When people think of their holidays, many think of sun, sea, sand and sangria, but some will need to add ‘solicitor’ to this list.
With around 16m package holidays sold to UK holidaymakers each year, inevitably some consumers don’t get what they paid for. Since the introduction of the Package Travel, Package Holidays and Package Tours Regulations in 1992 (SI no 3288) (the 'Regulations') a growing number of holidaymakers are seeking redress for failing to get the holiday they expected.
After advising on the prospects of establishing liability, advising your client on what he can expect to receive is just as important. But calculating damages in package holiday cases is difficult. Until recently, holiday claims remained one of the few types of cases where damages for distress, vexation, frustration and loss of enjoyment were recoverable (usually referred to as ‘loss of enjoyment’ or ‘distress and disappointment’ losses). However, calculating this element of a claim is fraught with difficulties, requiring extensive use of comparables.
Basic principles of assessment
Holiday claims are essentially simple breach of contract claims where one party (normally the tour operator) has failed to provide the package of component services (accommodation, flights, transfers to and from the airport, use of a representative at the destination) in accordance with the contract. So when the tour operator has breached its obligations under the contract, e.g. by not supplying the five-star hotel chosen (as in Beck v Tropical Worldwide Holidays Ltd  CLY 1384), the consumer should be eligible for compensation.
That compensation can be broken down into two main headings:
(1) Diminution in value; and
(2) Consequential loss.
In turn, consequential loss subdivides into four heads:
(1) distress and disappointment;
(2) additional expenses;
(3) physical inconvenience, and
(4) physical injury.
However, when considering loss under these headings, it should be remembered that:
(a) the tour operator is liable for the proper performance of the contract, irrespective of whether the obligations were to be performed by subcontractors (e.g. where a local bus company provides the transfers to and from the airport) (see Reg 15);
(b) the claimant can claim not only his losses, but also those of the other members of his family who accompanied him (Kemp v Instasun  2 FTLR 234); and
(c) if, after the initial problems appear, the tour operator failed to provide prompt assistance or make efforts to find a solution, this is a further breach for which damages can be recovered.
Diminution in value
The claimant will normally recover the difference, in monetary terms, between:
(a) what he was promised, and
(b) what he actually received.
So where the claimant specifically contracted to receive a hotel with a heated swimming pool, because his wife was about to have a hip operation and wished to exercise in warm water, but actually received a hotel with a cold pool, the claimant was entitled to the difference in value between the two (Forsdyke v Panorama Holidays Group Ltd  3 CL 544). If a holiday with a warm swimming pool is worth £675, and without one it is worth £225, the claimant will recover £450 as diminution in value. In respect determining (a) and (b) above, in practical terms there is at least a easy starting position for (a) - since it is almost always the price the claimant contracted to pay for the holiday (but see ‘Loss of a good holiday deal’, below).