Can I be held liable for a group's hotel cancellation charge without a signed contract agreement?
Question Details: I am a home based travel agent. About 11 months ago, I contacted 3 hotels to get a quote for a small group traveling for 13 rooms. Then, 4 months ago, at the time just prior to departure, I received a call from the hotel representative asking if the group was still coming. I said no, that the group cancelled their trip. At that point, I was told that my credit card would be charged a cancellation fee of over $2000. I do not have a contract for this nor any of the other hotels I contacted. I called and emailed that hotel representative to forward a signed agreement for me to examine. There is none. My bank has cancelled the charge back and paid the hotel, leaving me owing my bank the charge. My banking institution says that my releasing a card number made me liable even in the absence of a contract agreement.
No, releasing a card number does not automatically make you liable for the charge: at most, it is evidence that suggests or supports that you agreed to cover the charge, but does not necessarily by itself prove that. Many states, including the state you list, LA, have laws saying that certain contracts, like those to answer for or pay the debts of others, must be in writing to be enforceable, and this situation might fall under that heading. You may wish to sue the hotel for $2,000 on the grounds that they charged you without there being an agreement that you would pay. Of course, in your line of work, suing a hotel might be a bad thing to do; and if they are in a different state, the costs and effort of suing them might exceed the value of the $2,000. Unfortunately, suing is the only option you'd have to get the money back, so you need to decide if it is worthwhile to you to do so.