ABTA defends membership procedures

ABTA has defended its membership rules from criticism by a judge.

The judge reportedly described ABTA’s documentation for membership as being ‘contradictory and confusing’ during action brought by Brighton-based Spanish villa rental agent Villaspain.

The company brought the action against ABTA for breach of contract following troubles with Villaspain’s own membership application, which caused the application to lapse unnecessarily.

The case against ABTA was dismissed but at an initial hearing in November 2005, Judge Robinson was critical of ABTA’s application procedure, saying it involved an “excess of bureaucracy”. 

Villaspain owner Bruce Gibson said: “Whilst it was anticipated that the full action in August 2006 could well fail on breach of contract – as it did – Villaspain felt compelled nevertheless to bring the action so as to highlight its treatment and ABTA’s procedures.”

Gibson said ABTA had eventually given Villaspain a written apology and invited the company to resume its application, but by that stage Villaspain had lost confidence and decided not to bother.

“We were grossly misled and shabbily treated by certain staff at ABTA. If they treated an applicant in this way, then how would they treat members and consumers? And if ABTA no longer offers consumers the old protection then, frankly, what’s the point? To us, membership’s meaningless,” he claimed.

“And nothing’s improving. A year on from the judge’s criticism, the ABTA documentation that was confusing and contradictory in 2005 remains exactly the same. ABTA hasn’t removed the confusion.”

He believes ABTA membership is now pointless anyway.

“The lack of consumer protection will come as a shock to many holidaymakers. For us, it means we’re no longer interested in ABTA membership and we’d like to warn consumers and potential members to beware of ABTA.”

Since ABTA’s move away from bonding for accommodation protection, Villaspain believes consumers are far better protected by the Consumer Credit Act.

Under this legislation, if anyone pays for goods worth over £100 using a credit card, the lender will refund the money in full in the event of non delivery of the goods or service paid for.

Villaspain said it is also increasingly concerned about the way ABTA handles claims and just how well it represents the holidaymaker’s best interests.

“If eligible consumers elect to use ABTA’s arbitration service, they must pay ABTA a fee but they cannot attend the hearing, put their case in person or challenge the ABTA member’s evidence.

“They must accept the decision of the arbitrator as legally binding and if they want to appeal they must pay a further fee of £350.

“Very few claims actually make it to arbitration (ABTA states that over 90% of claims are withdrawn beforehand) but for those that do, it seems higher awards might have been obtained in court.”

Responding to Gibson’s allegations Simon Bunce, ABTA’s head of legal services, said: “Mr Gibson made an application for membership to ABTA but eight months later had not provided all the required information and his application lapsed.

“He took us to court for the refund of his accountant’s fees even though he had produced no accounts. On more than one occasion we tried to resolve this matter with Mr Gibson out of court and did in fact encourage him to continue with his application. 

“Ultimately the judge ruled in favour of ABTA and made it very clear to Mr Gibson that his case should not have been brought as there was no legal basis for it.

“The judge certainly did not criticise ABTA’s documentation in court but merely made one comment relating to one line in the application that mentions audited accounts and we have noted the judge’s comment.

“ABTA has over 1,600 members who have successfully applied for membership without any problems. In addition we ensure we offer every assistance and advice possible to companies applying to ABTA for membership we are not in the business of putting off or turning away any companies who wish to join. 

“To date we have had no complaints from new applicants about our documentation relating to it being confusing or contradictory.

“The question on ABTA’s financial protection has been discussed in the press on a number of occasions and here is not the place to explain this further.”

Bunce continued: “With regard to ABTA’ s Arbitration Scheme, ABTA receives no fee whatsoever when consumers go to arbitration. The Arbitration Scheme is the most heavily used consumer arbitration scheme in the UK run independently by the Chartered Institute of Arbitrators.

“Consumers can take an unresolved dispute to arbitration or court – it’s the consumers choice and the member has to abide by that under the Code. The Scheme is an alternative to court for those thousands of consumers each year who do not want the hassle and expense of travelling to court to attend a hearing. Over 1,400 consumers each year actively choose not to attend a hearing but to benefit from a documents-only on-line scheme.

“For the average compensation claim the fee the consumer pays the arbitrator is much cheaper that the court small claims track fee. Appeal from small claims judgments is very limited and involves going to the High Court – a process that puts the consumer at high risk of costs way in excess of any arbitration review fee.

“Most of the 17,000 written cases and 70,000 phone queries ABTA deals with each year do not get to arbitration because ABTA is there to help them settle beforehand and this at no cost whatsoever to the consumer. In those cases that do end up in arbitration in over 75% of cases the consumer wins compensation.”

By Bev Fearis