Event organisers: How to handle event cancellations
The Coronavirus pandemic has seen most events cancelled over the next few months. Many of our event organiser clients are asking how they should respond? This is easier for those that had chosen to purchase insurance cover for communicable diseases but very difficult for the many event organisers that did not.
Our first pointer is always to look at the contract terms you have in place with your clients: This should clearly state whether you can cancel and what liability you have to refund your customers. Hopefully you will have a clause that specifies your responsibilities in the event of an occurrence beyond your control, often known as ‘force majeure’. If your contract has been well constructed then there should be no arguments, but that does not mean you can get away with anything.
Steve Thomas is a Commercial Partner at law firm Harrison Clark Rickerbys with a specialism in events, he comments:
“Business to Business (B2B) contracts can be challenged under the Unfair Contract Terms Act 1977 (UCTA) and Business to Consumer (B2C) contracts can be challenged under the Consumer Rights Act 2015 (CRA). So even if you have express rights in your contract to cancel without refund to your customer it is possible that this provision could still be challenged:
A clause in a B2B contract on the event organiser’s standard terms may be challenged if the effect of the clause is to allow the event organiser to “render contractual performance substantially different from that which was reasonably expected or to render no performance at all”.
C2C contracts are expected to be even more considerate to customers; According to guidance published by the Competition and Markets Authority, a term which requires a customer to go on paying when services are not provided as agreed, simply at the discretion of the event organiser, is particularly objectionable. However, terms which allow businesses some flexibility in the performance of their duties are more likely to be ‘fair’ when they are clearly in circumstances beyond the business’ control.“
Event organisers should consider these risks carefully and, where at all possible, take a balanced approach to their cancellation and refund policies.
As an insurance broker specialising in sports & leisure, we insure a wide variety of events in the UK and abroad. Our team has seen cancellations, postponements and disruptions for all manner of reasons; from extreme weather to double booking of venues and, of course, communicable disease.
Duncan Sutcliffe, director, Mann Broadbent, added: “Whether your event is insured for disruption or not, we urge event organisers to look at their contracts. We have seen far too many event organisers left with huge costs or facing online abuse from disgruntled customers because their contracts were badly constructed.”
If you would like advice on insuring your event please get in touch with the Mann Broadbent team on 01905 612336 or via email