Keep Calm and Cruise On – When Disappointment and Distress May Result in an Award of Damages
April 19, 2023
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With the impacts of COVID-19 continuing to effect our everyday lives, Australia’s tourism industry has been forced to adapt more than most for the foreseeable future. This is particularly the case for those businesses that provide services aimed at entertainment, enjoyment and relaxation.
Damages for disappointment and distress
At law, a consumer may recover damages against a supplier for any loss or damage suffered by the consumer because of a failure to comply with consumer guarantees if it was reasonably foreseeable that the consumer would suffer such loss or damage as a result of such failure.
Last year, the High Court handed down a judgment in Moore v Scenic Tours Pty Ltd [2020] HCA 17 which enabled individuals to successfully seek damages for ‘disappointment and distress’ arising from breaches of consumer guarantees.
Following this decision, there is an expectation that claims for disappointment and distress suffered as a result of disruptions to travel and tours caused by COVID-19 may dramatically rise.
Moore v Scenic Tours Pty Ltd
In 2012, Mr Moore booked a cruise through Europe for himself and his wife with Scenic Tours. Scenic Tours promoted the cruise as a luxurious, once in a lifetime cruise, which visited numerous destinations without passengers having to constantly unpack. Unfortunately, a major portion of the cruise (10 days out of the 14 days) were spent on a bus, with the passengers having to change ship twice due to unfavourable weather conditions and flooding. Needless to say, the cruise fell short of what was promoted by Scenic Tours.
As a result, Mr Moore, together with 1,500 other disgruntled passengers, sued Scenic Tours claiming damages arising from disappointment and distress. The claim against Scenic Tours comprised multiple breaches of the Australian Consumer Law, including that the tour supplied was not fit for purpose and was not of a nature and quality that passengers could reasonably expect.
Scenic Tours argued that the poor weather and flooding were out of its control and additionally that disappointment fell under a personal mental injury which meant that the Australian Consumer Law was not applicable.
The High Court determined that Mr Moore’s claim for disappointment and distress was not a type of personal injury damages and accordingly the Australian Consumer Law applied and Mr Moore was able to recover damages for the disappointment and distress he had suffered as a result of the failed tour.
Keep calm and cruise on
The Moore v Scenic Tours case demonstrates a tourism operator’s necessity to be well-versed in current legal principles regarding the Australian Consumer Law. By doing so, the operator will have a better chance at avoiding liability through any potential misleading and deceptive conduct.
Under the Australian Consumer Law, damages for losses suffered as a result of a failure to comply with the consumer guarantees are available if they are reasonably foreseeable. Such consumer guarantees include that the service be:
• provided with due care and skill;
• fit for any express or implied specified purpose; and
• provided within a reasonable time (when no time is set).
Although consumer guarantees cannot be contracted out of, suppliers of services should avoid making false statements and misrepresentations regarding the standard, value or quality of the service they are providing in advertising material.
Furthermore, operators should strive to ensure all clients are aware of potential conditions which may affect the service provided to avoid disappointment, such as ‘out of control’ events like unfavourable weather.
How we can help
In light of the recent High Court case and the constantly changing nature of COVID-19, tourism operators should be aware of the potential repercussions of failing to review and update their promotional material and terms and conditions.
At Bailiwick Legal, we can assist you by drafting or reviewing and updating your current terms and conditions as well as your contracts and promotional material.
If you would like further information in relation to how the above matters may affect you, please contact us on (08) 9321 5451 or by email danielle@bailiwicklegal.com.au.
Danielle Edwards (Associate)
For further information about our legal services, please visit our website: https://www.bailiwicklegal.com.au/
The above information is a summary and overview of the matters discussed. This publication does not constitute legal advice and you should seek legal or other professional advice before acting or relying on any of the content.
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