Q: In last week's column about destination weddings [Legal Briefs, Sept. 8: "Contracts for destination weddings depend on who's paying"], you noted that wholesalers may have their own terms and conditions for participants to sign. You also recommended that our agency have its own participant's agreement, as the wholesaler's terms do not necessarily protect us and may in fact make us more likely to be sued. Why would we be more likely to be sued if something goes wrong? Would the same advice apply if a tour operator wants our participants to sign its terms? I think you are being impractical in advising us to ask wedding guests to sign two sets of agreements. What's a practical alternative?
A: In cases of severe personal injury or major economic loss, the participant would probably retain a personal injury lawyer, who, after investigating the situation, would find that the wholesaler may have valid defenses because of the disclaimers in the wholesaler's terms and conditions. The lawyer would then focus on your agency and try to concoct a legal theory of liability, such as negligent selection of the wholesaler, destination or resort.
Without your own terms and conditions protecting your agency, you would be fairly easy prey. By the time you got to trial, you would have spent more in legal fees and time than it would have cost to settle the case, regardless of whether you were really negligent, unless you had errors and omissions insurance covering your legal fees.
The same considerations apply when you sell the products of every tour operator that wants your clients to agree to its terms and conditions: Those terms do not protect you and make it more important for you to have your own terms and conditions.
I agree that it is off-putting to ask clients to sign not one but two sets of terms and conditions when you are trying to collect a deposit or final payment, so here are some creative alternatives:
First, you can ask the wholesaler or operator to cover you in its terms and conditions. For example, where the operator states, "ABC Tours has no liability for acts of suppliers," the operator can change it to "ABC Tours and XYZ Agency have no liability."
Major operators already make such changes for sponsoring organizations such as alumni associations, so there is no legal reason why they cannot make this change for you. Of course, if you are dealing with a single sale for a large operator, the latter is unlikely to agree, so let's look at other alternatives.
Second, you can redraft your disclaimer to incorporate the operator's terms and conditions into a single document. You would need the operator's approval of the document, which sounds unlikely, but I have done this before. You can find an example at www.pestronk.com/free.html under "Combined Retailer and Wholesaler Disclaimer."
Third, you can distribute the operator's terms as required by the operator, and you can post your own on your agency's website. However, be sure to call the client's attention to yours by a separate communication such as an email or letter. Also, be sure to retain proof that the client saw your online terms by recording the IP address, date and time. Even better, require the client to click "I Agree."
The client should have the opportunity to review your online terms before the deposit becomes nonrefundable.
Mark Pestronk is a Washington-based lawyer specializing in travel law. To submit a question for Legal Briefs, email him at [email protected].