Karpik v Carnival plc (The Ruby Princess) (Initial Trial) [2023] FCA 1280
File number:
NSD 806 of 2020
Judgment of:
STEWART J
Date of judgment:
25 October 2023
Catchwords:
REPRESENTATIVE PROCEEDINGS – where lead applicant claims that she and her husband were infected with coronavirus on board the cruise ship Ruby Princess – where claims made pursuant to the Australian Consumer Law (ACL) and in negligence – trial of lead applicant’s claims – common questions
HIGH COURT AND FEDERAL COURT – federal jurisdiction – application of ss 5H, 5I, 5R, 16 and 32(1) of the Civil Liability Act 2002 (NSW) (CLA) and s 9(1) of the Law Reform (Miscellaneous Provisions) Act 1965 (NSW) to consumer guarantee claims under the ACL – whether picked up and applied as surrogate federal law by ACL s 275 – if picked up whether applicable on the facts of the case
CONSUMER LAW – claims for failure to comply with the care guarantee in ACL s 60 and the purpose and result guarantees in ACL ss 61(1) and 61(2) – identification of the relevant services – terms on which the services were to be provided – particular purpose and result wished to be achieved – meaning of “particular” purpose – whether particular purpose made known – where particular purpose was to have a safe, relaxing and pleasurable cruise holiday – whether services reasonably fit for purpose – whether the services were of such a nature and quality, state or condition that they were reasonably likely to achieve desired result – where applicant did not have a safe, relaxing and pleasurable cruise holiday
NEGLIGENCE – whether the respondents (being the owner and charterer of the vessel) owed the applicant a duty of care – where applicant a passenger on a cruise ship – whether duty is novel or falls within recognised category – whether scope of duty extends to the harm allegedly suffered – nature of relationship between passengers and cruise ship operators – reliance of passengers on cruise ship operators for their safety – respondents’ peculiar knowledge of risk of coronavirus outbreak on their cruise ship – whether respondents owed applicant a duty of care as a close family member in respect of mental harm caused by passengers suffering and near death experience
SHIPPING AND NAVIGATION – whether owner and operators of passenger vessel owe passengers a duty of care to take reasonable precautions to protect and safeguard them from infectious disease – scope of duty – whether duty breached – negligence
NEGLIGENCE – breach of duty – identification of relevant risk of harm – whether reasonable person in the position of the respondents would have taken the precautions identified by the applicant – consideration of factors in ss 5B and 5C of the CLA – whether respondents should have cancelled the cruise – relevance of industry guidelines, lack of governmental action restraining operation of cruise industry and extent of respondents’ knowledge at time of departure 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.
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AGLC
Karpik v Carnival plc (The Ruby Princess) (Initial Trial) [2023] FCA 1280
Case
[2023] FCA 1280
Decision Date
CaseChat Overview and Summary
Karpik v Carnival plc (The Ruby Princess) (Initial Trial) was a case before the Federal Court of Australia, where Mrs Karpik alleged that she and her husband contracted COVID-19 while on a cruise on the Ruby Princess. Mrs Karpik brought her claims under the Australian Consumer Law (ACL) and in negligence against the respondents, the owners and charterers of the vessel. The court was required to decide a range of issues, including the application of the Civil Liability Act 2002 (NSW) (CLA) to the consumer guarantee claims under the ACL, whether the respondents owed Mrs Karpik a duty of care, and the causation and contributory negligence of Mrs Karpik. The court also had to consider the nature and extent of the damages claimed, including non-economic loss, past and future medical expenses, and distress and disappointment damages.
The court held that the various provisions of the CLA applied to the negligence claim, but not to the consumer guarantee claims. The court found that Mrs Karpik made known to the respondents that her purpose in booking the cruise was to have a safe, relaxing and pleasurable cruise holiday. However, as a result of contracting COVID-19 on the cruise, Mrs Karpik did not have a safe, relaxing and pleasurable cruise holiday, and the particular purpose and result she wished to be achieved accordingly failed. The court found that the purpose and result guarantees were not complied with. The court also found that Mrs Karpik's claims for misleading and deceptive conduct under the ACL were not made out.
The court made orders for the matter to be listed for the making of final orders and further case management at a later date. The parties were required to email agreed or competing orders to give effect to the reasons for judgment published, including with regard to common questions or the process for the making of orders on common questions, to the Associate to Stewart J by a specified date. The entry of orders was dealt with in Rule 39.32 of the Federal Court Rules 2011.
Orders
Orders of the court
1. The matter be listed for the making of final orders and further case management at 9.30am on 10 November 2023, or at such other time and date as the parties may arrange with the Associate to Stewart J.
2. The parties email agreed or competing orders to give effect to the reasons for judgment published today, including with regard to common questions or the process for the making of orders on common questions, to the Associate to Stewart J by noon on 9 November 2023.
Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.
Background
Background to the litigation
This case generated a substantial volume of evidence. For ease of future reference, I have included document identity references to the evidence in square brackets in these reasons for judgment. The references do not form part of the reasons for judgment. They are not exhaustive of the evidence that I have considered in relation to, or that is supportive of, the findings to which they relate. I mention also that there are colour graphics in these reasons for judgment that will make limited sense in black and white, so they are best read in colour.B. THE FACTSB.1 The applicant Mrs Karpik was 69 years of age and had been married to Mr Karpik for nearly 50 years at the time of the cruise. She had retired from nursing but continued to work part-time as an official visitor under the Mental Health Act 2007 (NSW). Mr Karpik, a retired police officer, was 72 years of age. He was sight-impaired to such a degree that he is described as “legally blind.” Mr and Mrs Karpik both gave evidence. Mrs Karpik also relies on the evidence of an additional seven lay witnesses who were all fellow passengers on RU2007, her treating psychiatrist, Dr McMahon, and six expert witnesses. I will identify the expert witnesses in section B.3 below. The lay witnesses gave evidence of their experiences on the cruise. Several of them were cross-examined.B.2 The respondents At all material times, the first respondent, Carnival plc, was incorporated in the United Kingdom. It was also a registered foreign company in Australia and carried on business in Australia with a registered office in New South Wales. It was the time charterer of the Ruby Princess. [CRT.500.004.0001 [3]] Carnival traded as “Princess Cruises” and “Carnival Australia.” It employed shore-based personnel in Sydney who were involved in, amongst other things, managing the arrival and departure of the Ruby Princess and issuing instructions about the conduct of the voyage. Princess Cruises, P&O Australia, Holland America Line and Seabourn are all brands of the Holland America Group (HA Group). The second respondent, Princess Cruise Lines Ltd (PCL), was incorporated in Bermuda. It owned and operated the Ruby Princess, as well as other passenger liners which feature in what follows, including the Diamond Princess and the Grand Princess. [CRT.500.004.0001 [4]] The Ruby Princess was time chartered by PCL as owner to Carnival as charterer for the period from 23 October 2019 to 2 May 2020. Although the respondents foreshadowed in opening that they would urge the Court to draw a distinction between Carnival and PCL as reflected in their pleaded defence, no such distinction was drawn in closing either in writing or orally. Indeed, it is part of the agreed facts that Mrs Karpik contracted with “the respondents.” [JNT.002.001.0001 [3]] Accordingly, save where it is necessary to distinguish between Carnival and PCL, they are referred to hereunder simply as the respondents. The Ruby Princess is a large, modern, ocean-going cruise ship. It has a range of indoor and outdoor venues, including shops, restaurants, a gymnasium, a theatre, a casino, cafes and bars, an outdoor cinema, swimming pools, an outdoor sports court and a mini golf course. The vessel is 290m in length, has a gross tonnage of 113,561mt, was launched in 2008, has 17 decks and is flagged in Bermuda. [LAY_SKA.003.001.0047 p 51]
Evidence
Evidence Before The Court
Full text does not contain this section.
Decision
Reasons for decision
The matter will accordingly require further listing for the determination of what truly are common questions and what their answers are.L. SUMMARY AND CONCLUSION For ease of reference, it is worth taking stock of what I have decided, noting that I do not intend by the summary that follows to say anything different from what I have recorded as having decided above. Also, the summary mostly omits various findings that I have made in the respondents’ favour, focussing instead on the respects in which Mrs Karpik’s claims succeed. On the critical factual issues, I have found that Mr Karpik most likely contracted COVID-19 on board the Ruby Princess (at [294]), and that Mrs Karpik contracted COVID-19 from Mr Karpik on the voyage (at [397]). Mrs Karpik suffered a recognised psychiatric illness in the form of an adjustment disorder as a consequence of Mr Karpik’s illness and hospitalisation (at [938]), but she did not suffer from Long COVID (at [984]). With regard to the application of the CLA to Mrs Karpik’s various claims, I have held as follows:(1)It is common ground that the various provisions of the CLA to which the parties refer (and which are identified in the following sub-paragraphs) all apply to the negligence claim (at [399]), save for CLA s 5D(3)(b) which deals with the admissibility of a statement by an injured person of what they would have done had the negligence not occurred (at [782]).(2)CLA s 16, which limits liability for damages for non-economic loss for personal injuries unless the severity of the non-economic loss is at least 15% of a most extreme case, and which sets a maximum amount of such liability and an indexed sliding scale for its determination, applies to and limits the consumer guarantee claims (ie, ACL ss 60, 61(1) and 61(2)) (at [419]).(3)CLA s 5R and s 9(1) of the LRMP Act, which provide for the reduction of recoverable damages to the extent of the claimant’s contributory negligence, apply to the consumer guarantee claims (at [420]).(4)CLA s 5H, which provides that a person does not owe a duty to another person to warn of an obvious risk, is not picked up and applied to the consumer guarantee claims (at [430]).(5)CLA s 5I, which provides that a person is not liable in negligence for harm suffered by another person as a result of the materialisation of an inherent risk, is not picked up and applied to the consumer guarantee claims (at [438]).(6)CLA s 32(1), which applies a standard of “normal fortitude” to claims for mental harm, does not apply to the consumer guarantee claims (at [443]).(7)It is not contended by either side of the case that any of the CLA provisions apply to the ACL s 18 claim for misleading and deceptive conduct. With regard to Mrs Karpik’s ACL ss 61(1) and 61(2) claims, the purpose and result consumer guarantees, I have found as follows:(1)Mrs Karpik made known to the respondents that her purpose in booking the cruise, and the result that she wished the cruise to achieve, was that she would have a safe, relaxing and pleasurable cruise holiday substantially in accordance with the advertised and booked itinerary (at [469]).(2)The effect of s 61(1) is therefore that the respondents guaranteed that the cruise services to be supplied by them would be reasonably fit for that purpose, and the effect of s 61(2) is that the respondents guaranteed that the cruise services to be supplied by them would be of such a nature, and quality, state or condition, that they might reasonably be expected to achieve that result.(3)As a result of Mr and Mrs Karpik contracting COVID-19 on the cruise, Mrs Karpik did not have a safe, relaxing and pleasurable cruise holiday. The particular purpose for which the services were acquired and the result that was desired to be achieved accordingly failed. The reason for that failure was because the services were not reasonably fit to achieve that purpose and they were not of such a nature and quality that they might reasonably have been expected to achieve that result. (4)The purpose and result guarantees were accordingly not complied with.(See section E.6 above.)