Section 75 - can i claim for this?

Jeffonaplate

I am in need of some advice if anyone can help me. I had flights booked to New York with Zoom and as I am sure everyone is aware they are now in administration. Sadly I could not afford to re-book with another carrier and had to cancel my holiday. I had booked a hotel in New York and as I cancelled so close to the date I have lost 50% (over £500), this was booked on a credit card and I was wondering if I can claim for the money I have lost under section 75?

jonesMUFCforever

You can claim back the cost of the flights if you booked using a credit card but unless you have insurance for the hotel you can't claim for that.

moonrakerz

You can claim back all of the costs that you incurred due to Zoom's failure. The Card Issuer has a duty to put you in the same financial position you would have been in had Zoom not failed.

"The claim is not limited to the amount of the credit card transaction. Customers can claim for all losses caused by the breach of contract or misrepresentation. And this applies even if all they paid by credit card was the deposit."

See: http://www.financial-ombudsman.org.uk/publications/ombudsman-news/31/creditcards-31.htm

dzug1

moonrakerz wrote: »

You can claim back all of the costs that you incurred due to Zoom's failure. The Card Issuer has a duty to put you in the same financial position you would have been in had Zoom not failed.

"The claim is not limited to the amount of the credit card transaction. Customers can claim for all losses caused by the breach of contract or misrepresentation. And this applies even if all they paid by credit card was the deposit."

See: http://www.financial-ombudsman.org.uk/publications/ombudsman-news/31/creditcards-31.htm

Even costs that Zoom would not have been liable for had they continued trading?

YorkshireBoy

dzug1 wrote: »

Even costs that Zoom would not have been liable for had they continued trading?

I think moonrakerz has misinterpreted the "all losses" wording.

In my opinion, "all losses" relates to that part of the contract (ie the flight purchase) paid by other means, ie debit card, bank transfer, cheque etc if only a deposit was paid by credit card.

moonrakerz

dzug1 wrote: »

Even costs that Zoom would not have been liable for had they continued trading?

Of course not ! I said "all of the costs that you incurred due to Zoom's failure"

I have not misinterpreted "all losses" - that is just what it means !

The Law is quite clear - your credit card company is in breach of contract. The Law covering breach of contract states that you are entitled to damages to put you where you would have been, financially, had the breach of contract not occurred.

Please read the link I posted previously. In there it says, "Section 75 does not, in itself, provide grounds for a claim against a supplier. Customers must have a valid claim of breach of contract".

Where the OP might be confused is:
The loss on the hotel booking is not covered under sect 75, on the card the booking was made on - the OP cancelled that.
However the loss on the hotel booking IS the responsibility of the credit card company who paid the flight bookings (even tho' it may well be the same company) in that the flight did not take place and therefore the OP incurred a loss of £500.

If the flight was booked on a Barclaycard and the hotel was booked on a Tesco card - you claim the hotel loss back from Barclaycard, not Tesco. You must, of course, have evidence that you did actually incur this loss.

You must understand that Sect 75 does not mean that credit card companies must give you your money back. What it does do, is to clearly state that the supplier of a credit card is equally responsible for breach of contract as the supplier (Zoom in this case) would be.
You are not claiming your money under Sect 75, you are claiming it for breach of contract.

YorkshireBoy

Specifically then, because the OP "could not afford to re-book with another carrier" you're saying his card provider who financed the flights on credit is still liable for the 'non-refundable' hotel booking the OP made with another service provider/finance provider?

And generally...

Customers must have a valid claim of breach of contract

The "contract" was to fly the OP to the USA and back again. Nothing more, nothing less.

And the "valid claim" is the supplier's failure to complete the contract (because the airline went bust).


All in my opinion of course.

jonesMUFCforever

Mine too I still say he has no case to get compensated for the hotel part.

normanmark

No the hotel wouldn't be compensated in this case. Your card issuer will dispute the amount with the hotel company & on their records it will show that you've cancelled the dates with them & on their terms and conditions its the customer thats decided to end the agreement.

The hotel would have no involvement or no knowledge that you've booked with Zoom. Big grey area imo, but i don't think you would be successful. Good luck!

moonrakerz

YorkshireBoy wrote: »

Specifically then, because the OP "could not afford to re-book with another carrier" you're saying his card provider who financed the flights on credit is still liable for the 'non-refundable' hotel booking the OP made with another service provider/finance provider?

All in my opinion of course.

It may be a bit late to say this, but ............. the OP could have afforded to re-book with another carrier - because the card company was responsible to get him to his destination once Zoom had gone bust. He should have booked immediately (on the same card) with another carrier and written to the card issuer and said that they were liable for the cost of that replacement flight.

YorkshireBoy wrote: »

The "contract" was to fly the OP to the USA and back again. Nothing more, nothing less.
And the "valid claim" is the supplier's failure to complete the contract (because the airline went bust).

Correct - but the failure of the supplier to complete that contract caused the OP to lose £500 from the hotel, so..............

"Customers can claim for all losses caused by the breach of contract"

***********************************************************************

On a general point on this subject. People who are claiming money back from:- Maxjet, Zoom, XL etc, etc MUST understand what the Law says, many do not.
If you understand your rights you can say to the card company that what they are saying (in many cases) is a load of b******t.
I was caught up in the Maxjet failure. My cardholder told me that I had to supply all sorts of documentation; ATOL bonding certifcate, written proof that Maxjet had gone bust, etc, etc. When I told a "customer service agent" that none of this was necessary, he told me that Mastercard was the Law and what they said - went. He then called me "arrogant" and said he would terminate the call if I persisted in telling him what the Law of the Land said !!! I spoke to his Manager for a couple of minutes; then sent in one letter with a copy of my Maxjet booking and a copy of my BA (replacement) booking. My payment to Maxjet was deleted from my account and the card company paid me another £2,000 - this being the extra I had to pay BA.

Most of the statements I see on this site that have come from credit card companies regarding Sect 75 action, are; pure, unadulterated, copper bottomed, brassed necked rubbish, designed to make the customer give up and go away !

MarkyMarkD

But you're still wrong about consequential losses e.g. hotels, as others have said*.

The card operator are liable for exactly what the airline would have been liable for, had they chosen to cancel the flights - which is effectively what has happened. And they would have been liable (according to their contracts) to refund you and to pay you some miserable amount of compensation.

Now, I don't accept that those cancellation terms are fair, and I think that you would likely win a claim for the cost of replacement flights - and on that basis, the payment you got from your Mastercard operator was appropriate.

But it's not reasonable to impute consequential losses onto that liability in the way that you are suggesting people can.

All of the journalistic efforts to describe individuals' rights in these circumstances have stopped at the "getting a refund of what you paid for the flight/holiday". Nobody has even gone as far as "getting compensation in full for the cost of replacement flights/holiday", let along "getting compensation in full for the cost of the flight and other things which I bought from unrelated suppliers".

Martin's own article on the XL collapse doesn't mention any possibility of getting back anything over and above the cost of the flights/holiday paid for up front, apart from suggesting that the FOS are saying there's a "slim chance" of getting back the actual cost of a flight back home if you are stranded abroad. Personally, I think that's a bit wet - if you are stranded abroad, you are definitely legally entitled to be flown home at the card operator's expense under s.75 exactly as you would have been entitled to get the airline to pay for this if they cancelled your original flight. The EU compensation rules re cancelled flights should also apply. As Martin's article on EU compensation says:

When a flight is cancelled you also have the right to either a refund or transportation to your destination as soon as possible. This is on top off the compensation payout.

(my emphasis).

* Because the contract between you and the airline will exclude consequential losses. And hence they wouldn't themselves compensate you for consequential losses. And hence s.75 protection doesn't compensate you for consequential losses.