Cancellation denial called “arbitrary and unfair” — but is it wrong?

Selma Sobelman wants to know. She booked a Panama Canal cruise through Overseas Adventure Travel, with the understanding that she’d have 30 days to cancel her trip, if necessary. But when she called the whole thing off, she learned the truth.

“We were told we would lose our deposits,” she says.

Did OAT misinform Sobelman when she made the original booking, and if so, should it refund her $500 deposit?

We received “Cancellation Claim” Forms from Trip Mate, which said we could only be reimbursed for reasons of death or illness. None of
this was disclosed to us at the time of booking. My friend is 85 years old and I am 78.

We feel this is an arbitrary and unfair way to do business. Could you help us with this?

If OAT told her she could cancel without a penalty within a certain amount of time, but then didn’t, I’d have a problem. I asked OAT to investigate. According to the company,

The 30-day risk free period applies to travelers who book outside of penalty dates.

In this situation, Ms. Solbelman booked her small ship cruise 103 days prior to the trip’s departure. Cancellation penalties on our small ship cruises begin at 120 days, so when she booked, she was inside the penalty area and the 30-day policy did not apply to her.

Ms. S. gave us a $500 deposit. Her cancellation fee was $310.82, so we refunded her $189.18 in cash on May 8th $189.18

I can’t tell from our records whether or not the sales person told Ms. S. that she had 30 days to cancel without penalty. While she was in the penalty area, maybe the sales person didn’t check this or gave her the wrong information?

Since I can’t tell, we are going to send her a voucher of $310.82 that she can use for travel with us within the next two years.

In a he said/she said scenario, in which no one side can prove it was right — or wrong — a compromise voucher is completely acceptable. I think OAT has done the right thing by giving its customer the benefit of the doubt.

We’ve had quite a few heated discussions about travel insurance, and the need for a good policy. Alas, this is one of those times when insurance wouldn’t have helped the traveler.

(Photo: Scott Ableman/Flickr Creative Commons)

  • Harry Baxter

    Unfortunately, “a verbal promise isn’t worth the paper it’s written on”. Regardless of what a TA tells you, when you have to cancel a trip, the governing document is going to be the travel company’s printed cancellation policy, and “Calling the whole thing off” isn’t a sufficient reason for collecting on an insurance claim. There are, of course, “Cancellation for any reason” policies, but they cost a lot more, and they usually don’t refund the full amount that the customer paid. Nevertheless, I’m sorry that Ms. Sobelman had to learn a lesson that cost her money.

  • Arizona Road Warrior

    “Alas, this is one of those times when insurance wouldn’t have helped the traveler.”
    - – - – - – - – - – - – - – - – - – - – - – - – -
    While it is the most expensive travel insurance policy, a person can buy a travel insurance policy with a ‘cancel for any reason’ benefit which will cover them for any reason if they want to cancel.

    It was disclosed in the article but it seems like Overseas Adventure Travel sold a ‘travel protection plan’ that they designed with Trip Mate (not an inusrance company) to Ms. Solbelman. I went to Trip Mate’s website and there is very little information on the site and it can’t compared to the websites that sells travel insurance policies.

    One of the rules of buying travel insurance is never buy travel insurance from the travel provider because the policy is usually written in favor of the travel provider. One time, we took a land tour and the ‘travel insurance’ policy was included in the price of the tour. Another time, the total cost of ‘travel insurance’ for the both of us was $ 79. If you read the policies, there were very little benefits. What do you expect from a policy that was included or cost $ 40 per person! We ended up buying policies on our own.

  • Peter

    Chris:

    You usually fight tooth and nail for the customer, which is why I find your taking Overseas Adventure Travel at their word surprising. I start from the assumption that a 78y/o traveler and her 85 year old companion are neither sophisticated, nor looking to take advantage of the travel agency (and $310.82 is not a sum worth scamming for). That being said, where, exactly, do we thing these two elderly travelers got the notion of the 30 day frisk-free period. Who, other than OAT, would they have heard of this policy from? Of course they were suckered in with the promise of a 30 day no questions asked promise, and then screwed by the 6 point print footnotes when they actually went to enforce the saleman’s promises.

    This is not a “he said/she said” circumstance. A voucher is insufficent, as it requires the traavelers to spend more of their money with an organization that has already tried to cheat them once in the past. They are entittled to a full refund, and I am disappointed that you were willijng to accept anything less.

    Sadly, I think you let OAT off the hook too easily in this case.

  • Joe Farrell

    They refunded her cash? Really?

    Sending a 78 and 85 year old a travel voucher for ‘future travel’ [which is likely not transferable] is like giving tomato plants to a hospice instead of fresh tomatoes . . .

  • Arizona Road Warrior

    @ Harry Baxter – “Cancellation for any reason” policies, but they cost a lot more, and they usually don’t refund the full amount that the customer paid.”
    - – - – - – - – - – - – - – - – - – - – - – - –
    The ‘Cancel for Any Reason’ policies from Travel Insured, Travel Insurance Services, Travelex, Seven Corners and Travel Guard will pay 70%, 75% or 80% of the trip cost. However, ‘Cancel for Any Reason’ policies from Travel Safe, Global Alert, Travelex (they have different policies..some pay 80% of the trip cost and some will 100% of the loss) and MH Ross will cover 100% of the loss.

    Of course, the key is to read the policy to see what it covers, how much it covers and etc.

  • Arizona Road Warrior

    @ Joe Farrell “…is like giving tomato plants to a hospice instead of fresh tomatoes…”
    - – - – - – - – - – -
    I had a client that used to say “I am so old that I don’t buy green bananas”

  • Sharon Margret

    @ Arizona Road Warrior and Joe Farrell

    Wasn’t it George Burns who often said that?

  • http://www.cutcat.com ChelseaGirl

    I completely agree with Harry Baxter. Verbal promises are meaningless; you must get everything in writing. If the cancellation information is not already in the contract (which would be odd to begin with), get them to e-mail or fax it to you and don’t put down any deposits until you have it in writing. When will people learn?

  • Carver

    Verbal promises are meaningless

    —————————————————————–

    That’s not true at all. A verbal promise is completely binding, IF, and its a big IF, you can prove it, unless the law requires a written contract, e.g. real estate transactions.

    As Peter mentioned, where would these two elderly folks learn about OAT’s 30 day refund policy? Almost certainly from the agent. That’s probably why OAT gave any consideration.

    The most likely scenario is that the agent disclosed the 30 day policy as an inducement to make the sale, but failed to check the 120 day cut-off window. Whether the failure to disclose the 120 day cut off was wilful or not, I have no idea.

  • Arizona Road Warrior

    @ Sharon Margret – “Wasn’t it George Burns who often said that?”
    - – - – - – - – - – - – - – - – - – -
    The phase of ‘I am so old that I don’t buy green bananas’ is credited to Claude Pepper, former US Senator and US Representative from the state of Florida. I don’t know if George Burns used that line.

  • Arizona Road Warrior

    Carver is right that verbal agreements can be binding IF they meet certain requirements and some states may have additional requirements for verbal agreements. However, certain types of contracts do have to be in writing to be valid, under laws known collectively as the “Statute of Frauds.” These types of contracts include sales of land and other interests in real property, agreements which, by their own terms, cannot be performed within a year, and contracts for sales of goods priced over $500.

    In this case, Ms. Sobelman made a deposit of $ 500 but the total value of the trip was much higher; therefore, verbal statements are not binding.

    It is my guess that the sales agent was reading from a script that mentioned a 30-day look as a benefit\feature without realizing that her trip was within the 120 days window.

    It is my recommendation for travel providers to record all calls so that it eliminates ‘he said\she said situations’.

  • Steve Horwitz

    I suspect the poster who wondered how these two senior travelers came to believe (the OAT rep must have told them so) there was a 30-day recission period is on to something. My own experience with OAT, though we enjoyed our tour of east Africa immensely and think OAT pricing is a great value, started with the phone agent providing deceptive assurances about an option to have a layover night in Amersterdam, which eventually turned out to be not available. Though a condition of making our deposit had been the availability of this layover night, OAT was adamant that no refund would be forthcoming. Indeed, reference to the OAT website made it clear that the Amsterdam stopover was an available option. Not so. The moral of the story is that even when you read the website, you are still vulnerable.

  • Carver

    @Arizona

    There is an exception for performance. If a party has accepted partial performance by the other party, it cannot assert the Statute of Frauds. In this case, the acceptance of the deposit eliminates the Statute of Frauds as a defense by OAT.

  • El Cee

    For now I’m going to pretend I didn’t read “We received “Cancellation Claim” Forms from Trip Mate…” which could lead to the assumption that Ms. Sobelman bought some form of insurance or protection plan from OAT as Trip Mate administers its Travel Protection Plan.

    OAT states Ms. Sobelman booked her cruise 103 days prior to departure. Because we don’t know when Ms. Sobelman cancelled her trip, I will assume that she tried to do it within the 30 days she thought she had (even though the policy did not apply to her, she didn’t know it). The period within which she thought she could cancel is 74-103 days prior to departure. This would put her cancellation fees by OAT’s Terms and Conditions at “…Prior to departure 120-90 days (is) 10% of selling price or $300—whichever is greater” or “89-60 days (is) 40% of selling price”. OAT stated that Ms. Sobelman’s cancellation fee was $310.82 which means her penalty was at either 10% or 40%. Whatever the case, by OAT’s own terms and conditions, even before Chris’s involvement, she was owed $189.18. This did not call for any involvement whatsoever from Trip Mate.

    I disagree that this is a he said/she said scenario because OAT’s own Terms and Conditions clearly outlines the obligations they did not meet. With Chris’s involvement, OAT made it right but what a disgusting display of preying on the elderly and spinning the situation.

    So, Ms. Sobelman received the $189.18 in cash that she was owed. Should we even visit the possibility that she bought the Protection Plan which would explain Trip Mate’s involvement? Under this plan, according to Trip Mate’s website “…your cancellation penalty will be refunded in Overseas Adventure Travel Vouchers…with the balance of the refund made, if applicable, either in cash or credit card credit.” This would mean that the $310.82 voucher OAT granted as a fair compromise owing to the he said/she said situation would be, shock of shocks, something else that Ms. Sobelman was owed regardless of any 30-day penalty-free cancellation. OAT’s just tripping over themselves with their gestures of largesse. In a perfect world, OAT owes Ms. Sobelman and her companion a free cruise of their choice with the voucher to be used on-board or on an add-on land excursion, PLUS Travel Protection Plan in consideration of their inability to meet their own Terms and Conditions.

    So, just to tally Ms. Sobelman paid a $500 deposit, or potentially $835 or $714 with the Protection Plan. She has been refunded $189.18 cash and, oh yes, that voucher of $310.82 she can use within the next 2 years.

    Ms. Sobelman, please take a printout of Chris’s post, check your voucher for an expiry date and if the voucher is accompanied by a letter, please read it carefully because according to OAT’s Terms and Conditions “Overseas Adventure Travel Vouchers are NON-TRANSFERABLE AND NON-REFUNDABLE…,” and if it applies, according to Trip Mate’s Certificate of Coverage details “…Overseas Adventure Travel Vouchers (are) (valid for travel within 12 MONTHS of the date of issue, but NO LATER THAN 15 MONTHS from the date your trip was canceled)….” Hhmmm, that voucher smells like a fresh post for Chris.

    Ms. Sobelman, I say rebook your trip soon and fast as winter chickens (as opposed to spring ones) can’t afford to wait and vouchers have short memories.

  • http://www.cutcat.com ChelseaGirl

    Re: “A verbal promise is completely binding if you can prove it”–but how are you going to prove it unless you taped the conversation?

  • Carver

    @ChelseaGirl

    That’s a good question. Fortunately, you only have to prove it by a preponderance of the evidence, i.e. that your version of what transpired is more likely than not to have happened. Perhaps you have an eyewitness. Perhaps the other side’s story is unbelievable. Perhaps the other side is caught in a lie which kills their credibility. Perhaps the other side has a history of a certain behavior.

  • Harry Baxter

    I stand corrected concerning my statement about verbal promises not being binding, but realistically, many of the people who give verbal promises know how to game the system. Yes, you can record the person making verbal promises, but if you don’t inform yhat person, you’re usually committing an illegal act. If you read Mr. Elliott’s column regularly, you’ll frequently encounter complaints that start with the words: “The Travel Agent told me…”. If you value your money, get it in writing before you spend it.

  • Joel Wechsler

    @Arizona Road Warrior My father-in-law, who died in MA several years ago at the age of nearly 101 used the green bananas line often. I’m quite certain that he was not familiar with Sen. Pepper so I’m guessing he probably heard it from George Burns.
    As to the OP, having some familiarity with OAT and their way of doing business, I’m pretty sure that their agent offered the 30 day cancellation option as an inducement. Whether this was just an innocent mistake or willful disregard of the penalty period is impossible to determine. In either event I don’t believe vouchers, which may or may not be useable by these elderly ladies, are a fair response. They should get a full refund in cash.
    Chris, I agree with @peter that you let OAT off the hook a bit too easily on this one.