Licence Appeal Tribunal
Appeal from a decision of the Travel Industry Council of Ontario denying reimbursement of a claim.
Between:
Feriz Muharremi Appellant
and
Travel Industry Council of Ontario Respondent
DECISION AND ORDER
ADJUDICATOR: Evelyn Spence, LL.B.
APPEARANCES:
For the Appellant: Self represented
For the Respondent: John Park, Counsel
Heard by Teleconference: January 15, 2021
DECISION AND ORDER
A. Overview
1The appellant, Mr. Feriz Muharemmi, appeals a decision dated April 15, 2020 of the Board of Directors of the Travel Industry Council of Ontario (“TICO”) under the Travel Industry Act, 2002 (the “Act”). In particular, the appellant appeals TICO’s decision to deny part of his claim for compensation from the Travel Compensation Fund (the “Fund”) pursuant to section 57 of Ontario Regulation 26/05 (the “Regulation”).
2The appellant seeks compensation in the amount of $6,061.48 from the Fund. This amount represents the total cost of round-trip tickets for the appellant and his family to travel from Toronto to Pristina, Kosovo (the “original tickets”). It also includes the cost of purchasing replacement return tickets when the airline carrier his travel was booked through ceased operations.
3The respondent, on the other hand, asserts that the appellant and his family did, in fact, complete their travel to Pristina so that TICO is only liable to reimburse him for half of the cost of the original tickets. It also maintains that the appellant’s credit card company reimbursed him for the return portion of his ticket, and that the appellant’s replacement tickets are ineligible under the Fund. In light of the above considerations, TICO calculated the appellant’s entitlement at $1,180.
4The appellant was assisted at the hearing by an interpreter, and it was obvious his proficiency in the English language was very limited. He stated his understanding that he was asked to list his total expenses on TICO’s claim form, which he did.
B. ISSUE AND DECISION
5The issue to be determined is the amount of compensation the appellant is entitled to receive from the Fund.
6For the reasons that follow, I find that the appellant’s claim for further compensation is dismissed. The total compensation for which he is entitled is $1,180, which amount TICO has already paid.
C. EVIDENCE
7The facts are not substantially in dispute. The appellant purchased round-trip tickets for himself, his wife and his son to travel to Pristina in the fall of 2019. The appellant purchased the tickets through an Ontario-registered travel agent (a “TICO registrant”). The total cost of the original tickets was $3,605.48.
8On or about September 15, 2019, the appellant and his family completed their outbound travel and they arrived in Pristina. The Muharremi family had purchased staggered return dates, with the appellant returning in October 2019, a month earlier than his wife and son. However, before any of the return trips were made, their airline carrier, Adria Airways, ceased operations. As a result, neither the appellant nor his wife and son were able to use the return portion of their tickets.
9The appellant thereafter was required to purchase replacement tickets, which he did again from the same TICO registrant. The cost of his wife and son’s replacement return tickets was $1,350.00 (or $675 each). The total he paid for his own replacement return ticket was $1,106. It appears the appellant purchased a round-trip ticket from Pristina, however, with only half that amount attributable to his return to Canada. Notably, his claim with TICO includes the whole amount of that round-trip ticket despite the fact that it permitted him to return to Pristina at a later date without further cost to himself. According to TICO, it is often cheaper to purchase a return ticket than a one-way ticket.
10In February 2020, the appellant filed a claim form with TICO, in which he sought reimbursement for the full cost of his family’s original tickets and the cost of the three replacement return tickets, for a total compensation claim of $6,061.48.
11In reviewing the documentation provided with the appellant’s claim, TICO noted that on or about November 6, 2019, Visa issued a credit to the appellant in the amount of $622.74. This amount represented half of the cost of the appellant’s original ticket, which was paid by Visa, and was understood by TICO as reimbursement for the entire cost of the appellant’s (cancelled) return ticket.
12In her evidence, Ms. Lori Furlan, Claims Coordinator with TICO, explained that it is very difficult to calculate the true cost of each ticket, for the purposes of determining the amount of reimbursement due where only part of a round-trip ticket is used. This is because costs depend on routing, applicable taxes, airport fees and so on. Accordingly, she explained that TICO, and some credit card providers (including Visa in this case) generally calculate the cost of a single direction ticket of a round-trip fare based on the amount the customer paid for the round-trip ticket divided by half.
13By letter dated February 20, 2020, the appellant was advised that TICO had concerns with his claim. Subsequently, when the TICO Board met on March 31, 2020, it determined that the appellant was entitled to $1,180.00. This amount represented exactly half the cost of Mr. Muharremi’s wife and son’s round-trip tickets, which had been paid for in cash, for the two unused return airline tickets.
14By letter dated April 15, 2020, a cheque for $1,180 was sent to the appellant.
D. LAW
15TICO’s principal mandate is consumer protection. Administering the Fund is part of that mandate. All travel agencies in Ontario are required to register with TICO and contribute to the Fund.
16The entitlement to claims and exclusions on the Fund are set out in section 57 of the Regulation made under the Act. The Board has to balance its consumer protection mandate with the requirement that it preserve the Fund, which is essentially monies held in trust for the benefit of all eligible claimants.
17In administering and managing the affairs of the Fund, TICO’s Board is obliged to operate within the confines of the Regulation. TICO’s position therefore relies heavily on a strict interpretation of the statutory provisions, and the relevant sections of the Regulation are set out below.
18Subsection 57(1) states, in part, that a customer is entitled to be reimbursed for travel services paid for but not provided if the customer paid for the travel services and the payment or any part of it was made to or through a registered travel agent.
19Subsection 57 (2) states that a reimbursement under subsection (1) is limited to the amount paid to or through any registrant for the travel services that were not provided. In addition, subsection 57(3) 9 states that a customer is not entitled to be reimbursed for a claim that is based on the cost, value or quality of the travel services or alternate travel services and subsection 57(3) 11 states that a customer is not entitled to be reimbursed for consequential or indirect damages incurred as a result of the failure to provide the travel services. Said otherwise: the Fund only allows a claim for the value of that part of original travel services which were not provided.
20Finally, subsection 57(1)(c)(iii) clarifies that a customer is not entitled to reimbursement for travel services paid for but not provided in cases where any other person who may be legally obliged to reimburse or compensate the customer does, in fact, reimburse the customer.
21Section 61 of the Regulation sets out the requirement to submit documentation to the Board of TICO to prove the claim. The Board reviews claims made to the Fund by customers and determines entitlement. TICO’s review is based on documents submitted to it including sworn affidavits and supporting documentation (e.g. receipts, itineraries, etc.).
E. ANALYSIS
22In the present case, there is no disagreement that the appellant is a customer entitled to reimbursement for travel services paid for through a registered travel agent. The evidence is clear that Mr. Muharremi purchased his family’s tickets through a TICO registrant, and that a portion of their travel - that is, their return travel - was paid for but not provided due to the bankruptcy of their selected air carrier.
23Given the framework, the appellant’s claim must fit within the legislative parameters in order to be eligible for reimbursement. However, the appellant seeks reimbursement for costs which are expressly ineligible under the Regulation, namely:
the cost of tickets ($1,802.74) that were used by the family in respect of their outbound travel to Pristina– which does not fall under the terms of subsection 57(1) because the outbound service was not a service that was “paid for but not provided”;
a portion of the appellant’s ticket that had already been reimbursed to him directly by his credit card company (that is, the $622.74 which was returned to the appellant by Visa, representing the value of the unused return ticket) - Subsection 57(1)(c) denies reimbursement where the customer has already been reimbursed; and,
the cost of new replacement tickets ($2,456) for the family to return home to Canada (which includes the cost of a future ticket for the appellant) - Subsection 57(3) 9 and 11 bars the appellant from reimbursement of costs of alternate travel services or for consequential or indirect damages incurred due to the failure to provide the travel services.
24As such, and in accordance with section 57 of the Regulation, the only part of Mr. Muharremi’s claim that is reimbursable is the cost of the cancelled travel from Pristina to Toronto for the appellant’s wife and son. That amount comes to $1,180, which TICO has already duly paid. A further breakdown of the appellant’s expenses are included in the attached Appendix “A”.
F. ORDER:
25Having reviewed the evidence and taken into account the submissions of the parties, and pursuant to s. 71 (6) of the Regulation, I hereby refuse to allow the appellant’s claim for further compensation.
LICENCE APPEAL TRIBUNAL
Evelyn Spence, LL.B. Member
Released: January 28, 2021.
APPENDIX “A”
The following calculations provide a useful breakdown of the costs incurred by the appellant:
Round-Trip Tickets
$2,360 for round-trip tickets for Mr. Muharremi’s wife and son (paid by debit/cash)
$590 per person, per direction
Used portion of tickets = $1,180 (travel for 2 from Toronto to Pristina)
Unused portion of tickets = $1,180
Net loss = $1,180
$1,245.46 for round-trip tickets for Mr. Muharremi (paid by Visa)
$622.74 per direction
Used portion of ticket = $622.74 (travel from Toronto to Pristina)
Unused portion of ticket = $622.74
Reimbursed from Visa = $622.74
Net loss = $0
= $3,605.48
Replacement Tickets – Ineligible
$1,350 for replacement return tickets for Mr. Muharremi’s wife and son
$675 per person
$1,106 for (round-trip) replacement return ticket for Mr. Muharremi
$533 per direction
Used portion of replacement ticket = $533
Future portion of ticket $553
= $2,456.00
= $6,061.48 Total Expenses
$6,061.48 (total expenses)
$1,802.74 (total cost of outbound tickets for appellant and his family)
$622.74 (amount reimbursed for appellant’s return ticket from Visa)
$2,456.00 (cost of ineligible replacement tickets)
$ 1,180 (amount eligible for reimbursement from TICO)