Insight Vacations Pty Ltd v Young [2011] HCA 16 11 May 2011 S273/2010
ORDER
Appeal dismissed with costs.
On appeal from the Supreme Court of New South Wales
Representation
J E Sexton SC with D I Talintyre for the appellant (instructed by Lee & Lyons Lawyers)
M J Joseph SC with A P L Naylor for the respondent (instructed by Gerard Malouf & Partners)
Intervener
M G Sexton SC, Solicitor-General for the State of New South Wales with H El Hage intervening on behalf of the Attorney-General for the State of New South Wales (instructed by Crown Solicitor (NSW))
Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports.
CATCHWORDS
Insight Vacations Pty Ltd v Young
Trade practices – Conditions and warranties in consumer transactions – Implied warranties – Limitation or preclusion of liability for breach of implied warranty – Section 74(1) of Trade Practices Act1974 (Cth) ("TPA") provided that in every contract for supply by corporation of services there was an implied warranty that services will be rendered with due care and skill – Section 74(2A) of TPA provided that, where implied warranty breached and law of State was proper law of contract, that State law applied to limit or preclude liability for breach of implied warranty in same way as for breach of another term of contract – Section 5N(1) of Civil Liability Act2002 (NSW) ("Civil Liability Act") provided that term of contract for supply of recreation services may exclude, restrict or modify liability for breach of implied warranty – Appellant and respondent entered contract for supply by appellant to respondent of tourism services in Europe – Proper law of contract was law of New South Wales – Contract contained clause exempting appellant from liability for claims arising from accident where passenger occupied motor coach seat fitted with safety belt if safety belt not being worn – While travelling by coach respondent left seat to retrieve item from overhead shelf – Coach braked suddenly causing injury to respondent – Respondent claimed damages for breach of implied warranty by appellant – Whether s 74(2A) of TPA picked up and applied State laws as surrogate federal laws – Whether s 74(2A) of TPA picked up and applied s 5N of Civil Liability Act – Whether s 5N a law that applies to limit or preclude liability for breach of contract.
Negligence – Civil Liability Act – Whether provision of transport services in the course of tourism constitutes "recreation services" for purposes of s 5N.
Statutes – Acts of parliament – Interpretation – Geographical limitation on legislative power of State parliament – Whether s 5N of Civil Liability Act subject to geographical limitation – Whether, if picked up by s 74(2A), s 5N applied to contract for supply of…
Grounds of appeal
[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.
[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.
[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.
Consideration
[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.
[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.
Continue reading Insight Vacations Pty Ltd v Young
Sign in free to access the full text
Details
AGLC
Insight Vacations Pty Ltd v Young [2011] HCA 16
Case
[2011] HCA 16
Decision Date
CaseChat Overview and Summary
In this matter before the High Court of Australia, Insight Vacations Pty Ltd (the appellant) appealed a decision concerning a contract for the supply of tourism services in Europe to Ms. Young (the respondent). The dispute arose when Ms. Young was injured while travelling on a coach after leaving her seat to retrieve an item from an overhead shelf, and the coach braked suddenly. Ms. Young claimed damages for breach of an implied warranty under the *Trade Practices Act 1974* (Cth) (TPA). The contract contained an exemption clause that purported to relieve the appellant from liability for claims arising from an accident where a passenger occupied a motor coach seat fitted with a safety belt but was not wearing it. The proper law of the contract was determined to be the law of New South Wales.
The High Court was required to determine several key legal issues. Firstly, it needed to ascertain the operation of section 74(2A) of the TPA, specifically whether it incorporated State laws as surrogate federal law. Secondly, the Court had to consider whether section 5N of the *Civil Liability Act 2002* (NSW) fell within the description of laws picked up by section 74(2A). Thirdly, if section 5N was engaged, the Court had to decide whether it applied to a contract for the supply of recreation services that were to be provided entirely outside of New South Wales. Finally, the Court was asked to consider whether, if section 5N was applicable, the exemption clause in the contract operated to defeat Ms. Young's claim.
The Court reasoned that section 74(2A) of the TPA does indeed pick up and apply certain State laws as surrogate federal laws. However, it concluded that section 5N of the *Civil Liability Act 2002* (NSW) was not a law of the kind that section 74(2A) incorporated. The Court found that section 5N does not itself exclude, restrict, or modify liability but rather permits parties to contract for such exclusions. Furthermore, even if section 5N had been picked up, it would not have applied to the circumstances of this case because it is limited to contracts for the supply of recreation services within New South Wales, whereas the services in question were provided outside that State. Additionally, the Court found that, on its proper construction, the exemption clause did not apply to the events that occurred, as it was intended to operate only when a passenger was seated and not when they were standing or moving about the coach.
Consequently, the appeal was dismissed with costs.
Orders
Orders of the court
Appeal dismissed with costs.
Background
Background to the litigation
Full text does not contain this section.
Evidence
Evidence Before The Court
Full text does not contain this section.
Decision
Reasons for decision
FRENCH CJ, GUMMOW, HAYNE, KIEFEL AND BELL JJ
(dissent)
Insight's appeal should be dismissed.Issues and conclusions The issues that arose in the appeal can be identified as being:1.How does s 74(2A) of the TPA operate? Is it, as Insight submitted, a law which picks up and applies, as surrogate federal law, the State laws which meet the description given in that sub‑section?2.If "yes" to 1, is s 5N of the Civil Liability Act a law which meets the description given in s 74(2A) of the TPA and is thus picked up and applied?3.If s 5N does meet the description given in s 74(2A), does it apply to a contract, such as that in issue in this case, for the supply of recreation services where the supply is to occur outside New South Wales?4.If s 5N of the Civil Liability Act is engaged, and if in consequence Insight may rely on its exemption clause, does that clause operate, on its proper construction, as an answer to Mrs Young's claim? These reasons will show that s 74(2A) of the TPA picks up and applies certain State laws as surrogate federal laws. Section 5N of the Civil Liability Act, however, is not a law of a kind picked up and applied by s 74(2A). Section 5N does not itself provide any exclusion, restriction or modification of liability. It permits parties to contract for the exclusion, restriction or modification of liability. That is reason enough to conclude that Insight's appeal should be dismissed. In any event, s 5N, had it been picked up and applied by s 74(2A), would not have engaged with the facts and circumstances of this case. Section 5N applies only to contracts for the supply of recreation services in New South Wales. Insight's contract with Mrs Young was to supply recreation services to her outside New South Wales. And in any event, on its true construction, the exemption clause did not apply to the events that happened. The exemption clause should be construed as engaged only when a passenger was seated, and as having no application when the passenger was standing or moving about the coach.Section 74(2A) of the TPA Section 74(2A) of the TPA was inserted in that Act by the Treasury Legislation Amendment (Professional Standards) Act 2004 (Cth)[4] and commenced operation on 13 July 2004. Section 74(2A) provided:"If:(a)there is a breach of an implied warranty that exists because of this section in a contract made after the commencement of this subsection; and(b)the law of a State or Territory is the proper law of the contract;the law of the State or Territory applies to limit or preclude liability for the breach, and recovery of that liability (if any), in the same way as it applies to limit or preclude liability, and recovery of a liability, for breach of another term of the contract."[4]s 3 and Sched 1, item 8A. The conditions stated in pars (a) and (b) of s 74(2A) were, of course, met in this case. Mrs Young alleged, and the trial judge found, that there had been a breach of the warranty implied by operation of s 74(1) in her contract with Insight. The law of New South Wales was the proper law of that contract.