Question 1

An agency relationship consists of two parties, a principal and an independent contractor.

Accepted Answer

An agency relationship consists of two parties, a principal and an agent, not an independent contractor. An independent contractor works independently and is not subject to the control of the principal as an agent would be.

Question 2

Cancellation of an airline flight due to adverse weather conditions will result in liability by the airline for breach of contract to those persons who had reservations on the flight.

Accepted Answer

Adverse weather conditions are considered to be a force majeure event, which is an unforeseeable circumstance beyond the control of the airline. Therefore, the airline is not liable for breach of contract and passengers are not entitled to compensation. However, airlines may provide alternative arrangements such as rebooking or refunds as a goodwill gesture.

Question 3

When an airline overbooks and passengers must be bumped, which of the following is the correct order for determining which passengers are bumped?

Accepted Answer

This is the most common procedure followed by airlines. First, they will seek volunteers to give up their seats in exchange for compensation or other benefits. If there are not enough volunteers, the airline's priority rules will then determine which passengers will be bumped. Following the last to arrive at the gate can create confusion and may not be fair to passengers who arrived earlier but were temporarily away.

Question 4

Which of the following is not true about independent contractors?

Accepted Answer

Independent contractors are not considered employees and therefore are not subject to direct control by the person hiring them. While they may have some guidelines for completing their assigned tasks, they are considered self-employed and are responsible for their own work arrangements.

Question 5

Which of the following would constitute negligent entrustment of a rental car by a car rental company?

Accepted Answer

Negligent entrustment occurs when the owner of a vehicle (in this case, the car rental company) loans a vehicle to someone who is unlicensed, incompetent, or reckless. Renting to someone who is visibly intoxicated would constitute negligent entrustment because the rental company should reasonably know that the driver may not be able to safely operate the vehicle. Renting to someone under age 21 (A) may violate rental company policy, but it does not necessarily constitute negligent entrustment if the driver is legally licensed and competent. Renting to someone without proper identification (C) may also violate company policy, but it does not necessarily mean that the driver is incompetent or reckless. Renting to someone accompanied by three friends (D) does not necessarily constitute negligent entrustment, as long as the driver is legally licensed and competent to handle the number of passengers.

Question 6

Where an agent acts outside the bounds of delegated authority, the principal is not bound.

Accepted Answer

When an agent acts beyond the limits of their delegated authority, they do not have the power to bind the principal, and the principal is not bound by the actions of the agent. Therefore, the answer is true.

Question 7

Which of the following is not true about overbooking by car rental companies?

Accepted Answer

Overbooking by car rental companies is not a crime, although it may result in legal action for breach of contract.

Question 8

A travel agent may be liable for all but which of the following?

Accepted Answer

The travel agent cannot be held responsible for injuries caused by a drunk driver as it is beyond their control. However, the travel agent may be held liable for providing inaccurate information, breaching a contract, or failing to investigate the appropriateness of recommended travel services.

Question 9

Which of the following is true about disclaimers?

Accepted Answer

The answer of Which of the following is true about...

Question 10

Two hundred members of a certain ski club paid $3,000 each for a European ski trip. The company that sponsored the trip went out of business without providing the trip and without returning the club members' deposits. What type of action best suits this circumstance?

Accepted Answer

A class action would be the best choice in this scenario because it would allow all 200 members to join together to sue the company that sponsored the trip. This would be more efficient and cost-effective than each member pursuing their own individual lawsuit.

Question 11

Heather rented a car from a travel agent. Even though she was the only authorized driver listed on the contract, she allowed her friend Ashley to drive the car. Ashley was in an accident caused by her negligence. Heather suffered injuries, and the car was damaged. Which of the following is true?

Accepted Answer

Heather violated the rental agreement by allowing an unauthorized person, Ashley, to drive the car. Therefore, she is liable for damages to the car caused by Ashley's negligence. Rental agreements typically specify that only authorized drivers are covered by any insurance or waivers provided by the rental company.

Question 12

Jan was an authorized agent for an airline. Due to shoddy work on her part, the airline withdrew the authorization for Jan to act as an agent. Nonetheless, she sold tickets to a customer. The airlines refused to honor the tickets. Who is liable to the customer for the money paid for the tickets?

Accepted Answer

As an unauthorized agent, Jan had no right to sell airline tickets on behalf of the airline. Therefore, she is personally liable for any damages resulting from the sale of the tickets. The airline is not liable since they withdrew authorization for Jan to act as an agent. The Department of Transportation is not liable since they have no involvement in this specific transaction.

Question 13

Tariffs are developed by the airlines and must be approved by the Department of Transportation.

Accepted Answer

Tariffs are developed by the airlines and must be approved by the Department of Transportation before they can be implemented.

Question 14

Prior to take-off, two stewardesses overheard two passengers discussing how to hijack the flight. The stewardesses informed the pilot. Which of the following best describes the authority of the pilot?

Accepted Answer

The pilot has the authority to remove any passenger from the flight if they believe there is a safety concern. In this case, the pilot was informed by the stewardesses of a potential hijacking and has the authority to remove the passengers in question without needing to find weapons or rely on a lie detector test.

Question 15

What types of damages are recoverable by the owner of a dog that dies while in the custody of the airline?

Accepted Answer

The owner of a dog that dies while in the custody of the airline is entitled to recover the value of the dog, which is considered property. Mental anguish and loss of services are not applicable in this case because they only apply to personal injury cases, not property damage cases. Punitive damages may be awarded in cases of gross negligence or intentional misconduct, but they are not typically awarded in cases of simple negligence involving property damage.

Question 16

If a judge, while applying an international treaty in the course of deciding a case, disagrees with parts of the treaty, what should the judge do?

Accepted Answer

As a judge, it is the duty to apply the law, including binding international treaties, regardless of personal views or disagreements. Therefore, the judge should apply the terms of the treaty as is, even if they don't agree with it.

Question 17

To avoid liability for breach of contract when an airline cancels a flight for a good cause, what must the airline do?

Accepted Answer

When an airline cancels a flight for a good cause, they are not liable for breach of contract. However, they should still assist passengers in finding alternate flights to reach their destination. This is not only good customer service, but it also helps to mitigate any inconvenience caused by the cancellation. Option A, C and D are not necessary actions for the airline to take in this scenario.

Question 18

An airline cannot discriminate against a person because of a disability, but an airline can refuse to transport an individual who is unable to meet certain minimum requirements defined by law and aimed at ensuring the safety of that person and others.

Accepted Answer

According to the Air Carrier Access Act (ACAA), airlines cannot discriminate against individuals with disabilities but can still refuse transportation if the individual cannot meet certain safety requirements. These requirements are in place to ensure the safety of the individual themselves and other passengers on the flight.

Question 19

Why is the existence of small claims court significant to the hospitality industry?

Accepted Answer

Small claims court allows individuals with small claims to bring lawsuits against travel agents and airlines without the expense of hiring a lawyer. This could potentially increase the number of lawsuits that the hospitality industry faces.

Question 20

The Warsaw Convention applies to both foreign and domestic flights.

Accepted Answer

The Warsaw Convention specifically applies to international carriage by air, not to domestic flights. It sets rules for international transportation by air, including the liability of airlines for damage to passengers, luggage, and goods.

Quiz 13: Travel Agents and Airlines Rights and Liabilities