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Published on: 11/17/2001
Last Visited: 8/15/2002
Convene recently asked Robin Roth, senior contracts editor for Conferon, Inc., to provide some insight for meeting planners about how to conduct the review process.Here's what she had to say.
Convene: When a contract arrives on your desk, what specific steps do you take in reviewing it? Roth: Reviewing a group sales hotel contract can be time-consuming and confusing.If you are a meeting sponsor, you seek a fair agreement that accurately and comprehensively covers your meeting arrangements.When you receive the contract from the hotel, you must closely examine a document that is often one-sided in favor of the hotel, vague in many places, sprinkled with errors and typos, contradictory, and missing essential language.It is helpful to examine the contract twice.First, look at everything that is there and identify the terms that need to be rewritten, changed, or deleted.Second, look at the contract again for what is not there that needs to be added.
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Roth: Surprises are not welcome once a customer has signed a group sales contract with a hotel.Contract language should be as clear and specific as possible so that both parties know exactly what terms they have agreed to.The group should not be faced with unexpected charges, have a different understanding of how future rates are to be calculated, or arrive at figures for attrition or cancellation charges that are poles apart from the hotel's.They shouldn't even debate whether there is attrition in the contract in the first place!The planner should check each term of the contract to be sure that all items have been clearly spelled out.Legalese that isn't understandable should be rewritten in plain language that is clear to both parties.It is helpful to beware of words and phrases like "reasonable," "at the hotel's discretion," and "meeting room rental may (vs. will) apply."
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Roth: On business issues, most hotels are empowered and willing to negotiate.These areas often include rates, dates, space, concessions, room rental, service ratios, etc. Negotiations can be more difficult when you are requesting material changes to the legalese or the liabilities associated with the booking.Many hotel sales personnel need to refer requested changes to clauses such as Force Majeure, arbitration, or indemnification back to their corporate legal departments.If you request changes to the liability issues (such as attrition and cancellation), your requests can often send up red flags to hotels.Requesting a better cancellation clause can be interpreted to mean that you may have a higher risk of canceling.Requesting improved terms of attrition can be interpreted to mean that you are unsure of your ability to pick up the block.
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Roth: Reviewing a first contract can be an overwhelming experience for a new meeting planner.There is a great deal of information covered, and the subject areas may be overlapping or even combined.This makes it difficult to ensure that each topic is clearly and accurately covered.A rule of thumb is that each important topic in the contract should be covered separately under its own clause.For room block performance there should be only one clause, usually attrition or a meeting room rental sliding scale tied to room block performance.Make sure that room block performance is not tied to another major area like food and beverage performance or cancellation.Also make sure that if there is no room block performance that it is so stated in the contract.
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