I SUED SHEARINGS – and guess who won?

by Christopher Draper

I’VE just returned from a North Wales Courtroom where I was the litigant in a Breach of Contract legal action and “Shearings Holidays Ltd”, the defendant. If you are one of the few people in Britain who’ve never enjoyed a Shearings coach holiday you must be very young or a southern snob (or possibly both) and when the Wigan-based business celebrated its centenary last year it was described as the biggest and most successful coach holiday company in Europe, carrying over a million holidaymakers every year but all was not as it appeared.

Herbert’s Story

The Company was started in Oldham, in 1919 by pioneering motor mechanic Herbert Shearing, who’d six years earlier been fined a pound for barrelling along Manchester Road at a speed in excess of the legal limit of 5 mph! Herbert began by taking coachloads of Oldham working folk down to Devon for their annual week-long holiday. While other coach touring companies stayed at different hotels every night Herbert used a Torquay hotel as a base for daily trips out. His bargain-basement prices soon attracted customers from across the Pennines and this prompted him to start a “feeder-service” bringing Yorkshire-based customers to his Oldham depot but his enterprise wasn’t appreciated by rival proprietors. When Herbert, in 1934, advertised a feeder-service from Halifax he first had to overcome objections from Leeds-based, Wallace-Arnold Coaches. As his network expanded by 1936, he offered Liverpool customers, “a ten day all-in holiday in Scotland for £8.40 or nine days in Devon for £6.50”. “Shearings” thrived after the war although Herbert himself retired to Torquay where he died on 14 July 1945.

Post-War Shearings

Shearings prospered under a series of different owners and in 2005 even swallowed up its old Yorkshire rival “Wallace-Arnold”. By 2015, the company owned and operated over 200 coaches, 52 hotels and annually conveyed a total of 1.1m passengers by coach, rail, air and ship to over 170 destinations worldwide. In 2016 Shearings was acquired by Lone Star Funds, a private equity company and although a positive spin was put on this takeover at the time “to fund expansion plans etc” in reality it was extremely bad news.

Lone Star or Black Hole?

Texas based Lone Star is more “Vulture capital” than “Venture capital”, specialising in buying up “distressed assets” and sucking the life and value out of them. Founded, owned and controlled by 64 year old John Grayken, Lone Star manages over seventy billion dollars of assets, with Grayken’s personal fortune valued at 7.4 billion dollars, making him the 196th richest person on the planet. Born in Boston, Grayken is an Irish citizen, having renounced his U.S. nationality for tax purposes and according to Forbes magazine, “Amongst the robber barons of the new-millenium, few are as secretive – or as loathed”. Despite his American birthplace, Irish citizenship and Dallas HQ this modern day robber baron naturally lives in London, the tax-avoiding plutocrat’s domicile of choice. His seventy million dollar

Chelsea mansion is equipped with a glass elevator, basement pool, cinema and Japanese water garden and was purchased through a Bermudan company. Grayken also owns Pyrford Court, a fifteen-bedroomed Surrey manor house with a twenty-one acre garden and La Bergerie, an extensive Swiss estate overlooking Lake Geneva though he prefers to spend summers in Massachusetts where he owns the exclusive White Head Island.

Ruthless Economy

I missed Herbert’s era but over the last forty years I’ve enjoyed many Shearings holidays and until recent times the company maintained decent, old-fashioned business ethics. After Lone Star took over Shearings adopted a ruthless, Ryan Air style business approach. “Dynamic pricing” was introduced with an emphasis on online sales, hotel prices were segmented into all sorts of price levels with supplementary charges, higher payment was demanded for sitting on the front seat of coaches and an extra cost levied for using feeder-coaches. Petty economies extended to withdrawing bread rolls from meal times and charging for post-dinner coffee. Years ago when Shearings failed to attract enough passengers on a trip I’d booked they generously offered me a longer alternative holiday at no extra cost. This sharply contrasts with my recent experience.

Last Tango to Harrogate

For the last few years my partner and I enjoyed annual coach holidays in Harrogate, staying at Shearings’ St George Hotel (their best by far). In July 2019 I booked and paid a deposit to return the following January (2020) only to receive a phone call, six weeks later, informing me that Shearings no longer intended to honour the booking and wouldn’t run a coach to Harrogate for unexplained “operational reasons”. I offered to make our own way to and from the hotel if the company agreed to cover rail costs but they adamantly refused. Initially unable to specify which provision of our binding contract the company relied upon to legitimate this cancellation, Shearings eventually cited “clause 9” which states that “As we plan your holiday arrangements many months in advance we may occasionally have to make changes or cancel your booking and we reserve the right to do so at any time.” I pointed out the significance of the words “have to make changes”, meaning that for any cancellation to be legitimate it must be forced upon the company by external circumstances (such as the hotel having burnt down), NOT simply the company’s whim. On the internet I discovered Shearings were marketing the same category of room and meals at the St George for the identical four day period at three times the price contracted to me and “coincidentally” Harrogate was that week hosting a Sales Convention at the Conference Centre opposite the hotel. On the face of it, Shearings appeared to be cynically selling our contracted rooms at a much higher rate to incoming sales reps. I printed off this page and when I checked a few days later all these rooms had been sold, presumably at this higher price.

Terminological Inexactitude

In a letter dated 11.9.2019 Shearings’ “Customer Relations Manager” Angela Fowler re-stated the company’s position - “we may occasionally have to make changes” and “we are not able to agree to any of the choices that you have given us” (my emphasis). Instead of addressing the critical distinction between forced changes and voluntary choices Ms Fowler claimed a similar inability to finance alternative transport. I realised that ultimately Grayken’s ruthless regime was pushing Shearings’ minions into screwing customers like me but I wasn’t intimidated and decided to sue for “Breach of Contract”.

Justice Delayed

After essential pre-action exchanges of letters I filed formal court papers on 3.10.2019. You don’t need a barrister, solicitor or horsehair wig, just £35 (less online). I claimed £257.60, the cost of two ordinary return rail fares from my home in Llandudno to Harrogate. Shearings’ defence amounted to no more than a restatement of Angela Fowler’s previously quoted letter. I was duly informed that the case would be heard on 20.3.2020, unfortunately Covid intervened and the hearing was twice postponed until on Friday 6th November 2020 at 2pm I was finally called into Prestatyn’s Court Number Three for a hearing before Deputy District Judge Morris.

Justice Denied

The judge ruled against Shearings’ defence that the contract gave carte blanche for the company to amend or cancel at will. I was awarded my original claim plus costs, amounting to £317.60. Unfortunately in the interval between launching the claim in 2019 and this November 2020 judgement Shearings went bust.

It’s difficult to calculate how much wealth Lone Star extracted before eventually driving Herbert Shearing’s century-old company over the edge. E & Y (previously “Ernest & Young”) will certainly make a fortune from their dismemberment (“Administration”) of the company’s residual assets as they’re legally entitled to feast on the carcase before lowly “unsecured creditors” like me get a look in. Leger Travel bought the Shearings trading name and customer-list but none of its liabilities, 2,500 employees lost their jobs while innumerable suppliers were left with unpaid invoices. Although I don’t expect to get my £317.60 I’d still encourage people not to submit to big company bullying. If all else fails, suing isn’t difficult or expensive and authority everywhere relies on deferential, fearful compliance. As I write John Grayken’s Lone Star has just sunk its fangs into another well-known “distressed asset”, so if you’re contemplating moving into a McCarthy & Stone retirement home, think again.

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