A travel agency that was facing a lawsuit over a ruined holiday has learned it is not even liable after consulting ABTA’s legal department.

Ramsay World Travel was  facing legal action along with Thomas Cook, Directline Holidays and lowcostbeds.com after eight couples said they fell ill while on holiday at the Hauza Beach Hotel in Egypt.

According to the litigants’ solicitors, Irwin Mitchell, the holidaymakers claimed they suffered stomach problems after eating undercooked food at the all-inclusive five-star hotel.

David Harle from Durham and his wife Judith, who are taking legal action against Thomas Cook, said their £2,000 trip was ruined.

The companies are being sued for damages for the loss of enjoyment on the holiday, for personal injury damages for the illness and for any expenses incurred as the result of the illness.

But after consulting ABTA’s legal department, it emerged that Ramsay World Travel was not even liable.

An ABTA spokesperson said: “[Ramsay World Travel] contacted ABTA’s legal department. We assessed the paperwork and confirmed their status was as a travel agency. The legal department then advised them to contact the solicitor with this information.”

“ABTA’s legal department does deal with a lot of queries from agents who have received legal letters and we are able to assist in establishing the agency status from the paperwork provided.

“This can save companies a great deal of time and money – providing they have the correct paperwork of course.”

Ramsay World Travel’s accommodation supplier to the resort, Triton Rooms, is also denying liability, said ABTA.

Directline Holidays chief executive Maria Whiteman said: “We’re not aware of any legal proceedings but will fully investigate any complaints we receive.”

Thomas Cook issued a statement: “We take all reports of illness very seriously, so we were very concerned to hear that Mr and Mrs Harle became unwell while they were on holiday.

“As a priority we are undertaking a full investigation with the hotel and our resort team and are liaising with the solicitor representing the couple.”

The two other companies involved said they did not wish to comment.

According Irwin Mitchell the hotel is not being sued because the clients had a contract with the tour operators, not the hotel itself.

Five more people have complained and their cases are under investigation. A further three companies are also under investigation, but claims have not been issued yet.