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FREE BOOK SAMPLE: The Package Travel, Package Holidays and Package Tours Regulations 1992 – What is a Package? – Telephone Bookings (From ‘A Practical Guide to Claims Arising From Accidents Abroad and Travel Claims’ by Andrew Mckie & Ian Skeate)

22/03/17. One of the key matters that will always need to be looked at in accident abroad claims, is whether the 1992 Regulations apply or not. This Chapter deals with bookings made by telephone and in a face to face meeting at the office of the tour operator / travel agents. Internet bookings will be dealt with below.

Claims brought under the 1992 Regulations, allow a consumer to sue in contract in England and Wales for an accident case which may have incurred outside the jurisdiction. This is extremely useful and convenient as it avoids the procedural difficulties of litigating outside the jurisdiction of England and Wales as well as imposing on the Defendant UK standards. In these cases the practitioner will be relieved to know that the procedural and evidential rules used will be that of English law and the Civil Procedure Rules.

The Regulations impose duties upon Tour Operators.

Regulation 3 says:-

Application of Regulations

3. (1) These Regulations apply to packages sold or offered for sale in the territory of the United Kingdom.

(2) Regulations 4 to 15 apply to packages so sold or offered for sale on or after 31st December 1992.

(3) Regulations 16 to 22 apply to contracts which, in whole or part, remain to be performed on 31st December 1992”.

An example of a service that is ‘ancillary’ for the purposes of the Regulations would be the provision of food and drink on board an aircraft.

The full Regulations can be found at:- http://www.legislation.gov.uk/uksi/1992/3288/made

What is a Package?

The definition of a package within the meaning of the Regulations is as follows:-

The pre-arranged combination of at least two of the following components when sold or offered for sale at an inclusive price and when the service covers a period of more than twenty-four hours or includes overnight accommodation:—

a)transport;

b)accommodation

c) other tourist services not ancillary to transport or accommodation and accounting for a significant proportion of the package,

and

(i) the submission of separate accounts for different components shall not cause the arrangements to be other than a package;





(ii) the fact that a combination is arranged at the request of the consumer and in accordance with his specific instructions (whether modified or not) shall not of itself cause it to be treated as other than pre-arranged ;







and

retailer” means the person who sells or offers for sale the package put together by the organizer”.

In R (on the application of ASSOCIATION OF BRITISH TRAVEL AGENTS LTD (ABTA)) (CLAIMANT) v CIVIL AVIATION AUTHORITY (DEFENDANT) & SECRETARY OF STATE FOR TRADE & INDUSTRY (INTERESTED PARTY)(CLAIMANT) v CIVIL AVIATION AUTHORITY (DEFENDANT) & SECRETARY OF STATE FOR TRADE & INDUSTRY (INTERESTED PARTY) (2006) [2006] EWCA Civ 1356 , the Court looked at the question as to the meaning of a package within the Regulations. It said:-

22. At first sight, therefore, there is now little, if anything, bsetween the parties on this question. The requirement that the components be sold or offered for sale “at an inclusive price” must be read in conjunction with the requirement that the components be sold or offered for sale as a pre-arranged combination. The price is the price of the combination.

25. In many cases – indeed, I suspect, in the majority of cases – the price of the combination will not be the aggregate of the prices for which the components within the combination would have been sold or offered for sale if each component had been sold or offered for sale as a separate service outside the combination. That may be because some of the components (for example, the services of the organiser’s local representative) would not be available as a separate service outside the combination. Or it may be because some of the components can be provided more cheaply if provided in conjunction with other components - the hotel may provide a courtesy airport transfer service. Or it may be that, in order to sell the package, the organiser will price attractively: the organiser will offer the package of services at a price which is below the aggregate of the prices which would be charged if the components had been sold separately. In those cases there is unlikely to be difficulty in reaching the conclusion, on the facts, that the components (including flight accommodation) are being sold as a pre-arranged combination and at an inclusive price. The same could be said of cases – which, I suspect, are likely to be rare indeed – in which the price of the combination exceeds the aggregate of the prices for which the components would have been sold or offered for sale separately.

26. The more difficult cases are those in which the price for the whole is equal to the aggregate of the prices for which the components would have been sold or offered for sale separately. The principle is, perhaps, easier to state than to apply in practice. If the components are offered for sale as a pre-arranged combination – albeit that the components are not combined (and, perhaps, not all identified) until “the moment when the parties reach an agreement and conclude the contract” (to adopt the language of the Court of Justice in the Garrido case) – then the price for the combination will be “an inclusive price” notwithstanding that it may have been calculated, arithmetically, by aggregating the prices of the components: that is to say, notwithstanding that the price for the combination is the aggregate of the prices for which each component would have been sold or offered for sale if it had been sold or offered for sale as a separate service outside the combination. The factual question to be resolved – on a case by case basis – is whether the services are being sold or offered for sale as components of a combination; or whether they are being sold or offered for sale separately, but at the same time.

27. The point may be illustrated by examples. Suppose a customer, in London, who wishes to spend a week at a named hotel in, say, Rome. He asks his travel agent what the trip will cost him. The agent ascertains that the cost of the return flight will be £X, the cost of accommodation will be £Y and the cost of the airport transfers will be £Z. Without disclosing the individual cost of each service, the agent offers the customer flights, accommodation and transfers at a price of £(X+Y+Z). The customer accepts without further inquiry. In that case there would be little doubt – as it seems to me – that the services were sold as a pre-arranged combination and at an inclusive price.

28. Now suppose that the agent has informed the customer that the cost of flights will be £X, the cost of accommodation will be £Y and the cost of transfers will be £Z; and has explained to the customer that he can purchase any one or more of those services, as he chooses, without any need to purchase the others. He has explained, in effect, that the customer can choose to purchase the other services elsewhere; or to make other arrangements. In that case – as it seems to me – there would be little doubt that the services are not offered for sale as a pre-arranged combination and at an inclusive price.

29. What, then, if the customer chooses, and contracts for, one of those services. It is plain that that service would not be sold as a pre-arranged combination: it is not sold in combination with any other service. And it is plain that that position would not alter, if having paid for one of those services, the customer subsequently decides to take, and contracts for, another of the services. Nor would the position alter if, after paying for the second service, the customer later decides to take, and contracts for, the third service. And it would make no difference if, having entered into three separate contracts and received three separate invoices, the customer were to pay the three invoices with a single cheque. The position would be the same. There would have been no sale of a pre-arranged combination of components at a single inclusive price. Rather, there would have been three separate sales of independent services, the aggregate of the prices payable for the three separate services being satisfied by a single payment.

30. Nothing in the preceding paragraph is inconsistent with proviso (i) to the definition of “package” in the Package Travel Regulations or the ATOL Regulations (“the submission of separate accounts for different components shall not cause the arrangements to be other than a package”) or with the proviso to the definition in the Directive (“The separate billing of various components of the same package shall not absolve the organiser or retailer from the obligations under this Directive”). As the judge explained at paragraph [158] of his judgment, if the arrangements would otherwise be a “package” – because the services are sold or offered for sale as components of a pre-arranged combination and at an inclusive price – the substance of the arrangements is not altered by invoicing the components separately . But, if the arrangements would not otherwise be a “package” – because the services are, in fact, sold or offered for sale separately – separate billing merely reflects the substance of the arrangements. The most that could be said is that composite billing might be evidence (in the particular case) that the services had been sold as a package.

31. Returning to the second of the examples which I have set out, difficult questions of fact are likely to arise if the customer chooses and contracts for two or more of the services on the same occasion. The principle is not in doubt. If the services are sold or offered for sale as components of a combination, there is a package: if they are sold or offered for sale separately but at the same time, there is no package. The question whether they are sold as components of a combination - or separately but at the same time - is a question of fact. That question may not be easy to resolve in the particular case”

Key Points

  1. The court has to decide whether the services are being sold separately albeit at the same time, or as components of a combination.

  2. There is an emphasis that the answer to whether there has been a package is a question of fact in each individual case. This is a strong point in favour of claimants as this could shift the burden of proof onto the defendant to prove it was not a package. Evidence could include composite billing or an absence of being told that the combination was available elsewhere and/or could be bought separately for the same price rather than being interlinked.

In Titshall v Querty Travel Limited [2011] EWCA 1569 the Court provided some further guidance as follows, as to the test of whether a holiday is a package or not in circumstances in determining whether components were sold or offered for sale at an inclusive price, it was necessary to answer the factual question of whether the services were being sold or offered for sale as components of a combination, or whether they were being sold or offered for sale separately, but at the same time.

The facts of the case were as follows:-

1. This appeal raises a question as to the proper application of The Package Travel, Package Holidays and Package Tours Regulations 1992, SI 1992 No 3288, to which I shall refer hereafter as “The Package Travel Regulations”. Those Regulations were made under s.2(2) of the European Communities Act 1972 in order to give effect, in domestic legislation, to the Council Directive of 13 June 1990 on Package Travel, Package Holidays and Package Tours (90/314/EEC), to which I will refer hereafter as “the Directive”.

2. The matter comes before the court by way of an appeal against a determination of a preliminary issue by District Judge Glover in the Dartford County Court. In brief outline the Claimant/Appellant Mr Titshall booked a holiday in Corfu through (I use a deliberately imprecise word) the Defendant/Respondent Qwerty Travel Limited, to which I shall refer hereafter as “Qwerty”. Whilst staying at the Ermones Beach Hotel in 2006 he suffered serious injuries as a result, he says, of his attempt to open a sliding glass patio door which proved to be defective in its manufacture, in consequence of which the glass shattered. Qwerty says that at the time Mr Titshall and his partner, who had accompanied him on holiday, were heavily intoxicated and engaged in a row which generated a tussle, in the course of which he fell through, or kicked, or was forced through the glass pane. That aspect of the factual dispute remains to be tried and I need say no more about it.

3. In addition to joining issue with the Claimant’s account of how he came by his injuries, Qwerty denies that it owed any obligation to Mr Titshall over and above that “commensurate with its role as retail agent for the suppliers of accommodation at the hotel”. In fact Qwerty says that Mr Titshall and his partner (but I will henceforth ignore her) entered into two separate contracts, one with First Choice for the supply of return flights between London Gatwick and Corfu on 25 September and 2 October 2006, and another with a company called “Hotels4U.com” for the supply of seven nights all inclusive accommodation between those dates at the Ermones Beach Hotel . Critically, Qwerty pleads at paragraph 2 of its Defence that Mr Titshall “did not purchase a package within the meaning of the 1992 Regulations from the Defendant”. Although this may be pedantry, the relevant question is in fact whether Qwerty sold or offered for sale a package within the meaning of The Package Travel Regulations”

The Court in this case, looked at the legislation and given the time and cost of calling witnesses from another jurisdiction said:-

6. Whilst consumer protection is plainly not the primary object of the Directive, save insofar as that can be equated with the achievement of a common market, it can I think at the least be said that one purpose is to render it straightforward for a consumer to effect recovery from a single domestic source in the event that he has bought a package which involves the supply of services in a state other than that in which he is resident and when there is some failure properly to perform.

7. The parties agreed that there should be a preliminary hearing “to resolve the issue as to whether the claim arises from a package holiday and whether the Defendant was a party to the holiday contract”. Judge Roberts approved that approach and directed such a hearing. The parties apparently had in mind a desire not unnecessarily to incur the costs of calling witnesses from Greece. Whether this approach was best calculated to promote expeditious disposal of the claim may be open to question.

The Court said the following in this case:-

22. The key to the resolution of the factual enquiry whether the services were here offered for sale as the components of a combination or whether they were being sold or offered for sale separately – whether Mr Titshall was buying and paying for them as a whole – lies in my judgment in two features of the transaction. The first is that it is plain that no explicit suggestion was made to Mr Titshall that either the flights or the accommodation were available for separate purchase, the one without the other . The second is that the treatment of the service costs, however precisely that was dealt with in the elementary and simple breakdown, seems to me on the facts of this case at any rate to supply a clear unifying feature connecting the provision of the one service with the provision of the other. The service costs, or at any rate the greater part thereof, must in some way have been presented as in part the price for putting together the package, not as the cost of some separate service, available in its own right, which would have been an incoherent suggestion. It is inherently unlikely to the point of being inconceivable that, insofar as it was presented as a free-standing cost, as the judge found that it was, it was put forward on the basis that that cost would be X if the flights alone were bought or Y if accommodation alone was bought.

23. Whilst therefore I can see that the transaction had the potential to develop into an offer for sale and a sale of separate services, it did not develop in that way. Qwerty offered a package which inevitably had component parts – it would not otherwise have been a package – but where those parts were presented for sale as a whole for an inclusive price which comprehended the cost of putting them together as well as the cost of sourcing them. Mr Saxby’s principal argument in refutation of this conclusion was that it was implicit in Mr Titshall being given a breakdown of the costs of the flights and of the accommodation that he could purchase the one rather than the other. He submitted that the statement that Qwerty acted only as agents for third party suppliers who were then named served to reinforce that what was offered was two separate albeit simultaneous sales. I do not agree that these considerations, whether taken singly or in combination, are sufficient to achieve that result. In my judgment the argument ignores the context of the Teletext advertisement, which was of a last minute get-away at an inclusive price (notwithstanding that that may apparently have been expressed as “from” whatever may have been the figure quoted) . In my view it ignores too the service costs, the greater part of which, without further breakdown or elucidation, necessarily represented the indivisible cost of making available the two component parts which made up the package.

25. It follows that in my judgment the judge was in error in characterising his findings of fact as amounting to Mr Titshall purchasing two services at the same time but separately. He did not purchase them separately. They were sold to him as the component parts of the combination or package. The judge’s further finding that the price was not an inclusive price was, I think, simply the corollary of his conclusion that there had been two separate purchases. But in any any rate the greater part thereof. There is no principled basis upon which one can conclude that any particular proportion of the service costs should be attributed to the sale of the flights or to the sale of the accommodation, and thus whilst the sale of two services may have been identified, there is no way of ascertaining what is the total cost of either of them.

Key Points

  1. The absence of an explicit suggestion that either the flights or the accommodation are available separately will present a difficulty for the defendant.

  2. A separate breakdown of the components does not imply separate albeit simultaneous sales.

  3. Even the defendant stating that it is acting as agent for third party suppliers and naming those does not necessarily prevent the combination being a package – the context of the advertising and booking process is key. The absence of these features will clearly help the claimant’s cause but this area is very complex and requires experience and judgment that would usually be best obtained by instructing specialist Counsel.

  4. In a recent case dealt with by one author against a holiday company whose business was generated mostly online, the defendant company settled the claim after the telephone transcript showed that the agent had not followed the script and had not explained that the different components could be purchased separately or elsewhere. Additionally, in that case the claimant had telephoned to complete the booking because the website had stated, ‘This holiday is not available online. Please telephone X Ltd’. This allowed the claimant to argue that the online terms and conditions did not apply.

  5. In every case, therefore, the claimant solicitor must check for any anomaly or evidential hole in the defendant’s case.

Therefore in light of Titshall it will be necessary to look at the following factors, if the booking was made by telephone:-

  1. Were the services being sold or offered as a sale of components or a combination?

  2. Was the claimant told at the time of the booking that there were a number of components to the holiday, and that these would be separate bookings?

  3. Was the claimant told at the time of the booking that the Defendant was acting as agent for different companies?

  4. Did the Defendant ever mention that there was another supplier of these services in the telephone conversation?

  5. Did the claimant specifically request a ‘holiday’ booking or was the claimant seeking to book separate flights, hotels and accommodation?

It will always be necessary to try and obtain a copy of the recording of the telephone call, and/or a copy of the script that was used for the conversation by the Defendant’s handling agent to see what training they were given at that time and as to what they were instructed to tell the claimant during the telephone call. In light of Titshall there is reasonable authority that if the separate components of the holiday were not made clear at the time of booking, i.e. during the call, when the contract is formed, it seems likely that the Court will confirm it to be a package.

Another useful authority, is in Club-Tour v Garrido [2002] ECR 1 – 4051. In that case the European Court of Justice was dealing with a situation where the applicant purchased a holiday from Club Tour consisting of air tickets and accommodation for two weeks at a holiday village in Greece. Club Tour purchased the holiday from a travel agency, Club Med. However, there was an infestation of wasps at the holiday village and Club Med was not able to place the customer elsewhere. He refused to pay the price of the holiday and Club Tour sought to enforce payment before the Portuguese courts.

The court was asked to answer two questions relating to the Directive, namely:

  1. Whether the word “package” in Article 2(1) of the Directive included holidays organised by a travel agency at the request of and according to the specifications of the consumer, or a defined group of consumers; and

  2. Whether the term “pre-arranged combination” in Article 2(1) of the Directive included combinations of tourist services which were put together at the time when the contract was concluded between the travel agency andthe consumer.

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