I am taking a small tour group to London next week. One member had to cancel due to a serious medical reason. She had purchased Travel Insurance, but the cancellation occured before she paid her final balance due. (She had already paid the deposit, airfare and travel insurance.)

I had clearly spelled out my cancellation policy on the reservation form but she is saying she "never saw it".

I believe I am entitled to keep the money she sent in for the trip (which is still only one-half of what she owes according to the cancellation policy) and apply it as her cancellation fee.

She thinks I should just send it back to her because I was able to fill her slot, but in my mind, that is irrelevant. I went through a lot of stress, headache and WORK trying to locate a last minute replacement for her.

I cannot convince her that I am entitled to keep what money she has paid thus far. (I know I will never be able to collect the rest of what she "owes".)

Suggestions?

Thanks,

You need to give a little more info. Who are you and who are the tour members? If this is a formal travel/tour agency and these are random people you certainly have the right to enforce your contract.

However, from your tone it sounnds like this may be some sort of group activitiy that you're leading as a favor and you are somehow related to the people involved (friends, organization members etc). If it's the former, how would the cancelee even know if you got another person or not?

If its the latter I would cut her some slack - and just cover your own costs - in the interest of avoiding bad feeling among the entire group.

I think you ought to give her back the $$ as you have filled the spot with someone else. Keep what it cost you to fill the spot.

A simple solution is to remind her of the terms of the contract, and tell her that, as a compromise, you won't collect the remaining balance that she owes as long as she agrees, in writing, that she won't pursue the return of her deposit.

You could also offer to hold her deposit as a payment against a future trip (within a definitive time frame).

Good point, NYTraveler.

I am the tour leader. I created the tour. I am a LLC and this is my first tour. I used the services of a travel agent to book our airfare, and the services of a DMC in London to help with transport and accomodation.

I do not personally know any of the people on this tour, although some of them I "know" through online tea groups. The travelers (10 of them) are coming from all around the country.




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You need to give a little more info. Who are you and who are the tour members? If this is a formal travel/tour agency and these are random people you certainly have the right to enforce your contract.

However, from your tone it sounnds like this may be some sort of group activitiy that you're leading as a favor and you are somehow related to the people involved (friends, organization members etc). If it's the former, how would the cancelee even know if you got another person or not?

If its the latter I would cut her some slack - and just cover your own costs -in the interest of avoiding bad feeling among the entire group.

Give her the money back as a matter of good will. Since you filled her vacancy and she had a serious medical problem, take the high road.

Since you found a person to fill the slot, I would give her the refund. It is just good pratice and policy in my book. Never overlook the importance of client relations and word-of-mouth advertising, which can work for you or against you depending on how satisfied the customer is.

I completely agree with Budman and Shandy1977. If it was a serious medical reason, it was beyond her control and not her voluntary choice. I am always impressed when I hear of businesses doing this type of thing. All other things being equal, I would prefer to patronize a business who has gone out of their way to be (more than) fair to the consumer. I have some degree of confidence that they will treat me fairly too!

Suggestions?

Have mercy.

Also, as others have suggested, I think you will come to find that surviving in a service-oriented business is going to require that from time to time you think outside the box of what you are "entitled" to, and think about what the right thing to do is. I appreciate your point that you spent some amount of time to fill her slot, and that your time is valuable. But I am curious, exactly what is the amount of money you are proposing to retain as a cancellation fee?

I'm also curious, have you thought about how you would want a tour operator to treat you if you were the one with a serious medical issue?

I too agree with Budman and Shandy for the same reasons.

Denise,

You mentioned that she has the Travel Insurance. You should call the insurance company and ask if your penalties are covered as an independent agent. If so and she had a serious medical condition then she would put in a claim and get the refund back from the insurance company. That is the whole reason to get the insurance.

You spelled out the cancellation policy on the reservation form, you should be able to collect the fees unless your state has laws against that. On the final payment, there is no way to collect that. It was your responsibility to get it on time. I would pursue the insurance option and assist her in making the claim.

If you think you are correct, then why are you asking us? Because the little voice inside of you is telling you that you need to give the money back and you need to hear it from others. Give the money back, it's the right thing to do. Besides, if you don't, you could be bad-mouthed and lose potential future business. If you do, others will speak highly of you and your integrity.

There are some legalities to consider also. Forgive me if I'm wrong but the LLC the OP spoke of sounds like a somewhat informal arrangement.

Many states have quite restrictive requirements, including experience, licensing, and bonding, about who may call themselves a travel agent or arrange tours for a fee. Depending on the state the agent is in and the state the client is in, if the client should make a complaint and the agent has not met all the requirements, thelost deposit could be the least of the agent's worries.

A friend of mine, in the not too distant past, set herself up as an independant travel agent and started booking flights and tours without meeting the state's requirements. The state Attorney Generals office landed on her with both feet and a sledgehammer. By the time she finished paying legal fees and penalties, she would have had to been in business 2 or 3 lifetimes to break even. Had she tried to meet the initial requirements, she did not have the financial resources to do so, even before the legal fees and penalties started to accrue.

"I went through a lot of stress, headache and WORK trying to locate a last minute replacement for her."

And you are the one who chose to do so.

Do you have any absolute proof that she was aware of the cancellation policy?

Let this be a lesson for the future.

Q. But I am curious, exactly what is the amount of money you are proposing to retain as a cancellation fee?

Q. Do you have any absolute proof that she was aware of the cancellation policy?




Total package cost of tour is $2950 (includes airfare). She paid her $300 deposit; $165 travel insurance; and $790 airfare = $1200.

Balance of tour was due Feb. 4. She had unexpected surgery, and cancelled on Jan. 29 so, of course, never submitted final payment.

The cancellation policy – which was clearly spelled out on page 1 of the 2-page Reservation Form (which she signed and submitted with her payment) states a 75% penalty if cancellation occurs within 59-30 days prior to departure (which is March 4).

We are currently holding her $1200 (the 75% penalty fee would be $2,212.50).

Given the fact that she did not pay for the entire trip, I am not sure if the Travel Insurance would cover anything.





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"I went through a lot of stress, headache and WORK trying to locate a last minute replacement for her."

And you are the one who chose to do so.


You bet I did! There were 9 women from across the country who were counting on going on this trip! Our group airfare was based on 10, our hotel/transport in London based on 10, etc. etc. It's fortunate we found a last-minute replacement.

Since this is your first tour, I would back down on this one. You can do it without losing face. Just tell her that because she had unexpected surgery and you understand that it was beyond her control, that you will waive the cancellation fee this time and this time only.

Then, I would seriously look over your business plan. A few items concern me:

1. If your cancellation policy is 75% of the cost for cancellations 59 days or less, WHY would you not require final payment until 28 days before the departure date? You're never going to get people to pay up on a cancellation fee AFTER they've cancelled. You need to collect the full amount sooner OR change your policy to match when the final payment is required OR require a minimum 75% of the total cost before the 59 day point.

2. You mention that she had paid for the trip insurance, but you have the money for it. Were you in charge of submitting the payment to the insurance company?

Did the insurance company refund the fee to you? If so, why? Did you cancel it when she called to tell you see couldn't go?

Did you ever submit the fee to the insurance company? Or were YOU waiting for the full payment to be received before sending in the money and activating the insurance?

You say that "Given the fact that she did not pay for the entire trip, I am not sure if the Travel Insurance would cover anything." - that leads me to believe that you never submitted anything to the insurance company to begin with. That means that it is because of YOU that it's 100% guaranteed that they aren't going to pay out. Had you activated the insurance, she might have been willing to send you a check before the surgery - knowing she'd get it back from the insurance.

I'm also not sure why you're including the cost of the trip insurance in your cancellation fee. I don't believe the insurance company is going to pay out for 75% of the fee that she paid to them. That's a circular issue that doesn't sit well with me.

3. You indicate that the cancellation policy was on page 1 of a 2 page document. I'm gathering that she signed page 2. Were these pages back to back? Or stapled? Or were they two completely separate pieces of paper? It's much easier to argue that you never saw the policy if it's on a different piece of paper than your signature. Move all terms (including cancellation fees) to the same page that is to be signed.

Are you trying to start a tour business or is this a one shot deal? If you are trying to start a business then I would suggest you give her her money back, or if not all of it, most of it. I have a service business, a floor covering business, and I do no advertising. All my business if referral and word of mouth. I give a lot back to my customers during the year, sometimes it's accommodation that I really shouldn't have to do, but, I chalk it up to "advertising". Advertising costs a fortune these days and I can say all the "pretty phrases" in an ad..excellent workmanship, excellent service and yadda yadda, but the proof is in the "doing". Now, if she had just called you and said "you know, I think I've changed my mind and I really dont' want to take this trip and I want my money back", that would be a different story, but she has a medical issue that she was not in control of. You really have not lost anything financially..yes it took some time to find another person..but if you are trying to start a business, I think in this circumstance, you should give her money back to her. I'm thinking that's not what you want to hear, but you posted the question and indicated you wanted some feed back, so I'm "feeding back".

It appears you're in good shape as far as your tour is concerned. You have the 10 persons required and essentially you're not out anything, except the uneasy time you had until you filled that 10th spot.

I don't understand why you seem so angry at this woman. It's as if she had emergency surgery to spite you! I doubt she had her checkbook in the recovery room, so she could whip out a pen and pay the balance she owed you. Have a little compassion and give her back her money and enjoy the trip. You have nothing to lose at this point. She had to worry about her convalescence and hopefully a good outcome and diagnosis from the surgery she underwent.

The slot is filled. Give her the money back.

God bless you and yours when someone is faced with a "serious medical" situation.

" I went through a lot of stress, headache and WORK trying to locate a last minute replacement for her."

You haven't started experiencing the above (unpaid) yet. Good luck to you on the actual trip next week. Leading a group of strangers on a trip will NOT be a tea party!