Hot Topics in Hospitality Law

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Hot Topics in Hospitality Law

• Lisa Sommer Devlin
• Devlin Law Firm

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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

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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
• Dont 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 dont DEMAND it.
• Tell the hotel immediately, dont 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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