On 30 August 2022, the Federal Court of Justice specified the criteria to assess whether extraordinary circumstances provoked “significant impairment” for the performance of a package tour, justifying the full refund of the price.

The applicant had booked a package tour to Mallorca in February 2020, for holidays between 5-17 July 2020, for a price of 3,541 euros. On 3 June 2020, the applicant had withdrawn from the contract and asked the organizer to refund the deposit of 709 euros. Instead, the organizer charged cancellation feeds of 886 euros (25% of the total price), and additional compensation of 177 euros on the applicant’s credit card. The hotel booked was closed both at the time of cancellation and during the travel period.

The lower regional court had sided with the applicant, holding that refund of the deposit was justified because the hotel booked was closed during the travel period. The applicant was therefore not liable to pay compensation for withdrawing from the contract.

On appeal, the Federal Court of Justice analyzed whether the organizer could counter the refund claim with a claim for compensation. Under the German Civil Code, the claim for compensation is excluded if unavoidable, extraordinary circumstances occur at the destination or in its immediate vicinity which significantly impair the performance of the package tour or transportation to the destination. The assessment is conducted from the perspective of a reasonable average traveler.

The Court referred the case back to the appellate court, holding that the latter did not properly assess whether a “significant impairment” had occurred here. Instead of considering only the fact that the hotel booked was closed during the travel period, the appellate court should have also assessed whether another accommodation could have been booked, even with a reduction in price. An overall assessment based on the purpose and concrete design of the trip and type and duration of the impairment should be conducted. The Court of Appeal now has to conduct this assessment based on the Federal Court of Justice’s interpretation.

Reference: proceedings X ZR 84/21.

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