Let down by airlines and companies

Let down by airlines and companies

20th May 2020

Refund Refusal is branded 'a Disgrace' as demand for refund advice rises by 350%.

Citizens Advice Scotland has called for action to help consumers who have been unable to get refunds for cancelled flights, holidays and events during the Covid-19 crisis.

The charit revealed figures yesterday from its public advice website which show the numbers of visits to the pages about refunds for flights and holiday cancellations has spiked by 346% compared to the same period last year. The number of visits to the new page ‘refunds due to coronavirus’ since 23 March is 2,196.
 
Cases brought to the Scottish CAB network include a young couple who are waiting for around £15,000 in refunds after their wedding was cancelled, and another couple who spent over £2,000 on holiday flights. In both cases the companies involved have either refused to refund the money paid or are stalling unnecessarily [see details below].
 
CAS spokesperson for Fair Markets, Kate Morrison, says,
 
“The increase in the numbers of people viewing these pages is astonishing and shows there is a real wave of cases where people feel they have been let down by holiday companies, airlines and other traders.
 
“In addition to these statistics, we have anecdotal evidence of cases where people have spent tens of thousands of pounds for services which have not been delivered. Yet when they contact the company to try to get a refund, the company either refuses or offers vouchers instead of money. This is not acceptable. Some of the cases we’re hearing about are really distressing. People feel like they’ve been ripped off.
 
“As Scotland’s biggest provider of consumer advice, we want to give a voice to all those who have been let down in this way. It’s upsetting enough to have a holiday or wedding cancelled, without then finding that you’re not getting your money back.
 
“Covid-19 is not the fault of the airlines or holiday companies or event planners, but nor is it the fault of their customers. The bottom line is that if you pay for something and don’t get it, you should get your money back. Not in vouchers but in the money you paid. Refusal to comply with this simple principle, using covid-19 as an excuse, is a disgrace. 
 
“CAS will continue to stand with all the consumers in Scotland who are seeking the refund they are due. We note that the Competition and Markets Authority (CMA) has already stated that consumer law is on the side of customers in this situation, and we call on them and other regulators to come down hard on any company which refuses to refund its customers. If these companies won’t do it voluntarily then we believe penalties are appropriate.”
 

CASE STUDY 1: Emily and George
Emily Liddle and George Ridley have lived and worked in Edinburgh for years. Last year they decided to re-locate to London, but before that they wanted to have a once-in-a-lifetime holiday. In September 2019 they booked their flights, aiming to travel first to London, then fly from Heathrow to Japan on March 19, followed by a complicated itinerary of travel through Asia before flying home from Singapore in June.
Emily writes: “We booked with Lufthansa, thinking they were a reputable airline so we’d have no problems. Then on March 12, about a week before we were due to fly, they cancelled our flights. They actually didn’t tell us they cancelled (no call, email or text, nothing!) It was only because I was worried about the covid-19 situation that I checked our account to find it had been cancelled.
For the next 2 days we spent ages trying to call the company, waiting for hours at a time to speak to an agent. At that point, covid-19 wasn’t yet a pandemic and there weren’t the global travel restrictions that were later applied. We got through eventually, to find they had decided to cancel our flight for ‘economic reasons.’ The flight the next day was still operating, so we had the option of booking onto that - but this would’ve meant our whole itinerary was ruined, plus we’d have to re-arrange all our travel and accommodation to London, as we were staying the night beforehand to catch our flight from Heathrow.
“The agent recommend that we could get a full refund on the flight and that would allow us to re-book with their sister airline KLM. We decided this was the best thing to do, as the KLM flight was on the same day (March 19) and at the same price. So, we re-booked with KLM and accepted the flight refund from Lufthansa; they told us we’d have the money back in 7 days. Then on the Monday (March 16) the UK travel advice changed, banning travel out of UK, which meant we were unable to get on our KLM flight.
“Subsequently, KLM cancelled our flight, so even if we had been crazy and decided to travel against the government advice, we wouldn’t be able to. Lufthansa supposedly ‘refunded’ our first flight that day (March 16) but and we still haven’t seen a penny. In fact, they notified us on that they have changed their policy to give us flight vouchers only, rather than cash. We are trying to dispute this. We have been through the same process with KLM, where they are refusing to refund our flights at all, even though it was they and not us who cancelled our flight. They keep re-iterating that it’s “not their current policy” to refund in cash, so they too are offering to provide flight vouchers only. This has been over a series of calls and emails that has been very stressful and frustrating. I hate to add that I have also had some extremely poor customer service. I had read out my consumer rights under EU Law to be told there is nothing that can be done.
“Those 2 flights cost just shy of £2,000. On top of this, we had booked internal flights in Asia which have all been cancelled and we are unable to get refunds for those, so we about £2,200 out of pocket for services we have never received. Added to this the cost of phone calls to the various companies and the amount of time and stress it has taken up. 
“I feel really angry and frustrated. I know the pandemic itself is nobody’s fault and many people are suffering in lots of different ways. This isn’t about us losing our holiday – that can’t be helped. It’s about the appalling way we are being treated. The bottom line is that we’ve paid for services that we have not received, so surely we are entitled to our money back.”
 
CASE STUDY 2: Aimi and Ali
Aimi Gold and Ali Miles are a couple in Glasgow who had planned to get married earlier this year but those plans were thrown into chaos by the pandemic. This meant the couple has had refund problems with a variety of different companies. The total amount of refunds they are waiting for is £15,000.
The venue: Aimi writes, “We booked our wedding in December 2018 and picked a date in May, as we thought that would be our best chance of securing some nice weather in Scotland. At that point in time, good weather on the day of our wedding was the biggest problem we foresaw - not a global pandemic!
“I'm a solicitor with some consumer law experience and I reviewed the contract from the venue in detail – marking it up as I would for a client. I specifically asked the venue about some broad provisions in the contract that provided that the venue could keep any deposits we paid where the venue cancelled. The venue responded that they were unable to change the contract, and that they had never had to cancel a wedding in all their 20 years of business, but confirmed that they would transfer us to their sister hotel, should there be any issues. At the time, not wanting to fight too hard on the issue, I thought the main thing that could go wrong would be a fire/or a flood in the venue – some sort of force majeure event – and in that case we could get married in the sister hotel.  I also reasoned that if I signed the contract, then if something went massively wrong, consumer rights law would step in and remove the unfair terms. (The main thing I've learned through my various refund requests over the years as a lawyer is that a lot of companies don't understand that their T&Cs are not the be all and end all and that if the terms are unfair the Consumer Rights Act will come into play and those terms can be over-ruled). 
“COVID-19 changed everything. We realised in early March that things were not looking good for our wedding – and although we continued planning, when the lockdown happened on 23 March, we started to contact our venue and suppliers to see what our options were. Some of our friends who were meant to get married around about the same time moved their weddings to September/October – but we weren't comfortable doing that as there was no security that everything would be back to normal by then. Some other couples we knew moved their weddings to 2021, but Ali and I decided to postpone the wedding altogether.
“Although our venue have promised to repay our deposit in principle, they have stated they are not able to do this until they are back in the office. It is now nearly two months since we cancelled. I've now asked for the refund to be made within the next month. So far I haven’t gone into detail about the legal position, as I am trying to resolve issues as amicably as possible. We have about £7,000 sitting with the venue at the moment.”
Other suppliers: Aimi writes: “We've had trouble with some smaller suppliers, who have completely refused to provide a refund altogether. These companies (Make Believe Events and Platinum Linen) have offered to change the dates of the services they provide, but this is no use to us since we are not planning to get married for the foreseeable and the only services they offer are wedding decorations. I've sent these companies various emails, explaining the legal position and citing useful Citizen's Advice/CMA/Which guidance and various news articles. These companies are now ignoring my emails – so the next step will be to send a Letter Before Action and then a small claims action if necessary. I have a lot of sympathy for these companies and would be happy to wait for a refund until later in the year, but given that they are completely refusing a refund altogether, and given the position at law clearly provides that I am entitled to a refund, I feel like I don't have any other option than to raise a small claims action.”
The stag night: Ali writes: “I had this stag booked with a holiday company who have flatly refused to provide a refund and have instead provided a credit note that is redeemable for cash in July 2020. This is really frustrating as the company were actually only a booking agent – the underlying booking was with the Hilton hotel and the Hilton are offering refunds to all customers for this package who booked directly. We have raised this issue with Hilton who are looking into it. Initially the agent offered a credit note that could not redeemed for cash if not used within a specific period, but changed this after we applied some pressure. They then changed this to a cash redeemable voucher after Jan 2021 then after further pressure to July 2020. The company are hiding behind ABTA guidance, which they say allows them to provide credit notes, but this is not the correct legal position: any package holiday provider must provide you a refund under the Package Holiday Regulations. They have also been removing bad comments about their service from Facebook and from Trustpilot. Overall, a really awful service.”
The Honeymoon: Aimi writes, “We booked our honeymoon with a big package holiday company who have processed a refund for us – although they have been clear that the refund won't be in the 14 days prescribed by the Package Holiday Regulations. The company made us pay our final payment of £5,000 a few weeks ago – even though it was quite clear that we wouldn't be able to go on the holiday which was booked for 1 June (at the point they were requesting final payment, the company had cancelled all holidays up to 31 May – the day before our holiday). In the end, I made the payment, because if I didn't I would have breached the contract and the company could have kept the deposit. I was really frustrated by the company asking me to make payment of the remainder of the holiday, because it was clear that we would not be able to go on the holiday and I couldn't understand why they wanted to take my money and have the extra admin of having to return it. In the end paying the full amount was the only way to ensure we got all our money back. The company cancelled the holiday a few days after I made final payment and now we are in a long refund queue. This is something that other consumers should bear in mind – don't breach the contract yourself and don't cancel yourself unless you are comfortable with the risk that you may lose your deposit.”
Flights: Aimi writes, “We have had various flights cancelled for my hen night and another wedding we were due to attend in May in Spain – although we have had various emails from the airlines pressurising us to take credit notes rather than refunds we have eventually managed to get in the refund queue, but it should not have taken so much time and stress.”