Couples Statement, 30th October
The WVSG seeks to engage the CMA to create fair guidance
The Wedding Venues Support Group (WVSG) was set up to provide wedding venues with the legal advice that has been made necessary by the unprecedented impact of Covid-19 on the industry, and the Competition and Markets Authority's (CMA) unfair approach to weddings affected by the pandemic.
To address this unbalanced Guidance from the CMA, WVSG united over 200 wedding businesses to fund expert legal advice from the top consumer law silk, Jonathan Kirk QC. Support and pledges continue to rise, as more and more venues feel mistreated and vulnerable due to the stance taken by the CMA.
The CMA issued Guidance in April and September to couples with weddings impacted by Covid-19 that included analysis of the law of frustration, which contained 'material errors of law' according to Jonathan Kirk QC.
Where wedding venue agreements were incapable of being performed (or 'frustrated') as a result of the Covid-19 lockdown, CMA guidance encouraged couples to seek full refunds for cancelled weddings from the wedding venue with very limited scope for venues to recover costs they have incurred. This Guidance has misled couples on the law relating to ‘just expenses’ incurred by venues and so encouraged decisions to cancel where, with all the facts available, postponements may have been considered. Worse, the one-sided advice has led to disputes and and is now being used by insurance companies to resist making payouts to couples on their wedding insurance.
The pre-eminent consumer law silk has since provided an Opinion critical of the CMA's Guidance. His analysis concludes there was 'no excuse' for failing to consult the £10billion industry, which employs half a million people, before issuing its erroneous Guidance to the public. Mr Kirk added that the CMA's approach as to the costs which may be offset by venues is 'too narrow', incorrectly excluding any allowance for fixed or indirect costs.
"In my opinion the CMA Guidance (collectively) is not balanced and may have been counterproductive to the interests of consumers because insurance companies have cited it to avoid paying consumer claims on the basis that the Guidance means that the trader is wholly responsible for Covid 19 refunds. This is contrary to the expectation of most consumers, who would ordinarily rely on their insurance cover to protect them against such unforeseen events. It may also have unfairly placed the burden of Covid 19 compensation on smaller traders as opposed to national insurance providers."
– Jonathan Kirk QC
Mr Kirk also went on to highlight three bases upon which the Guidance is fundamentally flawed. Firstly, the CMA’s failure to consult the wedding industry before publishing their Guidance. Second, their interpretation of ‘just expenses’, and finally, the CMA’s assumption that it is their decision to determine whether a contract is ‘frustrated’ or not.
On receipt of Mr Kirk's 26-page opinion, the WVSG promptly requested that the CMA suspend its Guidance and consult with the wedding sector before taking any further steps. To date, the CMA has declined to do so.
All we are asking for is fairness in the CMA’s Guidance. Currently the CMA are making wedding venues solely reliable for compensation, while the insurance sector is accepting no liability whatsoever. This unjust Guidance cannot continue, and with the top legal advice we have received, we fully believe we have more than enough grounds to dispute it. Our aim continues to be to engage with CMA and work with them to create fair Guidance that won’t persecute wedding venues, but still help couples whose weddings have been affected by Covid-19.
