QLD Debt Collectors - Hotel Damage

[Smiley]

Hello, is my cousin at fault and liable for the following debt?

A debt recovery group (debt collectors) is seeking $6k worth of damages due to a hotel room that was flooded.

1. My cousin stayed in a hotel in QLD in September 2013 for several nights. On the last night she returned to the room and turned on the bathroom tap. No water came out. She accidentally left the tap on.

2. She advised reception of the water issue and was advised water maintenance was going on and should be returned later. No signs of water maintenance anywhere in hotel nor in my cousins hotel room.

3. She went out and returned to find the room flooded. On check out, the hotel took her bond of $300. My cousin states that had she been warned about the water maintenance from the hotel, she would not have turned the tap on in the first instance.

4. In Feb 2015, a debt recovery agency contacted my cousin and advised they act on behalf of CGU Insurance and seek $6,517 due to damage. Breakdown as follows:
Loss of rent - $232 per night for 17 days ($3,944)
New carpet $1,990
Gold Coast cleaning $583

5. I asked the debt recovery group where is the contractual obligation between my cousin and CGU? They replied as this is a debt recovery, no contractual obligation is required.

6. My cousin states that the debt recovery agent contacted a manager from the hotel and from that conversation, the debt recovery agent is now offering $5k to settle or will seek instructions from their client to comment litigation.

Please help.

 

[AnnaLJ]

Hi Smiley

My understanding is that before debt collection agencies commence the debt collection process they require their client (in this case, the Hotel) to sign an agreement declaring that the debt is 'not in dispute'. It would seem from the description you have given about that the debt is likely in dispute.

You are well within your rights to request a copy of the contractual obligations you have breached that led to the liability for the damages being claimed (and to request proof that this debt is not in dispute). I would put any requests to the debt collector in writing.

Does your cousin recall signing anything either at the time they checked into the hotel or (in the case of an online booking) at the time they booked the hotel online? These T&Cs would be the first port of call for your cousin to try to navigate through these issues. In absence of any T&Cs, the position here could get tricky.

As there are large sums involved and this does seem a big complicated, I would recommend engaging a lawyer as this looks like it could get messy.

Please keep us posted and if you do end up getting a copy of the contract from CGU let us know!

All the best

 

[Smiley]

Hi Anna,

You infer I should obtain a copy of the T&C's. I will ask for this from the debt agency. Thanks.

Unfortunately as this incident happended in 2013, my cousin no longer holds any paperwork she signed with the T&C's, booking confirmations etc.

Regarding the contractual obligation my cousin broke, I have no idea which one? We asked the agency to confirm, but they advised as this is a debt, contractual obligation isn't required?

I have asked the debt collection agency to provide a copy of all the documentation they hold on file. They advised I will need to complete an application with them for this. I have requested a copy of the application and I am awaiting their response.

I called CGU complaints department and they advised they have no idea about the matter and it is not with them? But as the debt agency states their client is CGU, I can only assume a direction must have been given somewhere in CGU for the debt agency to engage my cousin over the debt.

Regards,

 

[AnnaLJ]

Hi Smiley

I understand it could be difficult to track down those T&Cs as it's certainly not something we think to take a copy of when staying in a hotel! What I would be hoping to see in the T&Cs would be details around damage to the hotel room and property, the guest's liability for such and perhaps some general exclusions to liability (such as where damage is caused as a result of a defect in the structure of the building etc).

If the debt collector continues to maintain the debt has not arisen out of a breach of a contractual obligation, then I guess you could assume that they're running this based on a general claim of damages for loss suffered. Either way, I really think the onus needs to be pushed back onto the debt collection agency to support your legal liability for the debt. I would continue to be insisting on this. Then, based on what they say, it might be time to get some legal representation.

Out of curiosity, did your cousin happen to have travel insurance while staying at the hotel?

Anna

 

[Smiley]

Thanks for the information, it is really appreciated and I will push on the points stated.

I do not think my cousin had travel insurance as at the time of the stay, she lived in Brisbane and the hotel she stayed in was also in Brisbane. She stayed there for a few nights when one of her girlfriends came to visit. Nevertheless I will ask.