HO HO HO....when holiday plans go awry.

Your rights under the Australian Consumer Law

When the Rolling Stones cancelled not one but two Australian concerts in 2014, the ticket providers offered refunds to those concert ticket holders. But what about the cost of flights or accommodation?

With the holiday season just around the corner, what happens if your Christmas holiday plans involve not just an “event”, but associated travel and accommodation?

Here is some food for thought as you plan your Christmas festivities and summer holidays.

The Australian Consumer Law (ACL) provides consumers guarantees that services will be:

1. provided with due care and skill;
2. fit for the specified purpose; and
3. supplied within a reasonable time.

When a service provider fails to meet these guarantees and the failure can be characterised as a “major failure”, the consumer is entitled to:

• cancel the service and obtain a refund for any unconsumed services; or
• keep the contract and receive compensation for the difference in value between the service delivered and the service paid for.

Examples of major failures include:

1. accommodation that is infested with insects – you are entitled to pest free accommodation;
2. the provision of services in a sub-standard manner such that you would not have purchased the service if you had known the nature and extent of the problem;
3. failure to provide a premium service when that is the level of service booked and paid for;
4. a service to arrive at a destination by a specified time, only to have the service arrive late; and
5. a service that creates an unsafe situation for you.

Under the ACL, consumers can claim compensation for a loss that arises as a result of a supplier’s failure to meet one or more of the consumer guarantees. This entitlement is not restricted to direct loss, but includes the right to claim consequential loss.  That is, not just the cost of the service, but other costs that were incurred as a consequence of the failure. 

In order to claim consequential loss it must be shown that the loss or damage was reasonably foreseeable and not caused by something outside human control.

For example, airport shuttle services ordinarily provide details in their terms and conditions which require you to book a shuttle time that ensures you have enough time to meet your airline's check in requirement.  If you book an airport shuttle service which, according to the shuttle service's terms and conditions should allow you to catch a particular flight, and the service runs late due to human error of the driver, it is reasonably foreseeable that you would miss your flight. This would likely amount to a breach of the guarantee to provide a service that is fit for purpose. The airport shuttle service could very well be held liable for the breach.  As consequential loss is recoverable under the ACL, this could potentially include compensation for the cost of the airline ticket. 

However, if the shuttle service was delayed due to a major road accident that closed the road to the airport, you would be hard-pressed to establish that this amounted to a breach of a consumer guarantee.

If you find yourself receiving a substandard service over the Christmas period or beyond, ask yourself whether the service provider has provided the services:

1. with due care and skill;
2. in a manner that is fit for the specified purpose; and
3. within a reasonable time.

If not, you have the right to protest and demand that the services you paid for are provided.  You may also be in a position to claim compensation.

If you would like further information regarding your rights under the ACL, please contact:

Joanne D’Andrea
Principal
Harwood Andrews
T: 03 5226 8513
E: jdandrea@harwoodandrews.com.au