Non refundable hotel booking - what are my ACTUAL rights?

MobileSaver

the_lunatic_is_in_my_head said:

MobileSaver said:.

And as already pointed out, this whole conversation is pointless anyway as "unfair terms/good faith/imbalance" only apply to "the small print" and the OP has admitted they knew they selected non-refundable so it was presumably prominently displayed at the point of entering the contract.

The CAA paper makes mention to the Parking Eye case, the pay £80 if you stay longer than x hours isn’t in the small print but was still tested for fairness. 

This is starting to turn into a whataboutism and while no expert on the Parking Eye case I am pretty sure it was also found NOT to be an unfair term so perhaps not a good example to support your position... 

Fundamentally I think you need to take a step back and explain to yourself and the OP why "non-refundable" in the OP's case is not a Core Term of the contract? 

The same room for the same date booked at the same time with the same breakfast/wifi/parking options is two different prices depending on whether you choose refundable or non-refundable. Refundable or not is literally the only differentiator for a £100 price difference so I genuinely cannot see how that cannot be considered as part of "the main subject matter of the contract".

TL;DR it is a core term and so it cannot be unfair from a legal viewpoint as the OP chose the option knowingly and willingly.

the_lunatic_is_in_my_head

MobileSaver said:

the_lunatic_is_in_my_head said:

MobileSaver said:.

And as already pointed out, this whole conversation is pointless anyway as "unfair terms/good faith/imbalance" only apply to "the small print" and the OP has admitted they knew they selected non-refundable so it was presumably prominently displayed at the point of entering the contract.

The CAA paper makes mention to the Parking Eye case, the pay £80 if you stay longer than x hours isn’t in the small print but was still tested for fairness. 

This is starting to turn into a whataboutism and while no expert on the Parking Eye case I am pretty sure it was also found NOT to be an unfair term so perhaps not a good example to support your position... 

Fundamentally I think you need to take a step back and explain to yourself and the OP why "non-refundable" in the OP's case is not a Core Term of the contract? 

The same room for the same date booked at the same time with the same breakfast/wifi/parking options is two different prices depending on whether you choose refundable or non-refundable. Refundable or not is literally the only differentiator for a £100 price difference so I genuinely cannot see how that cannot be considered as part of "the main subject matter of the contract".

TL;DR it is a core term and so it cannot be unfair from a legal viewpoint as the OP chose the option knowingly and willingly.

Yes correct it was found to be fair term, due to the argument of legitimate interest. If you think that would apply here perhaps it would, perhaps it wouldn’t  

As I said the term is triggered on termination, as such I don’t believe it’s a core term. 

MobileSaver

the_lunatic_is_in_my_head said:

MobileSaver said:

the_lunatic_is_in_my_head said:

MobileSaver said:.

And as already pointed out, this whole conversation is pointless anyway as "unfair terms/good faith/imbalance" only apply to "the small print" and the OP has admitted they knew they selected non-refundable so it was presumably prominently displayed at the point of entering the contract.

The CAA paper makes mention to the Parking Eye case, the pay £80 if you stay longer than x hours isn’t in the small print but was still tested for fairness. 

This is starting to turn into a whataboutism and while no expert on the Parking Eye case I am pretty sure it was also found NOT to be an unfair term so perhaps not a good example to support your position... 

Fundamentally I think you need to take a step back and explain to yourself and the OP why "non-refundable" in the OP's case is not a Core Term of the contract? 

The same room for the same date booked at the same time with the same breakfast/wifi/parking options is two different prices depending on whether you choose refundable or non-refundable. Refundable or not is literally the only differentiator for a £100 price difference so I genuinely cannot see how that cannot be considered as part of "the main subject matter of the contract".

TL;DR it is a core term and so it cannot be unfair from a legal viewpoint as the OP chose the option knowingly and willingly.

As I said the term is triggered on termination, as such I don’t believe it’s a core term. 

Unless you can provide any evidence that a term triggered on termination is excluded from being a core term then I think this discussion has run its course. I've read through the Unfair terms guidance and several other official .gov.uk sources and can't find anything that supports your view.

At the end of the day, if "non-refundable" was not a core term of the contract, why did the OP pay £100 less for an otherwise identical room? Or perhaps look at it from a different perspective, why would another person pay £100 more for an otherwise exact same room if the termination policy is not part of the main subject matter of the contract?

the_lunatic_is_in_my_head

You know what MobileSaver I should probably apologise for doing what I complained of earlier, of being stuck in a rut believing something to be true.  

Lets say you are indeed correct that the term is part of the core subject matter and/or related to the price and look at this from the start again to answer that nagging question of why all this guidance exists if such an exclusion also exists. 

The term may fail to meet 

A term which has the object or effect of requiring that, where the consumer decides not to conclude or perform the contract, the consumer must pay the trader a disproportionately high sum in compensation or for services which have not been supplied.

This is from Part 1 of Schedule 2 of the CRA

https://www.legislation.gov.uk/ukpga/2015/15/schedule/2

as you've noted certain terms are excluded from being tested for fairness, this exclusion is also detailed in the CRA under Section 64 which says:

https://www.legislation.gov.uk/ukpga/2015/15/section/64

64Exclusion from assessment of fairness

(1)A term of a consumer contract may not be assessed for fairness under section 62 to the extent that—

(a)it specifies the main subject matter of the contract, or

(b)the assessment is of the appropriateness of the price payable under the contract by comparison with the goods, digital content or services supplied under it.

(2)Subsection (1) excludes a term from an assessment under section 62 only if it is transparent and prominent.

(3)A term is transparent for the purposes of this Part if it is expressed in plain and intelligible language and (in the case of a written term) is legible.

(4)A term is prominent for the purposes of this section if it is brought to the consumer's attention in such a way that an average consumer would be aware of the term.

(5)In subsection (4) “average consumer” means a consumer who is reasonably well-informed, observant and circumspect.

(6)This section does not apply to a term of a contract listed in Part 1 of Schedule 2.

That only leaves us with good faith, I'm sure we could go a few more pages on good faith

To summarise my view, as mentioned previously good faith is to be interpreted broadly encompassing more than openness. I would suggest whether good faith applies here is a matter where, should someone wish, two sides will spend much money and time to debate to service their end objective and our musings on the matter are largely academic   but until such time as it is clarified in a higher court there is no reason a consumer can't use the term from the Grey List to articulate their position and if the trader wishes to disagree they'll have to argue their counter-position in court, should the consumer go that far. 

MobileSaver

the_lunatic_is_in_my_head said:

The term may fail to meet 

A term which has the object or effect of requiring that, where the consumer decides not to conclude or perform the contract, the consumer must pay the trader a disproportionately high sum in compensation or for services which have not been supplied.

This is from Part 1 of Schedule 2 of the CRA

(6)This section does not apply to a term of a contract listed in Part 1 of Schedule 2.

Good spot on the clause (6) "does not apply to a term of a contract listed in Part 1 of Schedule 2" and interesting that the OFT guidance wrongly states transparent and prominent core terms are exempt when we've now discovered there are some cases where core terms may not be exempt from the fairness test.

However all this just brings us back to my first post on the topic which is that in the OP's case I believe the term would not be found to be unfair anyway.

Both the legislation and guidance highlight the importance of the "main subject matter" of the contract and it's simply not in question (except by you ) that "refundable/non-refundable" is part of the main subject matter. With the trader offering a choice with a £100 difference that, in my view, nullifies the "disproportionately high" claim and satisfies every other fairness test too.

For the avoidance of doubt, it's the trader offering a choice that is the key here. If all bookings were non-refundable with no option to pay more for a refundable room then I would agree that gives the consumer a much stronger case to claim a partial refund on the basis of an unfair term (and much harder for the trader to argue the "disproportionately high" claim too.)

the_lunatic_is_in_my_head said:

if the trader wishes to disagree they'll have to argue their counter-position in court, should the consumer go that far. 

Of course in almost all such cases the trader already has their money so it is the consumer that would need to instigate court action.

I'm normally very gung-ho about legal action when I feel wronged but in my opinion you'd just be wasting even more time and money on a hopeless claim in this particular case...

Grumpy_chap

the_lunatic_is_in_my_head said:

Lets say you are indeed correct that the term is part of the core subject matter and/or related to the price and look at this from the start again to answer that nagging question of why all this guidance exists if such an exclusion also exists. 

The term may fail to meet 

A term which has the object or effect of requiring that, where the consumer decides not to conclude or perform the contract, the consumer must pay the trader a disproportionately high sum in compensation or for services which have not been supplied.

I think that the refundable / non-refundable part of a hotel booking price is a core term.  I have just looked at a randomly selected hotel and the options for a room are presented as follows:



The non-refundable status of the lowest cost option seems absolutely clear and it would be rather unintuitive to book that £91.04 rate and then moan if I was unable to cancel and obtain a refund.
In the same way as one clearly cannot book the £91.04 rate and get breakfast included.


However, let's ignore the "core term" part of the discussion as there is not full agreement on that element.  If the "core term" did not apply to the £91.04 price and there are scenarios where the booking can be cancelled and a refund obtained, we come to the second part of the discussion. 
How much refund is reasonable (if less than 100%)?  
If the consumer decides not to conclude the contract, is the consumer required to pay a disproportionate amount in compensation?

I actually think that a 100% penalty may be entirely reasonable (even if the hotel is eventually fully booked on that date).
Hotels (as do many other leisure activities) work on minimised occupancy (or equivalent) rates to cover core costs from the basic rate and then seek to make a profit from the "upsell" of extra services, so dining / spa / drinks or whatever. 
(As an example, we recently received an offer from our local steak house for £8 main course dining.  The £8 needs to cover the direct costs.  Some people will go, buy a main course, drink tap water, and that's it.  The venue is counting on the majority taking that £8 offer will also buy starter / drinks / dessert / coffee and the upsell generates profit.)

A hotel does not operate on a direct cost per room - otherwise the first room booked for any night would have to be prohibitively expensive (£thousands) and would never be booked but the subsequent rooms would only have to pay a marginal cost.  (The exact same situation applies for airlines, trains, coaches.)

A hotel will plan on achieving a certain occupancy rate for the rooms on an averaged basis over the year, let's say 80%.
So the basic room rate is set to cover the costs of the hotel if the 80% occupancy is achieved over the averaging of the year.  That level of income is the basis that allows the hotel to continue existing.
Then there is a "premium" rate that can be cancelled.  In the example above another £10 per room from a £90 per room.  This extra £10 might include some "upsell" profit, but is quite likely informed by the hotel experience that typically 10% of flexible rooms are subsequently cancelled.  Because there is the extra £10 paid across a pool of cancelled "upsell" rooms at the premium flexible rate, the hotel can achieve the same equivalent occupancy as standard rate rooms that generate the baseline income irrespective of whether the occupant actually arrives.

In overall consideration, a 100% of room rate compensation for the traveller who decides not to actually stay at the booked room does not seem wholly unreasonable.  That has covered the hotel for their costs proportion associated with that room on that night.  The hotel remains deprived of the opportunity for "upsell" from the occupant of that hotel room.



I now want to revert again to the "core term" part of the price options presentation.
If the "non-refundable" part of the lower price rate is not to be considered a "core term", how is it proposed that the schedule of prices is to be read in a meaningful way?
Would the argument be that the rates are meant to be read as "non refundable unless you really argue and kick up a silly amount of fuss" or "refundable on request"?  That seems, to me at least, absurd and illogical.

the_lunatic_is_in_my_head

MobileSaver said:

For the avoidance of doubt, it's the trader offering a choice that is the key here. 

This is main point on which I disagree.

When you pay extra you are paying for flexibility and there is nothing wrong with that (which I know of) because being able to cancel for a full refund is more than you'd be entitled to under the ordinary position.

However I disagree that just because they offer an option that offers you more than the ordinary position that in turn means the standard position can penalise you beyond the Grey List. 

Go back to powerful_rouge's analogy, £12 for 60 days return, £10 for no return, wouldn't fly for a distance contract just because they gave you an option to pay for more than your rights offer, the alternative cheaper option can't strip away those rights. (Of course the difference is those rights aren't ambiguous where as unfair terms is until a higher court decides on them).  

It's also worth noting, as per Grumpy's screenshot, no room ever "non-refundable" if the hotel can't provide the room you booked they'd have to refund you, that kind of wording is heading into CPRs territory (but let's not go 8 pages on that point ). 

Grumpy_chap

the_lunatic_is_in_my_head said:

However I disagree that just because they offer an option that offers you more than the ordinary position that in turn means the standard position can penalise you beyond the Grey List. 

Go back to powerful_rouge's analogy, £12 for 60 days return, £10 for no return, wouldn't fly for a distance contract just because they gave you an option to pay for more than your rights offer, the alternative cheaper option can't strip away those rights. (Of course the difference is those rights aren't ambiguous where as unfair terms is until a higher court decides on them).  

I don't think that analogy is correct to apply to the case of a hotel booking.
Distance contract is covered under CCR and the consumer right to cancel under CCR is specifically excluded for hotel bookings (and certain other services which have a date attached to them).

My interpretation would be that the room example I posted upthread is offered as per the CCR non-cancellable / non-refundable but the customer is being offered a more expensive option which allows the consumer more rights than statute requires.
It is the inverse interpretation of the choice which MobileSaver references.  You seem to be interpreting a compliant with statute / better than statue option (more expensive) as the default and the choice for a non-compliant than statute option at a cheaper price that strips away cancellation rights.  I read it that the default (as per CCR) is the lower cost and the choice is being offered for something better than statute.

Whether we agree or disagree on that may not be important.

I do think your comment is valuable as it has made me realise a potential conflict.
There has been much comment about unfair terms under CRA "Consumer Rights Act 2015", yet here we have a specific regulation CCR "Consumer Contracts (Information, Cancellation and Additional Charges) Regulations 2013" which came into force in June 2014.
This now becomes a matter of how the two statutes work together. 

• Does the later statute overrule the earlier?
• Does the later statute include any specific reference as to how it interfaces with the earlier?  (Order of precedence.)
• Does the later statute having a generalised nature only apply where specific legislation is silent on a matter?

I don't know the answer to the above.  My layman interpretation would be to look to the specific statute applying to a situation before reverting to statute of a more general nature.

Now, I have looked through CRA and can find reference to the interface between CRA and CCR for a supply of service contract:
https://www.legislation.gov.uk/ukpga/2015/15/section/50
50 (3) Without prejudice to subsection (1), any information provided by the trader in accordance with regulation 9, 10 or 13 of the Consumer Contracts (Information, Cancellation and Additional Charges) Regulations 2013 (SI 2013/3134) is to be treated as included as a term of the contract.

In CCR, for a distance contract:
https://www.legislation.gov.uk/uksi/2013/3134/regulation/13
13 (1) (b) if a right to cancel exists, must give or make available to the consumer a cancellation form as set out in part B of Schedule 3.

But, as per CCR 28 (1) (h) there is no right to cancel for the supply of accommodation, transport of goods, vehicle rental services, catering or services related to leisure activities, if the contract provides for a specific date or period of performance.
https://www.legislation.gov.uk/uksi/2013/3134/regulation/28

This means that my layman interpretation is seemingly confirmed by the way the CRA has been drafted.  As I read it, the CRA specifically references the earlier CCR and embeds the absence of a right to cancel into the contract.

This could mean that we have actually got to an answer to the OP's question "Non refundable hotel booking - what are my ACTUAL rights?"

The answer appears to be that for a contract for service comprising of accommodation falling under CCR, there is no right to cancel and this is not in conflict with CRA.

I would be really grateful if others could review and challenge my rationale and interpretation and, hence, the conclusion I have reached.
This question does arise from time to time in the forums.
If we have been able to reach a specific answer to the direct question the OP asked, this thread has great potential value.
In fact, a clear answer might even be something that would benefit by being updated with a simple lay terms explanation into the MSE guides on the same.

the_lunatic_is_in_my_head said:  

It's also worth noting, as per Grumpy's screenshot, no room ever "non-refundable" if the hotel can't provide the room you booked they'd have to refund you, that kind of wording is heading into CPRs territory (but let's not go 8 pages on that point ). 

I think this is an aside and a distraction.  The basis of the thread is about the consumer cancelling and the consumer's rights in the event that the consumer cancels.  The situation where the hotel cancels is outside the scenario that the OP appears to have intended to have been considered.
FWIW, if I arrived at a hotel and the hotel failed to make the accommodation available, I might well consider that a refund was insufficient remedy if the result was that I was then left without accommodation or faced with a premium charge for last minute booking alternative accommodation.
I think I am happy to leave this can of worms for another days and not have several pages of discussion on it.

the_lunatic_is_in_my_head

Grumpy_chap said:

The answer appears to be that for a contract for service comprising of accommodation falling under CCR, there is no right to cancel and this is not in conflict with CRA.

The CCRs aren't offering a right to cancel, they are offering a right to cancel without giving any reason, and without incurring any liability (with the exception of a few odds and ends)

https://www.legislation.gov.uk/uksi/2013/3134/regulation/29

No one can force you to receive a service so the term in the Grey List is referring to a situation where the consumer decides not to receive the service without any justification for doing so. 

Grumpy_chap

the_lunatic_is_in_my_head said:

Grumpy_chap said:

The answer appears to be that for a contract for service comprising of accommodation falling under CCR, there is no right to cancel and this is not in conflict with CRA.

The CCRs aren't offering a right to cancel, they are offering a right to cancel without giving any reason, and without incurring any liability (with the exception of a few odds and ends)

https://www.legislation.gov.uk/uksi/2013/3134/regulation/29

No one can force you to receive a service so the term in the Grey List is referring to a situation where the consumer decides not to receive the service without any justification for doing so. 

You are dismissing the CCR right to cancel exceptions as "a few odds and ends" which is rather blase in the context of this thread.  This thread is related to a non-cancellable hotel booking and hotel bookings are one of the specific exclusions ("few odds and ends") from the CCR right to cancel as I linked upthread clause 28 (1) (h):
https://www.legislation.gov.uk/uksi/2013/3134/regulation/28

Limits of application: circumstances excluding cancellation

28.—(1) This Part does not apply as regards the following—

(h)the supply of accommodation, transport of goods, vehicle rental services, catering or services related to leisure activities, if the contract provides for a specific date or period of performance.

Obviously, you cannot force the consumer to receive the service and actually stay in the booked hotel room.  If the consumer chooses to not receive the service, the consumer remains liable for the agreed price.  The hotel does not lose out on the revenue.

Where does your term "Grey List" originate from?

EDIT - I found the source for the term "Grey List":

https://www.legislation.gov.uk/ukpga/2015/15/section/63/notes

I don't have the time to review now.