Agents wrestle with issue of liability when plans go awry

September 23, 1990|By Laura Bly | Laura Bly,Universal Press Syndicate

A business consultant attending meetings in South America changes and postpones his itinerary several times. His original visa expires. When he is denied entry, his anger lands him in jail, and he misses his appointments. He sues his travel agent -- and settles for $75,000.

Two elderly women on an African walking safari are charged by a Cape buffalo. One is killed, the other badly injured. The insurance company for the tour operator who arranged the trip pays more than $1 million for the operator's promise of experienced guides and an "authentic Masai warrior" who turned out to be a dishwasher from a local camp. And because the travel agency that booked the trip failed to advise the women that it could be a hazardous trip with exposure to wild animals, the agency's insurer pays more than $100,000.

After consulting with their travel agent, a couple spends more than $13,000 for a trip with Hemphill/Harris, a deluxe tour operator. But the couple's Far East vacation ends in a nightmare a few days after it begins, when their hotel turns them away and the tour is aborted. The still-pending case is one of several filed against travel agencies in the Hemphill/Harris debacle. The unhappy travelers' argument: Their travel agent should have known -- via front-page stories in the trade press, Hemphill/Harris' ouster from a well-known trade group, and other warning signs -- that the operator was in deep trouble.

These true scenarios presented during a American Society of Travel Agents symposium in Washington in late July illustrate an increasingly relevant and difficult question: If something goes wrong during the trip, when is your travel agent responsible?

Disgruntled travelers have sued their travel agencies for everything from not catching enough fish to acts of terrorism. The estate of Leon Klinghoffer, killed in the hijacking of the Achille Lauro cruise ship, has named his travel agency as part of an ongoing $1 billion lawsuit.

Travel agents have argued successfully that they act only as conduits for other travel companies -- tour operators, airlines, hotels, cruise lines, car rental companies and others -- who pay them a commission. Since they don't provide the services themselves, the theory goes, they shouldn't be held accountable for events beyond their control -- whether it's a rained-out golf tournament, lost luggage or a tour operator who goes belly-up and leaves the traveler waiting at the gate.

But as several prominent travel industry attorneys and insurance consultants pointed out during the ASTA symposium, determining agents' liability isn't always that simple.

Part of the problem stems from the nature of the travel industry itself. You decide where you want to go on vacation and consult a travel agent. But most vacation packages are orchestrated by a tour operator or wholesaler, who buys blocks of airline tickets, hotel rooms and other services and sells them either directly to consumers or, much more commonly, through travel agents.

More and more travel agencies now include a liability disclaimer form with the client's travel documents, explaining the agent-tour operator-supplier relationship. But what happens when the tour operator, whose own brochure also disclaims liability, books you into a hotel going through a renovation that leaves the swimming pool unusable and fills the early morning air with the sound of jackhammers? You could go after the hotel, but what if it isn't part of a chain and happens to be in a far-flung corner of the world?

Or, worse yet, how do you get your money back when the tour operator itself goes bankrupt? In these kinds of cases, the travel agency is a convenient -- and sometimes the only accessible -- target.

In what is still an evolving area of the law, courts have gone both ways in deciding whether a travel agency is responsible for a bungled trip. But as travel agents move far beyond merely taking orders for the airlines, the "reasonable standard of care" they must follow changes accordingly.

A New York judge, for example, recently held a travel agent liable for failing to advise a client that he needed a visa. And, says New York travel attorney Arthur Schiff, "I think the courts will continue to expand what a reasonably prudent agent ought to do."

That may mean that an agent should double-check hotel reservations, inform you when an airline is going through rancorous labor negotiations that might have an impact on its flight schedules, or even warn that a hurricane is headed toward your intended vacation spot.

"If you have access to information that's negative, you have an obligation to tell your client the bad news. If you don't, you're going to be held responsible -- particularly when information is readily available," says Thomas A. Dickerson, a New York travel attorney who has filed a suit against a travel agency that booked clients on an ill-fated Hemphill/Harris tour.

How will travel agents' increasing professionalism and corresponding liability affect you as a traveler? For starters, more agencies will insist on travel insurance or a signed statement that you turned it down. Comprehensive insurance is expensive, and the limitations can be significant. But it can spell the difference between disaster and mere annoyance if something goes wrong.

You'll also see a greater reliance on a select group of tour operators and other suppliers with which the agency has done past business or has reliable knowledge. That, in turn, could lead to a "shakeout" with more stability and more reliability, but fewer choices and higher prices.

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