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Travel agents should be aware of package holiday liabilities

With the 2013 summer holiday season approaching it is important that travel agents be aware of their liabilities when they sell package holidays.

There are two types of “package” holiday a travel agent can sell – the most widely known is the regulated package holiday, when the customer pays a fixed cost for a number of services which usually include accommodation and travel plus options of transfers, meals and even pre-booked excursions.

Holiday Illness

Regulated packages are usually put together by a tour operator and sold through the tour operator’s website or sometimes through a travel agent – and since 2012 these are issued with an ATOL certificate at the time of booking.

A regulated package is covered by the 1992 Package Travel Regulations, which means the tour operator and travel agent can be held liable if something goes wrong with the package holiday.

The other type of package holiday is called a dynamic package – and this sort of holiday comprises different components, such as accommodation or travel and meals, which are contracted separately either by the holidaymaker or through a travel agent, even though they may be paid for on one invoice.

With dynamic package holidays, it is the holidaymaker’s responsibility if they want compensation for anything which goes wrong, as each part of the holiday is considered to be separately contracted.

However, in 2011, a holidaymaker injured at his hotel in Corfu won his case against online travel agent Qwerty Travel, who had denied liability for his injuries on the grounds the holiday was not a regulated package and Qwerty was acting merely as an agent when the holiday was booked.

The injured holidaymaker – Sean Titshall from Sheffield – booked with Teletext Holidays through the Qwerty Travel website. He claimed he had been sold a package and therefore Qwerty Travel was liable for his injuries when glass in the patio door of his hotel room shattered.

Originally Dartford County Court found in favour of Qwerty, which denied liability. But an appeal court overruled the original judgment that Mr Titshall’s holiday consisted of separate components “for an aggregate price” – and Mr Justice Tomlinson ruled in favour of Mr Titshall because Qwerty Travel had charged him and his girlfriend “service costs” when it put together the package:

“Qwerty offered a package which inevitably had component parts – it would not otherwise have been a package,” said Mr Justice Tomlinson.

“I would declare that Qwerty is liable to Mr Titshall for the proper performance of the obligations under the contract made on 24 September 2006, whereby Mr Titshall was provided with hotel accommodation at the Ermones Beach Hotel Corfu for the period 25 September-2 October 2006.”

It may be difficult for holidaymakers to understand the difference between a regulated package and a dynamic package, so always ask whether a holiday is protected by the 1992 Package Travel Regulations at the time of booking.

Since 2012, regulated package holidays are also now issued with an ATOL certificate – a scheme regulated by the Civil Aviation Authority (CAA).

Holidaymakers should also book with travel agents who are members of ABTA (Association of British Travel Agents) or tour operators displaying the AITO (Association of International Tour Operators) logo, as well as the ATOL (Air Transport Operators Licence) logo on their website or in their window.

The ruling in favour of Mr Titshall sounded alarm bells for travel agents to be more aware of what constitutes a package holiday – and to make sure that they issue an ATOL certificate to customers at the time of booking.

Travel agents should also be upfront about the holidays and products they are selling, said Julia Lo Bue-Said from the Advantage Travel Centre:

“They need to ensure the customer understands what this means in the event of any incidents while on their holiday. If an agent is advertising an inclusive price, then it's perceived that they are advertising a package and therefore need to comply with the Package Travel Regulations.

“It's important that agents are explicit with their customers on what they are selling – and they ensure their customers understand that they are, where relevant, only acting as an agent.”

Holiday Hotel Watch

Mr Justice Thompson explained that in the case of Mr Titshall – although the holiday he was sold comprised separate parts – the fact that it was not possible to attribute a particular service cost to each component of the package meant the holiday had been sold as a package:

“…Where those parts were presented for sale as a whole for an inclusive price – which comprehended the cost of putting them together, as well as the cost of sourcing them – there is no principled basis upon which one can conclude that any particular proportion of the service costs should be attributed to the sale of the flights or to the sale of the accommodation; and thus, while the sale of two services may have been identified, there is no way of ascertaining what is the total cost of either of them.”

Both travel agents and holidaymakers need to be aware of what they selling and what they are buying – and holidaymakers should always make sure that the package holiday they are purchasing really is a package and they will be protected under the 1992 Package Travel Regulations if anything goes wrong.

Dated: 24/05/2013