Mark Pestronk
Mark Pestronk
Q: Our agency tries to sell the services of our preferred suppliers as often as possible. By "preferred," I mean a supplier that has a good reputation, offers higher-than-standard commissions or overrides and has been endorsed by our consortium or franchise. Now, a client wants our agency to book a tour with an operator in Asia that I have never heard of, and he refuses to listen to our recommendations about operators to use. Of course, I don't want to decline the sale, but if the operator fails to deliver the promised services, or if the client gets injured, I am afraid that the client may try to sue our agency. Do we need any special language in our disclaimer to cover situations like these?


A: The free, model agency disclaimers that I offer at www.pestronk.com/free.html touch on this issue but do not address it directly. For example, those disclaimers state:

"ABC Travel, Inc. [the name of the agency in my model disclaimers] acts as a sales agent for any airline, hotel, car rental company, tour operator, cruise line or other service provider named in your itinerary ("Suppliers"). ABC is not responsible for acts or omissions of the Suppliers or their failure to provide services or adhere to their own schedules...."

"ABC assumes no responsibility for and shall not be liable for any refund ... [due to] any wrongful or negligent acts or omissions on the part of any other party not under ABC's control..."

"ABC has no special knowledge regarding the financial condition of the Suppliers."

So, if the operator takes payment and doesn't provide the services or if the client is injured on the tour, you have several defenses based on the wording of the disclaimer. However, those defenses would not necessarily protect you against a claim that your agency was negligent in recommending the particular supplier.

I realize that the client would be lying if he alleged that you recommended the supplier, but clients sometimes lie. Therefore, I have drafted a special disclaimer section for the sale of a nonpreferred supplier. It consists of the following:

"You have chosen to use a Supplier that we have not recommended or endorsed. We are not responsible for acts or omissions of the Supplier or its failure to provide services, adhere to its own schedules, or make refunds owed. We do not guarantee or insure the Supplier. We assume no responsibility for and shall not be liable for any wrongful or negligent acts or omissions on the part of the Supplier. You hereby release us from all claims arising out of any problem covered in this paragraph."

Although some disclaimers can be placed at the bottom of the invoice/itinerary or even in your email signature, I recommend that you obtain the client's signature on this particular disclaimer. A signature is evidence that the client knew that you were not recommending this particular operator.

The link to the entire disclaimer containing this paragraph can be found at www.pestronk.com/free.html and can be downloaded by clicking on "Disclaimer for Non-Preferred Supplier."

Please remember that this is a sample only and is not intended as legal advice. You should consult a knowledgeable lawyer who can advise you whether the model is appropriate for your agency.

One more thing: You must name the operator in order to be protected. Otherwise, under the legal doctrine of undisclosed principal, you, as the agent, become liable for the acts or omissions of the supplier.

I have focused on winning lawsuits, but the most important purpose of a good disclaimer is to deter suits in the first place.
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