On February 19, 2024, the Québec Superior Court issued its judgment on the merits of the class action Lussier v. Expedia, Inc. et al.[1] At issue was the manner in which certain fees charged directly by hotels, commonly referred to as “hotel fees,” “resort fees” or “establishment fees” (Resort Fees) were displayed on the expedia.ca, travelocity.ca and ca.hotels.com websites (the Websites) during the class period.[2]
The plaintiff alleged that, by failing to include Resort Fees in the total price displayed as of the first step in the reservation process, the defendants had breached subsection 224(c) of the Consumer Protection Act (the CPA),[3] which prohibits merchants from charging a higher price for goods or services than advertised, as well as section 14.1 of the Regulation Respecting Travel Agents (the RRTA).[4] The plaintiff also alleged that the display of Resort Fees on the Websites violated the CPA’s provisions regarding false and misleading representations and the failure to mention an important fact. While these Resort Fees were displayed on multiple occasions throughout the booking process, the plaintiff alleged that this was not sufficient and that they should have been included in the total price of the room, as of the first step in the reservation process.
The trial judge dismissed the class action in its entirety, finding that the defendants had not breached the RRTA or any of the provisions of the CPA that were invoked, and that the plaintiff had failed to prove the existence of any damages.
With respect to the alleged violations, the trial judge highlighted the fact that any Resort Fees charged by hotels were announced “early in the reservation process” in a manner that was “easily understandable” even for a credulous and unexperienced consumer. As for plaintiff’s allegations relating to the display of an incomplete or fragmented price, the trial judge distinguished the case from other cases involving price fragmentation on the basis that the Resort Fees in question are fixed fees charged directly by hotels once at the property, which allowed guests to benefit from various services offered by the hotels, as opposed to fees charged by the defendants at the time the reservation is made.
The trial judge also concluded that the plaintiff had failed to prove that class members were entitled to either a reduction of their obligations under section 272(c) CPA or damages. The trial judge relied on the Court of Appeal’s judgment in Fortin v. Mazda Canada Inc.,[5] which establishes the principle that a consumer’s right to compensation or to obtain a reduction of their obligations requires proof of damages. On the basis of the evidence submitted, the trial judge determined that such damages had not been proven.
Here, class members were clearly made aware of any Resort Fees charged by the hotels once they arrive at the property, both before making a reservation and immediately thereafter when they received their reservation confirmation and nonetheless willingly chose to reserve a hotel room (or not to cancel their reservation). The Court also noted that Resort Fees would have been charged by the hotels irrespective of the customer’s chosen reservation method (whether directly on the hotel’s website or on any other travel website). Finally, the trial judge also noted that the class members had or could have used the facilities for which the Resort Fees were charged, and many had made multiple subsequent reservations after having been charged Resort Fees a first time. In these circumstances, it was not open to class members to seek recovery of the amounts paid, either under the guise of a reduction of their obligations or as damages.
As for plaintiff’s claim for punitive damages in the amount of CA$15 million, it was also dismissed as the trial judge concluded that the defendants had, at all times, conducted themselves in good faith, with diligence and had worked proactively to improve the transparency of the pricing displays on the Websites over time.
For more information on this topic, please contact the authors, Margaret Weltrowska and Erica Shadeed.
[2] For the expedia.ca and travelocity.ca websites, the class period was from January 10, 2015 to June 4, 2020. For the ca.hotels.com website, the class period was from January 10, 2015 to February 28, 2022.
[3] CQLR, c P-40.1.
[4] CQLR, c A-10, r-1
[5] 2022 QCCA 635.
