ValueIreland.com

Food prices are increasing. Unemployment is rising. Inflation is getting out of control. The Celtic Tiger is a fading memory. Wage increases are unlikely in the near future. Job security isn’t what it used to be. Mortgage payments are biting hard for many.

Correct me if I’m wrong here, but if you’re facing into the perfect storm that is described above, unless you’re emigrating to make a new life for yourself, shouldn’t the cost of checking in baggage at the airport be the last thing you should be worrying about?

According to this article in this mornings Irish Examiner:

“The travelling public, particularly families, are being hit hard at a time when inflation is already high,” said CAI chairman James Doorley.

Lets look realistically at the overall net impact of the proposed Ryanair price rises would be €10 for a family of mum, dad and 4 kids - €1 each extra to check in at a desk, and €1 extra for each of 4 bags to be checked in.

€10!!!!! That’s all!

We’re talking about a family who are going on holiday with 4 children – flying. This is discretionary spending. They don’t have to go on holidays. They don’t have to fly for their holidays.

If families are in such a perilous financial situation because of rising inflation where an extra €10 is going to be a problem when they’re going on a holiday that will potentially cost thousands, then should they really be going on holidays at all?

Should our consumer advocates be jumping up and down because of such price rises? Can we not spend more of our campaigning time trying to address the types of inflation that impacts everyone, and more particularly impacts people who may really have financial difficulties because of rising inflation?

Shouldn’t all consumer advocates be focusing more on the fact that people who have real financial difficulties and don’t have the luxury of a holiday anywhere are having to buy the staple grocery items like milk and bread which are increasing in price at a faster rate that a bag of luggage on a Ryanair flight.

Which items below should our consumer advocates really be shouting about from the roof-tops?

I’m still working in the background on some site redesigns for both this blog, and ValueIreland.com as well. I’ve already finished, sort of, the SayNoTo1890.com website, but I’m still not really happy with it - so more changes to come there also.

However, in the spirit of the occasional series of “attention to detail”, here’s something that was of interest since I’m investigating updating the ValueIreland logo as part of the site redesign. It was brought to my attention last week via the Register, and I see that Rowan has covered on Fortify Your Oasis as well.

The UK government department, the Office of Government Commerce has recently designed it’s logo.

Interesting, the Office of Government Commerce sounds like something we might need since it’s “responsible for improving value for money by driving up standards and capability in procurement”. Oh, hang on, that’s the job of the Comptroller and Auditor General – though he doesn’t seem to be doing all that well by all accounts.

Anyway, here’s the new logo of the OGC:

Not sure how well it “stands up” to closer scrutiny!

Last week, I blogged about an expensive diesel price I noticed in Wexford. Also noticeable in the picture was the fact that the diesel was 20c more expensive per litre than the petrol. In the past, we’ve always been used to diesel being cheaper than petrol, but not recently.

According to this press release from Liz McManus TD, Investigation into disparity between petrol and diesel costs, Labour are going to look into this on our behalf:

Today Deputy Liz McManus proposed and got the agreement of the Oireachtas Committee on Communications, Energy and Natural Resources to investigate the disparity that has arisen in relation to petrol and diesel costs.

“Diesel is now 20% higher in cost on the forecourt than petrol in many instances,” said Deputy McManus. “Yet we are being advised by the Government to choose environmentally more efficient options.

The press release goes on:

“Recent figures show that diesel costs have jumped 17.3% in a year. This is a worrying development for those who have purchased diesel cars in the hope to reduce their emissions.

However (and no offence to Conor Faughnan), their first step in their investigation is:

“The Oireachtas Committee is to write to Conor Faughnan of AA roadwatch to make a presentation as a first step to deal with this issue,” said Deputy McManus.

Shouldn’t investigations such as this be directed to the Competition Authority, or the National Consumer Agency, or The Regulator In Charge of Petrol and Diesel Prices? You can find out the AA take on this by going straight to their website - there, I’ve done their investigation for them!

They notice they lost the data in 2007, yet this morning were being told that only now is the issue being looked at “as a matter of urgency”.

An interesting development in how our financial institutions are treating their customers. This is a letter from todays Sunday Independent:

Sir — One of our financial institutions promotes itself with a nod towards the American gangster culture. But even the wise guys of this culture would balk at a shakedown scheme undertaken by Ireland’s banking community.

The shakedown is based on the financial institutions charging a documentation fee for any application for financial lending services.

As a recent victim of this shakedown I was charged €75.00 for the privilege of applying for/taking out a motor loan.

Even though I was the one that supplied all relevant documentation and the processing of same would be a standard procedure within any organisation taking on new business.

Despite their relentless campaign to entice customers with special offers the customer still is paying over the odds for using the Irish banking system.

Charging a person to make a loan application is nothing less than extortion. One more example of Ireland’s rip off culture.

I wonder who this bank is - anyone have any idea?

That’s according to the News at One just now on RTE and their website. In accepting that they’d handled the situation very badly, Enda Corneile has confirmed that those who booked the cheap flights will be offered the flights that they thought they were buying - a standard ticket to the US.

Though, it now seems that some people still aren’t happy and are going to be demanding their business class seats. Mentioned on the askaboutmoney.com website, as well as a lady currently speaking on Joe Duffy on RTE.

The fall-out from this (if there is any at all) could be interesting. It is of great interest that a company felt that they could unilaterially break a contract like this in the first place, and that in doing so, there was only confusion as to what should or could happen next.

Shouldn’t we really have a consumer rights and legislative position in this country where if a company tries this in the future that it’s immediately known who the consumers impacted should go to for help (rather than just getting verbal platitudes and committments to publishing a press release)?

First things first - if you’re one of the people who purchased the Aer Lingus €5 business class flights, go straight to the Small Claims Court.

Last Tuesday in the Irish Independent where some Value Ireland research was mentioned by Ciaran Brennan in an article called “Check Please”.

A sidebar to that article was called “Undercharging just never seems to happen” and referred to my amazement that companies who make billing errors rarely make the errors in favour of the customer, but nearly always in favour of themselves.

But only two days later, we now hear of the Aer Lingus billing mistake that allowed about 100 customers buy €1775 business class tickets to the US for only €5.

Unfortunately, in the same way that if we’re overcharged for something and we expect to get our money back, Aer Lingus have cancelled all these tickets once the error was found. Their communication to customers who booked the tickets was as follows:

Dermott Jewell of the Consumer Association made the following comments:’Customers had a binding contract with Aer Lingus. They booked and paid to bind the contract. Realistically Aer Lingus is going to have to do something to abide by the bookings and to help the customers.’

This got me thinking! If an item is incorrectly priced in a shop, the price is considered an “invitation to treat” which means that when as a customer, if we offer to buy at that price, the shop may or may not accept the offer. If the shop in this case notices the mistake, they can then remove the item from sale at the incorrect price. If they don’t notice the mistake and process the sale, then the customer purchases the item at the incorrect price and goes home happy.

In such situations, if the shop discovers after the fact that they sold some items at an incorrect price, they’re not going to follow the customer home and take the item back. Just like Arnotts aren’t going to be able to take my new jacket off me because they got their 40% off signs positioned in the wrong place and their staff didn’t notice.

So, with this Aer Lingus situation, where do customers stand? It would appear to me that Aer Lingus made an offer via their website of business class flights for €5. 100 customers saw the “invitation to treat” and offered €5 for those flights. At the time of confirming their acceptance of the customers offer, Aer Lingus (through their automated booking system) didn’t notice the
incorrect price, and confirmed the offer. And because Aer Lingus confirmed the reservations at that price, presumably a contract was entered into.

From this solicitor’s website, you can see the following is the definition of a “contract offer”:

Therefore, in the Aer Lingus situation, there was further confirmation from Aer Lingus since they confirmed the flights at €5. Furthermore, also from the same website, a confirmation or acceptance is described as:

An acceptance is a final and unqualified expression of assent to the terms of an offer. It may sometimes be difficult especially in business to determine when the negotiations have ended and the offer has been accepted. The court will look at the entire negotiation to ascertain whether or not final acceptance had taken place. Acceptance can be deemed to have taken place through the conduct of the parties. The general rule is that acceptance must be communicated to the person who makes the offer, although there are exceptions to this rule, for example where the offer expressly waives the requirement. One of the main exceptions is where acceptance is made by post. In this situation acceptance happens upon the posting of the acceptance. In practice, most contracts in today’s business world will lay down very specific methods of acceptance.

To me, an e-mail confirmation of flight details from Aer Lingus would seem to be a satisfactory exhibition of acceptance on their part - they would use that as an indication of contract if you tried to back out of buying a ticket.

So really, when Enda Corneille, Director of Corporate Affairs at Aer Lingus, comes on the radio and said “anyone who booked a business class ticket, which usually retails at about €1,775, and got it so cheaply should know there was a mistake”, he’s really just saying “wah wah wah, it’s not fair. We screwed up, and got caught out. It’s not fair!” Yet they’ve taken their flights back, cancelled the contract between them and their customers, returned the money, and picked up their ball and scuttled away home.

Now, you can accept his point when he says ‘When you are selling seats on the front of the site quite openly for €249, to sell a business class seat for a fiver is a genuine mistake. People are going to know there’s something up.’

But doesn’t the same thing apply if Munster supporters are trying to book flights to somewhere there’s a game and a normal €5 flight when there’s no game on suddenly becomes €250 on the weekend when there’s a game. There’s definitely “something up” in those situations!

I’m definitely not an expert here, but I presume the defence of Enda Corneile and Aer Lingus is that the consumers didn’t enter into the contract to purchase the €5 ticket “in good faith”. Based on his comment above, there could be seen to have been no good faith on the part of the consumer when they would have known that there’s no way a normally cheap ticket of €249 which could cost €1775 could cost €5.

Unfortunately I can’t find anything on the websites of the Consumer Association or the National Consumer Agency to explain how to handle this kind of situation. That I can find out through a very quick Google search, the “in good faith” principle technically may apply to protecting the consumer rather than the business concerned – it’s intended to prevent any unfair terms being added into contracts which would lessen consumer rights.

If I were one of the people who purchased one of these flights, I’d definitely fight it. They made a contract with Aer Lingus, who’ve now broken it. This is a definite case for the National Consumer Agency (the former Office of Director of Consumer Affairs) – though that would then mean you’d have one state organisation going up against another state organisation, and that’s never really going to happen, is it.

It could also potentially be one for the Small Claims Court though. According to their website:

The small claims procedure is limited to: a claim in respect of goods or services bought for private use from someone selling them in the course of a business (consumer claim). This is provided that the claim does not exceed €2000.00 in each case.

In this situation, consumers have purchased an airline flight for €5 for private from use from Aer Lingus who’s business it is to sell flights. The claim will actually cost more than the flight. A no brainer really!