, because they could sue and win the money + court fees, etc.
posted by absolutshrk at 6:28 AM on September 1, 2010

Get in contact with them immediately. You mention above that water companies in the UK cannot cut you off - that's right, they can't, but because of this they will immediately go down the CCJ route, and because they have no other recourse to getting their money apart from the courts, the courts will almost certainly find in their favour.
posted by BigCalm at 6:45 AM on September 1, 2010

I second what the majority have said above, especially ArkhanJG, but would like to add that your strategy should include what you intend to do about the ASBO they might swear out on you.
posted by Old Geezer at 6:47 AM on September 1, 2010

I know someone that this happened to… The water company actually let an entire [new] neighborhood go for about a year without being charged. The company representative that she spoke to on the phone was a complete dick for some reason (probably because had had dealt with an entire neighborhood trying to get out of paying their bills) but he did offer to let her pay for the missed year in payments over the coming year with no interest or fees.

As far as not paying the full amount, I wouldn’t count on it. In the US, if you applied a “your problem, not mine” argument to Uncle Sam, you wouldn’t get very far, and likewise, (and unfortunately) the water company being who they are will mostly call the shots unless you’re interested in stimulating some attorney’s personal economy. That said, if they never billed you for something, I wouldn’t actively try and fix their mistake, but they figured it out, you got to keep the money for an extra year, and fair is fair.
posted by Dr. ShadowMask at 7:17 AM on September 1, 2010

A few observations:

They won't write any debt off based on your story here (the nearest thing to this is if they have a charitable trust fund you could qualify for based on your family circumstances, who could make an arrears payment for you. "I didn't bother chasing them up for a bill" does not make a good charitable case).

Lying about your moving in date is obviously not a good idea, especially as you indicate they may have your initial notification on file.

An acceptable payment arrangement might be, say, clearing the account by the end of the financial year. A long-term arrangement may have to be backed up by details of household income and expenditure before being accepted.

They will probably use a collection agency before securing a CCJ as well as after, but this will depend on the company's current policy.

They shouldn't add interest or late fees - just court costs when they eventually go for a CCJ. I'm not sure water companies report debts to credit agencies (unlike British Gas say), but the CCJ will certainly show up.

The company might be breaking their code of practice on billing frequency, but I doubt you have any complaint that the ombudsman would be much interested in. In England or Wales the Limitation Act gives them 6 years to sue you, no matter what any code of practice states.
posted by wilko at 12:44 PM on September 1, 2010

A few points:

* The water company accepting a payment plan is a given, so I'm really not worried about that.

* My water is a fixed charge and not metered.

* I wasn't asked to confirm after I'd moved in. I called them with a specific date a couple of weeks prior to the move. It's not simply that they didn't send me a bill because they forgot and I neglected to remind them - they were completely unable to locate my current residence on their systems. They could not, in fact, generate a bill for me or register my new details.

* I'm well aware of how companies deal with debt, having previously been on both sides of the equation. I don't expect this to go anywhere near to a CCJ. I'm not intimidated by this process and respectfully, I don't need anyone warning me about the terrible, terrible consequences I may face. (Worst case scenario - they apply for a CCJ, I pay off the debt in full and no judgement gets recorded against me. However, I wouldn't expect them to apply for a CCJ if we were in the middle of their complaints process.)

* 25% is probably a bit ambitious, but I'm expecting there to be at least some negotiatiability in the total amount owed. I would actually be quite shocked if they weren't willing to discuss this at all.

But we'll see what happens, I guess.
posted by xchmp at 4:58 PM on September 1, 2010

I don't any reason its in a Utility's interest to reduce YOUR debt? They may be polite on the phone but they are not really in the customer service on no someone is in happy with our service business. They have plenty of power to get the full amount from you and likely employ people full time to take care of this sort of thing. Your only power in these situations is to take your business elsewhere. Is that even an option?
posted by saradarlin at 10:46 PM on September 1, 2010

* I wasn't asked to confirm after I'd moved in. I called them with a specific date a couple of weeks prior to the move. It's not simply that they didn't send me a bill because they forgot and I neglected to remind them - they were completely unable to locate my current residence on their systems. They could not, in fact, generate a bill for me or register my new details.

I still think you're missing the point. Whether they asked you to or not, it's still your responsibility to contact them after moving in. You didn't. As stated in your original question you "didn't think any more about this." Believe me, I've just spent five months trying to sort out a fuck-up by a utility company - while it would be nice if they followed things up themselves and you didn't need to initiate nearly every interaction, that is not the case. You should have called. You owe a year's water rates. A single phone call before you moved in isn't going to do you any favours.

Water companies are local monopolies, in a way that other utilities aren't. They're effectively privatised government departments and will most probably want to recover the full amount, because they're not going to 'lose' you as a customer if they don't offer a reduction on the money you owe.
posted by Happy Dave at 1:25 AM on September 2, 2010 [1 favorite]

I think you're correct to want to start negotiation as soon as possible. As soon as the account is routed down the debt collection path, I think you will be unlikely to get anyone with authority or inclination to write off part of the debt. Debt collection should be suspended while an account is in genuine dispute, but I fear you might struggle to show there is any genuine dispute here. One thing that might possibly assist you, referred to above: can you show that there is (or has been) a billing problem for your entire street or neighbourhood, not just you? Kicking up a fuss about such a systemic problem causing financial hardship to various households might possibly carry a bit of weight.
posted by wilko at 12:31 PM on September 2, 2010

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