Unfair Booking Terms in the Spotlight

Tuesday 27 May, 2025

The Commerce Commission and Bachcare reached a settlement in April 2025 relating to Bachcare’s contract terms around cancellation and customer refunds. This comes after the Commerce Commission filed civil proceedings in the High Court in April 2023 that Bachcare’s terms were unfair under the Fair Trading Act 1986. Bachcare is one of New Zealand’s largest holiday home rental platforms.

The settlement is a timely reminder for both businesses and consumers to understand their rights and obligations when it comes to terms and conditions.

Unfair terms

The Commerce Commission sought a declaration from the High Court that the following types of terms used by Bachcare were unfair:

• Loss of full payment on cancellation: Guests could lose up to 100% of the booking cost, even when cancelling well in advance.
• Non-refundable service fees: Bachcare retained its service fee, regardless of whether a booking was cancelled by the guest or by Bachcare.
• No refund for uncontrollable events: If a booking was cancelled due to circumstances outside anyone’s control (e.g. extreme weather), and the stay couldn’t be rescheduled, the guest could lose 100% of the amount paid.

Bachcare has admitted its cancellation and refund terms were unfair and has agreed to update its terms and conditions to make them fairer for future bookings.

The parties have jointly asked the High Court for an agreed declaration stating the cancellation terms were unfair. If a term is declared unfair, any further use of the term could be a breach of the Fair Trading Act.

Why this matters 

This case serves as a reminder for businesses using standard form contracts: contract terms must be clear, transparent, and fair. A business is entitled to have terms that protect its own interests, but those terms must not put consumers at an unfair disadvantage.  

Commission Deputy Chair, Anne Callinan, describes the settlement as a win for consumers: “Businesses can’t have contract terms that are unfair and create a significant imbalance.”

Need advice?

Our team can help you review your consumer contracts for compliance with consumer protection laws, including the Fair Trading Act. If you are unsure whether your terms strike the right balance, or if you need help responding to regulatory investigations, we have commercial and regulatory team members who can work with you.