Chocolate Pillow | The legalities of hospitality
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The legalities of hospitality

16 Feb The legalities of hospitality

I have had a lot of queries in my past about what a hotel legally can and cannot do, and what is legal or not (including guests screaming at me quoting scripture and verse of bar-room lawyerism).  So I thought I would write a few bits that are important for any hotel manager to know – these are UK legislations and whilst practice may be the same, legal foundation may be different according to the country you are in.  Any solicitors,lawyers etc, please feel free to add / improve or correct any points by contacting me or commenting. [box type=”warning”] It should be noted that this information is not applicable to every circumstance – there may be situations outside of the cases below that offer alternative outcomes; remember that a lot of contract law is case law – generally ‘whoever has the best argument wins’, but there are foundations in written law which are outlined below.[/box]

One of the main things that people argue over is the accommodation, and I have had people lambast me before with ‘you have a legal contract with me’ and ‘you cannot do that, it is illegal because I have paid’ – I cannot tell you how many times I have been tempted to scream ‘WRONG!’ at them and launch a tirade of legalities that prove them entirely wrong; but being the consummate professional, I have not done so (….yet…)

Lets start with the actual booking itself.  Now when a guest books, it is generally thought of that the accommodation is guaranteed, after all there ia a contractual formation between hotel and guest that accommodation will be provided…. or is there?

The basics of a contract between two or more parties is that an invitation is made, then an offer, which is then accepted, but most importantly between this is consideration.  Okay, it seems a bit baffling, but take for example a purchase in a shop – you see an item at £1, this is an offer for you to buy the product at £1.  So you accept this and go to the till, where the price comes up at £2.  The shop is not contractually bound to provide you that item at £1.  This is because they offered at £1, but when you came to accept, they didn’t accept the terms of sale (by saying it was £2 they have reconsidered their offer) and therefore re-offered to you, for your consideration.  You can then accept or refuse the offer.  If you accept and they then sell to you at £2, they have also formed acceptance. This is a simplified version and in the UK there are other legislations that prevent shops from actually doing this.

So lets look at the basics of hotel bookings before getting in to some trickier scenarios:

A guest sees a room advertised online so books the room.  You have then confirmed that booking and the guest has paid; it commonly is assumed that the contract is formed at this point, but it could be said that this is not the case on all occasions.

The guest has seen an invitation to treat (the advertised price and availability), so they propose their acceptance (make the booking).  If this is a pre-paid booking, then there is a strong case to say that the contract is formed at the point of payment, whereby the hotel becomes contracted to the guest; but in the case of flexible (pay on arrival) bookings, it could be argued that the payment is not received so no contract is formed until the guest turns up and pays.

It is commonly accepted that the former scenarios applies and that the contract to provide accommodation is formed at the point of the guest having the booking confirmed to them.  Some legal minds will however still be able to argue that the payment or confirmation is only proof of intent, and intent to form a contract does not confirm a contract is in place (okay, will back off this one as starting to get in to tricky territory).

So – a guest books and pays meaning a contract is formed…. sort of.  Up until the point of payment being accepted or the booking being confirmed, the hotel effectively has not accepted that booking… getting confused?  Okay; the guest has had an ‘invitation to treat’ – basically a ‘here are my rooms, come and book one at this price’ offer.  They have then acknowledged their intent and consideration by making an offer to take one of the advertised rooms at that price.  The hotel then has to accept the guests offer to have that room at that rate, which they can decline if they wish.

Lets look at clearing some common scenarios up to make sense of this….

Can a hotel legally out-book me… a paying guest?

[dropcap style=”font-size: 60px; color: #088da5;”]Yes. [/dropcap] Generally speaking, this tends to form some part of the booking terms and is classed as a cancellation or amendment.  Guests will have little to no recourse against this action through the courts.  Legally guests will reserve the right to accept or decline the altered contractual terms, or cancel the contract altogether.

If you accept the altered terms (usually accommodation elsewhere) you will be entitled to little to no recompense as the contract alterations have been agreed by you, and you moving to another hotel will essentially be classed as your consideration and acceptance of the altered terms.  If you refuse, the hotel can make an alternative offer to you, or more commonly, rescind their offer and contractual agreement – this means that they can simply give you your money back and leave you to sort yourself out.  Again you will have no recompense or right to compensation.  If you decide to cancel the contract at this point (because the alterations are unacceptable to you) then the hotel must provide a full refund to you of any monies paid, and you are not entitled to any more compensation than this.  Essentially the contract is null and void if you accept a refund.  There are legal arguments that could be used to push for compensation, but these are sketchy at best as the legal foundation is that you booked accommodation and were provided with it (albeit somewhere else).

It is important to know that if you accept a refund, you accept cancellation of the contract (which in the case of a pre-paid booking is generally non-refundable), so both parties have agreed the contract cancellation, as you accepted your money back and the hotel agreed to cancel and refund a non-cancellable and non-refundable booking.  If this is the case, you cannot demand a refund and relocation at the cost of the hotel, it is usually one or the other as a hotel is obliged to only one action, not several – they must only do one choice of refund, relocate or change the dates of the booking, but not all three!

Can a travel agent out-book me because the hotel is full?

[dropcap style=”font-size: 60px; color: #088da5;”]Yes. [/dropcap] The contract you form is through a third party, however is still with the hotel in essence.  This can get tricky dependant on tour operators, packages etc, however if you use an online agent for a room booking then generally your contract is not formed until the hotel confirms to that agent that they accept it and accept payment for it.  This is a bit more tricky, however until the contract is confirmed as accepted by the hotel (by confirming the booking to the agent), then no contract is realistically enforceable between the consumer and the hotel.

If using a tour operator, then things are different, but the booking terms will usually again allow for cancellation by the hotel under certain circumstances.  As a general rule, the argument that ensues with this is often not worthwhile, however you are usually entitled to a refund if the booking has been accepted and paid for, then the contract changed afterwards.

You will be very lucky to be compensated by a hotel for this.  Bear in mind that if a hotel out-books you via the third-party agent, the hotel is usually charged not only for your booking, but also the difference in cost between the booking you held and the one with another hotel – you pay no extra, but the hotel could lose out on hundreds of pounds.  Generally you have little recompense against a tour operator, as their terms usually allow for relocation and cancellation due to differing circumstances.

Can a hotel throw a guest out or refuse them a room?

[dropcap style=”font-size: 60px; color: #088da5;”]Yes.[/dropcap] A hotel will always reserve the right to remove any guest that is causing a disturbance or grievance to other guests in the hotel.  This scenario usually falls within health and safety regulation because the hotel has a duty of care to all residents, that dictates they need to provide a safe environment; a guest posing a threat to safety can be removed because they are a risk to other residents.  It is normal for a hotel to have a set of informal house rules, that can apply for almost any situation.  There is no obligation for the hotel to publish these, and in many circumstances the decision on what is and is not appropriate conduct can be made exclusively by the hotel representatives.  Any hotel has the automatic right to evict, and permanently exclude, any guest engaged in illegal activities on the premises or posing a threat to others.

Can a hotel refuse to refund me if I cancel my room or leave earlier than planned due to an emergency?

[dropcap style=”font-size: 60px; color: #088da5;”]Yes.[/dropcap]  The hotel has offered accommodation to you, and you have agreed to occupy the room for the period you have booked.  This generally prevents the sale of the room to any other guests, so cancelling or leaving early will normally leave the business at a potential loss which they are entitled to be compensated for.  The actual cancellation policy does vary from hotel to hotel, so it is worthwhile checking this fully before paying anything.  If you cancel a non refundable booking, you may get lucky and receive a refund, but it is not guaranteed – remember that there is no legal basis for you to receive a refund if you decide to terminate your contract of booking with the hotel and their terms define it as non refundable.

Can a hotel charge me more or less for a disabled access room?

[dropcap style=”font-size: 60px; color: #088da5;”]No.[/dropcap]  A hotel is disallowed by law (in Europe and the majority of the world) to discriminate based on race, gender, age, religion, sexual orientation or disability.  This means that you cannot charge more for a room based on someones physical ability etc, but you also cannot charge less.  You may have disabled access rooms that have upgrade charges applicable to them, however, imagine you have 3 upgraded disabled access rooms and one standard disabled access room; if the standard disabled access room is booked, it potentially could be deemed unlawful to force a guest to pay an upgrade to get a disabled access room.  Best practice for any online booking system that a hotel uses is to ensure that you advise if you have disabled access rooms and request the guest calls the hotel after booking to make the necessary arrangements.  Almost undoubtedly it is illegal to discriminate by charging more (or less) for a disabled access room. compared to a non-disabled access room of the same standard.  The act of charging less for a disabled access room is also immoral because it devalues the guest – it could be argued that the act of charging less is a positive discrimination to entice bookings of those rooms, however it also serves as discriminatory by sending the message that disabled guests are worth less than other guests in the hotel.

Must a hotel compensate me if something is stolen?

[dropcap style=”font-size: 60px; color: #088da5;”]Possibly.[/dropcap]  There is nothing definitive to prove that something was stolen from a room.  I have been in many an accusatory situation between housekeeping teams and guests, but none of those actually ever came to fruition as theft.  It is important that the exact facts are established and in the implication of genuine theft, that key-card system reports are checked to see who has had access to the room and when.  In many countries (particularly the UK) the liability for theft, loss and damage is limited by law (The Hotel Proprietors Act in the UK) to a certain amount.  It is important that where a genuine theft is suspected, that the local law enforcement are called.  This will help establish liability and aid resolution.  The important thing is to remember that in order to succeed in a liability claim for missing property, it must be established that the hotel has been negligent to the point of allowing theft to occur (for example having broken locks on doors, doors not closing properly, no security checks when giving keys out/replacing keys for guests).  One example where the hotel would be liable is where Mr Smith goes to the bar and orders a drink, he charges it to his room and gives his name and room number.  An opportune thief at the bar then goes to reception and asks for a replacement key, giving Mr Smith’s name and room number.  Reception provides a replacement key without further security checks, so the thief steals the laptop, wallet and car keys from the guests’ room.  The hotel would be liable as they failed to ensure the security of the room.  If however Mr Smith had dropped his room key and registration slip in the street, which were then found and used to gain access to his room, the hotel could not be held liable as they did not facilitate a stranger accessing the room – although this then becomes the hotel’s liability if the hotel was notified of the lost ket and failed to de-program it.

Can I sue a hotel for damages?

[dropcap style=”font-size: 60px; color: #088da5;”]Maybe.[/dropcap] If you suffered a personal injury as the direct result of negligence by the hotel, then you probably can, but you need definitive proof of negligence.  Take for example one case I have dealt with personally.  The bathrooms had floor-to-ceiling tiles, and ceramic soap dishes beside the bath that were moulded in to the porcelain tiles.  To replace a soap dish meant replacing the entire tile.  A guest leant on the soap dish to get out of the bath; the soap dish broke and shattered, causing him to slip and suffer severe cuts and injury requiring emergency treatment by paramedics and over 200 stitches across his arm, back and face.  The hotel was not liable for this, despite the injury occurring in the hotel bathroom.  The reason being that the hotel provided grab rails on the bath, had the soap dish positioned at a higher level then the side of the bath (it was about 8 inches above the side of the bath).  We also had a sign on the wall advising guests for their own safety to use the hand rails provided when exiting the bath.  Despite this the guest claimed we had been negligent but we successfully argued that the controls in place were more than adequate to ensure the safety of guests and advise of action to safeguard their welfare.

If you have suffered a poor event experience, then you may be able to argue a breach of contract or that services were not provided with due diligence or the required care and attention; but this is difficult.  Unless you have a definitive service level agreement and evidence that this was broken, this argument could be a long drawn-out affair.  Generally speaking, it is advisable to sometimes let sleeping dogs lie and accept any compensation offered – I have known people spend thousands on legal fees with nothing to show for it at the end.

Can a hotel sue me for damages?

[dropcap style=”font-size: 60px; color: #088da5;”]Maybe.[/dropcap]  You have a responsibility to remain in control of yourself throughout your stay, and to remain within the confines of the law. Remember that within hotels, you do not own the property. This lack of ownership does not relinquish responsibility. So, if you smash a lamp or stain the carpet, the hotel will have a legal basis on which to raise a charge, and expect you to pay it. Many hotels will let these sorts of things go un-charged, but be aware that legally they can not only charge you for repairing it, but can also raise a charge of criminal damage if there was intent behind it (for example you complain about dinner and then smash the dinner table). There is also law surrounding disorderly conduct (breaching the peace, drunk and disorderly behaviour are just 2 examples) which can be called upon if required. Take one example – a guest smashed a television, they were charged for replacing it and refused as it was accidental. The hotel held to their claim for reimbursement and won the cost through the courts, as even though it was accidental, the guest had caused the accident to occur through their own drunken behaviour. Bear in mind that if there are a group of rooms, the tour or group organiser (as the main booker, therefore the contract holder) is generally viewed as the one holding legal responsibility and liability for damage caused by their guests. One example is a wedding where a wedding guest urinated against another guests door; they were charged for cleaning and replacement of the door but refused – the hotel won the case against the wedding organiser (bride and groom), to be reimbursed for the repairs as they clearly held liability for ensuring their guests behaved in an orderly manner – these scenarios are generally worth getting further legal advice on as there could be hundreds of factors that can tip the scales in favour of either party! A hotel also has a legal basis for charging you if you are loud in your room and cause disturbance to other guests, especially if they had complaints that they had to resolve with reimbursements of charges or refunds to other guests – as the hotel has suffered a financial loss due to your actions (particularly if you have been contacted to keep the noise down and then fail to do so), they are entitled to claim a reimbursement from you for that direct financial loss.

I hope this helps people out with a few of those weird situations – if you can think of any more you may have to deal with, let me know as I am happy to write follow-up posts!

Matt Shiells-Jones
matt@chocolatepillow.com

Husband, Author, Hotel Manager and ambitious 'old cat lady'



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