Business owner sucked into vacuum referral scheme

A dustup over an expensive vacuum cleaner ended with a $545 judgment.

John Sobhani, the owner of Port Coquitlam-based Diamond Auto Glass, paid $4,509 for the vacuum and power nozzle before concluding he’d been scammed.

Sobhani contended a company sales representative for Rainbow Systems told him he’d be reimbursed for the vacuum’s purchase price after referring 12 people to the company.

The sales representative, identified in the judgment only as VD, told Sobhani the people he referred weren’t required to buy anything and would receive a free air cleaner after listening to the company’s presentation.

Rainbow also threw in a 12-piece cookware set and an air machine as part of the deal.

However, Rainbow refused to count the people Sobhani referred as referrals. The company also didn’t give out the air cleaners.

“[Sobhani] was essentially stuck with a $4,500 vacuum and some angry friends,” concluded Civil Resolution Tribunal member Micah Carmody.

After VD refused him a refund, Sobhani’s credit card issuer refunded the purchase price.

Rainbow Systems requested the court award the company $4,509, arguing: “Sobhani has the vacuum and has paid nothing for it.”

However, Carmody noted Rainbow’s evidence “is only slightly different” from Sobhani’s.

Rainbow didn’t count Sobhani’s first referral, “and it does not explain why,” Carmody wrote.

“It also does not deny that Mr. Sobhani’s referrals were supposed to receive air cleaner, but did not,” Carmody wrote. “I find Rainbow’s refusal to honour the referral scheme amounted to a repudiation that entitled Mr. Sobhani to treat the contract as being at an end.”

However, Carmody was persuaded by Rainbow’s contention that, rather than reimbursing Sobhani the entire purchase price, Rainbow offered $4,000 for 12 referrals.

Based on that discrepancy, Carmody ordered Sobhani to pay Rainbow $546 including interest.

Sobhani is permitted to keep the cookware set and air machine, as they were included in the initial sale.