The Case for Single Hotel Contracts Over Addendums

Introduction:

In a recent HopSkip webinar, industry experts Sean Whalin (Co-founder and CEO of HopSkip), Barbara Dunn (Partner at Barnes & Thornburg LLP representing groups), and Lisa Sommer Devlin (Devlin Law Firm, P.C. representing hotels) discussed the common practice of attaching company addendums to standard hotel contracts.

The conversation emphasized that this approach often complicates negotiations and leads to potential conflicts. Instead, they advocate for creating one comprehensive contract from the outset to simplify the process and ensure clarity.

This blog post delves into why hotels are increasingly unwilling to accept addendums and how a streamlined contracting process can benefit both parties.

What are hotel contract addendums?

Hotel contract addendums are supplementary documents attached to the main hotel contract detailing additional terms and conditions important to the event planner or their organization.

Planners might prefer to use addendums because they allow for the inclusion of specific clauses that address unique requirements or contingencies not covered in the standard contract.

A company hosting a large conference might attach an addendum that includes detailed cancellation policies, liability clauses, or specific service guarantees. This could occur when an internal legal team has established mandatory clauses that must be included in all contracts to mitigate risks and ensure compliance with corporate policies.

For example, an addendum might specify that the hotel must provide certain accessibility features for attendees with disabilities, ensuring that all guests have a comfortable and inclusive experience.

The information provided in this video does not, and is not meant to, constitute legal advice; all information, content, and materials available on this site are for general informational purposes only. This video's information may differ from the most up-to-date legal or other information. Please keep in mind that readers of this website should contact their attorney for advice about any particular legal matter.

Why Hotels Prefer Single Agreements Over Company Addendums

Transcript:

Lisa Sommer Devlin:

Barbara and I agree on this one. Having a contract and a group addendum is nothing more than lazy contracting. It would be best if you always tried to negotiate one complete contract rather than having a contract and an addendum.

If you've got terms in your addendum that are very important to you, you should put those in your RFP and say, this is how we want to make a cancellation. If that's uncomfortable for you, or if you want other special terms, you should let the hotel know. Instead of just sticking a second contract on the back of the hotel contract and putting that together, negotiate one complete contract.

I always give this advice to my hotel clients, so the short answer to your question is that I tell my clients not to be willing to take those addendums. They usually get you in trouble.

Even though the addendum says, "this addendum will control if there's any conflict between the contract and the addendum," it's not always true that it's black and white, which would control how they can be read together. So, don't do addendums; negotiate one complete contract. Barbara, what do you think?

Barbara Dunn

As you said, Lisa, I wholeheartedly agree with you. And I agree that, you know, and this happens a lot in a corporate environment where internal legal may have put together, these are the clauses we always have to have. Again, the thought is that you attach them to the contract, and it fixes everything.

And to Lisa's point, no matter whether you say which one controls inconsistency, there are still things that can't be read together in a way that could make sense. And, of course, those are often the ones that come across our desks through a dispute—so, having said that, I agree with Lisa. One clean contract is one thing to focus on, potentially valid for both sides.

But I'll say on the group side, if you're working with language that you need or that you've been told you need, really seek to get training to be informed on why you need that clause, why it's essential, and what issues you need to have addressed.

The folks on the front line who can communicate why we need a particular indemnification clause, why it's essential, and what features are often in that case, you're successful in negotiating a clause that will work for both sides. You're not pigeonholed in saying, "It has to be this exact language." We're saying, "Look, we must address these issues." Right? So, if it's construction, we need to address the issue that we'll find out about construction.

We'd like to know what you're going to do about it. We want to have time to work through a resolution with you. And if we can't work through a resolution, we want the opportunity to walk away. Often, when you articulate things that way, you can come together on either side with language that will work instead of just having a battle of the clauses.

So, for those of you who might have this internal addendum, I would push your teams to educate and train the group using these so that you can work to integrate them as closely as possible in the hotel contracts.

Conclusion:

Hotels and event planners can prevent misunderstandings, avoid attaching addendums, negotiate a comprehensive contract, and ensure smoother collaborations.

This approach fosters more transparent communication and builds more robust, trusting relationships between all parties involved. Embracing this strategy can lead to more efficient and successful event planning, benefiting everyone in the industry.