Monday, January 19, 2009

de lage landen: Copier Lease Gone Bad - in a city called "Homer"


"We're not going to get any money back, but it irks me that they did this to us," councilwoman Beatrice Harris said of the company."

In a story released January 9, 2009 by The Dispatch, a copier remained on site, three years after the lease was "terminated" and a new machine purchased.

According to the borough, when Homer City officials inquired about returning the old copier, a DeLange employee said the company would "take care of it".

De Lage Landen Financial Services, the company that leased the machine to the borough, finally sent an invoice for $5,100.00, 3 years after the lease had ended.

De Lage Landen and the city of Homer settled for $3,300.00 for the now 8 year old copier which for the last 3 years, probably sat in a hallway somewhere, unused. So for the last 36 months, the city has been paying $91.66 for a copier it was not using.

Doh!

Borough solicitor Pat Dougherty negotiated the settlement, with the borough and Central Indiana County Water Authority each paying $1,650.

The original lease was for 60 months at a cost of $152.00/month.

When the leasing costs are added to the settlement amount, the copier has cost the borough and water authority a total of about $12,400.

The city offered to return the machine, within 72 hours, to any location De Lage determined - this offer was refused. City officials felt abused by the leasing company, but Dougherty said the borough would probably lose in court based on the language of the lease.

"You guys don't want to be involved in paying me to litigate something like this when chances are we would have to pay anyway," Dougherty said, "and you would have litigation costs in excess of $3,000 anyway."

Council members talked about possibly reporting the incident to the Better Business Bureau.

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This is nothing new. Unfortunately, the city is at fault.

Let's review point 7 of 19 of a typical de lage landen lease agreement:

"7. Redelivery and Renewal: Upon at least ninety (90) days written notice to US prior to the expiration of the initial term of this Agreement, YOU shall advise US of YOUR intention to return the Equipment to US at the end of the initial term of this Agreement. Provided YOU have given such timely notice, YOU shall return the Equipment, freight and insurance prepaid, to US in good repair, condition and working order, ordinary wear and tear excepted, in a manner and to a location designated by US. If YOU do fail to so notify US, or having notified US, YOU fail to return the Equipment as provided herein, this Agreement shall renew for additional terms of twelve (12) months each with the C-P-C Payments and Additional Copy Charges equal to 100% of the C-P-C Payments and Additional Copy Charges at the expiration of the initial term of this agreement." - 2000.

This is very straight forward, there are three basic points in this clause:
  1. If you do not let the leasing company know, at least 90 days before of the termination date, that you intend to indeed terminate the lease the lease will automatically renew for 12 months
  2. Once you notify, you must return the equipment to any location the lease company tells you to and at your cost and the machine must be in "working order"
  3. If you notify the lease company that you wish to terminate at lease end but do not return equipment, the lease renews for another 12 months
It is up to the customer to send a letter of intent to terminate and it is the customer's financial responsibility to return the equipment in "good working order".

Leases from Toshiba, Canon, Ikon, etc., all have similar if not identical verbiage. As a matter of fact, ALL leases I have seen, hold the customer responsible for shipping costs of the unit back to the leasing entity.



What to know more? Check this out:

"Beware of DLL, a business nightmare..."



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3 comments:

  1. DLL's collection agency called us TWO YEARS after we returned their copier, claiming "The bank can't find your copier in our warehouse, and unless you can provide documentation that you returned it, you owe us $6K for collection fees, $12K for additional rent, and $10K for residual value, for a total of $28K." (the copier originally cost $26K) Fortunately we had bill of lading and receipts but they are still hassling us.

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  2. We are in NEW YORK CITY with an office closing and De Lage Landen will not answer our calls or letters telling us where to return the copier. Anyone have any advice?

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  3. As unscrupulous as these leasing companies are they do cover themselves with the fine print. The customer must exercise due diligence and persistence in order to avoid giving the leasing company an upper hand.

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