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AFTA’s advice after travel agent’s legal appeal succeeds

July 22, 2021 Business News, Headline News No Comments

The Australian Federation of Travel Agents (AFTA) has advised agents to take care when keeping records following a landmark decision by the NSW Civil and Administrative Tribunal (NCAT) Appeals Panel, in favour of a travel agent.

The Appeals Panel’s decision was to set aside orders that travel agent Wendy Kiss, of Helloworld Gosford, refund a consumer in full for bookings even though the travel providers, Air Canada and Momento Travel, had offered credits and a partial refund.

AFTA funded Kiss’s initial appeal against NCAT’s decision that the contract was frustrated. The federation provided Kiss with the support of well-respected consumer law expert (and former chief executive of the Australian Consumer and Competition Commission) Hank Spiers to assist with the written submissions for the second appeal.

The Appeals Panel considered two issues: agency and frustration.

Citing another similar recent Appeal Panel decision, the Panel highlighted that where a travel agent accepts payment as agent only and the booking terms and conditions make that plain when travel arrangements are made between the client and the agent, the client has no recourse to the travel agent.

As such, the Appeals Panel found the money received by Kiss was received as an agent for the travel providers, and that Kiss had only acted to facilitate the making of the reservations. On this basis, Kiss is not liable to meet any loss. Given this, the Appeals Panel found the Tribunal erred in its application of the Frustrated Contracts Act 1978 (NSW) and Kiss was not liable to the consumers.

The full decision of the Appeals Panel is available on the link below:

https://www.caselaw.nsw.gov.au/decision/17aa36235b7d6540ea850089

“Without AFTA’s support and Hank’s considerable assistance and expertise, I wouldn’t have been able to get through this,” Kiss said afterwards.

“I understand that consumers get frustrated and want their money back but it’s not the travel agent sitting on the money that is the problem. I felt I had to keep appealing given the principle of the matter and the flow-on ramifications for my agency and every other agency if we didn’t get a fair and reasonable outcome.”

AFTA Chair Tom Manwaring offered several key recommendations for members.

“Make sure you get and keep a record of acceptance of your terms and conditions before payments are received,” he advised.

“Make sure that your T&C’s include:

  1. that Rules and Restrictions apply;
  2. that you as an agent are not liable for any loss or damage suffered in connection with the non-delivery of a travel product;
  3. that you are not liable for any breach of obligations by any third-party travel provider.

“If you find yourself in the unfortunate position of facing a Tribunal hearing, make sure you cite Kiss v Parsons if appropriate. AFTA will continue to support Tribunal applications and responses selectively and strategically in order to shape the legal landscape within which we operate. While Tribunal decisions aren’t binding on the courts, this is an important outcome and we are very grateful to Wendy for her resilience, persistence and tenacity.

“AFTA will continue to work on guidance in relation to T&C’s for agents, and this and other decisions are important in clarifying what that advice should exactly be”.

The Appeals Panel ordered:

  1. The orders the Tribunal made on 30 March 2021 be set aside;
  2. The Appellant [Wendy Kiss] is entitled to receive for its own use the full amount of any refund received from Air Canada in respect of the airfares (being $6051.68);
  3. The Appellant is entitled to receive for its own use the amount of the partial refund received from Momento Travel in the amount of $1297;
  4. The respondents are to pay, within 14 days of the date of these orders, the amount of $1743.32 to the appellant, being the balance of the payment which the appellant has made to the respondents under the terms of the Tribunal’s orders which are now set aside.

Edited by Peter Needham

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