Webb v Flight Centre Travel Group Limited

[2021] NSWCATCD 31

Civil and Administrative Tribunal

New South Wales

Medium Neutral Citation:

Webb v Flight Centre Travel Group Limited [2021] NSWCATCD 31

Hearing dates:

8 April 2021

Date of orders:

13 May 2021

Decision date:

13 May 2021

Jurisdiction:

Consumer and Commercial Division

Before:

P Thew, General Member

Decision:

The application is dismissed.

The Tribunal NOTES that the Respondent stated during the hearing that the Applicant has available to him a credit with the Respondent to the full value of the amount that he paid to the Respondent that he can use within 24 months from the date of having made that payment and that the tickets are transferrable.

Catchwords:

CONSUMER LAW — Consumer guarantees — Supply of services — Guarantee as to due care and skill

Legislation Cited:

Australian Consumer Law, schedule 2 to the Competition and Consumer Act 2010 (Cth)

Fair Trading Act 1987 (NSW)

Category:

Principal judgment

Parties:

David Webb (Applicant)
Flight Centre Travel Group Limited (Respondent)

File Number(s):

GEN20/47940

Publication restriction:

Nil

REASONS FOR DECISION

1. On 16 November 2020 the Tribunal received an application made by Mr David Webb (the Applicant) against Flight Centre Travel Group Limited (the Respondent). In the Application the Applicant sought an order for compensation in the sum of $4233.48 that he claimed by way of reimbursement for the deposit paid for two air travel tickets that he states in his Application he purchased through the Respondent as agent for Air Canada.

2. The matter was listed for a final hearing on 8 April 2021. During this hearing (by telephone) the Applicant was self represented and the Respondent was represented by Ms White.

3. The Applicant has not specified in his material which legislative provisions he relies upon but said during the hearing, upon questioning by the Presiding Member, that he asserted that the Respondent had failed to meet the obligation of due care and skill. This obligation is contained in within section 60 of the Australian Consumer Law (the ACL), at Schedule 2 to the Competition and Consumer Act 2010 (Cth), dealt with below.

EVIDENCE

4. In reaching the conclusions herein, the Tribunal has had regard to the following:

1. The material filed by the Applicant on 24 November 2020 and 2 February 2021 marked Exhibits A1 and A2 respectively.

2. The material filed by the Respondent on 8 March 2021 and marked Exhibit R1, said in the hearing to be the only bundle the Respondent relied upon.

3. The oral evidence and submissions made by the parties at the hearing on 8 April 2021.

5. The specific documentary and oral evidence is described below.

JURISDICTION

6. The Tribunal's Consumer and Commercial Division has jurisdiction in relation to consumer claims under Part 6A of the Fair Trading Act 1987 (NSW) (the FT Act) which may give rise to rights arising under the ACL: see for instance Salloum v Charles Golding t/as Golden Motors [2016] NSWCATCD 72 at [3] to [7], unchallenged and not overturned on appeal: Golding v Salloum [2016] NSWCATAP 267 at [14]. Section 28 of the FT Act allows a consumer to assert a claim under the ACL.

7. As was observed by the Appeal Panel in Flight Centre Travel Group Limited T/A Aunt Betty v Goel [2021] NSWCATAP 44 from [18], Part 6A of the FT Act does not create a cause of action. Jurisdiction is conferred on the Tribunal by reference to the general type of claim made by the consumer: Lam v Steve Jarvin Motors Pty Ltd [2016] NSWCATAP 186. A cause of action is predicated upon the existence of causes of action that arise independently from Part 6A. As was stated at para 97 of the Appeal Panel decision in Matumaini v Automobile Industries Pty Ltd [2017] NSWCATAP 93:

The cause of action may be founded upon contract, tort, debt, statute or any other sufficient basis in law. All that is required is that the cause of action is available under New South Wales law to the consumer at the relevant time and provides a legitimate legal basis for the consumer to make a claim of a type listed in s 3A (1) (a) to (e) of the CC Act, or the corresponding definition in Pt 6A, against the supplier. If there is such a claim and the other requirements in relation to jurisdiction are met, the Tribunal then has power to make orders of the types listed in s8 (now ss79N, 79O and 79P of the FT Act), having regard to the legal entitlements of the parties under the causes of action upon which the claims are based: Lam v Steve Jarvin Motors Pty Ltd [2016] NSWCATAP 186 at [164].

8. The ACL was incorporated into the law of New South Wales, and as a part of the FT Act, by section 28(1) of the FT Act. The ACL consists of Schedule 2 of the Competition and Consumer Act 2010 (Cth), and the regulations under section 139G of that Act (FT Act section 27). The ACL applies to create rights at law in consumers that fall within the terms of the ACL including the consumer guarantee provisions in Part 3-2 of the ACL. Whilst the ACL creates a cause of action at law and a range of remedies for parties, it does not of itself confer any jurisdiction on this Tribunal to hear those actions and provide those remedies.

9. Section 79J of the FT Act gives the Tribunal jurisdiction to hear claims falling under the FT Act, which by operation of section 28 of the FT Act include claims made under the ACL. Section 79D of the FT Act defines a 'consumer' to include a natural person to whom a supplier has supplied or agreed to supply goods or services, whether under a contract or not. The Applicant meets the definition of ‘consumer’ for these purposes.

10. The claim arises from the supply of services to the consumer (under a contract or not) and constitutes a claim by the consumer for the payment of a specified sum of money (FT Act section 79F and within the meaning of section 259(1) of the ACL). The services to which the claim relates were supplied in NSW (FT Act section 79K). The claim was made within the period of time allowed in section 79L of FT Act.

11. The claim is otherwise maintainable under the FT Act but as such is subject to the Tribunal's monetary jurisdiction which is limited by section 79S of the FT Act to making orders for the payment of no more than the prescribed amount. Under section 79S of the FT Act the prescribed amount is $40,000 and the claim is under this amount.

SUMMARY OF THE EVIDENCE

12. The Applicant’s evidence can be summarised as follows:

1. On about 23 August 2019 the Applicant paid a deposit for two air tickets from Sydney to Vancouver in the sum of $4,233.48 from Air Canada through the Respondent as agent for Air Canada. The Applicant states in his Application that he paid the deposit for the air tickets from the Respondent in the Respondent’s role as agent for Air Canada.

2. The Applicant’s receipt (doc 1, Ex A1) states that the Applicant paid the deposit for the tickets from the Respondent’s Erina Fair Shopping Centre agency and bears the words across the bottom: ‘Whenever you make a booking with us, you are subject to Flight Centre Travel Group Limited’s terms and conditions. If you have not received the terms and conditions please ask your consultant for a copy. Flight Centre Travel Group Limited's terms and conditions are also available at

3. The Applicant says that he did not pay the deposit online but paid cash at the Erina Fair Shopping Centre agency and was not given a copy of the Respondent’s terms and conditions when he paid cash and therefore did not read them or know of them. The Applicant said in the hearing that ‘to his knowledge he has no memory of signing any documentation at all.’

4. The invoice at doc 2, Ex A1 states that the date of travel was 2 June 2020. The Applicant said that Air Canada cancelled these flights.

5. While unclear, during the hearing the Applicant stated that his claim was that the Respondent ought to have advised him that he could have purchased the tickets online whereupon he would have been forced to read the terms and conditions at the point of purchase and would have become aware that the Respondent was an agent and therefore not liable for any loss. The Applicant said that he would then have purchased the tickets directly through Air Canada.

6. During the hearing the Respondent stated that the Applicant has available to him a credit with the Respondent to the full value of the tickets that he can use within 24 months from the date of purchase and in addition that name changes on the tickets are permitted, which means that he can transfer the tickets. In light of this, when asked by the Presiding Member what his loss was, the Applicant stated that his loss was the fact that he did not want to go anymore.

13. The Respondent’s evidence and submissions can be summarised as follows:

1. The Respondent is an agent for Air Canada and is therefore not liable for any loss suffered by the Applicant as a result of Air Canada’s conduct: Flight Centre Travel Group Limited v Goel [2021] NSWCATAP 44 at [61].

2. The terms and conditions of the agreement (doc 1, Ex A2) that the Respondent said was entered into between the Applicant and the Respondent upon the purchase by the Applicant of the air tickets includes a clause entitled ‘Agency’ which states:

‘We act as an agent for, and sell various travel related products as agent on behalf of, numerous transport, accommodation and other service providers, such as airlines, coach, rail and cruise line operators, as well as all of our wholesalers. Any services we provide to you are collateral to that agency relationship. ... We exercise care in the selection of reputable service providers, but we are not ourselves a provider of travel services and have no control over, or liability for, the services provided by third parties ...’

3. The Respondent said that the Applicant accepted these terms and conditions upon purchase of the air tickets from the Respondent. The Respondent relied upon the words at the bottom of page 13 of 13 of the Booking Terms and Conditions, which state ‘you acknowledge that you are 18 years of age or older and that you understand and agree with the above Booking Terms and Conditions…’. The Respondent relied upon the similar words on the face of the Applicant’s receipt at doc 1, Ex A1.

4. In response to the Applicant’s evidence that the Applicant had not been provided the Respondent’s terms and conditions upon purchasing the tickets, Ms White said that it was standard practice for all Flight Centre booking agents to provide a copy to purchasers. When asked by the Presiding Member whether she had checked whether the Erina Fair Shopping Centre agent had a record of a copy of the terms and conditions signed by the Applicant, Ms White at first said that the Erina Fair Shopping Centre agency had closed down but then conceded that she was mistaken about that and that she had not checked whether they had retained a record of the signed terms and conditions.

5. Ms White relied in addition on Toll v Alphapharm (2004) 219 CLR 165 as authority for the payment of money demonstrating an acceptance by a purchaser of the terms and conditions of purchase and said that it was therefore irrelevant whether the Applicant was provided with the terms and conditions.

THE APPLICABLE LAW

14. Division 3 of Part 6A of the FT Act contains provisions relating to orders the Tribunal can make in relation to a consumer claim made under that Part. Section 79N within Division 3 provides that the Tribunal can make an order in favour of a claimant in a consumer claim, which includes an order “that requires a respondent to pay to the claimant a specified amount of money”: see FT Act, s 79N(a).

15. In addition to the above, to the extent relevant sections 267 and 268 of the ACL provide as follows:

267   Action against suppliers of services

(1)  A consumer may take action under this section if:

(a)  a person (the supplier ) supplies, in trade or commerce, services to the consumer; and

(b)  a guarantee that applies to the supply under Subdivision B of Division 1 of Part 3-2 is not complied with; and

(c) unless the guarantee is the guarantee under section 60--the failure to comply with the guarantee did not occur only because of:

(i)  an act, default or omission of, or a representation made by, any person other than the supplier, or an agent or employee of the supplier; or

(ii)  a cause independent of human control that occurred after the services were supplied.

(2)  If the failure to comply with the guarantee can be remedied and is not a major failure:

(a)  the consumer may require the supplier to remedy the failure within a reasonable time; or

(b)  if such a requirement is made of the supplier but the supplier refuses or fails to comply with the requirement, or fails to comply with the requirement within a reasonable time--the consumer may:

(i)  otherwise have the failure remedied and, by action against the supplier, recover all reasonable costs incurred by the consumer in having the failure so remedied; or

(ii)  terminate the contract for the supply of the services.

(3)  If the failure to comply with the guarantee cannot be remedied or is a major failure, the consumer may:

(a)  terminate the contract for the supply of the services; or

(b)  by action against the supplier, recover compensation for any reduction in the value of the services below the price paid or payable by the consumer for the services.

(4)  The consumer may, by action against the supplier, recover damages for any loss or damage suffered by the consumer because of the failure to comply with the guarantee if it was reasonably foreseeable that the consumer would suffer such loss or damage as a result of such a failure.

(5)  To avoid doubt, subsection (4) applies in addition to subsections (2) and (3).

268   When a failure to comply with a guarantee is a major failure

(1)  A failure to comply with a guarantee referred to in section 267(1)(b) that applies to a supply of services is a major failure if:

(a)  the services would not have been acquired by a reasonable consumer fully acquainted with the nature and extent of the failure; or

(b)  the services are substantially unfit for a purpose for which services of the same kind are commonly supplied and they cannot, easily and within a reasonable time, be remedied to make them fit for such a purpose; or

(c)  both of the following apply:

(i)  the services, and any product resulting from the services, are unfit for a particular purpose for which the services were acquired by the consumer that was made known to the supplier of the services;

(ii)  the services, and any of those products, cannot, easily and within a reasonable time, be remedied to make them fit for such a purpose; or

(d)  both of the following apply:

(i)  the services, and any product resulting from the services, are not of such a nature, or quality, state or condition, that they might reasonably be expected to achieve a result desired by the consumer that was made known to the supplier;

(ii)  the services, and any of those products, cannot, easily and within a reasonable time, be remedied to achieve such a result; or

(e)  the supply of the services creates an unsafe situation.

(2)  A failure to comply with a guarantee referred to in section 267(1)(b) that applies to a supply of services is also a major failure if:

(a)  the failure is one of 2 or more failures to comply with a guarantee referred to in section 267(1)(b) that apply to the supply; and

(b)  the services would not have been acquired by a reasonable consumer fully acquainted with the nature and extent of those failures, taken as a whole.

Note:          The multiple failures do not need to relate to the same guarantee.

(3)  Subsection (2) applies regardless of whether the consumer has taken action under section 267 in relation to any of the failures.

269   Termination of contracts for the supply of services

(1)  This section applies if, under section 267, a consumer terminates a contract for the supply of services.

(2)  The termination takes effect:

(a)  at the time the termination is made known to the supplier of the services (whether by words or by conduct indicating the consumer's intention to terminate the contract); or

(b)  if it is not reasonably practicable to communicate with the supplier of the services--at the time the consumer indicates, by means which are reasonable in the circumstances, his or her intention to terminate the contract.

(3)  The consumer is entitled to recover, by action against the supplier of the services, a refund of:

(a)  any money paid by the consumer for the services; and

(b)  an amount that is equal to the value of any other consideration provided by the consumer for the services;

to the extent that the consumer has not already consumed the services at the time the termination takes effect.

16. The Applicant states that he relies upon section 60 of the ACL, which provides:

1. Guarantee as to due care and skill

   If a person supplies, in trade or commerce, services to a consumer, there is a guarantee that the services will be rendered with due care and skill.

FINDINGS

Did the Respondent ‘supply services’ ‘in trade or commerce’?

17. Yes. The First Respondent supplied services to the Applicant within the meaning of section 60 of the ACL. The services were in addition supplied ‘in trade or commerce’ as that term is described in Miller’s, Australian Competition and Consumer Law Annotated 2021 [CCA.4.540]. However, for the reasons below the Application is nonetheless not made out.

Were the services carried out with due care and skill?

18. The consumer guarantee that services be provided with due care and skill that is implied into consumer contracts is a guarantee that the services will be performed in a “careful, skilful, and workmanlike” manner. However, the test is an objective test (Mayne Nickless Ltd v Crawford (1992) 59 SASR 490; Read v Nerey Nominees Pty Ltd [1979] VicRp 6; [1979] VR 47 at 49; S.G. Corones The Australian Consumer Law (2011) Lawbook Co pp 361-362), and all of the facts and circumstances must be considered in the context of the application of an objective standard of due care and skill: see for instance Liu v Zaccaria trading as Precision Automotive Engineers [2017] NSWCATCD 59 from [71].

19. The effect of section 60 is to negate the opportunity to contract out of or limit a claim for negligence: Miller, Miller’s Australian Competition and Consumer Law Annotated, 43^rd ed, LBC, 2021, [ACL.60.20]. Such claims may only be limited, or contracted out of if permitted to do so by the exceptions to section 60: Miller, Miller’s, supra, [60.20]. None of the exceptions in sections 63 or 65 apply in the instant case.

20. In Scenic Tours Pty Ltd v Moore (2018) 361 ALR 456, Sackville AJA (Payne JA and Barrett AJA agreeing) said at [174]:

The text of s 60 does not imply and certainly does not compel the conclusion that if there is a contract in place between the supplier and the consumer the obligations imposed on the supplier by the Care Guarantee [in section 60] are co-extensive with the supplier’s contractual obligations. Unless there is some contextual reason to construe the Care Guarantee in s 60 of the ACL as applying only to “services” that are co-extensive with the supplier’s contractual obligations, there is no basis for doing so. The same can be said for the Purpose and Result Guarantees.

21. For the purposes of section 60, the question of whether there has been a failure to carry out the services with due care and skill is not one to be considered in the abstract, but in the context of the contractual terms agreed by the parties. The standard required under the contract, or by the ACL, is not perfection: RG Concrete & Polish Pty Ltd v Smart (Civil Claims) [2019] VCAT 722 at [55].

22. In the instant case, the Applicant has been unable to articulate in any comprehensible or logical way how it was that the Respondent failed in its duty to carry out the services with due care and skill, despite lengthy questioning during the hearing by the Presiding Member. If his submission is that there was a failure to afford due care and skill because he says he lost the deposit price when Air Canada cancelled the flight, this argument must fail because he has suffered no loss. The Respondent clearly said at the conclusion of the hearing that he has available to him for 24 months from the date of purchase a credit in the full sum of the deposit that he paid. In response to his assertion that he no longer wants to go, the Respondent stated that the tickets are transferrable. This is despite the terms on the Applicant’s invoice (in Ex R1) which clearly state ‘Flights are non changeable. Flights are non refundable.’ The Applicant has therefore suffered no loss.

21. Not only does this mean that there has been no breach of section 60 of the ACL, it would in addition prevent the Applicant from recovering damages pursuant to section 267(4) of the ACL even if a breach of section 60 of the ACL had been found, given a consumer can only recover damages for ‘any loss or damage suffered’. Similarly, an order for the payment of money under section 79N(a) of the FT Act would not be ‘fair and equitable to all parties’ as required by section 79U of the FT Act given the Applicant had suffered no loss. For these reasons the Applicant would also fail in any claim under any other provision of the ACL or in a contractual claim.

Could the Respondent have been liable for any loss?

24. While the Applicant has suffered no loss and no breach of any relevant provisions of the ACL, or a contractual breach, have been found, even if such breaches had been found the Respondent could not have been liable for them. As was observed in Goel at [47]-[49]:

Such principle was referred to specifically in relation to travel agents in Air Tahiti Nui Pty Ltd v McKenzie (2009) 77 NSWLR 299; [2009] NSWCA 429, where Allsop P and Handley AJA said at [21], in answer to a submission that a party who arranged flight travel was liable for injuries sustained on a flight operated by the appellant:

We reject these submissions. The phrase “as a principal” describes the capacity of the person who “makes an agreement for carriage”. An agent who “makes” such an agreement, such as a travel agent, is not a contracting carrier.

Further, at [22], their Honours said:

Travel and transport intermediaries may procure a contract of carriage as a broker or agent; or may undertake a contractual obligation for carriage. In the former case they are not a principal, but in the latter they are, even if they cannot perform the contract themselves but have to subcontract with an actual carrier.

It follows that, provided that the respondent had knowledge of the terms and conditions which included a term that the appellant was acting only as agent, or is deemed to have such knowledge, no personal liability is incurred by the agent. (emphasis added)

25. In Goel it was held that the purchaser in that case had knowledge of the terms and conditions by reason of having to click on the button agreeing to the terms and conditions when purchasing the tickets online.

26. When the Presiding Member read the above passage out during the hearing, the Applicant in the instant case said that he had no knowledge of the Booking Terms and Conditions, which clearly state that the Respondent was acting as agent and bore no liability, because he had paid the deposit in cash and had not been given a copy. However, the Tribunal does not accept that the Applicant was not given a copy of the terms and conditions at the point at which he paid the cash deposit and finds that this is implausible. In addition, the Applicant did not categorically deny this but merely said that ‘to his knowledge he has no memory of signing any documentation at all.’ In his Application the Applicant repeatedly states that the Respondent was acting as agent on behalf of Air Canada.

27. In any event, even if the Applicant did not receive a copy of the terms and conditions at the point of paying the deposit, Toll v Alphapharm is authority for the proposition that where a party is aware of the existence of conditions, but chooses not to read them, they are nevertheless bound by the conditions. In the instant case the receipt included in the Applicant’s own materials (doc 1, Ex A1) issued to the Applicant when he paid the deposit clearly states ‘whenever you make a booking with us, you are subject to [the Respondent’s] terms and conditions’ and says that if a purchaser has not received the terms and conditions, the purchaser is to ask the consultant for them.

28. Moreover, inToll v Alphapharm the High Court said at 179:

It is not the subjective belief or understanding of the parties about their rights and liabilities that govern their contractual relations. What matters is what each party by words and conduct would have led a reasonable person in the position of the other party to believe.

29. The Applicant by his words and conduct in paying the deposit would have led a reasonable person in the position of the Respondent to believe that he either had the terms and conditions and had read them or would ask the consultant for them as he was advised to do on his own receipt.

30. On the above bases the Applicant had the requisite knowledge of the terms and conditions, including the term that the Respondent was acting as agent and bore no liability, and the Respondent would therefore not be liable for any loss suffered by the Applicant.

31. The Tribunal is satisfied that it is fair and equitable to all the parties within the meaning of section 79U of the FT Act to order that the Application is dismissed.

CONCLUSION

32. For the reasons herein, the Application is dismissed.

33. The Tribunal observes that the circumstances in Rule 38(2) of the Civil and Administrative Tribunal Rules 2014 (NSW) do not prima facie arise in the instant case.

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I hereby certify that this is a true and accurate record of the reasons for decision of the Civil and Administrative Tribunal of New South Wales.

Registrar

Decision last updated: 05 August 2021