FAIRFAX, Va. -- Travel agent arbiter William McGee reinstated the
ARC accreditation of a Chicago agency that filed a new bond two
days late, saying it was "the only fair resolution." The agency was
Issa Corp. (doing business as Issa Travel).
McGee ruled that ARC was correct to cancel the agency's
accreditation when it became underbonded but that reinstatement was
"fair" in light of the "extraordinary circumstances" of the case.
It was one of the relatively few cases when the arbiter deviated
from the letter of the standard ARC-agency contract.
According to McGee's decision, ARC notified Issa Travel last
April that it needed to increase its bond from $19,800 to $26,200
by Aug. 1, but the rider was not filed on time.
Later in August, ARC notified the agency that its bonding
company would cancel its bond on Sept. 19. The agency had a 30-day
grace period to get a new bond or lose ARC accreditation.
During much of this period, the agency owner (who was not
identified) was very ill and hospitalized for more than a month. He
was released from the hospital on Oct. 16. Three days later, an ARC
representative came to pick up a replacement bond or the agency's
ticket stock.
The owner misunderstood the ARC representative's instructions
and believed he had more time to get a new bond.
ARC canceled the agency's accreditation on Oct. 19, the
deadline. Two days later, ARC received the new bond.
The agency owner told McGee that the bond would have arrived
before the deadline if he had not been hospitalized. He also told
McGee that the agency is his family's bread and butter and that he
never before defaulted on an ARC obligation.
McGee concluded that ARC's actions complied with "the letter of
the contract," but he restored Issa Travel's accreditation as the
fair thing to do.
As "extraordinary circumstances," McGee cited the owner's
hospitalization, his misunderstanding of the ARC representative's
instructions and the arrival of the new bond "just two days past
the deadline."
However, McGee ordered Issa Travel to pay ARC the application
fees that would have been incurred if it had had to apply for
reaccreditation.
The arbiter ordered the owner to sign a two-year personal
guarantee, making him personally liable for any future default.
McGee also warned the agency to expect immediate termination of its
accreditation if it ever fails to increase or replace its bond on
time again.