‘Aggressive’ water company appeals N.S. government’s decision to cancel permit

A water filtration company based in Dartmouth, N.S., is appealing the province’s decision to revoke its direct seller’s permit after the government found a “pattern of aggressive and high-pressure sales tactics.”

Atlantic Environmental Systems (AES) alleges, among other things, the registrar of Service Nova Scotia “committed errors of law” including the decision to revoke the company’s permit rather than “engage in progressive discipline.”

The company, owned by Danny Goldman, also said in its appeal filed with the Supreme Court of Nova Scotia that the registrar’s order should be immediately quashed and its permit be reinstated. 

Atlantic Environmental Systems garnered unfavourable attention from consumers across Nova Scotia earlier this year after several homeowners and their families alleged the company tricked them into paying thousands of dollars for water filtration systems.

Service Nova Scotia received nine official complaints and held a hearing on May 22. In a written decision released July 18, the registrar for the Direct Sellers’ Regulation Act, Kelly Wyer, wrote that AES was “unfit” to continue holding a direct seller’s permit, which allows a company to make door-to-door sales.

Three of the complaints, filed by adult children on behalf of their parents, reported to Wyer’s department that AES salespeople stayed in the home for three to four hours while pitching their products.

“In my opinion, AES salespeople were aggressive when they stayed for such a lengthy period in these consumers’ homes. I find that AES added pressure to consumers by insisting they make immediate decisions without giving them time to wait,” wrote Wyer.

Decision based on hearsay, says company

But the company denies it engages in high-pressure tactics. 

“The registrar relied upon the hearsay evidence of complainants who were not present during sales meetings, and provided accounts based on untested accounts by others, and did not confirm or corroborate such evidence, and did not bring such evidence to be tested in the hearing,” said Eugene Tan, counsel for AES, in the appeal document.

The company also alleged in its appeal that Wyer made a number of errors including “failing to consider inconsistencies, contradictions and gaps in the complainants’ complaints and making findings of fact that failed to consider the appellant’s evidence on the same points.”

In the decision to revoke the company’s permit, Wyer said complainants noted how difficult it was for clients and their families to cancel their contracts.  

“I find the evidence indicates that AES engaged in a pattern of intentionally stalling consumers within the 10-day cancellation period by not responding to calls or providing excuses to consumers each time they called until the 10-day cancellation period had run out,” said Wyer.

The appeal document, however, said the company believes Wyer relied on assumptions as to “discussions and policies regarding refunds given the contractual periods,” and stated there was no evidence it “deliberately failed to respond to communication.”

The province declined comment, saying the matter is still before the court.

Registrar says AES used ‘manipulative sales tactics’

Atlantic Environmental Systems also disagrees with the province’s conclusion that “call scripts and presentation materials submitted by AES demonstrate that AES engages in manipulative sales tactics.”

In the written appeal, Tan said sales scripts had been used as “evidence of underhanded behaviour, when, in fact the nature, purpose and contents of which were used to ensure compliance with provincial and national standards of ethical conduct.”

Goldman previously told CBC News his company follows a “strict code of ethics” by the Canadian Water Quality Association. The association’s president confirmed the board revoked Atlantic Environmental Systems’ membership earlier this year, and it has not been reinstated.

The move came after the water filtration company, operating in P.E.I. as Maritime Home Services, appealed that province’s decision to pull its direct seller’s licence. The appeal was rejected.

Atlantic Environmental Systems’ appeal in Nova Scotia will be heard before a judge on Nov. 26.