Lecture 3: How to Claim Refunds in Canada for Summer Camps/Airline Tickets Due to COVID-19?

Share this:

This is the third of five lectures on the issue of claiming refunds in Canada for Summer Camps and Airline Tickets. These lectures specifically deal with scenarios where summer camps have been cancelled by the Camp providers or the flight have been cancelled by the airline itself. (These lectures do not deal with scenario where a traveller has cancelled his/her flight or where the parent has cancelled the camp attendance of his/her child.)

Lecture 3 applies the legal principles of breach of contract to summer camps and specifically Stem Camp in Ontario and shows how the refund of monies cannot be legally denied by Stem Camp.

This lecture is taught by Amer Mushtaq, LL.B., M. Engineering , B.Sc. (Hons.), who is the Principal and Founder of Formative LLP.   Through his YouTube channel, YouCounsel, Amer shares practical advice from his years of legal experience to help anyone access justice and achieve their goals.  Subscribe today to learn more.


Show Notes:


Lecture Slides:

Welcome to YouCounsel.

This is our third lecture on this topic. If you are in a situation where you wish to claim a refund for the cancelled summer camp for your child or if you wish to claim a refund for the airline ticket that has been cancelled due to the flight cancellation – how do you go about it?

We once again begin with our usual disclaimer that this lecture is not legal advice. If you have any specific questions you should contact a lawyer or a paralegal or the Law Society of Ontario for a referral. If you are in another province, then contact the Law Society of that province.

In this lecture series, we have five lectures. In the first lecture which has been posted, we talked about the underlying principles about the breaches of contract and it covers all kinds of scenarios for breach of contract. Please check that out. In the second lecture we talked about the defences to breach of contract. How the breaching party, the non-performing party, can potentially avoid certain obligations, certain liabilities, based on these defences.  We talked about it.  As promised we said that in this lecture, we will apply those legal principles to summer camps and specifically STEM Camps, which is a specific camp that is in Ontario and has clearly indicated that it will not refund any monies to any of the parents for the camps.  In this fourth lecture we’ll talk about how do you go about executing a chargeback, a reversing of credit card payments for those monies and if everything else fails and if you have to go to court, how do you go about doing that.

What are the defences that have been forwarded or is likely to be forwarded by STEM Camps? Let’s talk about that specifically. Fundamentally, their defence seems to be based upon their notification that their contract for performance of their services i.e., running of camp is frustrated.  It’s impossible.  Why is that? Because the government has announced that the summer camps or any children’s activities where there will be a gathering, is not going to happen until September. That’s why they cannot operate. In that scenario the Frustrated Contract Act, applies.  This is the Act that I had mentioned in the previous lecture.  Then, on that basis STEM Camp should refund payment to parents and then they can deduct certain expenses relating to the camp.

What is the basis for STEM Camp to refuse complete refund? Essentially, they are forwarding/ advancing two kinds of arguments. One is that they are saying that we have changed the camp to virtual and so, we no longer are providing a physical camp, but we have changed it to virtual camps.  That’s why we shouldn’t be refunding and we will not be refunding any money.  The second argument that they’re making is that, there is no money left to pay back and therefore we’re not going to be refunding any money.

Let’s look at both of these explanations / excuses and see where does the law stand on these kind of explanations. The first argument: that they have changed the camp to virtual camp – is that an acceptable argument? The answer is No! When they change the physical camp, where the children were required to physically attend and socially interact with each other and learn and the camp was going to provide their childcare – all of these things – when they change that to a virtual camp, that is a change in one of the fundamental terms of the contract. You’re fundamentally changing the contract. It was different before and now you’re changing it to virtual—which is a fundamental change.  You cannot make a fundamental change unilaterally.

You have to consult with the parents, you have to make a proposal and if parents agree—it could be different for individual parents—but if a parent agrees to that, only then you are able to change it.  Otherwise you cannot unilaterally change the contract which seems to be the case that they have done. This argument is not going to be acceptable by a court. Also what they have done is not a comparable change. What they’re offering now is (previously the child would be attending the camp for the entire day and for the entire week) one and a half hour per day.  The activity will be virtually done and the parent will be responsible for the child. There is no childcare provision and the child will not be attending full time, for the entire day. This is not a comparable scenario and this argument is not going to be acceptable to the court.

The second argument is that we have no money left and therefore we can’t refund it, because there’s no money.  If you force us to refund, then we will have to unfortunately apply for bankruptcy. That argument is not going to fly either.  Primarily, because based upon their policies or the policies at the time people had purchased these camps and executed their contracts, their expenses can literally not exceed 10% of the purchase price. If you had paid $500 for that camp, then the expenses cannot exceed $50—because of their refund policy.  They have removed this refund policy which we’ll talk about next. The refund policy, when people purchased these camps, was that if the parents or the child cancels their attendance at the camp and it is done more than thirty days in advance, then you get ninety percent of the money back, only 10% of the money will be charged as administrative fees. This is a scenario when the child or the parent actually cancels. The non-performing party is the child or parents not the camp itself and, then, similarly if the cancellation is between 14 to 30 days then the refund is 50%.

When the camp is cancelled by STEM Camp itself, then they cannot justify, in my view, any expenses that could possibly exceed 10 percent of the value.  That’s the problem that I see.  Even for this refund policy, it states that when you claim that refund within 5 to 7 days, they have to process it.  I understand many people have already asked for the refund and they have simply said that they will not refund any money.

All of these scenarios and what I have seen with respect to the answers by STEM Camp brings me to the issue of potential fraud—which is a much more serious issue than the breach of contract that we have been discussing.  If this matter is before the court and the court finds that there is fraud or a fraud is established, then the court is entitled to pierce the corporate veil and then hold the directors and controlling mind of the corporation personally accountable.

Based upon what may be happening in STEM Camp this may be a possibility. It may go in that direction.  There may be people who claim fraud against STEM Camp, if this matter is not resolved amicably. Some of the examples that I am seeing that could amount to fraudulent conduct or bad faith conduct on part of STEM Camp are as follows: I’m not going to go into much detail, because I can see that this matter is going to go to litigation. But there are potentially false claims for certain expenses. Their claims that STEM Camp has advised people, that they have expended money in certain ways and those people have gone ahead and verified and found that in fact those expenses were actually not incurred.

Similarly, there are claims made by them that there has not been any receipt of grants and apparently it seems that parents have confirmed that is not true either. Then in terms of conduct – forcing parents to choose between donating their money, what they have said is either you donate the money or you accept the virtual camp. Those are the two options that STEM Camp offered to people and that’s hugely problematic because people are entitled to claim full refund and at least they are entitled to refund based on the refund policy. Just giving them the two options seems to be bad faith conduct. Similarly, they have gone ahead and removed refund policies from their website. They have taken away their Twitter page and whatnot and they have posted certain information that seems to be misleading for parents, etc. All of these scenarios if they are found to be true by the court and fraud is established, then STEM Camp may face a larger problem than simply the refund of the monies that people have paid.

Let’s recap. In my view, there’s absolutely no valid argument for STEM Camp to refuse refunding, repaying the monies that have been paid by parents to them and then forcing upon the parents the option of choosing between virtual and donating the money is rather absurd.  It’s not legally valid.  I can see that there are potential issues that may give rise to claims for fraud or bad faith conduct which will be problematic.

In the next lecture: Now, if you are one of those parents who are entitled to claim, refund – how do you avoid going to court? Just by simply getting your payments reversed by credit card companies, if you have made by credit card it’s called chargeback. How do you go about doing that we will give you some basic steps for doing that, so that you can accomplish a reversal of these payments without any difficulty.

Thank-you for watching.

Share this:

Comments are closed.