A Thomson traveller has won a significant legal victory after challenging the scale of cancellation charges imposed by a major tour operator.
Last May, Bruce Crawcour of Shrewsbury had to cancel a Thomson holiday to Majorca at six days’ notice because of illness. The customer services department at TUI Travel, Thomson's parent company, insisted that its cancellation clause permitted it to withhold the full amount paid for the holiday – some £2,200.
Mr Crawcour decided to investigate further. “Carrying out searches of their internet site it was clear that they had resold our Thomson airline seats within 24 hours, and they had resold or cancelled our room category at the hotel two days before departure,” he said, arguing that "this established that they had made no significant loss”.
TUI refused to budge, so Mr Crawcour took the case to the Small Claims Court himself, on the grounds that TUI was in breach of the Unfair Terms Consumer Contract Regulations 1999 and the 2004 guidance from the Office of Fair Trading on Unfair Contract Terms in Package Holiday Contracts.
This, argued Mr Crawcour, only allows operators to impose a sliding scale of charges which increase as the departure date approaches provided they are a genuine pre-estimate of the holiday company's loss. The vast majority of tour operators impose such charges, which usually rise to the full holiday cost if you cancel within two weeks of departure.
Mr Crawcour pointed out that the internet and development of real time information over the last 10 years has fundamentally changed the situation since these clauses were written. Tour operators can now measure easily and precisely whether they have made a loss or not on a cancellation, and holidaymakers should not be unfairly penalised by an arbitrary charge. In particular, he argued that the 100 per cent charge for cancellations within two weeks of departure was unfair.
The case was heard in the Small Claims Court in Telford last week, and despite TUI’s case being presented by a specialist London barrister, the judge decided in favour of Mr Crawcour, ruling that the cancellation band in the contract for the holiday could not be a genuine "pre-estimate of loss" and was therefore an unfair contract term.
Mr Crawcour was awarded a full refund of the cost of the holiday plus all his court fees. TUI has asked to be allowed to appeal to the High Court. A company spokesman said leave to appeal had now been granted, and so it would be inappropriate to comment further at this stage.
If the appeal fails, this case could prove a significant victory for consumers and force all tour operators to change their terms and conditions for cancellations. It also opens the way for anyone penalised by these cancellation terms to sue the travel company in their local Small Claims Court.