WHEN THE CRUISE OF A LIFETIME DOESN’T GO TO PLAN - RUBY PRINCESS

Previous cases may provide some guides as to how the Ruby Princess class action is likely to progress, writes Alexis Cahalan.

THE CLASS ACTION AGAINST THE operators and owners of the Ruby Princess is not the first time the cruise industry has been in the spotlight. In fact, cases arising out of claims brought by cruise ship passengers have been significant in shaping consumer claims and claims for personal injury.

RUBY PRINCESS

On 23 July 2020, a class action was filed in the Federal Court against Princess Cruise Lines Limited and Carnival Plc. The class includes persons from among the approximately 2700 people who were on board the ship when it docked in Sydney on 19 March who contracted coronavirus or did so from passengers or suffered psychiatric injury as a result. The proceedings commenced while the NSW government’s Special Commission of Inquiry conducted by Brett Walker SC was still to deliver its final report. The Commission had wide powers and there is a wealth of information for claimants.

A “WORLD OF RELAXATION”

The Ruby Princess was advertised to passengers to “discover a world of relaxation and exhilaration as you sail toward new adventures on this stylish retreat”. Over recent decades the High Court of Australia has reviewed cruise passenger claims in light of what was promised including in Baltic Shipping Co v Dillon (1993) 176 CLR 344 (Dillon). Mrs Dillon lost her belongings and suffered injuries as a result of the grounding of the Mikhail Lermontov off New Zealand in 1986. She was awarded noneconomic loss damages to compensate her for the disappointment and distress caused by a breached promise in a holiday contract to provide pleasure or relaxation. Recently, in Moore v Scenic Tours Pty Ltd [2020] HCA 17, the High Court of Australia examined a passenger’s entitlement to damages when the trip of a lifetime goes wrong.

Mr Moore had purchased for himself and his wife “a once in a lifetime cruise along the grand waterways of Europe”. The cruise was disrupted by high water levels such that the passengers were disembarked and either boarded other vessels or travelled by bus. Only three out of the ten days promised for cruising eventuated. Other passengers on 13 Scenic tours were also affected and Moore became the lead litigant in the action against Scenic Tours on behalf of some 1500 consumers.

Mr Moore sued under the provisions of Australian Consumer Law for breaching three statutory guarantees. He argued Scenic had breached the consumer guarantees in the ACL in failing to exercise due care and skill in providing the services, that the services provided were not fit for purpose, and that they didn’t achieve the particular result intended. In respect of each cruise, it was alleged Scenic’s failure to provide services which complied with the ACL guarantees arose because it knew or ought to have known about the adverse weather and should have cancelled or rescheduled the cruises.

Mr Moore’s claim succeeded on several grounds. The High Court held Moore was entitled to damages under section 267(4) of the ACL for disappointment and distress caused by the breach of contract, because his cause of action did not arise out of personal injury, and Part 2 of the Civil Liability Act 2002 (NSW) (CLA) did not operate to limit his entitlement to those damages. Using the precedent set by the High Court in Dillon, the High Court unanimously held that injured feelings or disappointment are distinct from losses arising from personal injury. Each can be compensated by its own award of damages.

A MULTIPLICITY OF CLAIMS

As cruise vessels can carry up to 5000 passengers, the potential for a multiplicity of passenger claims has the ability to make cruise operations commercially unviable. This is because unlike airline travel which is regulated by international conventions, in Australia the Athens Convention Relating to the Carriage of Passengers and their Luggage by Sea 1974, as amended by the 2002 Protocol (Athens Convention) does not apply for sea or cruise travel. While airline operators/carriers can limit their liabilities, cruise operators/ carriers are currently unable to do so except to the extent they can rely on limits of liability in the ticket contract with their passenger.

FINAL THOUGHTS

The cruise sector historically has been economically important. It will be interesting if the Ruby Princess class action provides impetus for the government to review its approach toward the adoption of the Athens Convention and in doing so provide some certainty for both passengers and vessel operators as to limits applying to passenger claims.

Contact:

Alexis Cahalan, Partner

Featured article in Daily Cargo News September Magazine Edition