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HWT failure highlights consumer protection loophole

The collapse of Harvey World Travel (HWT) has highlighted a fresh loophole in the protection of consumers.


Travel Weekly has been contacted by ex-travel consultant Derry Bailey, who was working for HWT when she made an Affordable Car Hire booking in April for her own holiday in September. When HWT went into administration this month, she contacted Affordable to check her own booking and those of her clients.


She said: “Affordable Car Hire cancelled all bookings made by HWT because of non-payment, even though ABTA had informed them that, by doing this, they would be contravening agency law.


“When I checked, Affordable said I could still have my booking honoured – but only if I paid again,” said Bailey. “I feel I have let my clients and myself down.”


The Freedom Direct failure in April raised similar concerns that suppliers owed money by failed agencies are not honouring bookings. While ABTA insists the suppliers are in breach of agency law (an area of contract law), suppliers claim they are sticking to the terms of their contracts.


A spokeswoman for ABTA said: “We are writing to Affordable Car Hire to remind it of its obligations and that we will inform local trading standards [officers] of the issue.


“They need to honour the bookings that their agent made. This is according to agency law, and can be enforced in the UK”.


However, Affordable Car Hire’s payment terms in its contract with HWT state it has the right to withdraw authorisation of a voucher when payment has not been received.


Affordable Car Hire managing director Angela Day said: “Unfortunately Affordable Car Hire has lost considerable amounts of money where clients have already travelled and there has been a payment crossover.


“Given the economic climate, no company can afford to write off thousands of pounds for bookings [of people who] have not even travelled and that are currently unpaid,” said Day.


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