What terms do I need to look out for when signing up for a package travel contract?
When many people arrange to go on holiday they do so by purchasing a package from a travel agent which will consist of one or more of the following elements:
- Transfers to and from the airport
- Activities while they are abroad
Is there any legislation which governs these kinds of contract?
All those people and companies who supply and promote travel packages must be aware of the laws specified by the Package Travel Regulations 1992. These Regulations therefore provide the guidelines by which an individual or a business can sell travel packages and the certain rules which they must adhere to.
Is there any legislation which is in place which is designed to protect the purchaser of the package?
Often when signing up to a package travel contract the purchaser or consumer will be required to sign the terms and conditions of sale for that business before the final contract for the package holiday has been formed.
If any of the terms included in this standard contract or terms and conditions do not reflect what the business obligations are under the Package Travel Regulations then it is likely that those conditions will be regarded as unfair using the Unfair Terms in Consumer Contract Regulations. This will be the case if the standard term is of the type which could potentially mislead the consumer when signing up to the travel package.
What happens if a term is found to be unfair under the Unfair Terms in Consumer Contract Regulations?
If a term is found to be unfair under the Unfair Terms in Consumer Contract Regulations then it will become void and that consumer will not be bound by it even if they have signed the contract.
What is meant by a standard contractual term?
When signing up for a package contract in this manner it is unlikely that a full contact will be drawn up which needs to be signed by both parties. What is usually the case is that the consumer will be required to fully read the companies standard terms and conditions of sale and show your agreement to them. If you purchase the package in the travel agents you will be provided with a hard copy of the terms and conditions and will be required to sign it at the bottom before you can proceed with the purchase.
If you purchase the package online through a designated travel package website then you will be required to state that you have read and understood the terms and conditions prior to being able to enter your credit card details.
Within these terms and conditions will be various terms which are in place to protect the interests of the travel agent rather than the consumer, such as the consumer accepting liability for damages which may occur from actions by the consumer while on the actual package holiday.
The important thing to note regarding these kinds of terms is that they are agreed unilaterally. This means that you do not have a say in these terms. They are put in place by the business and if you do not agree to be bound by them then you will not be able to purchase the holiday package.
Due to the unilateral nature of these terms it is imperative that there is some protection put in place for the consumer.
How will a term be held to be unfair?
There are two things that will be taken into consideration by a court when trying to establish whether a term is unfair. These are as follows:
- The test of fairness
- The plain language requirement
The test of fairness and the plain language requirement
A standard term in a consumer contract will be regarded by the court as unfair if it creates a significant imbalance in the rights and obligations of the parties who have entered into the contract. For the term to be unfair in relation to the consumer then this imbalance in the rights and obligations must be to the detriment of the consumer and contrary to the requirement of good faith.
What is meant if the term is said to be to the detriment of the consumer?
If a term is said to be to the detriment of a consumer then it will mean that the rights of the consumer have been put at an imbalance due to the term affecting their rights more so than the right of the business.
What is the requirement of good faith?
The requirement of good faith means that business must deal in a fair and open manner with all of their customers.
When a standard term in a consumer contract is drafted the terms must be fair and simple and not adversely affect the rights of the consumer. This means that they can still serve their purpose of protecting the business needs and interests of the package travel business but they must also be fair to the consumer.
According to the Unfair Terms in Consumer Contract Regulations a standard term, in assessing whether a term in fact unfair, the following things must be taken into account:
- The nature of the goods or services
- All the circumstances involved in the making of the contract
- The other terms in the contract
- The language in which the term is written
Looking at the above requirements this means that the contract will be looked at in its entirety taking into account all the terms.
Please note a standard term is more likely to be considered unfair if it is not written in plain and intelligible language as it may be unclear to the consumer of what the term is actually about. This does not mean that terms written in legal language such as a liability term which is required to include legal definitions would be regarded as unfair, however.
As a consumer are there any terms which I should potentially look out for?
Package travel contracts are contracts which are often concluded in a unique way in some cases relying on the expertise and local knowledge of the travel agent. Accordingly when purchasing a package you should look carefully look at terms which relate to the following:
- The transferability of the contract
- Acceptance of responsibility for statements made by travel agents
- Responsibility for errors in travel brochures
The transferability of the contract
Under the Package Travel Regulations the travel agent must provide the consumer with the option of transferring the holiday to another person if they cannot go on the holiday. They must however give reasonable time to the travel agent in order to do this.
In what circumstances may I do this?
- The Package Travel Regulations do not specify the circumstances when this is possible but it is usually taken to include illness, death or death of a close relative etc.
- If this is to occur the original consumer and the new consumer and jointly liable to pay for the cost of the holiday.
- If a package travel contract restricts your right to do this then it is likely to be seen as unfair.
What about cancellation provisions?
- It is common under contacts such as this to be provided with certain cancellation rights with benefit both the consumer and the business. If you wish to cancel depending on when you do you will be required to pay a certain amount of money in order to refund the travel agent for the existing work with the hotels and airlines etc. This is unlikely to be seen as unfair.
- If however, you are given no right to cancel then it is likely to be seen as unfair.
Acceptance of responsibility for statements made by travel agents
- Often when entering into a package travel contract a consumer will do so acting upon expert advice given by the travel agent on matters such as the facilities at the complex, the distance to the beach etc.
- A term in a contract which excludes or seeks to limit the travel agents obligations to respect any commitments made to a consumer whether they are in written or by spoken word has the potential to be unfair under the Regulations.
Responsibility for errors in travel brochures
- Often when purchasing a package holiday from a travel agent you will be shown the package in a brochure and details will be provided therein. As the industry is constantly changing and brochures become out of date quickly the agent will be under an obligation to inform you of any changes not shown in the brochure.
- A term in the contract which excludes or limits the travel agents liability for changes to the brochure is likely to be seen as unfair under the Regulations.