venue deposits and unfair retention

[misswoo]

Hi quick query.

 

 

been looking at the unfair terms in consumer contracts regulations 1999 to see if it will help me.

 

 

my daughter cancelled her wedding,

there are still over 8 months till the date,

its peak wedding season so i have no doubt the venue can get a new booking.

 

 

her total cost was £3200

she had to pay a deposit when booking of £1000 which is non refundable.

true the terms do state it is not refundable

 

 

however the Act says the contract may be unfair if irrevocably binding the consumer to terms

with which he had no real opportunity of becoming acquainted before the conclusion of the contract;

 

 

unfair if requiring any consumer who fails to fulfil his obligation to pay a disproportionately high sum in compensation;

 

 

also i think there is a 1977 law that states it is unfair to retain a large sum if the losses incurred by a company are not proportionate to what they keep?

 

 

I've written briefly to the company and their response is sorry,

you signed,

tough luck (not quite so blunt)

 

 

I wonder should I just cut my losses or write a sterner letter?

 

 

I appreciate they may have incurred some costs,

but no food bought etc,

plenty of time to rent out the venue again etc...

thoughts anyone?

thank you x

[dx100uk]

yes agree with you.

 

 

why not give the fos a ring and ask them their views.

 

 

they simply cant just say it non returnable esp given 8mts notice IMHO

 

 

dx

[ericsbrother]

If they manage to find another person to use their facilities and create the same amount of business for them then I am sure they will refund the £1000 as they would be obliged to. A way of finding out would be to turn up mob handed at ther venue on the day....

Alternatively ask for a breakdown of their losses they are going to accrue by your non performance to your side of the contract and that doesnt include a loss of potentail profit and then let them know you are taking the matter further if the figures look suspect.

[John78]

I know of a similar situation at Thornton Manor were a wedding was cancelled with nearly 2 years notice The deposit required was 50% this is unreasonable and is frowned upon by government agency’s to the point that if they don’t regulate themselves then the government will bring in laws to force the issue.

The management at Thornton Manor have been made aware of this issue but choose to ignore it.

 

“The Competition and Markets Authority (CMA) has advised more than 100 wedding and event venues that large deposits and cancellation charges could breach consumer law. The CMA said consumers who have to cancel or change their plans could face "considerable losses" because of potentially unfair terms after hiring venues at a cost that often runs to thousands of pounds. Venues have been told that a deposit is simply to make a reservation and should be no more than a small percentage of the total price and advance payments should reflect the business's expenses and leave a reasonable amount to pay on completion.It has also warned that customers must not lose large advance payments if they cancel, and venues should set sliding scales of charges to cover any losses.CMA consumer senior director Nisha Arora said: "Planning a wedding or any large event can be stressful. Consumers are particularly vulnerable when they are focusing on preparing for a special event and have paid significant sums up-front.”

 

Full Article can be found online

 

 

 

Time for wedding venues to watch out and not before time!

[honeybee13]

Here's a link, John78.

 

http://www.pressreader.com/uk/i-from-the-independent/20160303/282007556478655

 

Welcome to CAG.

 

HB

[misswoo]

Here's a link, John78.

 

http://www.pressreader.com/uk/i-from-the-independent/20160303/282007556478655

 

Welcome to CAG.

 

HB

 

thank you, I will read it now. I have learnt (by being a little sneaky and firing off some wedding enquiries as an interested "bride" that the venue has managed to fill the empty slot now, so effectively they have made a profit as there is no way their time and effort came to £1000. My daughter is concerned small claims would be tricky to do and risky, im wondering if the office of fair trading would be able to assist...

[ericsbrother]

not tricky or risky as the venue has recovered their expected loss and now owe your daughter a full refund. This term is mitigation so they may not profit from the situation, merely recover their losses, which will be very small as the only additional cost will be a small amount of time spent on the new paperwork.

Speak to your local CAB first.

If your daughter sends a suitable worded letter before action they may well thiink again about their position as they will lose not only the money but a lot of goodwill once they become known for their unfair and unlawful behaviour

[misswoo]

tried the letter before action route, asked all the relevant questions, ie did they take part in dispute resolution etc. Got the same bog standard response back from the hotel then pretty much word for word from someone higher up the food chain in the company, if you will.. basically my daughter signed the terms and condtions, she knew it was non refundable,, tough luck. this was before I found out they had rebooked the date, so I may give it one final shot pointing out its a disguised penalty etc. Think they won't care though ..

[aburobert]

Of course they do not care if you sent a letter before action and took no further steps. A letter before action is the threat of court action. As you did nothing they presume you will continue to do nothing.

 

If this was taken to the small claims court it is very likely you will get your money back if you can prove they suffered no loss as a result of the cancellation and they cannot prove otherwise. But it takes a little effort and organisation on your part to carry through with any threats that you may make.

[John78]

This extract is taken from a guide issued by The UK Government Competition and Markets Authority.

 

Competition and

Markets Authority

See more information about this Guidance

Guidance

Deposits, advance payments and cancellation charges explained

 

Published 2 March 2016

 

Contents

Tips for writing fair terms

Terms that may be unfair

Want to know more?

Deposits are a customer’s way of reserving your goods or services. Advance payments help you to pay your business’ actual costs during a contract.

 

If your customer cancels and it’s not your fault, you’ve got the right to protect yourself, but what you keep must take into account what your business is actually losing as a result. It must not be excessive.

 

A term saying no refund is available in any circumstances is likely to be unfair. Where there is no fault by your customer and the contract is ended by you, your customer may well have a right to a refund.

 

Tips for writing fair terms

For example, your terms are more likely to be fair if:

 

Deposits and advance payments

a deposit is just to reserve the goods/services and is no more than a small percentage of the total price

advance payments reflect your expenses in carrying out the contract, and leave customers with a reasonable amount to still pay on completion

you hold any advance payments in a secure scheme so they are safely held until any dispute with a customer is resolved

Customer cancellations

customers don’t lose large advance payments they’ve paid up-front if they cancel, in all circumstances

when you are not at fault, you only seek to recover losses that you have reasonably incurred

you set non-refundable advance payments or cancellation charges so they reflect a genuine estimate of what you will lose directly because of the customer cancellation.

Be clear with customers up-front about your deposits, advance payments and cancellation charges. Provide details of when these are required and why.

 

Terms that may be unfair

Making any substantial advance payments or deposits non-refundable, regardless of the customer’s reason for cancelling.

 

Example: ‘If you cancel your event, we cannot provide a refund in any circumstances’

Keeping payments to cover your costs and loss of profit when this could mean you get compensated for the same loss twice.

 

Example: ‘If you cancel this contract without justification, you must reimburse all of our expenses together with the anticipated gross profit had the contract been completed’

Keeping all of a customer’s advance payments if they cancel when you are not at fault, even though you could reasonably reduce your losses (eg by re-selling what they have ordered and paid for).

 

Example: ‘If you cancel your trip, all advance payments are non-refundable regardless of the time of cancellation’

Having clear and fair terms in your contract will:

save you time

help prevent disputes and reputational damage

protect your business if something goes wrong

Want to know more?

See our short guide for some key things businesses need to know about unfair terms.

You can also check out the CMA’s full guidance on unfair terms.

[numbers666]

As a hotelier for an international group

 

I) write to head office not local. If the hotel is franchised, managed or owned by the group ie holiday inn travel lodge etc, then those in charge will not permit damage to the brand trademark.

 

A trip advisor review - be trueful non emotive and factual will damage the reputation, and potentially hit future bookings.

 

If you can state the brand ie park plaza, novotel I will post up the person to contact. Don't need to know the location.

 

This usually leads to a quicker non legal resolution and usually additional payment for distress.

 

N

[John78]

One of the National Daily papers printed an article yesterday 24-03-16 about the unfairness of the wedding venues and unfair contracts.

The article is online as well and would advise anyone with a grievance to add weight to the discussion below the article.

Hopefully this publication will help to warn people about the unscrupulous practices the some wedding venues use.