Licence Appeal Tribunal File Number: 15983/TIA

In the matter of an appeal from a denied claim for reimbursement in accordance with section 57 of Ontario Regulation 26/05, under the Travel Industry Act, 2002.

Between:

Hichem Bouslama

Appellant

and

Travel Industry Council of Ontario

Respondent

DECISION and ORDER

ADJUDICATOR:

Bruce Stanton

APPEARANCES:

For the Appellant:

Hichem Bouslama (self-represented)

For the Respondent:

Husein Panju, Counsel

Heard by videoconference

December 3, 2024

OVERVIEW

1Hichem Bouslama (the “appellant”), appeals from the denial of his claim for reimbursement from the Travel Industry Compensation Fund (“Fund”) which is administered by the Travel Industry Council of Ontario (“TICO”) pursuant to Ontario Regulation 26/05 (the “Regulation”), under the Travel Industry Act, 2002, S.O. 2002, c. 30, Sched. D. (the “Act”).

Preliminary Issue

2I find that two items of the appellant’s filings of evidence will be excluded from evidence for the hearing. The first is an email from the appellant to TICO, copied to the Tribunal, dated September 27, 2024. The second is the paragraph, third from the bottom of page 2, of the document titled “15983-TIA Hichem Bouslama v. Travel Industry Council of Ontario – Summary” (“Appellant’s Summary”), starting with “July 24, 2024 …”.

3The appellant submits that he wishes to refer to both documents in their entirety and opposes having them excluded. He submits they are relevant to the issues before the Tribunal.

4TICO submits that the September 27 email references discussions at the case conference that are privileged. The email exchange started with a question from TICO to the appellant on August 29, 2024, which the appellant replied to on September 27. Since the exchange began post-case conference (after July 24, 2024), TICO submits the exchange is protected by litigation and settlement privilege.

5On the second item, TICO submits that the paragraph at issue in the Appellant’s Summary references discussions at the case conference which are not permitted to be before the hearing.

6I agree with the TICO that the two items are protected by settlement privilege because they refer to discussions during the case conference. It is not clear to me that the content of the two items were part of a settlement discussion, but I have nothing before me to suggest they were not. Since the two items describe discussions at the case conference, they are privileged in accordance with Rule 14.4 of the Licence Appeal Tribunal Rules, 2023 (“Rules”), which prohibits settlement discussions from being communicated to the Member that participates in a hearing.

7In addition, I find the content of the two items at issue are unlikely to provide any probative value to the hearing since they relate to subjects that are included in other evidence filed by the parties.

8I find the subject paragraph on page 2 of the Appellant’s Summary and the email of September 27, both filed by the appellant, are excluded from evidence.

ISSUES

9The issues to be determined are:

A. Whether, pursuant to section 57 of the Regulation, the appellant is entitled to compensation for travel services paid for but not provided by Holy Destinations Travel; and

B. If yes, then what is the amount of compensation.

RESULT

10I find the appellant is entitled to compensation from the Fund to the maximum amount allowed under the Regulation.

ANALYSIS

Events leading to the appellant’s claim and appeal

11On August 24, 2021, the appellant purchased a travel service to attend Hajj, a pilgrimage for followers of Islam, in Saudi Arabia in late June, early July 2022, at a cost of $11,500, from Holy Destinations Travel Inc. (“HDT”). HDT was, at the time, a travel agent registered with TICO. Mohammed Bensaci (“Bensaci”) is the principal of HDT.

12As the Hajj event approached, the appellant learned that due to the COVID-19 pandemic, the Government of Saudi Arabia was imposing a restricted attendance regime for Hajj 2022. A lottery system was put in place to select a limited number of attendees. The appellant was therefore prevented from attending Hajj 2022.

13The appellant undertook to consider his options, given the restrictions on Hajj 2022, and in discussion with Bensaci, chose to leave his deposit with HDT in the hope of attending Hajj in 2023.

14In April 2023, the appellant made inquiries to Bensaci about the coming Hajj. By mid-June, the appellant discovered that Bensaci was not returning his calls or WhatsApp texts and there were no arrangements in place for him to attend Hajj.

15On January 9, 2024, the appellant filed a claim to the Fund for $11,500,00 for travel services he purchased from HDT that were not provided.

16TICO denied the appellant’s claim by way of a decision letter dated May 31, 2024 on the basis that “the non-provision of travel services that were to be received in July 2022 was not due to the bankruptcy or insolvency of HDT.”

17On June 10, 2024, the appellant filed a Notice of Appeal with the Licence Appeal Tribunal (“Tribunal”) in relation to the May 31, 2024 decision letter, pursuant to section 71 of the Regulation,

Is the appellant entitled to compensation from the Fund?

18I find the appellant met his burden in demonstrating that he is entitled to compensation from the Fund. He paid for travel services that were not provided by HDT, at the time, a registered retail travel agent. When it became time for the appellant to travel on the services he booked and paid for, HDT had ceased carrying on business and could not be located.

19Subsection 57(1)(c)(i)(C) of the Regulation stipulates that a customer is entitled to be reimbursed for travel services paid for, but not provided, if or when the customer was not reimbursed by the agent because that agent ceased carrying on business and could not be located.

20The appellant testified that when he was prevented from travelling to Hajj 2022, he initially sought a refund but later accepted an arrangement with Bensaci to hold his deposit for the 2023 Hajj.

21The appellant referred me to transcripts of his WhatsApp texts between June 8, 2022 and June 16, 2023. Some of the texts are in Arabic but those that are in English support the appellant’s claim that Hajj 2022 was not accessible, that he initially sought a refund, and later accepted a postponement to Hajj 2023.

22The appellant testified that his preference was to go Hajj, not to get a refund. He testified that he met Bensaci at his mosque on occasion after the Hajj 2022 cancelation and learned that other members of the mosque were signing up for Hajj 2023 with HDT. He concluded that the 2023 trip was alive and on track.

23The appellant testified that, on June 13, 2023, Bensaci contacted him, suggested he fly to Saudia Arabia and Bensaci would get him into Hajj without a Visa. The appellant testified that Bensaci’s offer to “get him into Hajj 2023” without a visa amounted to “game-playing”. “I was frustrated [with the lack of service] therefore I went to court”. The appellant asked Bensaci for a refund on June 13, 2023, after which, the appellant noted, Bensaci stopped returning his calls and text messages. The appellant filed a claim in Ottawa Small Claims Court against HDT in the amount of $11,500.00 on June 13, 2023. However, since Bensaci could not be located, the small claim has not been served.

24The appellant submits that TICO administers the Fund under the Act to protect consumers against fraudulent practices of retail travel agents. He submits that HDT was registered at the time he purchased services and HDT failed to provide the services he purchased because HDT ceased carrying on business. The appellant seeks a refund of his payment to HDT to the maximum permitted under the Regulation.

25TICO submits that the appellant booked travel services for Hajj 2022, not 2023, and because HDT was still carrying on business in the summer of 2022, the Regulation does not oblige TICO to reimburse the appellant from the Fund.

26TICO submits that it operates to instill confidence in the travel industry through the licencing of travel agents and providing the Fund as a backstop for consumers who have lost deposits or payments due to fraud, malfeasance, or the failures of registered travel agents, in accordance with the Regulation. It submits that it must balance its consumer protection mandate with the necessity of ensuring the Fund is accessible only to claimants who are eligible under the Regulation.

27TICO relies on subsection 57(1)(c)(i) of the Regulation in denying the appellant’s claim, which limits a customer’s entitlement to reimbursement to circumstances where the subject travel agent:

A. Was unable to pay by reason of bankruptcy or insolvency;

B. Had ceased carrying on business and was unwilling to pay; or

C. Had ceased carrying on business and could not be located.

28Lori Furlan, a claims coordinator for TICO, testified that the non-provision of the services occurred in 2022. It was these services that were “not provided” and that in June/July of 2022 HDT was still in operation. She testified that the alternative arrangement (rolling the deposit over to Hajj 2023) was between the appellant and HDT. Therefore, the non-provision of their negotiated arrangement for Hajj 2023 is not eligible for reimbursement from the Fund.

29Furlan testified that at least 10 customers of HDT who purchased travel services for Hajj 2023 that was not provided, were successful in their claims for reimbursement from TICO. In their case, they made payments to HDT for travel services that were to occur at or about the same time HDT ceased carrying on business and could not be located, i.e., June 2023.

30On the question of what distinguishes the appellant’s situation from the 10 successful claimants in 2023, Furlan testified that the appellant booked and paid in October 2021, for travel services that were to occur in 2022, and in 2022 HDT was still an operational agency. By comparison, the successful claimants paid for travel that was to occur at or about the same time HDT ceased carrying on business and could not be located. The successful claimants met the test in subsection 57(1)(c)(i) because at that time, HDT had ceased carrying on business and could not be located.

31TICO submits that because the appellant negotiated a postponement, or roll-over of the services to 2023, he is not entitled to reimbursement under subsection 57(1). TICO’s reasons in the decision letter of May 31, 2024 align with its submissions and testimony. The decision letter states that the travel services in question were to be received in July 2022, and the non-provision of those services was not due to the bankruptcy or insolvency of HDT, i.e., HDT was still operating in 2022.

32The appellant argues that his circumstances are no different than those of the successful claimants for the 2023 Hajj. He, like them, purchased travel from HDT that was not provided. He argues that postponing the travel dates for legitimate reasons (COVID restrictions imposed at the destination) should not disentitle him to compensation from the Fund.

33TICO argues that HDT was still in business in 2022, and the appellant ought to have pursued a refund for the Hajj 2022 services he purchased.

34TICO submits that these scenarios where a non-provision of service is negotiated between a customer and travel agent for some future benefit, do not lend themselves to entitlement to the Fund under subsection 57(1). TICO directs me to subsection 57(3), a section of the Regulation that sets out circumstances that disentitle a customer to reimbursement. For example, paragraph 5 of subsection 57(3) stipulates a customer is not entitled to be reimbursed for:

“Travel services that were to be received as a prize, award or goodwill gesture, including travel services that were to be received because of the redemption of a voucher, certificate, coupon or similar document that was itself received as a prize, award or goodwill gesture.”

35TICO submits that the spirit of subsection 57(3)(5) is to disentitle customers to reimbursement from the Fund if they negotiate terms with an agent in lieu of the non-provision of travel. Put another way, if a customer accepts terms such as postponing the travel service to a later time in lieu of getting a refund from the agency, the customer is no longer eligible for reimbursement from the Fund when, or if, the postponed travel is not provided due to the agent no longer carrying on business.

36I am unpersuaded by TICO’s argument that the appellant became disentitled to reimbursement simply by agreeing to shift the dates by one year to Hajj 2023. The Regulation is clearly worded. A customer is entitled to reimbursement if they paid for services that were not provided when the agent in question ceased to carry on business and could not be located, as happened in this case.

37A customer might be disentitled if they meet one of the 11 exclusions from entitlement listed in subsection 57(3). I find the appellant’s case meets none of the exclusions prescribed in that subsection and nor has the respondent specifically relied on the exclusions to entitlement in subsection 57(3), save its argument that the spirit of that subsection suggests that a negotiated postponement becomes disentitling.

38I give little weight to TICO’s argument that, in the spirit of the legislation in subsection 57(3), a customer becomes disentitled if they accept a negotiated roll-over or postponement of the purchased travel services. Paragraph 5 of subsection 57(3), as I read it, applies in cases where the travel services were, from the outset, to be received as a prize, award or goodwill gesture, thus, where the customer either did not pay, in cash or other payment, for the services, or received a voucher or certificate in lieu of payment or other consideration. It is not analogous to the appellant’s circumstance where he had made a sizeable deposit with HDT since October 2021, and through no fault of his own, was unable to travel on the original booking (Hajj 2022).

39TICO has not directed me to any part of the Regulation that puts limits on the customer’s ability to postpone a travel booking when necessary. TICO seems to be arguing that eligibility for reimbursement on the Fund is confined to the travel dates the customer first purchases or arranges. To follow that argument to its logical conclusion, entitlement to the Fund for the non-provision of services would be negated by any negotiation between the customer and agency to postpone or change the original dates. I disagree with TICO’s interpretation of the Regulation as being antithetical to the goal of the Act and Regulation. Both the Act and the Regulation are consumer protection legislation and therefore must be read in a manner that advances that legislative goal.

40The appellant’s arrangement to substitute Hajj 2023 for the inaccessible Hajj 2022 was reasonable under the circumstances. It is reasonable to conclude that a person looking for that travel (and religious pilgrimage) experience, and committing the monies in advance to secure it, is likely to agree to shift their booking to a future date. The appellant gained confidence that there would be a Hajj 2023 because he knew of members of his mosque who were booking with HDT for it. He testified that it was his preference to travel to the destination he booked, not to get a refund.

41I find the appellant meets his burden in proving that he paid for the travel services that were not provided because his payment to HDT for the Hajj is not in dispute, the parties agree that HDT ceased carrying on business and could not be located after mid-June 2023, and I am unpersuaded by TICO’s argument that the postponement of services from Hajj 2022 to Hajj 2023 disentitles the appellant to reimbursement under subsection 57(1). I note that section 66 of the Regulation sets a maximum amount of $5,000.00 that can be paid in these circumstances. He is therefore entitled to reimbursement from the Fund in the amount of $5,000.00 pursuant to section 66 of the Regulation.

Conclusion

42For the reasons discussed above, pursuant to s. 71(6) of the Regulation, I allow the appellant’s claim for compensation in the amount of $5,000.00. I find the appellant has established his entitlement to compensation under the Act and s. 57 of the Regulation.

ORDER

43The appellant’s claim is allowed pursuant to s. 71(6) of the Regulation, and I direct TICO to pay $5.000.00 to the appellant.