A planned holiday to Thailand turned into a nightmare for a Feilding couple because of Covid-19 travel restrictions - but it was the $1436 cancellation fee that raised their ire.

Now Stuart Douce and his partner are planning to take Flight Centre to the Disputes Tribunal and have complained to the Commerce Commission.

Douce, a former teacher, said the $2328 holiday was booked in November last year through Flight Centre in Fielding, flying Thai Airways.

"When the outbreak of Covid-19 happened we received notification from Thai Airways on March 19 that they were cancelling all their international flights and it was indicated that all our money would be refunded by our travel agent," Douce said.

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Flight Centre told the pair they had two options; a credit to rebook the trip before December, valid for one year, or a refund minus the cancellation fee, which would take three months.

The couple declined the credit for several reasons:

• There was no guarantee Thai Airways and Flight Centre would still be operating at the end of the year and able to fulfill the commitment;

• Because it was a special promotion the couple would have to pay the full airfare and hotel costs to rebook, which they cannot afford;

• There was no way to know when travel and border restrictions would be lifted;

• Douce's partner has impaired lung function and is immune-compromised, and would not be covered by travel insurance for viral infections;

• They were not prepared to risk their health to travel while there was no Covid-19 vaccine available.

But when they chose the cancellation Flight Centre informed them of the $1436 fee and that the partial refund of $938 would take three months.

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Douce, 45, said the fee was unreasonable.

Similar cancellation fees by Flight Centre had been the subject of hundreds of complaints on a Facebook page set up by aggrieved customers, with some claiming to have lost tens of thousands of dollars.

A Change.Org petition set up to get Flight Centre to relax or waive the cancellation fees had attracted more than 4150 signatures on Wednesday afternoon.

There were also media reports in Australia and the United Kingdom over the same concerns.

Douce, a volunteer ambulance officer, lodged a complaint with the Commerce Commission and making application to have the case heard by the Disputes Tribunal.

"It's not just for me. It's for every other Flight Centre customer. It's just wrong."

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In Covid-19 disrupted travel, trade and events advice by the Commerce Commission, the contract became "frustrated" when the Government announced border restrictions in late March.

Where a contract is frustrated, the Contract and Commercial Law Act 2017 applies.

The CCL Act says the consumer is entitled to a refund, but the business may
retain its reasonable expenses and overheads incurred in relation to the contract.

"We are charging 'allowable expenses' and these charges were fully transparent at the time of booking," an email from Flight Centre to Douce said.

"We are legally entitled to charge the fees that are in place and we will not be amending this outcome for you."

However, after the Herald made inquiries, a Flight Centre spokeswoman said staff had managed to get a non-refundable deposit of $100 per person for the hotel room in Thailand, waived for Douce.

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The other fees included a $350 per person Flight Centre cancellation fee, and a $200 per person Thai Airways fee, totalling $1100.

A Flight Centre spokeswoman said the fee helped to cover the part of the service that's already been provided by the consultant.

Covid19.govt.nz: The Government's official Covid-19 advisory website

"A Flight Centre cancellation fee of $350 applies to long-haul international travel, and is disclosed to and agreed upon by the customer before booking.

"The amount covers just a small portion of the many hours of work and effort that our travel experts put into consulting and arranging the customer's travels, as well as handling cancellations directly with suppliers."

Consumer NZ chief executive Jon Duffy said he had received a steady stream of complaints about the cancellation fee and all of the customers were not aware of the "penalty".

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"Cancellation fees are not uncommon but in our opinion they need to be reasonable - $350 seems far in excess of what could reasonably be expected to cover the administrative costs of Flight Centre handling these bookings."

Consumer NZ chief executive Jon Duffy says the $350 fee is disproportionate to the service provided by Flight Centre to book the flights. Photo / Supplied
Consumer NZ chief executive Jon Duffy says the $350 fee is disproportionate to the service provided by Flight Centre to book the flights. Photo / Supplied

He said the situation that forced the cancellation was out of customers' control and Flight Centre should not be profiting from that.

Duffy said if it could be proved the fee was unreasonable it could be a breach of the Fair Trading Act and open to action by the Commerce Commission.

Making customers wait three months for a partial refund was added insult, Duffy said.

"It may not be illegal but it's really cheeky and it's pretty atrocious behaviour in the current climate.

"Everyone is struggling, businesses included. But to be profiting and effectively getting interest-free credit from your customers while you dilly-dally paying them back, it's pretty outrageous in tough times like these."

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