Knight v Adventure Associates
[1999] NSWSC 861
•27 August 1999
CITATION: KNIGHT v ADVENTURE ASSOCIATES & ORS [1999] NSWSC 861 CURRENT JURISDICTION: Common Law FILE NUMBER(S): 20018/1998 HEARING DATE(S): 10 August 1999 JUDGMENT DATE:
27 August 1999PARTIES :
Marie Louise Knight (Plaintiff)
v
Adventure Associates Pty Ltd (First Defendant)
Quark Expeditions Inc (Second Defendant)
Far Eastern Shipping Co (Third Defendant)JUDGMENT OF: Master Malpass
COUNSEL : Mr A Casselden (Plaintiff)
N/A (First Defendant)
Mr G Nell (Second Defendant)
Mr R A Cavanagh (Third Defendant)SOLICITORS: Stacks - The Law Firm (Plaintiff)
Ebsworth & Ebsworth (First Defendant)
Tress Cocks & Maddox (Second Defendant)
Norton Smith & Co (Third Defendant)CATCHWORDS: Service of process outside Australia; application for stay founded on alleged submission to jurisdiction of foreign court; onus and discretionary considerations. ACTS CITED: Trade Practices Act 1974 s 52, s 52A, s 74.
Supreme Court Rules 1970, Pt 10 r 6A, Pt 11 r 8.CASES CITED: Akai Pty Ltd v The People’s Insurance Co Ltd (1996) 141 ALR 374.
Oceanic Sun Line Special Shipping Company Inc v Fay 165 CLR 197.
FAI General Insurance Co Ltd v Ocean Marine Mutual Protection and Indemnity Association Ltd & Anor (1997) 41 NSWLR 559.
Baltic Shipping Company v Dillon (1991) 22 NSWLR 1.DECISION: See Paragraph 43
THE SUPREME COURT
OF NEW SOUTH WALES
COMMON LAW DIVISIONMASTER MALPASS
FRIDAY 27 AUGUST 1999
20018/98 MARIE LOUISE KNIGHT v ADVENTURE ASSOCIATES PTY LTD & ORS
JUDGMENT
1 These proceedings were commenced by Statement of Claim filed on 2 February 1998. The plaintiff brings a claim for damages arising out of the suffering of personal injury. The injury was suffered on 3 February 1996. At the time of the injury, she was a passenger on a vessel known as “Kapitan Khlebnikov” (the vessel) which was proceeding on a cruise to Antarctica. At the time of the injury, the vessel was in the Tasman Sea about 500 nautical miles south of Melbourne.
2 The process names three defendants. The first defendant is the travel agent who sold the cruise package to the plaintiff. It was acting as the sole and exclusive representative of the second defendant in Australia for the creation, marketing and selling of cruise products. The vessel was owned by the third defendant. The vessel had been chartered by the third defendant to the second defendant.
3 The originating process propounds causes of action founded on breach of contract, negligence and breach of provisions of the Trade Practices Act 1974 (sections 52, 52A and 74).
4 The plaintiff resides in New South Wales. The first defendant is a corporation registered in the State. The second defendant is resident in the USA. The third defendant is resident in Vladivostock.
5 An appearance has been entered on behalf of each of the first and second defendants. The court has been informed that the plaintiff has purported to serve process on the third defendant at Vladivostock. The third defendant has not filed an appearance.
6 On 13 November 1998, the third defendant filed a Notice of Motion. The third defendant seeks either a setting aside of the process or a stay of the proceedings.
7 The application was heard on 10 August 1999. The applicant relied on an affidavit sworn by Mr Wilson. There was a tender of a Statement of Agreed Facts (Exhibit 1). The plaintiff has sworn an affidavit.
8 At this stage it is convenient to mention some facts and circumstances. The mention is not intended as an exhaustive recitation of relevant matters.
9 In early 1995, the plaintiff became interested in the possibility of undertaking a cruise of the Antarctic. She approached the first defendant. Prior to 14 March 1995, she received documentation (copy documentation comprises annexures A and B to the affidavit of Mr Wilson) from the first defendant. The documentation comprised a brochure and a booking form. She completed and signed the booking form. It was signed on 14 March 1995. At the same time, she paid a deposit for the cruise.
10 One section of the brochure was headed “How To Book”. It provided for the payment of a deposit. It made provision for the payment of the balance (it was to be paid by 2 November 1995). It also made provision for cancellations and refunds (it stipulated certain cancellation penalties). Another section of the brochure was headed “Terms And Conditions”.
11 The “Terms And Conditions” comprised material appearing under various headings. The material appearing under the heading “Provision Of Services” includes the following:-
“The services provided on the passenger’s tour, including all transportation, tours and other services relating thereto are provided by the carriers and other Principals subject to their own conditions of contract.”
The material appearing under the heading “Responsibility” includes the following:-
“The passenger contract in use by the transportation companies or firms shall constitute the sole contract between the transportation companies or firms and the purchaser of the tour package/s.”
The “Terms And Conditions” conclude with the following;-
“Law Governing Contract: New South Wales”.
12 The second defendant issued a passenger ticket. It was dated 12 April 1995. There were no terms or conditions endorsed on the ticket.
13 In October 1995, the plaintiff received an invoice from the first defendant for the payment of the balance for the cruise. On or about 2 November 1995, she paid the balance to the first defendant.
14 About 2 or 3 weeks prior to departure, the plaintiff received further documentation from the first defendant (it included a document headed “Cruise Contract: Terms and Conditions - Important Notice to Passengers”). In the affidavit of Mr Wilson it is referred to as the “Cruise Contract”. A copy of the “Cruise Contract” is annexure C to the affidavit of the second defendant. There are definitions of words said to be used in this “Ticket and Contract” (including definitions of “Ticket” and “Contract”). The document further contained inter alia the following:-
“14. CHOICE OF LAW: LIMITATION OF CARRIER’S LIABILITY
(a) Applicable Law. This Ticket and Contract and all rights liabilities and duties of the Passenger and of the Carrier will be construed in accordance with English law. The Carrier shall be entitled to the maximum protection allowed by English law, including all protection as to the amount of damages recoverable.
…….
16. PLACE OF SUIT
All disputes, claims and suits and matters whatsoever arising under, in connection with or incident to this Ticket or Contract shall be brought and litigated, if at all, in and before a court of proper venue located in London, England, to the exclusion of the courts of any other city, state or country.”15 The plaintiff says that she did not read the “Cruise Contract”. She signed it on 1 February 1996. She says that she did not give a signed copy of it to any person upon boarding or after boarding the ship.
16 On 2 February 1996, the cruise commenced by departure of the vessel from Melbourne. The injury was suffered the following day when she became unbalanced due to the action of the ocean on the vessel and fell.
17 The plaintiff sustained a fractured skull and a fractured left wrist. She was taken by helicopter to Royal Hobart Hospital. Shortly thereafter she returned to her home in the Port Macquarie area. Her treating experts reside in this State. Her witnesses on the issue of liability reside in the State.
18 The case for the third defendant was presented as an application for relief pursuant to either Pt 10 r 6A or Pt 11 r 8 of the Supreme Court Rules 1970. Rule 6A is in the following terms:-
“(1) The Court may make an order of a kind referred to in Part 11 rule 8 (which relates to setting aside etc originating process) on application by a person on whom an originating process is served outside Australia.
(2) Without limiting subrule (1), the Court may make an order under this rule on the ground__
(a) that the service of the originating process is not authorised by these rules ; or
Rule 8 (1) enumerates orders that may be made by the court.
(b) that this Court is an inappropriate forum for the trial of the proceedings.”
19 Whilst the case was initially presented as an application for relief expressed in the alternative, in reality it became an application for a stay founded on provisions contained in the “Cruise Contract”. Such a stay has been traditionally granted by exercise of the inherent jurisdiction of the court.
20 Submissions have been made both in writing and orally. The court has been referred to a number of decided cases (including Oceanic Sun Line Special Shipping Company Inc v Fay 165 CLR 197; Akai Pty Ltd v The People’s Insurance Co Ltd (1996) 141 ALR 374; FAI General Insurance Co Ltd v Ocean Marine Mutual Protection and Indemnity Association Ltd & Anor (1997) 41 NSWLR 559 and Baltic Shipping Company v Dillon (1991) 22 NSWLR 1).
21 The submissions threw up two principal questions. The first question was whether or not the “Cruise Contact” formed part of the contractual relationship between the plaintiff and the third defendant. The second question depended on whether or not the third defendant received a favourable answer to the first question. If the “Cruise Contract” was found to be part of that contractual relationship the second question was whether or not the third defendant was entitled to a stay of the proceedings.
22 For completeness, it may be observed at the outset that there is material to suggest that a contractual relationship may not have existed between the plaintiff and the third defendant (inter alia it has been said to be the second defendant’s “Cruise Contract” and it is an agreed fact that the vessel had been chartered to it). There is also a question of consideration. For the purposes of determining this application, I put these matters aside. The parties have proceeded on the basis that there was a contractual relationship in existence. I shall deal with the application on that assumption.
23 The third defendant seeks to distinguish the circumstances of this case from other decided cases (such as Fay ).
24 Its further submissions, include the following:-
“13. The third defendant thus submits that:
(i) The booking form and promotional material did not form part of the contract between the third defendant and the plaintiff. It was either non contractual in nature or formed part of the contract only between the booking agent (the first defendant) and the plaintiff in respect of the booking services.. (See Fay’s Case) (Per Wilson J and Toohey J at 207).
(ii) Notice was given to the plaintiff in the booking form that the conditions of the contract of carriage would be contained in a passenger contract which constituted the sole contract between the carrier and the plaintiff.
(iii) The October 1995 invoice formed part of the contract between the third defendant and the plaintiff but did not contain all of the terms and conditions of carriage. Those terms and conditions are contained in the cruise contract which was received and signed by the plaintiff in New South Wales prior to embarking upon the cruise.
(iv) The third defendant says that it had done all that was reasonably necessary to bring the jurisdiction clause to the plaintiff’s notice prior to the plaintiff embarking on the cruise. It accepts that the reference to the contract in the booking form was not sufficient to bring the terms and conditions of the cruise contract to the notice of the plaintiff but it did so by forwarding the contract to the plaintiff prior to plaintiff embarking on the cruise. The plaintiff acknowledges that she received it prior to embarking on the cruise and by signing it is taken to have read it.
(v) The document headed cruise contract which was signed by the plaintiff on 2 February 1996 thus forms part of the contract between the plaintiff and the third defendant and the third defendant is entitled to rely on its terms.”
25 The plaintiff contends that the contract was made by the time the balance was paid on 2 November 1995. It is said that she was not aware of any foreign jurisdiction clause prior to the time of paying her fare in full. It is said that the “Cruise Contract” cannot be seen as a mere offer of carriage. The plaintiff directs attention to the fact that a decision to not accept any terms of carriage would place her in the position where she would forfeit the fare paid by her (US $11,890).
26 The responsibility for demonstrating that the “Cruise Contract” forms part of the contractual relationship allegedly made between the plaintiff and the third defendant rests with the third defendant. I am not satisfied that this onus has been discharged. I shall briefly refer to some of the matters that lead me to that view.
27 In my view, if there is any contractual arrangement with the third defendant, the material provided in March 1995 forms at least part of it (inter alia the material made provision for the payment of deposit, the balance and for cancellation penalties). This material gave no warning that any passenger contract would contain conditions relating to matters such as governing law and a submission to foreign jurisdiction. Indeed, such matters are not consistent with what appears in the March 1995 material (including provision as to the Governing Law).
28 I do not accept the contention that the third defendant had done all that was reasonably necessary to bring that jurisdictional clause to the plaintiff’s notice prior to the plaintiff embarking on the cruise (or any other relevant time). By the time that the “Cruise Contract” came on the scene (shortly before departure), the plaintiff had committed herself to the cruise. She had become subject to cancellation penalties. Any contractual relationship had already been finalised.
29 There is material in the “Cruise Contract” which could be taken as an indication that the intention was that it formed part of the “Ticket” and should have accompanied the ticked issued much earlier (in April 1995). It might be thought that perhaps due to oversight it was brought belatedly to the plaintiff’s notice in company with other documentation (which provided “Shipboard Information” and “Antarctic Questions”).
30 Whilst the decision that has been reached is determinative of the application, for the assistance of the parties I will make a brief reference to the second question that was agitated.
31 The court has an unfettered discretionary power to grant a stay. For present purposes the court is being asked to exercise a power conferred by the rules (as opposed to its inherent jurisdiction). The discretion is exercised having regard to the relevant circumstances of the particular case before the court. Each case can be expected to turn on its own particular facts.
32 There was no dispute that clause 16 was of the character that is described as an exclusive jurisdiction clause. There has been dispute as to the circumstances which would warrant a refusal of a stay.
33 The relevant law presently stands in an unsatisfactory state. It is clear that weight is to be given to the bargain reached between the parties. What is not so clear is the extent of the weight to be so given.
34 The cases throw up a variety of relevant expressions with varying connotations (including “the prima facie rule”, “strong bias”, “in the absence of countervailing reasons”, “sufficient cause” and “substantial grounds”).
35 It has been said that the exclusive jurisdiction cases require justification of a different order from that required in a case where the plaintiff has simply chosen to sue in one forum rather than another ( Fay at 230-231).
36 There is little guidance as to what considerations may suffice. There is authority to the effect that public policy considerations may be material.
37 Clearly, the court must have regard to the relevant circumstances of the particular case before it. I now turn to the circumstances of this case.
38 There is a significant connection with New South Wales. The contract was made in New South Wales. The plaintiff resides in the State. Her witnesses are in the State. The first defendant is resident in and carries on business in the State. It is the sole and exclusive representative of the second defendant in Australia for the creation, marketing and selling of the cruise product which had connection with the plaintiff’s injury. There is no evidence as to the location of potential witnesses for other parties. There is no evidence of any connection between England and the third defendant. There is evidence of a business connection with New South Wales.
39 This is simply not a case where the courts of this State provide a convenient forum inter alia for the plaintiff. Largely, there does not seem to be any real connection with either English law or a court of proper venue (whatever that may mean) located in London (it was said that the second defendant had an office in the U.K.). I bear in mind that there may be cases where the intention is to provide a neutral forum. In this case, there is no evidence as to the relevant intention. There is nothing to suggest that a court located in London would provide an appropriate forum from the point of view of the third defendant or any other party.
40 Indeed, it would seem that London may be an inconvenient venue for all parties. Apart from any question of providing a neutral venue, there would not seem to be any utility in the parties being placed in a situation where the dispute had to be litigated in London. Apart from the lack of utility, all parties may be put to unnecessary expense if that situation was imposed on them.
41 There is a further consideration. If the plaintiff’s claim was to be determined according to English law she would be deprived of the opportunity to prosecute her claim under the Trade Practices Act .
42 In the circumstances of this case, had it been necessary to do so, I would have refused the third defendant’s application for a stay on discretionary grounds.
43 The Notice of Motion is dismissed. The third defendant is to pay the costs of the Notice of Motion. The exhibits may be returned.
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