I won’t feel too bad if this gets tossed into the Pit, but I want to ask it as a GQ before I just go pitting the industry.
A Resort Fee is essentially a non-optional surcharge tacked onto a hotel bill in addition to the daily rate. Suppose, for instance, you book the Westin Hilton Head on Hotwire at $100/day for room and taxes. On arrival, the hotel “reminds” you that there is a non-optional Resort Fee of $16/day. You have already paid for the stay and are standing there so it’s a bit late to throw a hissy fit.
I can’t quite figure out how such a fee can be permitted to be excluded from the daily rate for the hotel since it is non-optional and related to nothing other than the fact that you are staying there. In principle a hotel could charge $20/day for a room and $100/day for the Resort Fee.
The lawsuits that have arisen over this practice have done little more than marginally improve the notification process (a small sentence somewhere at booking that mentions “a Resort Fee may be charged” for instance) and, in the case of Starwood at least, refunded offended customers with a Certificate for a reduced room rate at a different Starwood with room availability. Hooray, judge; I was cheated by the hotel but they will compensate me by letting me stay at the hotel I swore I would never stay at again…if they have an otherwise unrented room. http://www.guestchargessettlement.com/faq.htm
I am trying to get at the fundamental question of how such a fee is permitted to exist at all when it is nothing more than separating the daily hotel rate into two pieces and renaming one of the pieces. I get the general concept of shady practices but this one seems to have crossed the line into plain old fraud, and I am sort of staggered that it’s not illegal. “Yessir; we understand you rented the car but this fee is for the use of the wheels. We did mention in the Agreement that there might be Additional Fees.”
Sounds to me like you’ve answered your own question: if there was a lawsuit with sufficient merit to warrant Starwood settling it, it was (at least in the form then used) possibly actionable at law.
Reading between the lines of the settlement to which you link, Starwood at least have agreed to give better notice of their “resort fees” etc. If other hotels do not, they may well be vulnerable to a similar suit.
The legal position is likely simply to be that if it’s adequately brought to your attention you are stuck with it and if it isn’t, you aren’t. What constitutes adequate is of course debatable, and someone more knowledge than myself might be able to give you an answer on that, although I suspect it is a pretty gray area.
Is such a fee legal (that is, is it allowed by applicable statutes and/or common law)?
Is such a fee actionable for some other reason (such as violation of a contract)?
Hi, Opal!
As to the first question, what law do you think it would violate?
As to the second, as long as you have notice of the fact that you might be charged added fees to stay, presumably the “contract” you have includes the notification (which likely was the underlying basis of the legal action you mention).
I’d simply refuse to use any chain that utilized such practices, and make sure to let them know they lost my business and that of my friends/acquaintences for that reason.
It is just a quasi-leagl way to increase the price charged. it is like electricity deregulation: before this great boon came to pass, you got a monthly bill from your electric utility-it told you how amny Kwatt-hours you used, the charge per KW/Hour, and the total. now you have at least 7 different charges tacked on (sunk costs, transmission cost, leagl litigation costs, etc.). So you get a lower KW/H rate, but the other crap makes up the bulk of the charge.
Welcome to the legal world of fine print!
I stayed at a hotel in Disney World (I don’t remember which one; not one of the Disney hotels but another chain on the property). They tried to charge me a daily resort fee but I didn’t know about it until I checked out and saw the bill. I complained to the MOD and he took it off the bill without the least bit of an argument.
In another case, last year we went to the Don CeSar [sic] in St. Pete Beach and were charged a resort fee on check-in that was not quoted when I reserved the room. When I complained about it later, they told me that the fee was shown on their web site where I made the reservation. I looked, and it was indeed there but it was possible to book the room without ever seeing the page that fee was on. I complained again and the credited it back as a goodwill gesture. But that probably happens in a small percentage.
I can’t cite a specific law but aren’t there consumer protection laws that require pricing to be disclosed? The situation described in the OP says that the room was booked and paid for–and then only when you arrive at the hotel do they tell you that there are additional charges not previously disclosed.
I would say failure of consideration in two ways, unconscionable bargain and fraud in the inducement.
Firstly it seems like it violates the pre-existing duty rule, in that they are charging a higher price, without consideration, after the time of contracting. For the non-lawyers in the house, the pre-existing duty rule says that once a contract is formed, there is a duty to provide a good/service at athe contracted price. The price cannot change unless the good/service changes also.
Secondly, where one party has an absolute discretion over changing the bargain, there is no mutuality of obligation between the parties. Such a promise is illusory and again there is failure of consideration.
Thirdly, even if there is a notice that additional charges may apply, this strikes me as an unconscionable bargain where the Hotel has absolute discretion over what those “additional charges” could be.
Finally, it’s skating the fine edge of fraud in the inducement if you ask me. You’re induced to contract based on a certain price, then it turns out the price is more. When you do find out the price is more you are likely in a strange town with potentially few other options other than to accept their contract.
[quibble]It’s not really fair to say that these are legal rules that get violated, although they could certianly be valid defenses to paying the fee[/quibble]
Ditto here. The pre-existing duty rule says performing a duty already owed (in this case, by contract) isn’t consideration that supports a modification of the contract. http://nevadalawjournal.org/pdf/zhangVsDistrict.pdf Again, you might rightly refuse to pay the fee, be refused a room, and sue for damages. I wouldn’t say that’s a violation of a legal rule in the sense intended, though.
Good point. A factual question exists about how “absolute” the discretion really was. Did the OP call in advance and ask how much the “resort fees were”? Is there a schedule of the fees available in advance? Besides which, illusor consideration will get you rescission of the contract, which doesn’t really sound like what you’d want under these circumstances. You want to avoid the fee. Saying, “hey, this is an invalid contract” lets you leave and try your luck with another hotel.
Again, good point. But this is one of those law school defenses that doesn’t often work IRL. And again, unconcionability is generally not going to get the fee waived, it lets you walk away from the deal.
Possible, although fraud in the inducement usually involves a factual misre. And as others have pointed out, it might well violate consumer protection laws, which can actually be violated and which often offer criminal and civil remedies.
Right. The factual misrepresentation is the price quoted at the time of the reservation. As I understand it, you make a reservation through their website. A price is quoted, let’s say $100/night. You reserve for 2 nights. (lets imagine no tax applies to keep the numbers large & round) When you arrive at your destination you are presented with a form that says the total price is $230, because a $30 “resort fee” applies.
Through the reservation system, they intentionally misrepresented to you what the total cost would be, to fraudulently induce you contract with them and not a competing facility. Even if the further charges are noted, when they are noted in an intentionally inconspicuous way likely to decieve most people as to the true contents of the contract, its fraud in the inducement.
Can’t you get punitive damages for fraud? (I agree that the other things I mentioned are not very recoverable).
Sorry, I had intended to address your point about price misrepresentation being factual (IIRC there are some cases on point), but my phone started ringing. That’s apparently why I wasn’t able to finish typing the word misrepresentation. Things are crazy here right now, so I’m not sure when I’ll get a chance to return to it. If I get a chance, I’ll post what I can find.
Ditto punitive damages for fraud in the inducement.
It sounds like people are not discussing the fees themselves, but the lack of disclosure of the fees. Having been involved in organizing meetings where this is a big issue (400 chances for people to complain) I’m sensitive to this, and I’ve seen them disclosed (if in small print) on most hotel websites.
The other thing is that the fees are negotiable. I know of cases where either the fee was waived, or the conference attendees got additional perks, such as free parking and free Internet. So pricing flexibility might be one reason hotels charge this.
If you want to talk about resort ripoffs, how about $8 a night for self park in the middle of the stinking desert…
No. All those charges were always included. Now they are being broken out to give you more complete information about your bill. This is the result of regulation. The utilities aren’t doing this voluntarily.
I think it’s the wave of the future not only in hotels but everything. Adverstise the “Bare” bones price then add on. Like I recently flew British Airways and was shocked they wanted a fee to choose my seat. When I complained I never had to pay to choose a seat they said it was a “new concept” and they made an exception after I explained it was never disclosed to me BEFORE I actually booked the flight
Reminds me of the old “I Love Lucy” show where the guy sells Lucy a vaccuum and then adds in the canister, the on switch, the power cord etc etc etc
Often both.
They are trying to disguise the true cost, to sucker customers into booking and then hit them with additional ‘fees’ later.
And they are trying to cheat on their taxes. Some local governments have hotel taxes that are a percentage of the room rate. By charging this as a separate ‘fee’ the hotel under-reports its’ room income and pays lower taxes.
Phone companies are the worst. My phone bill (landline) has 11 ADDITIONAL charges (taxes, fees, ect, ect) that are more than 55%of the bill. Yet I see them advertise their “low monthy rates” without disclosing the extra charges they add on.
Not necessarily. In my town, hotels have three separate taxes.
First is the state Sales Tax (a percentage of the base rate).
Then there is the Lodgers Tax (a percentage of the base rate). I don’t know if that goes to the state or to the city.
This month, the city added a Convention Center Fee (a surcharge of $2.50 per room per night). The city government is allegedly going to use this to finance construction of a new convention center.
The reason this is permitted is because the out-of-towners who have to pay the taxes don’t get to vote in the elections of the city councellors who levy the taxes.
