Complaints

• Initial Complaint

  15/08/2022

  Complaint Type:

  Billing Issues

  Status:

  Answered

  More info

  I signed an Letter of Intent with Naveco Power in February 2022 to install 10 kW of solar panels on my house. Part of the LOI was my agreement to pay $2000 for services if I did not proceed with a contract and installation. I negociated a contract in May and June 2022. I was ready and willing to sign a contract. Then the owner of the company, **** *******, advised me that I would have to pay 100% of the project ($23k) upfront before any work started. He would not consider a holdback. I understand that Naveco is a startup company without much credit and needs to pay their suppliers upfront. Paying 100% of the project upfront is not acceptable to me expecially when Naveco is a startup with minimal experience. I walked away from the deal. I received an invoice from **** one week ago for $2300 ($2000 plus taxes). I don't mind paying a portion of this invoice. However, it is my opinion that paying 100% of the cost of this project upfront is unreasonable. I feel that I have been taken by this company. They should advise customers at the beginning of negotiations that 100% of the cost is required before construction will start. If I was aware of this requirement in February, I would not have wasted my time or theirs. I will upload the email responce I sent to **** regarding the invoice which outlines other concerning that I have. I have since signed a contract with another company to install solar at my house.

  Business response

  24/08/2022

  The client was given a milestone payment schedule as part of the contract for their review. The initial schedule shown to the client was approximating milestones that followed where major payments would have to be made by the small business to suppliers in order to complete this project.
  
  Continued discussions happened with the client explaining the small business’ situation due to the changes in interest rates and changing fiscal outlook of the country effecting the small business’ ability to access credit, which would have allowed for payments to be deferred to suppliers and tied to when funds are received from the client.
  
  The small business proposed a solution to the client that would protect both parties from any concern of goods not being delivered (due to a business going bankrupt) or goods not being paid for (client not paying the small business.) The proposal was for the funds for this project to be held in escrow by a well known lawyer located within the city of the project, the client and of the small business. The small business proposed that all funds be held in escrow like a real estate transaction and that funds would only be disbursed by the lawyer upon milestones being met by the small business.
  
  This method accommodated the client’s interest of a holdback payment post commissioning of the project and the small business’ needs to pay their suppliers.
  
  The lawyer would disburse 30% of the funds when they receive the invoice for the goods, 30% of the funds when the supplier needed to be paid prior to shipping, 30% upon beginning of installation to the contractor, and 10% upon final commissioning.
  
  The small business agreed to the client’s request of having a holdback on some of the payments, but that all funds required for the project to first be placed into escrow.
  
  All payments by the lawyer would have been sent directly to the suppliers, not to the small business, and the small business agreed to write into the terms of the agreement that in the event of insolvency, that all paid for goods (paid by the client) would be the property of the client and that they would be able to choose another contractor to complete the project.
  
  The client did not like the solution of using escrow for a $23,000+HST contract and decided to cancel moving forward with negotiations. Cancellation of negotiations happened after the client had signed the Letter of Intent which made them aware of the $2,0000+HST Feasibility Study Fee that would have to be paid if they cancel. The Letter of Intent also stated that if they were to continue and sign a contract to purchase the solar system, that the fee for the Feasibility Study would be waived.
  
  The client received the analysis of the Feasibility Study as well as engineering approval for our design given by a professional engineer.
  
  The $2,000+HST is a reasonable amount to be paid for the small business to pay the professional engineer for their consultation, and to mitigate some of the costs for paying staff involved in this project. Greater than 25 hours were put into making multiple designs, client consultations, engineering, and procurement.

  Customer response

  26/08/2022

  Good Morning 

  
  

  My wife and I made the decision to proceed and pay the $2300 to Naveco and move on. I continue to feel that I have been taken by the owner of Naveco. Being asked to pay 100% upfront is not acceptable in my mind, especially when this demand from Naveco came late in negotiations. I will be very cautious of similar arrangements in the future. Thank you for your time.

  
  

  **** *****

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