Heat-pump scheme banned in Ontario snares Miramichi homeowner

Theresa Marcotte now regrets her decision four years ago to have two heat pumps installed in her Miramichi home. 

The equipment's not the problem. It's the contract she signed in December 2020. 

It said for $160 a month, Simply Green Home Services would install two mini-splits and provide ongoing service and maintenance for the next 10 years. 

"Why would you buy one when you can rent it from them, and they take care of it?" Marcotte said to explain her decision.

"That's a good sales pitch, and I fell for it."

Marcotte's understanding was that at the end of the 10-year contract, Simply Green would take the heat pumps back. Or if she decided within that time that she no longer wanted to rent them, the company would take them back earlier, and her monthly payments would end.

She admits she didn't read the fine print, but said there was also more to the deal that the salesperson didn't explain to her.

Loan included 'NOSI' on Marcotte's home

Earlier this year, Marcotte applied for a home equity loan to help her daughter with college expenses.  

"And in the final stages, it came up, these two liens against my house — one for each mini-split — that I didn't know about," she said in an interview after working a full day as a personal support worker.  

It turns out they weren't exactly liens. According to the land registry office, the encumbrance on Marcotte's property title is a notice of security interest. People call them NOSIs, pronounced no-sees.

Two were registered on the title to her home by Crown Crest Capital, part of the Simply Green group of companies.

A notice of security interest tells a potential homebuyer that a lender has an interest in a specific fixture on the property — often a piece of equipment such as a heat pump or a furnace. 

That's different from a lien, which gives the lender a claim against a property and a right to be paid from the proceeds of a sale. 

Marcotte had never heard of a NOSI and immediately put the home equity loan on pause as she tried to figure out what it was and what it meant for her personal finances.

NOSIs now illegal in Ontario

NOSIs are allowed in New Brunswick, but they were recently banned in Ontario after a class-action lawsuit was brought against the same company Marcotte rented her heat pumps from.

Plaintiffs claimed Simply Green used the same technique with as many as 54,000 households in Ontario.

Lawyers for the plaintiffs said it was typical for homeowners to enter into agreements without a clear understanding of their obligations, as required by the Creditor Protection Act. 

The Simply Green group of companies would then register a NOSI on the homeowner's land title. 

"The Simply Group then waits until the consumer has to sell or refinance her home," said the factum of the class action plaintiffs. 

"At that point, often pressed for time with an upcoming closing or refinancing, the consumer has no choice but to pay whatever amount Simply Group demands, sometimes up to ten times the new market value of the equipment in question."

Simply Green told Marcotte that to have the NOSIs removed from her property, she would have to pay the company more than $5,600 per heat pump to buy out the contract. She would then own the mini-splits.

Combined with the rent she has already paid, the buy out would bring the cost of two mini-splits to more than $19,000, well above the cost of buying them new.

To protect consumers from fraud and bad actors, the Ontario government passed legislation last year that made it illegal to register NOSIs on consumer goods and retroactively rendered existing NOSIs expired.  

NOSIs a 'scourge,' lawyer says

Lawyer David Sterns, counsel for the plaintiffs, believes lawmakers in New Brunswick should follow suit and ban NOSIs as well.

"One of the best things about the settlement is that the NOSIs will all be removed," he said. 

"They can all get wiped out. There's a certain amount of administration that's involved in that, but these companies no longer have that leverage over everybody to be able to extract whatever payment amounts they want."

Sterns said the real function of NOSIs was debatable but they did have a terrifying effect on a lot of people. 

" And I hope any legislature, any person in position of power in New Brunswick who's listening to this gets working on writing a bill that gets rid of NOSIs because they are a scourge." 

'I feel like I've been scammed'

Marcotte said the entire experience has left her feeling duped.

The NOSIs remain on her property, and despite the ruling in Ontario, Simply Green won't remove them unless she pays the lump sum of more than $11,000.

Her other option is to continue renting the mini-splits for the remainder of her contract and hire her own lawyer to have the NOSIs removed in the meantime.

She said coming up with the buyout sum of $11,000 is unmanageable and unreasonable.

An HVAC provider CBC News spoke with said two brand new heat pumps for Marcotte's home would cost about $8,000 plus tax.

Marcotte said she feels trapped, and it's small consolation that thousands of homeowners in Ontario got taken in by similar schemes.

"Based on how the representative explained things — and based on similar ads I'd seen on TV about renting HVAC equipment — I thought this was a standard rental setup with a fixed monthly payment and the ability to discontinue the service when no longer needed."

"I feel like I've been scammed," Marcotte said. "You know, like, no one was truthful. They truly convinced me that this was just a rental program." 

Company response to CBC News

The class action against Simply Green Home Services was settled on terms accepted in April by an Ontario court. According to the settlement agreement, the defendants continue to deny all allegations of wrongdoing, fault, liability, or damage of any kind. 

CBC News asked Simply Green Home Services for an interview, but the company declined because it's currently under creditor protection. The company also declined to comment on Marcotte's account because of privacy legislation.  

The New Brunswick Financial and Consumer Services Commission advises homeowners to read the fine print in any contract and seek advice or clarification on any parts of a contract they don't understand.  

"All of your rights as a consumer in regards to that contract are going to be included in the contract," said Marissa Sollows, the commission's director of communications and public affairs. "That's why it's critical to read it."

Sollows said the contract should spell out the total amount a consumer will have paid at the end of the loan term, including interest and fees. 

Mark Marshall, who's been counselling borrowers in the Maritimes for 25 years, said he does see people enter agreements they don't fully understand. 

"You should always be looking for any kind of trigger words that would say 'security' or 'personal guarantee.' Anything that would kind of make the hairs on the back of your neck stand up a little bit." 

Marcotte said she wanted to take her story public because homeowners may not know about NOSIs, and they may not know about the class action settlement, which applies to homeowners across Canada who signed equipment leasing contracts with Simply Green between July 17, 2013, and Jan. 15, 2025.

The deadline to file a claim is Oct. 3, 2025.

Marcotte also complained to the Better Business Bureau, saying she was not satisfied with the options the company has given her. Marcotte wants the NOSIs removed at no cost to her because, she said, what the company did was unethical.