The travel company, escapetravel.com provides tours around the world on a budget. Every brochure refers to the general terms and conditions of bookings applicable uniformly to all tours operated by the website. The website offers tour packages and has a separate portal for brochures elaborating tours conducted in a particular country. These country wise brochures are detailed and have their own terms and conditions listed in the last page. One such brochure has been reviewed in this report.
The key information provided in the brochure can be summarised as follows-
The report seeks to analyse and critically appraise the terms and conditions laid down in the brochure and find out whether these are in consonance with the existing contract laws of the land.
The travel company, escapetravel.com provides tours around the world on a budget. Every brochure refers to the general terms and conditions of bookings applicable uniformly to all tours operated by the website. The website offers tour packages and has a separate portal for brochures elaborating tours conducted in a particular country. These country wise brochures are detailed and have their own terms and conditions listed in the last page. One such brochure has been reviewed in this report.
The key information provided in the brochure can be summarised as follows-
The report seeks to analyse and critically appraise the terms and conditions laid down in the brochure and find out whether these are in consonance with the existing contract laws of the land.
A critical analysis of the brochure and the terms and conditions, brings out the following points-
Firstly, this brochure is available at present on the website but the prices and taxes have not been updated after 11 October, 2016. The prices that have been mentioned in the brochure throughout may have been changed and increased over the months. The client booking this tour may have to pay more than the quoted amount.
This implies that the information relating to the pricing of the tour is potentially misleading as the client does not have the updated prices and taxes.
The terms stipulated in an agreement or contract are inherently for the benefit of both the contracting parties. Unilateral term means a condition or clause in a contract which is advantageous to one party to the exclusion of the other.
Moreover, the terms mention that the prices are subject to change without notice. In that case, the updated price list is a must to avoid any ambiguity. The brochure fails to meet this condition. This seems to be a unilateral term in the contract wherein the client does not have a right to prior notice regarding the change in pricing of the tour he is interested in. The Australian Contract Act, like all common law contract legislations, lays down that an agreement between the parties has to be fair and a contract cannot have unilateral terms. This unilateral term weighs disadvantageously on the side of the client.
Illusory terms means those which evade clarity to the disadvantage of one of the contracting parties. Such terms provide no clarity and may have different interpretations which make the term ambiguous and may prove disadvantageous to the client while agreeing to the contract.
The brochure mentions that seasonal surcharges and blackout dates may apply. However, no information regarding peak season and potential blackout dates have been provided in the brochure. Since the brochure covers a lot of tourist destinations, each may have a different peak season and blackout dates. Clients are most likely unaware of these details and the brochure should address these issues to make it easier for the client to book a suitable tour. This information provided in the brochure can be termed ambiguous.
This term in the brochure can be understood as uncertain and illusory. In contract law, the agreement “may be uncertain[1] because the terms are too vague or ambiguous for a meaning to be attributed by court.[2]” Further, a particular promise “may be illusory[3] because the contract effectively gives the promisor an unfettered discretion as to whether to perform the promise.[4]” The Courts have time and again reiterated that clarity of terms is one of the most important features of any contract or agreement. If the parties, after perusing the terms, are still not aware of its implications and ramifications, it is a futile agreement couched in ambiguity and failing to serve the purpose of an agreement altogether. “The words used must clearly and unequivocally cover what they are intended to cover.”[5]
In this case, the promise of allotting dates and accommodation for the tours is illusory to the extent that it is not certain whether the promise can be fulfilled or not and the brochure gives no further information on the tentative dates of seasonality as per the locations or the tentative dates of blackout in the tour areas.
The terms and conditions of the brochure indicate that the tour prices are exclusive of airfare. However, the brochure provides the option of creating tailor-made tours for clients across Canada and Alaska which will necessarily involve airfare. The brochure does not provide any information regarding the inclusion or exclusion of airfare in case the client wants to create his own itinerary. No price quote or other information is provided for such an option.
In the case of an informal contract, where the parties have not attempted to stipulate the full terms, the courts should imply a term upon referring to the imputed intention of the parties, provided that the particular term is necessary for the effective operation of the contract.[6] In implying terms in an informal contract, the High Court has suggested that a flexible approach is required.[7]
“In a case where the parties have not attempted to spell out the full terms of their contract, the court should imply a term by reference to the imputed intentions of the parties if, but only if, it can be seen that the implication of the particular term is necessary for the reasonable or effective operation of a contract of that nature in the circumstances of the case.[8]” Obviousness also remains an important element in implying a term in an informal contract.
When offering tailor-made tours across Canada and Alaska, the implication is that the tour will include airfare. The fact that it will be exclusive of airfare is an implied term in the agreement and forms a main part of the agreement since airfare significantly affects the cost of the tour. The brochure has not implied the cost of airfare and its addition to the tailor-made tour. This should be clearly mentioned for the benefit of the clients.
The terms of the brochure state that a non-refundable fee of $250 per person is applicable at the time of booking. This term in the agreement means that upon cancellation of the tour by either the client or the travel agent, the client will not be refunded $250. In other words, if the tour is cancelled by the travel operator at no fault of the client, the client will not be entitled to a refund of the entire amount. This may be considered a limitation clause in the agreement as it puts a cap on the pecuniary liability of the travel agent by making $250 non-refundable.
Limitation and exclusion of liability clauses are a sensible way of allocating risk but need careful drafting if they are to be enforceable[9]. The common law approach to construction is not always a literalist one and limitation/exclusion clauses will not be given a literal interpretation which would otherwise produce a result at odds with the main object of the contract.[10] In this regard, this clause seems plausible if the brochure also mentions that in case the tour is cancelled by the travel company itself or if it is cancelled on a date close to the date of departure, the entire amount may be refunded. Such an addition will make the term of refund fair to the traveller as well.
Conclusion
A careful analysis of the terms and conditions stated in the brochure brings us to the conclusion that essential information needs to be updated and expressed in a clearer manner for the customer to understand. The policies about airfare and refund which are vital to any traveller booking a tour, should be expressed in clear terms rather than being ambiguous and implied.
The aim of an informative text like a brochure is to be reader friendly. It should be clear and unambiguous and address basic and important queries without evading them.
Furthermore, the aim of a travel brochure is to cater to the client. Therefore, the terms need to be traveller-friendly. It has been established beyond a doubt that profit earning motives and client friendly terms can very well co-exist in an agreement. The brochure can make the terms fair and client friendly without losing out on their business or profits. On the contrary, it will attract more customers, if the terms are not unilateral and are advantageous to the client.
References
[1] Whitlock v Brew [1968] HCA 71, (1968) 118 CLR 445.
[2] United Group Rail Services Limited v Rail Corporation New South Wales [2009] NSWCA 177 74 NSWLR 618.
[3] Placer Development Ltd v Commonwealth [1969] HCA 29, (1969) 121 CLR 353.
[4] Godecke v Kirwan [1973] HCA 38, (1973) 129 CLR 629
[5] Pegler v Wang (UK) Limited, (2000) BLR 218
[6] Byrne v Australian Airlines Ltd [1995] HCA 24, (1995) 185CLR 410., Hawkins v Clayton [1988] HCA 15, (1988) 164 CLR 539
[7] Hospital Products Ltd v US Surgical Corporation [1984] HCA 64, (1984) 156 CLR 41
[8] Ibid.
[9] Ashurst. (2017, Feb 22). Limitation and exclusion of liability. Retrieved from https://www.ashurst.com/en/news-and-insights/legal-updates/quickguide-limitation-and-exclusion-of-liability/
[10] Mitsubishi Corporation v Eastwind Transport Limited and Others [2004] EWHC 2924 (Comm)
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