December 16, 2020 by Greg Meckbach
A British Columbia couple who cancelled their August 2020 wedding due to pandemic concerns is not entitled by a force majeure (an ‘Act of God’) clause to a refund of $4,000 they paid the would-be venue in advance.
The province’s civil resolution trial rejected an application by Melissa Appelt and Tyler Lawrence to order CPM Farms to refund a $1,000 deposit and $3,000 advance they gave to the venue for their wedding, originally scheduled Aug. 15.
This is the second case in two months (Grant v. Waters was decided in mid-October) in which the province’s small claims court decided that a couple was not entitled to their refund on a deposit to a vendor arranging a wedding. While these are not insurance contracts under review, the cases may be of some interest to liability insurers who must defend their commercial clients in contract cancellation disputes related to the pandemic.
The couple first booked the wedding date on Jan. 19, 2020.
On Mar. 11, 2020, the world Health Organization declared COVID-19 a pandemic. As part of the response, the B.C. government placed restrictions on gatherings of more than 50 people. Appelt and Lawrence had planned to invite 82 people to their wedding. So on May 8 they cancelled the booking with CPM Farms.
They paid a $1,000 deposit on booking and a $3,000 installment. By the terms of their contract ,the total cost was quoted as $7,900 plus tax. The $1,000 deposit was refundable (less a 12% administration fee) if the event was cancelled within four weeks of booking, which in their case it was not. The first installment of $3,000 was not refundable.
The couple took the venue to the CRT seeking a refund of the $4,000 they paid in advance. They cited the Force Majeure clause in their contract with the venue, which states:
“The ability to execute this Agreement by either party is subject to the Acts of God, including but not limited to hurricanes, flooding, earthquakes, fires, etc. as well as any government intervention, staff disputes and strikes, changes to by-law and licensing, civil disorders, terrorism, or other emergencies. Should the event be canceled through a Force Majeure event, all fees paid by Client to C.P.M. Farms Ltd. will be returned to Client within thirty (30) days.”
CRT Member Rama Sood rejected the couple’s application. Sood found that province’s pandemic restrictions did in fact constitute an act of God which would have trigged the force majeure clause. But Sood also found that the pandemic response was not actually the reason the couple cancelled. The couple said it would have been too risky for people over the age of 65 to attend the wedding, even with COVID precautions in place.
But the CRT found that the couple’s wedding could have gone forward in compliance with the province’s COVID-19 pandemic restrictions.
For its part, the venue said it offered to let the couple postpone the wedding to a later date at no additional charge. It also said it gave them the option to have their deposit held as a credit if they could not commit to a future date.
Keeping the $4,000 the couple already paid compensates the venue for the lost opportunity to rebook on the same date with another group, CPM Farms argued.
“I find that the applicants signed the contract, understanding that the deposit was non-refundable four weeks after the contract was signed and the first installment was non-refundable after it was received,” wrote Sood.
Feature image via iStock.com/Phynart Studio