hot topics in hospitality law lisa sommer devlin devlin law firm
DESCRIPTION
Biggest issue Used to be rate protection Used to be negotiation of amounts due Now: Customer simply unable to payTRANSCRIPT
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Who I am and What I do
• Tell me about you• Planners?• Hoteliers?• Others?
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Biggest issue
• Used to be rate protection
• Used to be negotiation of amounts due
• Now:• Customer simply
unable to pay
![Page 4: Hot Topics in Hospitality Law Lisa Sommer Devlin Devlin Law Firm](https://reader038.vdocuments.site/reader038/viewer/2022100607/5a4d1bc67f8b9ab0599d4e46/html5/thumbnails/4.jpg)
Is the economic downturn a Force Majeure?
• Short answer:• NO
• Key elements of Force Majeure:– Unexpected event– Makes contract
illegal or impossible
Economic changes are not unexpected
Don’t make it illegal or impossible
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What about H1N1?• Remember the two
elements:• Unexpected• Makes contract illegal
or impossible
• Most contracts contemplate that people may not come (Attrition)
• Not illegal or impossible unless quarantined
• Seasonal flu kills 35,00 annually
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What about Bailouts and TARP?• • No government
prohibition YET• Laws require
regulations to be adopted to prohibit UNREASONABLE spending
• Law does not clarify what is to happen to contracts already in place
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So what to do?• ASK for help; don’t DEMAND it.• Tell the hotel immediately, don’t wait. Lead time is
critical. • Be prepared to return proportionate function
space so the hotel can attempt to sell your inventory.
• Determine how much available inventory the hotel has prior to selling your rooms. Explore E solutions using opaque channels.
• Negotiate with hotel on any revenues you may be generating above those contracted to help reduce attrition exposure, i.e. catering.
• Make the convention bureau and national sales network aware of the available rooms.
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Common Contracting Mistakes• Using contract and addendum• Failing to do proper amendments• Failing to read and apply the contract!
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Common Mistakes, continued• “No Attrition” contracts• Under blocking/Intentional overbooking• Asking hotel to assume all risk
• BETTER:• Limit attrition or have release dates• Share risk of outside issues• Shorter term bookings• Consider no booking!
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