Did KLM lie about her ticket refund?

November 19, 2012

If you’re an airline apologist, you’ll probably answer Angelina Bellamy’s question reflexively, if not dismissively.

I almost did (and I’m no airline apologist). But this one’s interesting, and not as easy to fix as it looks.

Bellamy purchased four Economy Extra Flexible tickets on KLM from San Francisco to Stockholm recently. She decided to cancel her return ticket and ask for a refund.

Normally, when you cancel the return on a discounted fare, you don’t get a refund. In some cases, you should be grateful the airline doesn’t try to charge you for the more expensive one-way fare for violating its ticket contract — but that’s another story.

When Bellamy called KLM to inquire about the terms of her ticket, a representative told her that she could cancel the return for a full refund on the unused portion.

“That was the point for me purchasing the much more expensive tickets,” she said. “Otherwise I would have purchased the cheap tickets, canceled the return ticket and lost the money, which would have been much much less than I am now losing because I bought the expensive tickets.”

But KLM refused to refund a penny of her fare. The reason? Although her fare was “flexible,” it repriced her ticket as a one-way fare, ensuring it would keep all of her money. (I’ll let the airline explain in a minute.)

Bellamy understands the rules. She’s upset about the way in which the rules were communicated.

I was told several times by their staff that I would receive a refund.

KLM’s website, while being misleading about actually receiving the full refund, certainly does not state their policy about one-way ticket charges. If their customer service staff is misleading the consumer, they should honor those promises.

I have three different tape recordings of their customer service staff reassuring me I would get my money back upon cancellation.

I am furious about this deceptive tactic. Is there something that you might be able to do to help in this situation?

Let’s let KLM explain itself. Here are the relevant portions of her final rejection letter from the airline:

[Your] refund is calculated based on the journey you have flown (one way from Stockholm to San Francisco) and this is deducted from the refundable value of the unused portion of your ticket.

According to Article X (3) of our General Conditions of Carriage (b) the difference between the fare paid and the fare applicable to the scheduled route for which the Ticket was used, if a portion of the Ticket was used, less applicable administrative or cancellation charges.

Since you only flew one-way from Sweden to San Francisco, our Refunds Department calculates the one-way journey and deducts this from the value of the tickets paid.

In certain cases, as here, the one-way fare may be greater than the return fare purchased and there is no refund due; however, any unused airport taxes will be refunded.

Although I do not doubt the veracity of your comments and I am not in a position to confirm or deny that you were informed the refund due would be SEK32650, however can confirm that the amount refunded is correct.

In other words, it doesn’t matter what our representatives told you on the phone, or what our website suggests. It’s the fare rules and the conditions of carriage that matter here.

I agree with KLM on one level, and I disagree on another. Rules are rules. But if your own employees misrepresent the rules, then we have a problem.

And that’s not to say I agree with these rules. Recalculating the fare from a flexible economy class ticket to what appears to be a walk-up fare is unsporting.

Should I go to bat for Bellamy? I suspect I’ll strike out, but when has that stopped me from trying?

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TonyA_says

The strangest part of this story is why KLM is computing the refund in Swedish Kronas (SEK). That can only mean the ticket was priced in SEK. US Tariffs (i.e. SFO to STO) would be normally priced in US Dollars.

It seems like we are reading 2 different stories. The OP’s version and KLM’s version. They do not seem to match.
http://flyicarusfly.com/ Fly, Icarus, Fly

Then she should know that it’s all about money, money, money… in a rich man’s world…
bodega3

Here is a link to KLM’s economy fares:

http://www.klm.com/travel/us_en/plan_and_book/ticket_information/ticket_conditions/index.htm

As you can see, there is no, Economy Extra Flexible fare, so her wording or Chris’ in incorrect. Secondly, when I go into KLM’s rules, all economy fares are based on roundtrip travel, not oneway. So right off the bat, she can’t get a refund for an unused return segment as the ticket was priced on a roundtrip fare, not two oneways. Now did she have the agent pull up her PNR and review the rules of the fare or did she just call and ask a question that many have been generalized? What is the fare basis and the class of service she was booked in? Why isn’t this provided as these will tell us exactly where to look for the rules….which would have been online at the time of booking. Too much not being told or provided which always makes an OP look sneaky.
bodega3

Why are the classes of service and fare basis’ never provided in these articles? Those are what are needed, not he said, they said!
bodega3

In the rules of the fare which can be found online and are provided to the booker at the time of reservation.
anonymousegirl

I might be misunderstanding but from the quote “That was the point for me purchasing the much more expensive tickets,” she said. “Otherwise I would have purchased the cheap tickets, canceled the return ticket and lost the money, which would have been much much less than I am now losing because I bought the expensive tickets.”

it seems like she never intended to take the return flight.
http://twitter.com/johntbaker John Baker

@b5e389fdd67873b747175276b0b9b9ba:disqus I completely missed that. I guess that reinforces what I thought from the start that she was trying to pull a fast one on the airline and got caught.
Guest

“and the value of the “unused portion” is what? ”

Common sense says that it has some non-zero positive value. KLM is saying that the “unused portion” has negative value.

“she was trying to be cute with the airlines and thought she’d figured out a way to get a one way ticket cheaper”

If she was trying to do that then she wouldn’t have paid EXTRA for more flexible tickets.
Michael__K

“and the value of the “unused portion” is what? “

Common sense says that it has some non-zero positive value. KLM is saying that the “unused portion” has negative value.

“she was trying to be cute with the airlines and thought she’d figured out a way to get a one way ticket cheaper”

If she was trying to do that then she wouldn’t have paid EXTRA for more flexible tickets
Michael__K

Show us. A link or a direct quotation please.
TonyA_says

Of course they would never provide those. Otherwise this case would be simple for you and me :-)

But digging deeper … Assume this is a R/T SFO-STO flex fare.

The Economy Fully Flexible R/T fare of KLM is BFFUS $3276.00 before tax and surcharge. The cheapest O/W fare (SFO-STO) for KLM is YFFWUS $3280.00 before tax and surcharge.

The R/T ticket would have cost total $3913.60 (Tax $637.60)
The O/W ticket would have cost total $3581.80 (Tax $301.80)

If she really had a fully flex fare ticket to begin with and did not use the return portion, the refund will be about $331.80 using today’s prices.

The more I think about this, the more I find this story incredible.
Why buy a flex ticket in the first place? I need to know the “logic” behind that.
TonyA_says

Michael, I am sorry but your simply do not understand airline talk.

If you read my research somewhere here, I state that the one-way FARE BASIS ($3280) is actually $4 MORE than the round-trip fare basis ($3276). So there is less than ZERO refund for the Fare Basis only.

However, the taxes and surcharge for one-way fare is LESS than that for the round trip fare. Hence, net-net she will be getting a REFUND of the TAXES portion (less the difference in Fare Basis).

In my office, I am one of the few (if not the only one) who can compute these things. So do not expect a call center reservationist to give you EXACT answers.
TonyA_says

Here:

FARE RULES TEXT

UNLESS OTHERWISE SPECIFIED NOTE – RULE 16NP IN IPRG APPLIES

GENERAL RULES TEXT

UNLESS OTHERWISE SPECIFIED
NOTE –
CHANGES AND CANCELLATIONS PERMITTED.
-FOR CANCELLATION AFTER DEPARTURE-
THE REFUND GIVEN WILL BE THE DIFFERENCE BETWEEN THE FARE PAID AND THE APPLICABLE FARE FOR THE JOURNEY FLOWN
bodega3

Show you what? Her reservation? As you know, or should know, when you book online, the rules of the fare you booked comes up, usually through a link which you should alway read and print out. I pulled up all KL’s fares from SFO to STO fo 23JAN13 and the advance purchase economy fares are all based on roundtrip, even the economy flexible fares. So what Tony just provided shows you the rules of all of them.
http://twitter.com/johntbaker John Baker

Michael__K from the story

“That was the point for me purchasing the much more expensive tickets,” she said. “Otherwise I would have purchased the cheap tickets, canceled the return ticket and lost the money, which would have been much much less than I am now losing because I bought the expensive tickets.”

To me that sounds like she never intended to fly the round trip fare
Michael__K

That doesn’t answer the question: WHAT is the “applicable fare for the journey flown?” How is determined?

Not in the way most lay people with no subject matter expertise would interpret it…
Michael__K

“your simply do not understand airline talk.”

I’m being purposely (slightly) dense because that’s *exactly* my point: this stuff is not in the contract or even clear spelled out in the cited “fare rules.”

It requires “understanding airline talk” and all kinds of unwritten (for the passenger) rules which means it’s completely disingenuous to claim that the passenger should have read the contract more carefully.
TonyA_says

This really sounds fishy. But it could be she really was expecting too much from a lowly paid call center rep.

Here is the Standard Procedure for estimating the difference in fares.

First check the coupon status to make sure what segments are UNUSED. Then do the ff:

(1) Read the linear or cost of the existing ticket.

(2) Look up the fare rules for the existing ticket and see the Penalties (Category 16)

(3) If the fare rules allow the changes or cancellations you want to do then continue. Otherwise END OF STORY.

(4) Find the penalty if change or cancellation is allowed.

(5) Make a HISTORICAL quote (re-price) the flown segments. In other words, you will lookup what the flown segment’s ticket price WOULD HAVE BEEN at the time the original ticket was purchased. Good luck for amateurs on this one.

(6) Compare the difference and apply the penalty. You now have a decent estimate.

Now you know why the telephone agent will only tell you what they told her. The computation is usually done OFFLINE by experts in the backoffice. That’s why.
bodega3

That isn’t true, but if it is for you, then use a professional so you get the rules and understand what you can or can not do with the ticket you are purchaing.
Guest

(dupe)
TonyA_says

The point is many airline RESERVATION agents DO NOT KNOW or HAVE THE TIME to do these calculations. That’s why they have REVENUE ACCOUNTANTS locked up in another office :)
Michael__K

Show me a rule that is visible to the passenger that includes enough precision and detail so that someone with no special expertise can calculate on their own what the refund amount would be.
TonyA_says

You can read the rule(s), but normally you don’t know how to compute historical and applicable fares. So you need an “expert” to help you.
TonyA_says

That is TECHNICALLY CORRECT if she held a full flex fare ticket. Nothing wrong about that.
y_p_w

There was a time when trying to game the strange rules (Saturday stay) that were designed to make money from business travelers was an art form. I remember hearing about people who would buy round trip tickets for two separate trips but space them in such a way to use them avoid the premium for booking without a Saturday stay.

I’ve even heard that sometimes the fares were so much more without a Saturday stay that it made sense simply to eat a return fare and use a separate RT ticket booked separately. At least until the airlines caught on to it. Typically the passenger might just use different airlines.
TonyA_says

That and she probably made a tactical error.

If all she wanted was a cheap one-way ticket to Sweden, then she could have bought the cheapest roundtrip (R/T) ticket and throwaway the return portion.
Reason being that oneway (O/W) tickets are extremely expensive to and from Europe from the classic airlines.

If she was iffy about her return date to SFO, she still could have bought the cheapest R/T ticket and pay the $250 change penalty plus fare difference while in Europe. I think this will be cheaper than buying a FLEX R/T fare but I can’t be 100% sure depending on the travel dates.

That said, I can’t figure out what else she may have been thinking.
emanon256

I think her logic, using your prices, was: spend $3,581 on a one-way ticket, or spend $3,913.60 on a flexible R/T thinking she would get $1,956.80 back. She thought she could game the system and get a O/W for $1,956.80 by buying a flexible fare. That’s exactly why she recorded her phone calls, because she knew she was gaming the system and wanted support.
TonyA_says

Wow, if that is true then this case really stinks. Stay away !!!
emanon256

And a non-flexible economy R/T looks like it runs $2,286 on the dates I looked. That supports her statement:

“That was the point for me purchasing the much more expensive tickets,” she said. “Otherwise I would have purchased the cheap tickets, canceled the return ticket and lost the money, which would have been much much less than I am now losing because I bought the expensive tickets.”

She is right, she would have spend $2,286 if she did that, but she saw the flexible fare as an opportunity to save $330 extra dollars over buying a non-flexible R/T and not flying back. per her words, she knew in advance of booking she was not flying back.

So her choices were:
A. O/W: $3,582
B. R/T: $2,286
or
C. R/T Flex: $3,914

She with with option C, figuring if she bought the flexible fare she would get half of it back. But she was wary, so she recorded her calls. It didn’t work the way she wanted, so she has involved Chris and per her own words regrets not going with option B. Though if she went with B. and made a habit of this, they would probably go after her for the difference anyway.

Well, at least that my opinion based on the info we have. Not sure if that was what really happened, but it sure sounds like it to me.
Joe_D_Messina

Excellent post. Sometimes I’m amazed how hard these forums are on the OP. If she hadn’t taped the conversations, somebody would be all over her for not getting any proof. But she does tape them and now it’s because she was “trying to be cute”?

Who knows, maybe the tapes would show she misunderstood the reps, but assuming things went the way she claims, that’s inexcusable on KLM’s end. If the reps can’t look things up and determine if she’d get a refund, then there should be clear, canned response where they note the policy and make it clear that in some (many?) cases there’s no refund because of how their policies compute things.
TonyA_says

Oh dear. I searched. She is a scientist and does doctoral work in Stanford and Stockholm University. That’s probably why she needs a lot of flexibility in flight schedules. Maybe she really needed one-way tickets but they were too expensive as you said.
TonyA_says

Joe, note how the KLM letter says ” Our REFUND DEPARTMENT …”
As you can see it takes another group of people to compute the refund.

A lot of people simply do not understand that INTERNATIONAL fares are a lot more complex than domestic fares.

Inside the USA, most of our fares are oneway to begin with. So when we buy a roundtrip ticket, they simply sell 2 oneways.

Sometimes you will see domestic R/T specials but these are not the many compared to the usual oneway fares.

For international, the standard is roundtrip and the exception is oneway. Airlines will usually discount roundtrip like crazy but will leave oneway fares only to the most expensive booking classes. Europe (and open sky areas) is notorious for this. The exception to this is ASIA where oneway fare is usually 65% of roundtrip. I think this has to do with ASIAN airlines still being government regulated.

Bottom line, international fares are just more complex and do not expect simple answers to simple questions immediately.
TonyA_says

Michael, not sure I answered you (because I got lost with the number of open threads). But here is the way I compute it.

http://www.elliott.org/can-this-trip-be-saved-2/did-klm-lie-about-her-ticket-refund/#comment-714089798

True, Lay people will be lost in space. Sorry but that is the “system”. It is complex.
http://www.facebook.com/CarverFarrow Carver Clark Farrow

That’s not correct. An oral modification is binding in the US unless the contract specifies a writing is required (all do) or proscribed as a matter of law
Ed Boston

Hmmm… Well by you staying on the line and not verbally agreeing to the recording, that is implied consent and by your logic, not allowed. Personally, I don’t see anything implied about it. They state the call may be recorded. They don’t say you *CAN’T* record it. Just that it may be recorded . So they can’t argue, if you recorded it, that they didn’t think it was being recorded.

And could you provide the reference to the penal code you are referring to? If we assume the call originated in California but terminated outside the state, I believe the Federal Laws would apply because of it crossing state lines.
http://www.facebook.com/profile.php?id=1275578005 Noah Rosenthal

It’s Penal Code sec. 630 et seq.
Adam1222

Noah’s cite is correct.
Actually, we are talking about two different things.
(1) A says to B, “I may be recording this call.” B stays on the line. B has given implied consent to his call being recorded by A. This is well-established by case law.
You are saying, though:
(2) A says to B, “I may be recording this call.” You are saying then A has given consent for B to record the call. That is different.
Unfortunately, the statute doesn’t require someone to say “You CAN’T record the call.” The default is a prohibition on recording.
An implied consent is any consent that’s not explicit. A has never explicitly consented to B recording the call, so any consent would have to be implied.

Next, there’s no sort of estoppel argument here. It would not be KLM that is “arguing” there was no consent, it would be the District Attorney, as we are talking about criminal law.

Finally, the courts are all over the place in what law would apply. Check out http://www.rcfp.org/reporters-recording-guide/interstate-phone-calls But just because parties are in two different states doesn’t mean that state law is preempted by federal law — particularly here, where there is no conflict with federal law.
Adam1222

Noah’s cite is correct.
Actually, we are talking about two different things.
(1) A says to B, “I may be recording this call.” B stays on the line. B has given implied consent to his call being recorded by A. This is well-established by case law.
You are saying, though:
(2) A says to B, “I may be recording this call.” You are saying then A has given consent for B to record the call. That is different.
Unfortunately, the statute doesn’t require someone to say “You CAN’T record the call.” The default is a prohibition on recording.
An implied consent is any consent that’s not explicit. A has never explicitly consented to B recording the call, so any consent would have to be implied.

Next, there’s no sort of estoppel argument here. It would not be KLM that is “arguing” there was no consent, it would be the District Attorney, as we are talking about criminal law.

Finally, the courts are all over the place in what law would apply. Check out http://www.rcfp.org/reporters-recording-guide/interstate-phone-calls But just because parties are in two different states doesn’t mean that state law is preempted by federal law — particularly here, where there is no conflict with federal law.
Ed Boston

‘A’ has consented to the call being recorded. Doesn’t matter who records it. You have any case law that says differently?
dourdan

I voted this post up, because you said it clearer then i ever could.

“ONEWAY fare is not half the ROUNDTRIP fare”

I had to reread the article several times, because it is just too unbelievable; the OP is essentially buying a whole candy bar, only eating half and asking for some money back—That is NOT how the world works.

And yes i have been in that situation before (with a round trip fare, that i needed to cancel/only use half of.)
dourdan

as a former call center employee who did not know the answers to half of what i was asked, i was always told “stick to the script”. I have a feeling the person did a quick search of their script database under “what to say to someone complaining about an unused ticket” and read off a canned response, meant to calm down the OP.
TonyA_says

Even if I am well skilled in using my GDS, I do not talk on the phone and do analysis or fare quotes at the same time. I tell the client I will call them back or email them. This travel stuff is NOT easy especially when you need to compute $$$$. I believe what you said is what happened to her.
commentfromme

atrocious atrocious atrocious. a broken industry. no wonder I approach every interaction with the airlines as though I am a caged animal.
Michael__K

“Lay people will be lost in space”

As you wrote yourself in another comment, even the airline employees who answer the phones will generally be lost in space.

And a nitpick: aren’t there different valid ways to perform step 6 (“Make a HISTORICAL quote (re-price) the flown segments”“) with very different results? Does it depend on the reason for the cancellation (where is that explained)? When my return segment was cancelled and I opted for a refund (and to complete my journey on my own), the reprice was definitely NOT based on the one-way fare.
TonyA_says

Michael__K

Hey Michael, if you are interested to read the RULES of the ROUNDTRIP FLEX Fare Basis Code BFFUS, then read this link (open to consumers):

http://www.farecompare.com/products/fare-display/farerules.html?origin=SFO&destination=STO&carrier=KL&fareClass=BFFUS&linkNumber=1&sequenceNumber=22&tripType=roundtrip

Category 16: Penalties
Unless otherwise specified
Note – Rule 16NP in iprg applies -and- Unless otherwise specified Note -
Changes and cancellations permitted. -For cancellation after departure-
the refund given will be the difference between the fare paid and the
applicable fare for the journey flown

Here is a link to KLM’s Tariff (filing):
https://www.klm.com/travel/ca_en/images/CTA_tariff_tcm534-325630.pdf

Read the Voluntary Refunds section:

(C) VOLUNTARY REFUNDS
(1) IF A PASSENGER IS ENTITLED TO OBTAIN REIMBURSEMENT
FOR HIS/HER TICKET, FOR REASONS OTHER THAN THOSE
REFERRED TO IN SUB-PARAGRAPH (B) OF THIS ARTICLE,
THE REFUND SHALL BE IN AN AMOUNT EQUIVALENT TO:
(A) THE FARE PAID, LESS ANY REASONABLE
ADMINISTRATIVE OR CANCELLATION CHARGES, IF NO
PORTION OF THE TICKET WAS USED.
(B) THE DIFFERENCE BETWEEN THE FARE PAID AND THE
FARE APPLICABLE TO THE SCHEDULED ROUTE FOR
WHICH THE TICKET WAS USED, IF A PORTION OF
THE TICKET WAS USED, LESS APPLICABLE
ADMINISTRATIVE OR CANCELLATION CHARGES.

Welcome to my World :-)
Walhon

Thank you for setting the record straight! I appreciate your input!
TonyA_says

Yes they will be lost in space. Sorry but this is REALITY.

About the nitpick, airlines and GDS companies keep at least a year of historical fares in their online database PRECISELY FOR THIS PURPOSE.

Let us say the OP bought her tickets last 01SEP for departure 01OCT. I can easily lookup the fares for SFO-STO for departure 01OCT 2012 that would be effective if the ticket was issued 01SEP 2012. Once I get the base fare, I can easily add back the applicable taxes and surcharges that were charged for the ticket at that time (this info appears on the fare construction or linear of the existing ticket).

Therefore, I can accurately tell you what the ONE WAY FARE would have been for SFO-STO if I know the date she bought the ticket and the departure date. But, don’t try this at home folks :-)

If I can compute the oneway fare (the segments she actually had flown), then I can also compute the difference between that and the ticket she is holding. The refund is the difference (less any penalty or admin fee). Done.

Added: I can’t believe her statement – “… the reprice was definitely NOT based on the one-way fare” unless she shows why. I already showed you that the oneway fare is more expensive than the FLEX roundtrip fare. So her refund really consists of the tax (and surcharge) portion of the ticket. As I mentioned earlier, maybe even she is lost in space.
Michael__K

Reality should have consequences for the carrier too (they created the convoluted rules and they didn’t hire customer facing personnel who understand them).

I don’t think you understood my nitpick: my first-hand experience (not with KLM) is that they DO NOT necessarily use the one way fare when you cancel and seek a refund for a half-completed journey.
TonyA_says

Re: my first-hand experience (not with KLM) is that they DO NOT necessarily
use the one way fare when you cancel and seek a refund for a
half-completed journey.

Answer: If your ticket is based on 2 oneway fares combined then there is no need to reprice a oneway fare since they already know the cost of the flown leg (i.e. the oneway fare of the outbound segments). You see this normally for US domestic tickets.

Regarding consequences – get real. There is no app for that. :-)
Michael__K

I still have the same observation as before: it doesn’t explain what “FARE APPLICABLE TO THE SCHEDULED ROUTE FOR WHICH THE TICKET WAS USED” means.

For example, this “rule” doesn’t state that the one-way fare must be used rather than the component fares (or whatever they are called — the ones that add up to the actual fare paid). I’ve observed where the latter method was used.

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