Q: A major cruise line has sent
my travel agency a new commission agreement with a cover letter
that says the following: By continuing to make reservations after
we receive the contract in the mail, we are agreeing to its terms.
Are we really bound by this 15-page contract if we dont read it
before one of my agents, who does not know about the contract,
makes a routine booking? What if I want to reject the contract
because my consortium just negotiated a better deal? Similarly, can
other contracts ever be accepted merely by my silence after I
receive the contract in the mail?
A:
The cruise line is cutting some legal corners, and I believe that
your agency cannot be bound by the terms of the contract.
Therefore, you are free to propose new and different terms, and if
the cruise line rejects them, there is no commission
agreement.
Legally, an action
(such as a cruise booking) taken after receiving a contract like
this can only be deemed an acceptance if the person taking the
action intends to accept when he takes the action.
For example, if you
receive a piece of junk mail that contains a $1,000-per-month
maintenance agreement from a random photocopier repair service, and
you throw the mailing away, you know that by continuing to use your
own photocopier, you are not agreeing to pay $1,000 per month, even
if the contract says you are.
The only exception
would be the case where you agreed, in writing and in advance, that
future contracts or amendments sent by the other party would be
effective if you merely continued to use the product or service
after receiving the new contract or amendment in the
mail.
This is probably
the case with your personal credit cards: When you originally
signed the application, you were probably agreeing that future
amendments would be effective if you merely continued to use the
card after receiving a mass mailing.
Assuming that your
original contract with the cruise line did not have such a clause,
then the only way that a booking could legally constitute
acceptance would be if the booker personally knew about the new
contract and actually intended to accept it.
Of course, if you
knew about the contract and then made the booking yourself, the
cruise line could probably prove that you intended to accept, even
if you later try to say the opposite.
As far as silence
(or doing nothing) is concerned, the general rule is, again, that
you are not bound by a contract that you do not decide to accept,
so the other party could not normally prove your intent if you just
do nothing after receiving it in the mail.
However, if you
agreed in writing and in advance that mere receipt of future
amendments or even whole new contracts would constitute acceptance,
then you would be bound by doing nothing, as long as the mailing is
addressed to someone with the authority to reject it.
For example, some
GDS contracts state that amendments covering a new enhancement that
isnt free will be effective if you use the enhancement after you
receive the amendment.
As long as a
decision-maker gets a copy of the amendment, your agency is bound
as soon as one of your employees uses the enhancement.
Mark Pestronk
is a Washington-based attorney specializing in travel law. To
contact Pestronk directly, e-mail him at [email protected].