Q: Whenever I skim the standard terms and conditions at a travel website, I see a clause near the end stating that all litigation must be brought in the courts of the travel supplier's headquarters city, county, state or home country. Do the courts really uphold such clauses even in cases where it would be a real hardship for the consumer? If a consumer uses our travel agency, is the consumer deemed to be agreeing to these same terms and conditions?
A: These "exclusive forum" clauses are indeed very common on travel websites. Their sole purpose is to deter consumer litigation by making it more expensive and inconvenient to sue in a remote location.
The vast majority of the time, courts uphold these clauses. So if you try to challenge such a clause by bringing suit in your home city or county, the chances are very high that the court will dismiss the case.
Even if, based on precedents in your state, there is a chance that the court might not dismiss the case, it will often cost more to litigate the legal issue than the case is worth. So even if the clause might not be enforced, it still deters litigation.
Remarkably, airlines are not allowed to have such clauses on their websites. In 1996, the Department of Transportation issued an industry letter stating, "It is our view that for air transportation sold in the U.S., a passenger must be able to seek legal redress in any court of competent jurisdiction. Trying to force passengers to file what are generally small claims in courts that may be thousands of miles from their homes effectively deprives them unfairly of legal recourse. Such provisions are unconscionable."
All other types of suppliers have such clauses. Indeed, even Delta Vacations, which is a wholesaler that uses the airline's name, requires all suits to be brought in Dakota County, Minn. United Vacations requires you to sue in Wisconsin.
Most hotel chains have a similar clause: Hilton (suits only in federal court in Alexandria, Va., or state court in Fairfax, Va.), Marriott (suits only in Maryland), Wyndham (New Jersey), and as is very well known, all cruise lines have such clauses, following the U.S. Supreme Court's 1991 decision in Shute v. Carnival, which dealt with a cruise ticket and not a website, but the court's reasoning applies to the latter.
Even car rental companies get in on the act. If you use www.hertz.com, you agree to sue only in federal court in Newark, N.J., or state court in New Jersey's Bergen County.
Lest you think that these clauses pertain only to suits regarding the actual use of the website, as opposed to the supplier's travel services, look at this clause from www.hilton.com: "All users agree that the Indemnified Parties [the chain and hotels] ... are not responsible or liable for ... any losses, injury, death, property damage ... that may occur from use of the site or the acceptance of ... services or products related thereto or acquired therefrom."
If the consumer uses a travel agency that books through the GDS, the consumer is not bound by the supplier's website terms and conditions, so any consumer who books directly on suppliers' websites is taking a huge risk by effectively depriving himself of legal recourse, no matter what happens on the trip.
Mark Pestronk is a Washington-based lawyer specializing in travel law. To submit a question for Legal Briefs, email him at [email protected].