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Author: Dave Robertson

What the UK Supreme Court’s Ruling on “Woman” means for the Travel Industry!

Posted on by Dave Robertson
What the UK Supreme Court’s Ruling on “Woman” means for the Travel Industry!

On April 16, 2025, the UK Supreme Court delivered a headline making and landmark ruling in the case of For Women Scotland Ltd v The Scottish Ministers, clarifying that under the Equality Act 2010, the terms “woman” and “man” refer exclusively to biological sex and not gender identity. Following this judgment a transgender woman (even with a Gender Recognition Certificate) is not considered a “woman” for the purposes of the Equality Act.


It is important to note that this ruling doesn’t take away protections for trans people—they’re still protected under the law through “gender reassignment” rights, writes Ami Naru. But it does change how businesses interpret what “single-sex spaces” are legally allowed to mean. This decision has significant implications for the travel industry;

  • For a travel business that offers women-only tours, hotel floors, or spaces for example, this ruling means you can restrict those areas to biological females if you want to. Under the clarified legal definitions, access to such spaces could be restricted based on biological sex. While the ruling permits the exclusion of transgender individuals from single-sex spaces, it does not mandate such exclusions, leaving room for inclusive practices. Now’s the time to double-check your policies. Do they make sense now that we have legal clarity on what a woman means? And how are they communicated to guests?
  • Airlines, trains, and cruise lines offering gender-specific services (like restrooms or sleeper cabins) might want to re-evaluate how those are assigned—and make sure staff are trained to handle questions or complaints respectfully.
  • For travel agents & tour operators who market women-only getaways or retreats, you’ll need to be clear on who those trips are for. Ensuring clarity in definitions and inclusivity policies will be crucial to avoid potential discrimination claims and to cater to a diverse clientele.

Some may say this decision puts travel companies in a tricky spot: on the one hand we now have legal clarity, but social expectations are still evolving. Many travellers value inclusivity, and no one wants to make guests feel excluded or disrespected.

Ultimately, the travel industry has always been about welcoming people, creating great experiences, and bringing the world closer together. While the Supreme Court’s ruling gives more legal structure around the definition of “woman,” the heart of good travel remains the same: respect, safety, and inclusivity for all.

For help and advice on employment issues within the travel industry, contact;

ami@travlaw.co.uk

or call;

0113 258 0033

 

The Perils of using AI in 2025

Posted on by Dave Robertson
The Perils of using AI in 2025

AI is transforming industries, but with innovation comes risks. From the EU AI Act to GDPR concerns, click here to read Nick Parkinson’s latest article as he explores 8 key considerations when using AI in 2025.

  • Transparency for AI Content
  • GDPR & Data Breaches
  • Recruitment & the Equality Act
  • AI in Customer Apps
  • Marketing & Copyright Infringement
  • Commercial Terms with AI Providers
  • Ownership of AI-Generated Media
  • The Future of AI Regulations

Fines, lawsuits, and compliance challenges are real threats for businesses leveraging AI. Are you prepared? To read the whole article click here.

Techlaw is a full service law firm specialising in regulatory work, litigation, commercial, employment law and intellectual property but with a niche focus on data and the software & technology industry.  

Understanding the law is only half the battle. Techlaw’s understanding of the industry means you will no longer spend an hour explaining to your lawyers what cookies, API’s or SAAS are!

No matter how complex the law may be, no matter how complex the facts, our ethos is to ‘keep it simple’ and deliver straight talking, practical advice to enable your business to make the right decisions.

To find out more about what the services we can offer, click here or just pick up the phone and give us a call on 0113 258 0033.

Reg 11 Refunds – Sun, Sea and Social Distancing

Posted on by Dave Robertson
Reg 11 Refunds – Sun, Sea and Social Distancing

COVID-19 and March 2020 may seem like a distant memory but travel lawyers are still picking up the pieces when it comes to claims under Regulation 11 and 12 of the Package Travel Regulations.  In this article, Nick Parkinson, discusses the latest skirmish in: Mushtaq Usmani -v- Expedia (unreported, DDJ Kharron-deep, Coventry County Court 26/03/25).  

San Sebastian crowded beach Spain by aluxum from Getty Images Signature

The Claimant’s Case

Mr Usmani booked a package holiday to Turkey with Expedia on 06/03/20.  He was due to depart on 09/03/20, and duly did so.  On arrival, the Claimant concluded that this was not the holiday he was expecting.  The impact of COVID-19 was already being felt in Turkey with social distancing measures in place, closures of restaurants and some tourist activities shut down.  As the holiday progressed, the situation escalated and the Claimant’s return to the UK was affected by flight disruptions.

The Claimant’s case was that Expedia should not have sold the holiday or allowed it to proceed. In the alternative, and having allowed the holiday to go ahead, they should have done more to warn the Claimant about the situation in Turkey.   The Claimant sought a full refund plus significant compensation.

Expedia’s Defence

Expedia’s defence can be broken down into five parts:

  • There is a ‘high bar’ to be met before a package organiser is obliged to cancel or make significant changes to a holiday under Reg 11 of the Package Travel Regulations. As per the High Court decision in Sherman:  ‘there must no longer be a reasonable possibility of the holiday proceeding (without being significantly affected/changed)’
  • The evidence indicated that this ‘high bar’ had not been met because:
  • There was no FCDO advice against travel to Turkey, either at the time of booking or departure
  • There were no confirmed COVID infections in Turkey at that time
  • Expedia could still provide the travel services: flights, accommodation and transfers
  • The WHO had not declared a pandemic at that time
  • The UK government had not announced any type of lockdown in the UK
  • What actually happened after the holiday started is irrelevant. Judges cannot apply hindsight, as supported by the County Court decision in Brynmawr.
  • The COVID-19 situation was worldwide news both at the time of booking and at departure. Expedia had directed the Claimant to the FCDO website to check for travel advice (which noted social distancing was in place etc) at the time of booking.  The Claimant was therefore sufficiently informed to make a decision about whether to make the initial booking and subsequently travel (and made no attempt themselves to cancel before departure).
  • The position in Turkey had not changed significantly between the Claimant booking his holiday on 06/03 and departure on 09/03. In other words, this was ‘exactly the holiday the Claimant had bargained for’.  An argument supported by the European Courts in Tez Tours.

In short, it was up to the Claimant to decide whether or not to proceed with the holiday based on the knowledge available to him at the time of departure on 09/03/20.  Each to their own! Indeed, had Expedia cancelled, and the situation in Turkey had not escalated as it did, the Claimant could have argued that Expedia cancelled the trip prematurely and sought a full refund and compensation.

The Outcome?

The Judge gave an indication that the Claimant’s evidence was sufficient to make out a claim  under the PTRs but… the Claimant’s expectations on how much the claim was worth were unrealistic.  The Judge therefore directed the parties to explore an out of court settlement.  The parties duly managed to come to an amicable resolution – and for considerably less than the Claimant was originally claiming!

Final Thoughts

Once again, we are reminded that FCDO advice is merely evidence, not conclusive, as to whether package organisers are obliged to cancel under Reg 11 of the Package Travel Regulations (or whether customers are entitled to cancel under Reg 12(7)).  Further, as always in the Small Claims Court, the outcome of these arguments are inherently unpredictable – with Judges often taking a pragmatic approach to find an outcome that allows both parties feeling they have ‘come away with a win’.

If you have any questions or comments on this article, contact the author;

Nick Parkinson, Partner

nick@travlaw.co.uk

 

Apprenticeship Rules – Key Changes Employers Need to Know

Posted on by Dave Robertson
Apprenticeship Rules – Key Changes Employers Need to Know

The government is making significant changes to the apprenticeship landscape, with the goal of boosting economic growth and offering more flexibility to employers, writes Travlaw paralegal Rosie Riley. These changes, announced in February 2025 during National Apprenticeship week (10 -16 February 2025) , are designed to streamline the apprenticeship process and make it more accessible for both employers and apprentices. Here’s what you need to know.

Simplified Apprenticeship Process

The government is cutting down on the ‘red tape’ associated with apprenticeships. The annual Apprenticeship Funding Rules, released by the Department for Education, introduce several measures aimed at reducing administration for employers and apprentices. The onboarding process will be faster, and mandatory checkpoints throughout the apprenticeship will be reduced. This is a welcome shift for employers, making it easier to onboard and manage apprentices without getting slowed down by unnecessary intricacies.

More Flexibility with English and Maths Requirements

In a move that expands access to apprenticeships, the government is easing the English and Maths requirements. Previously, apprentices without the necessary GCSE qualifications in these subjects would have to take a Level 2 qualification. Now, employers will have the discretion to decide whether these qualifications are necessary, opening the door for more young people to enter apprenticeship programs without the barrier of additional qualifications.

This change is part of a wider initiative to offer apprenticeships to a more diverse group of individuals, including those with lower learning capabilities, ensuring more people have the opportunity to pursue a career through apprenticeships.

Reevaluating Active Learning Requirements

Another key update is the revision of the minimum active learning requirement. Previously, apprentices were required to complete active learning at set intervals throughout their apprenticeship. Under the new rules, apprentices will only need to engage in active learning at least once every three months. This gives employers and apprentices more flexibility to design apprenticeship programs that fit their needs without being constrained by rigid timelines.

Shorter Apprenticeship Duration

Starting in August 2025, the minimum duration for an apprenticeship will be reduced from 12 months to 8 months. This change aims to allow employers to train more workers in a shorter time frame, which will help boost jobs and contribute to economic growth. It’s a big shift that allows businesses to get the skilled workers they need more quickly.

Growth and Skills Levy

The Apprenticeship Levy, a tax on larger employers to fund apprenticeship training, is also set to be replaced by the new Growth and Skills Levy. The Apprenticeship Levy is a tax on large employers (who have a pay bill of at least £3 million annually) that can be accessed to pay for training apprentices. This approach was criticised for being too restrictive and for not allowing businesses enough flexibility to use the funds. Under the new system, employers will have more freedom to use the funds for not just apprenticeships but also short courses, online classes, and skills boot camps. The idea is to make apprenticeships more accessible and relevant to today’s workforce by offering a wider variety of training options.

In addition, the government’s new Skills England branch will allocate 50% of the funds to sectors where there is a high demand for skilled workers, like healthcare, engineering, construction, and social care. This targeted approach will help ensure that the apprenticeship funds are used effectively and align with the skills employers need most.

What Employers Need to Do

With these changes coming into effect, employers will need to adjust their apprenticeship strategies. The flexibility in qualifications and training methods should make it easier to offer apprenticeships and develop the workforce of the future. However, to take full advantage of these updates, employers will need to stay informed about the new rules and ensure they are utilising the available funds correctly.

Employers should also start thinking about how to integrate apprenticeships into their recruitment strategies. With more flexibility, apprenticeships will become an even more valuable tool for bringing new talent into your business. However, it is important to note that the presence of Level 7 apprenticeships in the market are likely to reduce to allow for younger workers to enter the market.

It’s important to remember that, with the changes to the Apprenticeship Levy and the introduction of the Growth and Skills Levy, there’s more opportunity than ever to invest in training and development. Taking advantage of these funding options will not only help your business grow but also ensure that the next generation of workers has the skills needed to thrive in the travel industry and beyond.

If you have any questions or comments on this article, please contact our Head of Employment Ami Naru, email advice@travlaw.co.uk. or call us on 0113 258 0033.

LOCAL STANDARDS – In It For The Long Fall

Posted on by Dave Robertson
LOCAL STANDARDS – In It For The Long Fall

In this article, Nick Parkinson, discusses a ‘recent’ County Court decision involving Local Standards Susan Auckland -v- Expedia (unreported, DJ Batchelor, Sheffield County Court 11/08/23).  

Previously on “Local Standards”

You may remember me from such articles as ‘When Breaching Local Standards Is Not Enough To Win Your Case’ and ‘Local Standards – Stepping In To The Dark’.  In both cases, injury claims were dismissed because there was no evidence that the accident was caused by a breach of local standards.  These were difficult cases where the package organisers stumbled over the finish line and, here, Expedia were up against similar challenges in the case of Auckland. 

DISCLAIMER:  Yes, I know I should have reported this case a long time ago.  Better late than never!

Background

Ms Auckland slipped in the changing rooms of the spa at the Crowne Plaza Vilamoura hotel in the Algarve, Portugal.  Ms Auckland suffered a fractured hip and brought a claim for personal injury. To succeed, the Claimant was required to prove:

  • The local standards
  • That the hotel breached those standards; and
  • Such breach caused the accident

It was alleged that the hotel had breached the local standards by either:

  • Allowing the floor to become wet,
  • Failing to install suitable flooring in a ‘wet area’, or
  • Failing to put up warning signs or install slip mats by the shower cubicles.

Ms Auckland and her husband alleged that the floor was made of marble (or another shiny, polished and slippery material).  She relied on the expert evidence of a Portuguese lawyer, Cristina Dein, who gave evidence that:

  • The floor surface required ‘good adhesion’, and
  • There was a need for ‘the hotel to maintain its floors dry’ or ‘duly signed when slippery’

Having a marble floor in the changing room for a Spa sounds like a recipe for disaster right?  How could we possibly defend such a claim?

The Defence

Expedia did not obtain expert evidence, nor did they put P35 Questions to the Claimant’s expert.  However, they did have evidence from Head of Engineering for the hotel group to say that:

  • The floor was actually made of a material called ‘travertine’
  • Travertine is suitable for wet areas
  • A non-slip coating was applied to the floor every year
  • A friction test had been carried out on the floor which showed it was above what he believed to be the UK standard

In addition, the hotel Spa manager gave documents to show that:

  • The Spa had a protocol to inspect and clean the floor every hour
  • Housekeeping had actually followed that protocol on the day of the accident

Armed with the above, we went into this trial quietly confident of getting the claim dismissed…

A Bumpy Start

It is fair to say we received an early curveball when the Judge immediately explained that she was ‘amazed’ that the claim was being defended.  The Judge felt it was obvious that the floor was unsuitable for a Spa changing room and that ‘local standards’ should not prevail over ‘common sense’.  Meanwhile, counsel for the Claimant launched a flurry of preliminary arguments!

First, that the hotel’s witnesses should not be able to give evidence because their statements were not ‘in their own language’.  The Judge gave this short shrift on the basis that the witnesses were fluent in English (as well as Portuguese) and their statements had been taken without an interpreter.

Second, that the statement from the hotel’s engineer should be dismissed because it was ‘expert evidence’ disguised as a witness statement.  The Judge agreed that two paragraphs in the statement were straying into ‘expert evidence’ – i.e. where the engineer talked about the ‘friction test’ complying with UK standards in his statement.  However, she decided to consider this later and ‘probably’ ignore those paragraphs. 

Phew, having survived the first two ‘sniper shots’ from the Claimant, it was time for a counter attack…

Sloppy Expert Evidence

The Claimant’s case relied heavily on an expert report on local standards from a (Portuguese) lawyer.  However, the report did not come with a ‘statement of truth’.  It did not, therefore, comply with the court rules (CPR 35).  The Defendant therefore invited the Judge to dismiss the report entirely.  A technical point, but one that would have been fatal to the Claimant’s case.

The Judge was not impressed.  The point had not been raised previously and there was no reason to doubt the honesty of the expert.  Finally, it was time to start hearing evidence from the witnesses.  Or was it…

A Judge Perplexed

The concept of ‘local standards’ can be a novel experience to Judges and lawyers handling a claim under the Package Travel Regulations for the first time.  The Judge, so convinced that the claim was undefendable, had the Defendant take the Judge through the relevant case law (Lougheed –v- On The Beach).  Still not convinced, but not seeing a white flag from the Defendant’s camp, the Judge eventually waved ‘play on’.

The Trial

Eventually, the witnesses gave evidence.  The Claimant’s evidence was largely expected.  She left the shower in the Spa area.  She slipped.  The floor must have been wet.  The floor felt like marble and ‘looked shiny’ so it cannot have been ‘non-slip’.

The hotel staff stood firm.  The Spa manager maintained that the area was regularly inspected and cleaned.  She also dismissed the need ‘to have floor mats’ near shower areas, being unhygienic and problematic for cleaning.  The head of engineering, meanwhile, maintained that the floor was made of a non-slip material (travertine) and routinely treated with a non-slip coating.

It had been a long day by this point but, finally, it was time for the submissions…

Defendant’s Submissions

It was now the Defendant’s opportunity to explain the relevant case law (Lougheed etc) to the Judge in the context of the evidence that had been presented.  Unfortunately, the Judge was far from convinced that the claim was defendable, interrupting counsel for the Defendant on several occasions.  Finally, however, the Judge appeared to have a ‘light bulb’ moment.  The penny had dropped.  The Judge promised to stop interrupting!

Given the kerfuffle that had ensued throughout the day, however, time had run out.  The Judge did not fancy playing overtime and ordered a second leg.  The parties would have to come back in 7 months.

Judgment Day

And now the moment you have all been waiting for.  Judgment was delivered.  Key parts being:

  • I cannot be sure there was a breach of any local standards for the cause
  • There was a proper system of maintenance in the spa area in place, and there is evidence it was being adhered to
  • I find Mr Da Silva’s evidence (the Head of Engineering at the hotel) helpful. He cannot give expert evidence, but he can assist the court with materials in use at this hotel from an informed perspective. 
  • The friction test is, however, discounted as expert evidence and I make no further reference to it
  • I do not think the absence of a (warning) sign is causative. The C knew that she would step out and be wet. This is not a Wilson case where it was so dangerous and there is no evidence of previous slips in this hotels
  • It is a most unfortunate accident but one that occurred without the intervention of negligence. I find no negligence on the part of the Defendant, or a breach, as to give rise to liability.

Victory!  And it is fair to say one that was ‘snatched from the jaws of defeat’ given the resistance presented by the Claimant’s barrister, and the Judge, throughout the trial.

Key Takeaways

Key Takeaways

There are a number of key takeaways for the travel industry here.  All of which are ‘recurring themes’ in these type of cases:

  • Judges are often not familiar with the relevant case law on ‘local standards’. Instructing experienced counsel is, therefore, critical.
  • Expert evidence from a lawyer can be limited in how far it can demonstrate the ‘local standards’. A more ‘practical’ expert, such as an engineer or architect, is usually superior.
  • In fact, claims can be defended without expert evidence. The Claimant has the legal burden of proof and it is often difficult to prove that an accident was caused due to a breach of local standards.
  • Hotel employees can be just as important as ‘experts’ – they have technical knowledge about the hotel’s procedures, maintenance and construction that can assist the court. However, caution is needed when they ‘stray into expert territory’.
  • The co-operation of the hotel to provide documents, and employees to give evidence, will considerably improve the prospects of defending the claim

The Auckland case concludes our trilogy box set on Local Standards for now.  But, don’t worry, we have just sold the franchise to Disney so there will be more prequels and spin-offs to follow over the next few months!

If you have any questions or comments on this article, contact the author;

Nick Parkinson, Partner

nick@travlaw.co.uk

Disclosure Wars (Taking Back Control)

Posted on by Dave Robertson
Disclosure Wars (Taking Back Control)

In this article Nick Parkinson explores the latest skirmish in the ongoing disclosure wars between package organisers and Claimant law firms.  On this occasion, Travlaw successfully defended an application for pre-action disclosure in Janet Openshaw –v- Great Rail Journeys (Worcester County Court, 30th October 2024).

Background

The extent of disclosure that must be given to Claimants has been a thorn in the side of the travel industry for many years!  This is because most package organisers do not own or control hotels; rather they contract with third party suppliers to source accommodation.  Behind the scenes reveals an even more complex ecosystem where many package organisers actually contract with a bedbank which, in turn, has a contract and direct line of communication with the hotel. 

More Than ‘Possession’

A common trap organisers often fall into is to say, “We don’t have those documents so you can’t have them”.  Typically, this will arise in the context of a claim for personal injury or gastric illness where the Claimant requests disclosure – often in the form of a list longer than the queue for assistance at the Brianair helpdesk.

The problem here is that, as Claimants will rightly point out, disclosure obligations go beyond possession.  The obligation extends to any documents that organisers have ‘control’ of.  This is exactly what the lawyers for Openshaw argued!

What does Control Mean?

Here we arrive at the million dollar question!  According to the Civil Procedure Rules ‘control’ includes documents in respect of which a party has (or has had) a right to possession, to inspect or take copies.  Further, the High Court decision in Berkeley v Lancer (2021) says:

“An arrangement or understanding which gives a party practical or de facto control of a third party’s documents is sufficient to constitute control for disclosure purposes

One of the factors to be taken into account for that purpose:

“There must be an arrangement or understanding that the holder of the documents will search for relevant documents or make documents available to be searched”

This presents a potential problem for those package organisers because…

The Supplier Contract vs Reality

There is often (but not always) a clause drafted into supplier contracts which places an obligation on accommodation suppliers to ‘provide reasonable assistance’ to assist defending consumer claims.  There may even be a detailed ‘Claims Handling Agreement’ specifying the level of co-operation expected in fine detail.  In these cases, Claimant firms will insist that the package organiser has ‘control’ over documents held by the hotel. 

The reality, however, is that:

  • In some cases, organisers will not know what (if any) relevant documents the hotel is holding.
  • The hotel is owned by a third party operator and is situated in a faraway land.
  • The organiser can ‘ask’ but there is no guarantee that they will ‘get’

So what happens if the hotel (or their insurers) fail or refuse to co-operate?  Can a court order a package organiser to provide disclosure in any event on the basis that ‘they have a contractual right to these documents’ and therefore ‘control’ of them?  Personally, I am not convinced.  Ultimately, a contractual obligation is ‘just a piece of paper’.  It is not a ‘magic wand’ that makes documents appear at the flick of the wrist. 

So What Happened in Openshaw?

In Openshaw, the Claimant was (and perhaps still is) pursuing a claim for personal injury.  The Defendant, Great Rail, obtained various documents from the hotel and duly provided them to the Claimant.  Great Rail made it clear to the Claimant’s lawyers that:

  • They did not have any more relevant documents in their possession,
  • They had passed on the Claimant’s disclosure requests to the hotel/their insurers, but
  • They had not received a response

Despite the above, the Claimant applied to court for an order that Great Rail provide further pre-action disclosure.  The Claimant accepted that Great Rail did not have possession of the documents but insisted that, because Great Rail are liable for their suppliers under the Package Travel Regulations, they must have ‘control’ of the documents.  An ambitious argument and, if correct, one that would have far reaching implications for the travel industry!

The Outcome?

Common sense prevails!  District Judge Khan concluded that the documents requested by the Claimant were not in the Defendant’s control on the basis that the Defendant had ‘already done everything it could to try and provide the documentation’ and, as such, ‘it was unreasonable to make the order requested by the Claimant’.  Dare I say it, we have ‘taken back control’! 

The Future of Disclosure Wars?

This is certainly not the last chapter in the ongoing disclosure war between Claimant firms and package organisers.  The decision in Openshaw is not binding on other courts and, in any case, these decisions are ‘fact sensitive’, which will inevitably lead to different outcomes. 

No doubt the Judge was persuaded in this case by the witness evidence and documents before the court to demonstrate that Great Rail had indeed ‘done everything it could’.  The best advice, therefore, is to make sure you are well prepared for any court hearings for pre-action disclosure.  Better yet, to engage with the Claimant pre-action to try to avoid court applications being made to start with!

Need Help?

If you are being pressed for disclosure, being threatened with court applications or simply want to discuss this issues raised in this article – feel free to get in touch with the author of this article at nick@travlaw.co.uk.

The Employment Rights Bill- what does this actually mean?

Posted on by Dave Robertson
The Employment Rights Bill- what does this actually mean?

On 10 October 2024, the government introduced the Employment Rights Bill 2024-25 (Bill) into Parliament, meeting its commitment to introduce the Bill within 100 days of entering office. The Bill brings forward 28 individual employment reforms, some of these reforms are sketchy and simply provide ministers with the power to make regulations, with certain other proposals to be padded out after consultation. The Bill will have its second reading on 21 October 2024, and thereafter it will need to progress through both Houses of Parliament, and then receive Royal Assent. It is likely that most of the provisions will therefore not come in to effect until 2026 and even then may change along the way.

Image of the Houses of Parliament

The Employment Rights Bill was labelled as a generational change in employment law, so what actually was proposed?

  • Unfair dismissal will become a day-one right, subject to a new statutory probationary period, and the two-year qualifying period will disappear. Ministers will make regulations covering dismissal during the “initial period”, after consultation. The detail around the statutory probationary periods is yet to be revealed, but we do know the governments stated preference is for a maximum nine- month period of probation. Unlike now, some sort of process will have to be followed for dismissals during this initial period. This will be a significant change to present and employers will want a simple process. Employee representatives however, will not want probationary periods to be seen as qualifying periods for unfair dismissal via the back door.
  • The Bill will restrict employers’ ability to “fire and rehire” by making it automatically unfair to dismiss an employee for refusing to agree to a change in their contract of employment. An exception will be made where the employer can show evidence of financial difficulties and demonstrate that the need to make the change in contractual terms was not reasonably avoidable. This proposal is a significant shift away from the current law, where employers simply need to show a good business reason requiring the change to terms to avoid an unfair dismissal. It is likely that these proposals will be contested by employers during the consultation, as they do not reflect the fact that employers may need to fire and rehire for other reasons than purely financial ones, such as changes in the law for example.
  • We were already aware that from the 26th October 2024, a new duty to prevent sexual harassment in the workplace by taking “reasonable steps” was coming in. The Bill will further expand this duty requiring employers to take “all reasonable steps” to prevent employees from being sexually harassed at work. The government have reverted to the original proposal for this duty, before it was watered down during parliamentary debate. This is a significant step up for employers to meet the duty, especially since it will be directly enforceable by individuals. The Bill will also reintroduce employer liability for third party harassment. In due course, regulations will outline what constitutes “reasonable steps” for both the proactive duty and the third part harassment. The steps that may be specified include:
    • Carrying out assessments of a specified description,
    • publishing plans or policies of a specified description,
    • steps relating to the reporting of sexual harassment, and
    • steps relating to the handling of complaints.
  • There was much talk about Flexible Working becoming the default position under this Bill. However, in a departure from what was promised what the Bill actually does is allow employers to be only able to refuse a request for flexible working where it is reasonable to do so in relation to one of the statutory reasons for refusal. So in effect the only thing that has changed is “reasonableness”. This not only applies to the process followed in dealing with flexible working requests, but will also now apply to the reason for refusing any such request. When employers refuse requests, they’ll need to explain the reason for the refusal and why that is reasonable. Therefore, despite a lot of attention and focus on what the landscape of flexible working will be under the new government and fear that flexible working would become a right, this proposal in fact does very little to change the existing position.
  • Statutory Sick Pay will be available from the first sick day rather than the fourth day. The lower earnings limit of £123 a week will be removed, but the Bill sets out a lower level of sick pay for lower earners.
  • Paternity leave will become a day-one right (currently requires 26 weeks’ service).
  • Unpaid parental leave will become a day-one right (currently requires one year’s service).
  • Unpaid bereavement leave will become a day-one right.

The above is simply a snap shot of the main provisions proposed, there will be various consultations launched and much may change along the way. For now employers need to keep a keen eye on developments (we will keep you posted) and start to reflect on how some of these changes may impact their business.

For help and advice on this or any employment issues within the travel industry, contact;

ami@travlaw.co.uk

or call;

0113 258 0033

 

Chargeback – When the Industry fights back, & wins!

Posted on by Dave Robertson
Chargeback – When the Industry fights back, & wins!

I have spoken many times about my frustrations of the chargeback process. Especially when those chargebacks are erroneously, ignorantly and sometimes fraudulently made against agents; agents who have no legal or contractual liability for the provision of travel services but yet end up on the receiving end of the chargeback process. Time and time again, banks and card providers overlook the facts (and the law!) and simply say ‘computer says yes’, resulting in recovery for the consumer, and a double loss for the agent.

I am a real advocate for the industry fighting back in these types of scenarios and pursuing customers who abuse the chargeback process in this way. This week, we saw one such case.

You don’t have to just ‘let it go’!

Southall Travel are an award winning travel company, selling packages and independent travel services alike. Like many travel companies, depending on how they sell their services, they can act in the capacity of either an Organiser or an Agent, as is made clear in their Terms and Conditions.

In this specific instance, the customer made a flight only booking, for return flights to Karachi. The flights cost a total of £752.64. Being a single travel service, the booking was not a package and Southall made perfectly clear at all stages of the booking process that they were simply acting as agent on behalf of the airline – Turkish Airlines.

The outbound flight went ahead without issue; however the customer’s return flight was cancelled by the airline. The airline failed to provide the customer with any assistance, resulting in the customer having to source additional accommodation, and their own return flights, thus incurring significant cost. Southall Travel, in their role as agent, did all that they could to assist the customer in returning home, but maintained that they were not responsible for any financial loss. This lay with the airline.

Upon returning home, the customer raised a chargeback against Southall Travel and received a refund for both the outgoing and return flight.  The chargeback was upheld even though Southall had acted as agent, had never even received the sum of £752.64 (paid direct to the airline) and the customer had actually travelled on the outgoing flight!

Many agents would simply ‘let this go’. It was a reasonably small sum, and perhaps not worth arguing over. Not Southall Travel!

You can make your case!

Southall Travel commenced a legal claim against the customer in the small claims court, arguing that a) the chargeback should never have been awarded against them in the first place, as they were acting only as agent, and b) in any event, the customer had been unjustly enriched; having availed of the outbound flight on the booking, yet claiming for and receiving a refund for the same.

The customer counterclaimed against Southall Travel, seeking the sum of £2,868.30 to cover the costs of their replacement return flights and accommodation.

The matter was heard before Romford County Court on 2nd August, where judgment was awarded in favour of Southall Travel. The customer’s counterclaim was dismissed in its entirety and they were instead ordered to reimburse Southall for the cost of the flights that had been previously awarded under the chargeback process.

In their Judgment, DDJ Greenwood stated: “It seems to me clear that the contract between Southall Travel and [the customer] is limited to Southall Travel facilitating a further contract with Turkish Air… I find that there is no basis in law for which [the customers] may obtain compensation for which they seek from Southall Travel. Any contract that would provide for compensation would be between the customer and Turkish Airways.

On behalf of Southall Travel, it was submitted that they have essentially been unjustly enriched. It seems to me that Southall Travel’s position in respect of the law must be correct

Closing Remarks

Cases like this are far too common; and what is just as common is travel companies feeling that they have no source of recourse especially when the cost of doing so may well outweigh the value of the claim being sought. In this case, the claim value was under £800. Southall made numerous attempts to liaise and settle the matter with the customers without the need for formal action, but when this proved impossible, they stood up for what is right and brought the matter before the courts. It is great to see companies such as Southall Travel fighting back and others in the industry should be encouraged to do the same!

Krystene Bousfield

If your travel business has an issue like the one described in this article, or just needs any legal advice, please contact the author on

krystene@travlaw.co.uk

or call us on 

0113 258 0033

Space Oddity

Posted on by Dave Robertson

Ground Control to Major Tom
Ground Control to Major Tom
Take your protein pills and put your helmet on
(Ten) Ground Control (Nine) to Major Tom (Eight, seven)
(Six) Commencing (Five) countdown, engines on
(Four, three, two)
Check ignition (One) and may God’s love (Lift off) be with you

[Verse 2]
This is Ground Control to Major Tom
You’ve really made the grade
And the papers want to know whose shirts you wear
Now it’s time to leave the capsule if you dare
This is Major Tom to Ground Control
I’m stepping through the door
And I’m floating in a most peculiar way
And the stars look very different today

[Chorus]
For here
Am I sitting in my tin can
Far above the world
Planet Earth is blue
And there’s nothing I can do

Greece

Posted on by Dave Robertson

Kelemenis & Co. is a premium Athens-based law firm providing quality legal services in the key corporate and commercial areas.

The firm advises a varied client base that includes corporations, governments, large institutions and high-net-worth individuals. The firm draws on a team of experienced lawyers with excellent academic qualifications from world-class universities.

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Email Us

Kelemenis & Co. is a premium Athens-based law firm providing quality legal services in the key corporate and commercial areas. The firm advises a varied client base that includes corporations, governments, large institutions and high-net-worth individuals. It has built a reputation for acting on complex, high volume cross-border transactions for a range of corporate and financial institution clients. The firm’s track record spreads across an array of sectors including hotels & leisure, energy, infrastructure, real estate, retail and technology.

Kelemenis & Co. has been involved in the sector of hotels & leisure since its inception and has continuously developed the practice. It advises some of the country’s largest and most prestigious hotel chains and several domestic and international investors, private equity funds, travel companies and operators on the full range of legal services including acquisitions, disposals, developments and construction, equity capital, bond issues, litigation and M&As. Given the sector’s focus on real estate, transactions involve advanced financing solutions which also make use of the firm’s deal structuring, finance and tax expertise.

The firm’s work includes, among others, the following:

  • Hotels management contracts;
  • Operating leases of hotels;
  • Acquisitions and disposals;
  • Development and construction;
  • Franchising schemes;
  • Joint ventures;
  • Incentives and grants;
  • Domestic regulatory and employment matters peculiar to the sector;
  • Sector-specific litigation; and
  • Tax compliance, especially on VAT.

Recent highlights include:

  • Acquisition of travel company Youtravel.com by FTI Tourstik GmbH.
  • Arbitration over the demerger of the Sbokos Hotels Group, one of the largest of its kind in Greece.
  • Acting for Aquis Hotels & Resort in multi-jurisdiction demerger involving Greece, UK and Cyprus.
  • Advice to UK-based fund Warwick Capital Partners on contemplated acquisitions in the Greek hotel sector.
  • Establishment and corporate restructuring of Meeting Point Hellas, a subsidiary of Meeting Point International.
  • A joint venture between two large hotel chains in the Greek islands.

Italy

Posted on by Dave Robertson
Italy

By virtue of our two offices, the first located in Milan and the second in Perugia, we are able to easily serve clients with respect to matters focused in the North and Centre of Italy.

Our network of correspondents also provides assistance in litigation before any Italian judicial offices. With regard to civil matters, we provide advice and expertise to the travel industry both with respect to litigation and dispute resolution and in non-contentious matters.

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The firm assists companies in litigation relating to package tours – including disputes before the Antitrust Authority, in its specific capacity as the authority regulating incorrect commercial practices – as well as in recovery actions against service providers directly responsible for causing damages to tourists and debt recovery actions. We also act as defence counsel in recovery actions brought by insurance companies. The firm further provides assistance in actions for the protection of trademarks, competition, copyrights and advertising disputes.

The firm provides advice and assistance in the context of judicial and mediation proceedings, before the competent Administrative Authorities, and in conciliation and arbitration procedures (both administered and non-administered), including before the Jury of the Advertising Self-Regulation Institute (Giurì dell’Istituto di Autodisciplina Pubblicitaria).

With respect to non-contentious matters, the firm prepares contract models governing BTB dealings as well as dealings with consumers; we prepare agency, distribution and service agreements and we also check the compliance of general clauses used by our clients with consumer protection, package tour and travel-related regulations; the firm also provides advice on data-privacy regulation compliance.

Last but not least, the firm handles complex commercial transactions concerning the provision of tourism and travel-related services such as, among others, the preparation of all contracts necessary for the realisation and distribution of “gift boxes” (including general terms applicable to consumers and also all contracts and agreements governing relationships with suppliers of tourism services, with any intermediaries and with retail and large chain store distributors).

Portugal

Posted on by Dave Robertson

Neville de Rougemont & Associados was established in 1987, and has fully transactional offices located in Portugal (Lisbon and Faro), United Kingdom and Cape Verde. Conceived in the Anglo-Saxon tradition, our aim is to be perceived as an international law firm within the Portuguese market offering advice in areas of law and expertise not generally available in traditional firms.

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Email us

Spain

Posted on by Dave Robertson

Based in Madrid, Spain, Rogers & Co. has worked as a team on personal injury claims for foreign clients (including class actions) for the last ten years.

We are experienced in;

  • Personal Injury Claims
  • Recoveries and Enforcements
  • Legal Precedent

More recently, we are also acting for a large number of UK Tour Operators and their insurers. Our experience spans not only all sides of the claim process, recoveries and enforcement in Spain, but also advising on Spanish law in foreign courts, principally the courts of the UK. From a commercial point of view, we have advised foreign underwriters on compliance relating to travel insurance and foreign service providers in relation to package holidays.

Marie Rogers grew up in London and qualified and practiced as an English solicitor in the City before moving to Spain 15 years ago and qualifying as a Spanish lawyer. This unique background allows us to combine our experience with a real and focused awareness of our clients’ cultural differences and expectations.

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Email us

 

Furlough’s End

Posted on by Dave Robertson

As the sun sets on the  government’s furlough scheme which will end in exactly 15 days’ time on the 30 September, the government has updated its guidance for employers on the Coronavirus Job Retention scheme. However before you all get excited, it’s not an extension to the current scheme, but rather what employers will need to consider with regards to staff who are still on furlough. A new section headed “When the government ends the scheme” has been added.
 

In short, the guidance under the new section states that employers will need to make decisions in anticipation of the scheme ending. Namely;

  • Whether to bring employees back to work
  • Terminate their employment on grounds of redundancy
  • Agree with employees any changes to their terms and conditions of employment

There are currently around 1.9 million people still on furlough, many of whom are employed in the travel industry and with the lack of sector specific support, employers in the industry will yet again face difficult decisions as to what to do for the best with regards to staff. Many employers will have already decided, but such decisions cannot be delayed much longer, because of the time it takes to go through redundancy consultations or indeed for time to consult on contract variations.

If you require advice or want to talk through your options please
get in touch with Ami or call us on;

0113 258 0033

We Don’t Need No Education-al Packages

Posted on by Dave Robertson
We Don’t Need No Education-al Packages

The World Starts To Slowly Open 

The world is slowly starting to ‘open up again’, and educational trips are likely to start resuming both to and from the UK over the coming months.  In this article our Associate Solicitor, Nick Parkinson, and Natalie Dindar discuss what that might mean for the educational sector.

The fallout of the Covid-19 pandemic has prompted many service providers to question what their obligations are to customers in terms of trips that are cancelled, curtailed or amended. The starting point is to determine whether or not you are providing a package holiday. What should be straight forward in theory inevitably never is, and education trips are no exception. In this article, we will firstly look at when providers of educational service will, or will not, be providing packages. Secondly, we look at what the impact of Covid-19 may have on the educational sector of the travel industry.

What Is a Package?

The bottom line is that a lot of educational trips can be constructed in such a way as to avoid becoming a package. However, it is important to know where the ‘lines in the sand’ are to make sure you never cross them by accident, and fall into ‘package holiday sinking sand’. Let’s start with reminding ourselves of the basics. In simple terms, a package is formed under the Package Travel Regulations 2018 when two or more travel services are sold at the same point in time, such as:

  • Carriage of passengers (flights, trains etc)
  • Accommodation
  • A ‘tourist service’

The ‘typical’ package that we are all familiar with would be ‘flights and accommodation’. However, things get more complicated where one travel service (e.g. accommodation) is combined with something that may or may not be a ‘tourist service’. In particular, the question for the purpose of this article is what happens when accommodation is combined with ‘educational services’, excursions, or both.

Does it Matter?

Definitely. The risks and obligations when selling packages are considerably higher because:

  • You are legally obliged to hold insolvency protection
  • You have much higher obligations to customers in terms of refunds etc.
  • You have various information requirements you are legally obliged to provide to customers in order to make the contract legally binding

Aside from that, it is a criminal offence not to comply with some of the above requirements.

Carriage

Not much to say here. If you have included carriage such as flights or train tickets, you have already provided ‘one travel service’. Provide one more, and you have supplied a package holiday. Supplying a package therefore seems inevitable if you are supplying carriage and accommodation.

Accommodation

Again, if you have included accommodation as part of the trip, you have most likely already ticked ‘one travel service’. Only one life left before it becomes a package! 

One exception, however, is that accommodation for ‘residential purposes’, such as for long-term language courses, will NOT be considered a ‘travel service’. 

Providing any guidance as to when accommodation becomes ‘long-term’ would, of course, make life far too easy. Most likely, however, accommodation over a few weeks for a ‘summer school’ is likely to be a ‘travel service’.  If you are providing students with ‘longer term accommodation’ than that, and you are not sure whether it is long enough to qualify for this exemption, feel free to get in touch with us for further advice.

Educational Services

Are educational services, typically from a language school, likely to be considered ‘tourist services’? If the purpose is specifically and exclusively for education rather than ‘travel and leisure, the answer is ‘probably not’. A good example of that would be a language school that provides nothing more than classroom (or webinar) based languages classes.

Although contentious at the time, that conclusion is consistent with the views taken by the European Courts back in 1999, based on the old 1992 Package Travel Regulations. Not to detract from the obvious Pink Floyd references in this article, and to instead quote the Beach Boys, wouldn’t it be nice if this had therefore been put beyond doubt by providing specific guidance for the educational sector in the 2018 Regulations? Equally so, if BEIS had issued some guidance on point. Wishful thinking, but in our view there is nothing new in the 2018 Regulations to change the position.

Excursions

The position seems simple enough if the educational services are exclusively educational; but what happens if the provider starts to incorporate a few ‘day trips? Naturally, it seems a tempting selling point if the students are not confined to the four walls of a classroom. What, if anything, changes if the provider were to include one or more excursions to give the students some ‘downtime’?

If the excursion is exclusively for ‘educational purposes’, it is probably not a ‘tourist service’ at all. Conversely, if it exclusively for ‘travel and leisure’, it will be a ‘tourist service’ if:

  • It accounts for a significant proportion (25% or more) of the total value of the travel services, or
  • It represents an essential feature of the trip, or
  • It is advertised as an essential feature of the trip.

So, if you are selling an educational trip with accommodation and a language school, for say £750, probably best not to throw in a trip to watch Manchester United for an extra £250. That football ticket would probably be a ‘tourist service’ for the purpose of the Regulations and, therefore, all of a sudden you have sold a package!

As to where you stand where the excursion has a flavour of both education and travel & leisure, things get much more difficult. All in all, it’s just another ‘gap in the law’.

Therefore, if you are selling trips with one or more ‘excursions’, and you are not sure whether or not this will create a package, do not hesitate to get in touch with the team here for advice.

The Impact of Covid-19

The ongoing Covid-19 pandemic has, and continues to prompt a range of questions from providers of educational trips, in particular as to your obligations when it comes to refunds, cancellations and alterations.

Providers are concerned about the implications should there be an outbreak at their language school. What if the students contract the virus? Could we be liable for an illness/injury claim? Where do we stand with refunds? What if students have to quarantine at the accommodation for longer than expected? What if they miss their return flights home? What if I have to make changes to the itinerary? Can we switch to an online course instead? Who pays the additional costs of all of this?

The starting point, as above, is to determine if you have sold a package. The second step is to look at your T&C’s to see what, if any clauses, have been included to cater for the situation at hand. Potentially, we may have to consider whether any clauses in your T&C’s are ‘fair’ and, therefore, enforceable. There are a lot of variables to consider here, so if you do find yourself in a situation and you are not sure where you stand, please feel free to get in touch.

Are Your T&C’s Up To Date?

Hey, teachers, leave those T&C’s alone! Actually, no. You may be excused for assuming that it is ‘too late’ to change your T&C’s if you have a number of trips booked for say September, that were booked under your current, and now ‘out of date’, T&C’s. In fact, it might be possible to change those terms with your customers, providing the customers are agreeable to do so.
Either way, even if your T&C’s were only updated last year, a lot has changed over the last 6 months! With the uncertainty that surrounds the ongoing pandemic, there are good reasons to consider updating your T&C’s because:

  • You may be able to enhance your contractual rights to obtain additional costs from your students/customers for certain ‘covid-19 scenarios’
  • What was once ‘unforeseeable’, and may previously have fallen under a force majeure clause, is becoming increasingly foreseeable! A force majeure clause may therefore no longer offer the protection it once did. Covid-19 scenarios therefore can and should be dealt with under separate clauses.
  • There are all sorts of specific Covid-19 scenarios that could arise, and it helps for both parties to have clarity on what each party’s liability and obligations are in all of those scenarios. For example, it is better that it does not ‘come as a surprise’ to a student if they are forced to quarantine and are then landed with a bill for the additional costs.

If you would like a member of our commercial team to review your existing T&Cs and provide you with a free no-obligation quote, feel free to get in touch with nick@travlaw.co.uk.

Travlaw advise on regulatory work, litigation, commercial, employment law and intellectual property (to name but a few), all specifically tailored to meet the needs of the travel industry.
If you have any questions, call 0113 258 0033 or email advice@travlaw.co.uk

COVID-19 – What Can You Do Right Now? – Part Three

Posted on by Dave Robertson
COVID-19 – What Can You Do Right Now? – Part Three

This is our final article, part of our “COVID-19 – What Can You Do right now?” article series. This time the focus of the article is on Agency Agreements and working out the clauses within such agreements helpful to you in this unprecedented time of COVID-19.

We have set out three articles for you, Part I helps to explain your position on commercial contracts and force majeure; Part II for Supplier Agreements; and Part III for Agency Agreements.

Where you are an agent or a principal, it should be the case that you have an Agency Agreement in place. The capacity of each party to the Agency Agreement should be laid out clearly so that, where difficult situations like COVID-19 arise, each party knows what to do and where responsibilities lie.

Customer responsibility

Fundamentally, an Agency Agreement will set out the capacity in which each party is acting. It will (hopefully) explain clearly who is the principal (and therefore the party entering into the ultimate contract with the consumer) and who is the agent, (and therefore the party who simply sells the services on behalf of the principal).

On the question of responsibility to consumers, it will ordinarily be the principal that is the party responsible to the consumer, given that the contract for services will be between the principal and the consumer. The agent will be selling the services on behalf of the principal but will typically not be a party to that contract. It should therefore be the principal who is responsible for any amendments, cancellations or refunds in light of COVID-19. Such refunds (or credit notes) coming from the principal themselves. Therefore, any agents who receive requests or complaints from consumers in respect of such issues should promptly refer those issues to the principal for direction / resolution.

However, the Agency Agreement should be read closely to confirm this is indeed the case; as a blur in the line of capacities or responsibilities may complicate this issue and result in the agent taking on more responsibility than ordinarily assumed.

Force majeure clause

It is likely that your Agency Agreement includes a force majeure (FM) clause. This will set out party obligations when an event makes it impossible for the affected party to perform their contractual responsibilities. FM events are usually defined as acts events or circumstances beyond the reasonable control of the party concerned, but whether an event is considered as an FM event will depend entirely on the wording of the contracts FM clause. Please see our “Part I: COVID-19 – What Can You Do right now?” article for more information on how to understand your FM clause.

Where an FM clause in your Agency Agreement has been vaguely drafted; doesn’t cover (or doesn’t cover clearly) the scenario or event; or, doesn’t fully set out the consequences of invoking the FM clause, you may find yourself in the murky waters of the laws of frustration, contra proferentum… or even having to revert to a foreign lawyer in the absence of an E&W jurisdiction clause. Nick Parkinson has offered advice in such predicament in his article, found here.

Customer contact

When FM events occur (such as COVID-19) it is likely that the customer will be worried about the services they have bought under the contract with the principal and, although amendment, cancellation and refund responsibilities may lie with the principal, depending on the words of the Agency Agreement it may be the agent who is responsible for liaising with the consumer in respect of those issues. For example, the agent may be required to take calls from worried consumers or communicate policies on refunds and cancellations.

Before contacting consumers and dealing with consumer concerns, the agent must be sure that it is acting in accordance with the terms of its agency agreement responsible for doing so. If an agent acts outside of its scope of authority (i.e. by stating a refund will be given without the principal’s confirmation that this is the case or indeed by going so far as to pay a refund, in the first instance, without principal approval), it may find that it is in breach of its contractual obligations and possibly liable for those refund payments, as a result.

Payment

The fundamental reason for parties to sign an Agency Agreement will be for the agent to promote and sell services on behalf of the principal, typically in return for commission. However, if a FM event occurs, either having the effect of sales not being taken, consumers cancelling holidays already booked or, consumers receiving refunds, what happens to the commission (to be paid, or already paid to the agent)?

There are no general / common law legal rules about how commission will be handled, in such circumstances. It is ultimately the parties’ decision how any payment will work and so the terms of any given Agency Agreement will be crucial here. Whether the agent will remain entitled to commission in full, whether they will be entitled to commission on cancellation charges only or whether the entitlement will lapse altogether will depend on the drafting of this clause.

Please contact us if you would like to discuss this further.

COVID-19 – What Can You Do Right Now? – Part Two

Posted on by Dave Robertson
COVID-19 – What Can You Do Right Now? – Part Two

Following on from our “Part I: COVID-19 – What Can You Do right now?” article, focusing on commercial contracts and force majeure, this is our second article taking on the COVID-19 pandemic form a commercial perspective, this time focusing on Supplier Agreements and any clauses within these, that may assist you right now.

We have set out three articles for you, Part I helps to explain your position on commercial contracts and force majeure; this article for Supplier Agreements; and Part III for Agency Agreements.

If you have any Supplier Agreements currently in use, whether or not they were drafted by lawyers, and no matter when they were entered into (providing that they have not been terminated), here are some helpful tips to understand where you stand when it comes to your contractual relationships; any obligations you may have in light of COVID-19; and the clauses that may assist as a starting point.

Force majeure clause

It is likely that your Supplier Agreement includes a force majeure (FM) clause. An FM clause seeks to set out party obligations when the occurrence of a specific event makes it impossible for the affected party to perform their contractual responsibilities. FM events are usually defined as acts events or circumstances beyond the reasonable control of the party concerned, but whether an event is considered as an FM event will depend entirely on the wording of the contracts FM clause. Please see our “Part I: COVID-19 – What Can You Do right now?” article for more information on how to understand your FM clause and any effects an FM event may have to your Supplier Agreement.

Where an FM clause in your Supplier Agreement has been vaguely drafted; doesn’t cover (or doesn’t cover clearly) the scenario or event; or, doesn’t fully set out the consequences of invoking the FM clause, you may find yourself in the murky waters of the laws of frustration, contra proferentum… or even having to revert to a foreign lawyer in the absence of an E&W jurisdiction clause. Nick Parkinson has offered advice in such predicament, in his article ‘Where Do We Stand With Our Suppliers?’

Liability

Does your Supplier Agreement include a limitation of liability clause? Contracts between businesses commonly include a clause that seeks to impose the liability of either one or both parties to the contract. Such limitation can be identified in a contract where the clause includes words to the effect of: The [PARTY’S] liability under or in connection with this Agreement shall be limited to £[SUM] for each and every claim arising out of the same originating cause or source. This limit shall apply however that liability arises, including, without limitation, a liability arising by breach of contract, arising by tort (including, without limitation, the tort of negligence) or arising by breach of statutory duty.

The safest way to limit a liability, is by including clear words – as the clause above limits liability for claims in breach of contract. A liability clause will normally be ineffective if it seeks to exclude certain liabilities, such as fraud, personal injury or death; is not reasonable under the Unfair Contract Terms Act 1977; or excludes all liability whatsoever.

Nevertheless, in scenarios where you are at risk of incurring liabilities to either a supplier or indeed another third party as a result of the COVID-19 pandemic and there is no FM clause or an ineffective FM clause in place, it is worth considering whether there is a limitation of liability clause in place that would offer some protection.

Termination

Termination of an agreement may occur at the end of a fixed term, or on the occurrence of an event. Ordinarily this means that the contract (and most of the clauses within it) will have ended, excusing the parties of their primary obligations. A termination clause may begin: Either party shall be entitled at any time to terminate this Agreement without penalty on the happening of any of the following events…

However, your FM clause may set out the effects of an FM event: and this could potentially allow your Supplier Agreement to be terminated in accordance with a termination clause. This may offer some assistance, if a contract has become undesirable to perform as a result of the COVID-19 pandemic.

Commercial Provisions

Ordinarily, parties will also need to check the commercial terms of the Supplier Agreement, along with all the legal terms above, to see what will happen if, or when, termination occurs. For example, what will happen to the services not provided? Will the supplier provide refunds for these services? On the other hand, will the parties miss any payment deadlines? What about outstanding monies?

Hopefully, your Supplier Agreement is clear about such arrangements, but where it is not, it may involve mutual discussions so that amicable resolutions can be reached. 

Please contact us if you would like to discuss this further.

COVID-19 – What Can You Do Right Now? – Part One

Posted on by Dave Robertson
COVID-19 – What Can You Do Right Now? – Part One

COVID-19 (coronavirus) has created some extremely difficult scenarios within the Travel industry in recent weeks. People may be telling you what you should have had in place to prevent difficulties; what could have been done to prevent worries; and what would be best to solve future problems. But, right now, what can you do?

We have set out three articles for you, Part I helps to explain your position on commercial contracts and force majeure; Part II for Supplier Agreements; and Part III for Agency Agreements. This article is Part one of the trilogy.

Commercial contracts and Force Majeure

At times such as these it is quite common to hear the term ‘force majeure’ banded around as a catch-all suggestion that contractual obligations are no longer enforceable. However, is this truly the case and is it possible to rely on force majeure in light of the COVID-19 pandemic? We take a look, below.

A force majeure (FM) clause seeks to excuse one (or both) parties to the contract, from their obligations following the occurrence of specific events which make the contract impossible to perform for the affected party. FM events are usually defined as acts, events or circumstances beyond the reasonable control of the party concerned.

When drafting FM clauses, wide language is often used so that a range of events are able to be considered as FM events and, further, in such a way so as to ensure that the list provided is not exhaustive. In doing so, certain events can be expressly mentioned within the FM clause (either to be included or excluded as an FM event). This prevents (or is intended to prevent, at least) ambiguity between parties. On the other hand, if the FM clause has no definition of FM events, it is unlikely to be effective due to uncertainty. It is therefore common for an FM clause to have words to the effect of:

Force Majeure Event means any circumstance not within a party’s reasonable control including, without limitation: acts of God, flood, drought, earthquake or other natural disaster; epidemic or pandemic; terrorist attack, civil war, civil commotion or riots, war, threat of or preparation for war, armed conflict, imposition of sanctions, embargo, or breaking off of diplomatic relations; nuclear, chemical or biological contamination or sonic boom; or any law or any action taken by a government or public authority.

Listing events in the way that we see here would ensure that, where those events occur, they are considered FM under the contract meaning that the clause is triggered.

The question of whether or not either party is entitled to any relief from their obligations or liabilities under a contract and, if so, the circumstances in which that relief will apply will depend entirely on the wording of any particular contract, however. There is no general / common law concept of force majeure under English law and so it is entirely up to the wording of the FM clause (if any) within any current commercial contract to decide whether it adequately covers the current COVID-19 pandemic.

Strictly speaking, to be entirely sure that COVID-19 is included within the range of events your contract considers as an FM event, the most desirable wording would be the inclusion of “COVID-19” or “coronavirus” within the FM clause. However, this is, of course, highly unlikely! Instead, explicit wording to the effect of “epidemic or pandemic” is likely to be the most practical source of assistance here. An argument could also be made to say that a reference to ‘acts of god’ is sufficient to cover this pandemic too.

It is the party wanting to rely on the FM clause who must prove that an event is considered FM. If COVID-19 can be considered as within the scope of an FM clause in your contract, the defaulting party must demonstrate the scope of the clause, demonstrate that the facts in question fall within that scope and, also, must be able to show that it has used all reasonable endeavours to prevent or mitigate the FM effects. After which, your next steps will depend on the FM clause and how it is drafted. It may:
• suspend obligations;
• remove liability for performance of one (or both) of the parties; or
• allow either or both parties to serve notice to terminate the contract.
The clause may also require that certain additional steps are taken, before the clause can be relied upon – e.g. giving prompt notice to the other party of the existence of the FM and its impact upon your ability to perform your contractual obligations.

Nevertheless, it is certainly possible that a FM clause in a contract may prove to be a source of assistance, if you are finding it difficult to perform any given contractual obligations in light of the COVID-19 pandemic. That said, you must look at the wording of your FM clause to decipher the effects of FM and decide your next steps.

For these reasons, it is essential that a FM clause should clearly cover all the consequences of invoking the FM clause (including refunds) otherwise you may find yourself in the murky waters of the laws of frustration, contra proferentum… or even having to revert to a foreign lawyer in the absence of an England & Wales jurisdiction clause. Nick Parkinson in our litigation team has dealt with these scenarios in his article, ‘Where Do We Stand With Our Suppliers?’

Before taking such steps as stated within the FM clause, practical considerations should be thought about. Are you able to resolve the FM event? Have you talked to the other party and considered any other options (e.g. an amendment to holiday dates or offering a credit note, rather than a refund)?

Please contact us if you would like to discuss this further.

Travlaw Legal Services Limited t/a Travlaw is registered in England and Wales (12348608) which is authorised and regulated by the Solicitors Regulation Authority. Directors: Rivka Hawley ACILEx (non lawyer), Matt Gatenby BA (hons).