Call Kurtis: How Long Can Companies Backbill You?
FOLSOM (CBS13) — A Sacramento alarm company said it realized it went years without billing several of its customers.
When Bill Jones said he got billed for almost nine years of alarm monitoring service — a sum of more than $2,300 — he called Kurtis.
Jones insisted he doesn’t owe Sacramento’s Smith & Sons anything, claiming he canceled his service back in 2005.
“I didn’t even give it another thought,” Jones said.
But the company sent a letter in November saying an audit found his account fell out of their “auto withdrawal system” in 2005. The company said it was still providing service to Jones.
“I don’t owe you,” he said. “How can you even come to me like this?”
Jones said he can’t find his cancellation notice from way back then but insists he owes them nothing.
“It certainly looks a little odd,” said the Better Business Bureau’s Gary Almond.
Almond said Smith & Sons shouldn’t have continued providing service if it wasn’t getting paid.
Under California law, a company may be able to go back and collect even if they didn’t bill you — however, the law limits that to four years.
“That’s a real long time,” he said.
Almond said even if the company is owed the money, it’s too late to collect anything prior to 2009.
So how did this happen? Smith & Sons declined to interview on camera but said it changed banks in 2005, and it took this long to realize several customers with auto-pay had not been paying for service.
The company said it wasn’t aware of the law limiting how far they can go back.
In Jones’ case, the company said it does not have a written cancelation, and said it had been providing service for him all this time.
After Call Kurtis got involved, the company agreed to reduce Jones’ balance down to about $1,000, but Jones insists he canceled and said he won’t pay it.
“I haven’t had a good night’s sleep since this happened,” he said.
While the statute of limitations for backbilling on many types of contracts is four years, utility companies often have stricter rules under the California Public Utilities Commission. These utilities are only allowed to backbill the last three months.