Case looks into wedding banquet cancellation fees

MS ANNA booked a $20,000 wedding banquet at a four-star hotel in March last year.

She was not given a contract to sign. But when she and her fiance broke up four months before the big day and she tried to cancel the package, the hotel initially wanted to charge her the full amount.

"I felt angry that I had to pay so much when the hotel had not done anything," said the customer care officer, 24, who declined to give her full name.

The Consumers Association of Singapore (Case) also feels some hotels charge too much for wedding banquet cancellations, and that unfair practices are rife in the industry. So the consumer affairs watchdog has come up with a list of cancellation charges for wedding packages at 18 hotels here.

It is also in talks with the Singapore Hotel Association to come up with an industry standard for such penalties, which are generally decided by hotels on a case-by- case basis. The association, which surveyed the 18 hotels recently, found that some customers were made to pay almost the full cost of the package, which can come up to $50,000, despite giving notice of cancellation up to eight months earlier.

Others had their deposits - ranging from $1,000 to $8,000 - forfeited despite finding couples to take over their bookings.

Case president Lim Biow Chuan said it is not fair for hotels to impose a penalty when they may not have genuinely suffered losses. "If you are able to find a replacement or if it is going to be held much later, there's obviously not much of a loss, so why are the cancellation rates so high?" he asked.

Speaker of Parliament Halimah Yacob, speaking to reporters at a World Consumer Rights Day event at the F1 Pit Building yesterday, said she knew of one couple who had to pay half the costs, despite cancelling their booking a year before the wedding.

"This is quite ridiculous because weddings are usually held during peak periods which you can easily fill up," she said.

Online wedding forums often feature couples looking to transfer their banquet packages to others. Couples say it is a win-win situation if the hotels allow the exchange because both parties save some money.

Hotels explained that they need to charge cancellation fees because, by reserving the date for one couple, they may have lost out on other business, as well as incurred costs.

Mr Patrick Fiat, general manager of Royal Plaza on Scotts, said: "Many of the arrangements, such as for manpower, flowers and food, would have been made."

Half of the hotels polled said they would waive charges if bookings were cancelled due to unforeseen circumstances, such as the death of a family member.

Case, which has handled 23 cases involving cancelled wedding banquets in the last four years, is also considering naming errant hotels which charge excessive cancellation fees.

Tips for couples

 - Book early, preferably more than one year ahead of the planned event.

 - Read the terms and conditions carefully before committing to any wedding package.

 - Think carefully before signing the contract because cancellation penalties can apply immediately.

 - It is less risky to sign a contract that has more cancellation time periods.

 - Some hotels make customers pay 50 per cent of the package cost even if they cancel just one day after a contract is signed.

 - Others have graded penalties. For example, six months away: 50 per cent; three months: 75 per cent; a month: 90 per cent.

 - Note that some hotels treat postponements as cancellations and impose cancellation charges.

 - Find out if any refund will be given.

 - Any refund arrangement should be put down in writing

jantai@sph.com.sg

Additional reporting by Linette Lai

This article was first published on Mar 16, 2015.
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