Group Sales Contracting: Have We Lost Our Minds?

Steve Rudner, Founder and Managing Partner of Rudner Law Offices, represents hotels, resorts and conference centers throughout the world, including some of the world’s largest hotel companies, prestigious independent properties, management companies, luxury collections, conference centers and others. He is past president of the Academy of Hospitality Industry Attorneys (AHIA) and frequently speaks to meeting industry organizations. He is a member of the State Bars of New York, Texas, Arizona, Colorado and the District of Columbia. He has been featured in The Wall Street Journal and is a sought-after speaker on issues of concern to the hospitality industry. He is based in Dallas, Texas.

When was the last time that you spent part of your contract negotiating time discussing how to incentivize attendees to reserve rooms within the block?

When was the last time you spent some of your time negotiating for a unique meeting room set up, or to give the chef more freedom to create a unique menu? 

When was the last time you evaluated those things which were within your control, and decided to devote negotiating time to those matters, utilizing your strengths as a planner or salesperson?

Wouldn’t focusing on those things within our control lead to a simpler, more amicable, more productive contract negotiation?

These thoughts come to mind as the meeting and event landscape continues to evolve on many fronts.

Since the first day COVID-19 was with us, hotel salespeople and meeting planners have been exchanging clauses intended almost exclusively to try to control something which neither party can control.

We learned a hotel cannot reasonably be expected, as some clauses proposed at the beginning of the epidemic, to indemnify the group if an attendee became infected during or shortly after a meeting at the hotel, principally because that is not in the hotel’s control.

A group cannot reasonably be expected to ensure that none of its attendees were infected with COVID (before tests were readily available) or that attendees were vaccinated when vaccines were in short supply because that was not something the group could accomplish within its control.  As monkeypox ominously looms, similar requests are also being exchanged.

While most hotel companies are strong supporters of LGBTQ+ equality, those located in states where the rights of the members of that community are in peril are being asked by planners to agree that groups can cancel without liability if anti-LGBTQ+ legislation is adopted.

Of course, neither the hotel nor the group has any control whatsoever about what elected officials may do. For meetings booked on a long window, neither a planner nor a hotel salesperson has any ability to know what the status of abortion-related legislation or gun control or any other legislation will be.

Rather than expending a huge amount of negotiating time on things which neither party can control, we could agree to return to rationality.

Rather than try to negotiate about social distancing and vaccinations, we could simply agree that each party will abide by all applicable laws, something which is very clearly in the control of the parties.

Rather than try to navigate and forecast political and legislative trends, which we do not control, we could recognize that any group can cancel at any time for any reason, including disagreement with laws which may be adopted, so long as it pays the damages due for that cancellation—something which the parties can control. 

A hotel cannot control—as is implicitly required in the confidentiality clause requested by many groups—whether a group leaves its handouts in unlocked and unguarded meeting spaces and asking a hotel to be liable for the risk associated with something out of its control is, on its face, unreasonable.

A group cannot control whether some of its attendees may reserve rooms through an online site, but asking a hotel to pretend a room, which was supposed to be sold at $200 at night, is the same as receiving $100, which is the result of many clauses proposed by groups.

A hotel cannot control whether attendees in a function space adjoining a group’s meeting space may boisterously and enthusiastically applaud for a speaker, causing a momentary noise disruption.

Why are we collectively spending so much time negotiating about situations we cannot control?