"Minimum Use Fee"???

[CuckoosNest]

What is the name of your state? New York.

This is more of a consumer advocacy question, but I've always gotten excellent advice here, so I thought I'd toss it out there.

I finished contruction on a vacation home last November. I just received a bill from the company that supplies me with oil and propane; they are charging me $89.00 plus tax for a "Minimum Use Fee." This is because I purchased only 131 Gallons of propane (as opposed to their "minimum" of 200) over the one year period from 11/1/05 through 10/31/06.

This fee has never been explained to me before, and I have no written contract with this supplier. In short, I never agreed to such a thing and I believe it's a total scam. Is their any validity to this charge? Further, what are my rights if I dispute it and they go after my credit rating?

 

[seniorjudge]

Before you do anything else, ask them to see in writing where you signed agreeing to the minimum use fee.

If they don't have such a critter, then ask them where they get the authority to charge this fee.

 

[CuckoosNest]

Update: spoke with a customer service rep at the company... apparently, they instituted a policy two-years ago requiring that customers purchase a minimum of double their tank capacity for every one-year period. We began service well after the new policy went into effect, but no one ever notified us about this little rule of theirs. Further, we definitely have no written contract with them... frankly, I don't know how they could enforce such a thing.

Thankfully, the CSR heard the - er - intensity in my voice and canceled the charge immediately. We spent $1400 in that one year period for propane and oil, and I think she realized that the additional $89 was adding insult to injury... she also knew I'd take my business elsewhere if she didn't.

Here's the shifty part: in early November of last year, the same company urged us to switch to a larger propane tank (from 45 to 100 gallons) and offered to do the upgrade free of charge. Once done, they said nothing about the minimum use fee. Can you say "set up"?