After breaking free from a poorly drafted exclusive jurisdiction clause, the Browitt family is free to sue Royal Caribbean Cruises in the Circuit Court, Miami Florida for damages resulting from death and injury sustained from the White Island Volcano eruption.
This is the result of a decision by the Honourable Justice Stewart, reported as Royal Caribbean Cruises Ltd v Browitt [2021] FCA 653 (18 June 2021) in the Federal Court of Australia.
The ill-fated shore excursion to Whakaari (White Island)
The Browitts had sailed on the Ovation of the Seas on a cruise that departed from Sydney on 4 December 2019 and was due to return to Sydney about 12 days later after sailing around New Zealand in a clockwise direction calling at various ports there.
On 9 December 2019, three members of the Browitt family from Melbourne, namely Paul Browitt and his two daughters, Stephanie and Krystal took a shore excursion to Whakaari (also known as White Island) when it suffered a volcanic eruption that killed and injured a large number of people who were visiting the island that day as tourists.
Whakaari is the peak of a submarine volcano in the Bay of Plenty about 48 km from the east coast of the North Island of New Zealand.
Stephanie and Krystal’s mother, Paul’s wife, Maria (Marie) Browitt, was not part of the tour party to the island. She had stayed on board the cruise liner, Ovation of the Seas, at Tauranga when her family undertook the shore excursion to Whakaari.
Paul, Stephanie and Krystal suffered horrific injuries from the molten ash and rock that spewed from the erupting volcano. Krystal died that day from her injuries. Paul died from his injuries in hospital a month later. Stephanie suffered third-degree burns to more than 70% of her body and remained in a coma for over two weeks. She was in hospital for six months.
Since then, she has had more than 20 surgeries, including the amputation of all her fingers and is still receiving intensive hospital outpatient treatment for her injuries. Marie has suffered unbearable loss and psychological injury. She is now Stephanie’s full-time carer.
Royal Caribbean chooses New South Wales, the Browitt family chooses Florida
The exclusive jurisdiction clause in the contract of carriage for the cruise provided for the courts of New South Wales to determine any dispute arising from the cruise on the Ovation of the Seas. It read as follows:
We both agree that any dispute or claim will be dealt with by a court located in New South Wales, Australia to the exclusion of the courts of any other state, territory or country.
The Browitt family chose the courts of Florida to hear their claim. On 4 December 2020, Marie Browitt, for herself and as representative of the deceased estates of Paul and Krystal, and Stephanie commenced a proceeding in the Circuit Court of the Eleventh Judicial Circuit, Miami-Dade County, Florida, USA, for loss and damages suffered by them as a consequence of the volcano eruption. The defendant in the proceeding is Royal Caribbean Cruises Ltd, a Liberian registered company headquartered and operating in Miami, Florida.
On 18 December 2020, Royal Caribbean Cruises / RCL Cruises commenced a proceeding in the Federal Court of Australia to enforce the exclusive jurisdiction clause, and for an anti-suit injunction against the Florida proceeding.
The decision of the Federal Court of Australia turned upon these issues:
- Were the booking terms and conditions legally binding on the Browitts?
- Who were the contracting parties?
- Was the Florida proceeding vexatious or oppressive?
But first, we need to examine the roles of Royal Caribbean Cruises and RCL Cruises, and the booking process.
The roles of Royal Caribbean Cruises and RCL Cruises
Royal Caribbean Cruises Ltd is the owner of the Royal Caribbean International Brand. It has a head office in Miami, Florida. It produces brochures for all cruises both in glossy form and on websites, including for the Ovation of the Seas cruise to New Zealand which departed on 4 December 2019.
Royal Caribbean Cruises was responsible for developing, operating and setting policy for Royal Caribbean International’s shore excursion program. It had approved the onboard promotion and sale of the excursion to Whakaari undertaken by members of the Browitt family on 9 December 2019.
The proceeding in the United States District Court, District of Florida, was brought by the Browitts against Royal Caribbean Cruises.
RCL Cruises is a subsidiary of Royal Caribbean Cruises. It has a head office in London and a branch office in Australia. RCL Cruises was the operator of MV Ovation of the Seas for cruises in Australia and New Zealand. It provisioned the ship and supplied the crew.
RCL Cruises developed and published standard terms and conditions for carriage of passengers for the Australian market, which it displayed on its website / URL for Australia (RCL AU terms).
The proceeding in the Federal Court of Australia was brought by Royal Caribbean Cruises and RCL Cruises jointly against the Browitts.
The booking process
RCL Cruises appointed Flight Centre as its retail sales agent to promote and sell cruise packages and enter into reservations for cabin accommodation with customers.
Mrs Browitt attended Flight Centre’s office in Craigieburn, Victoria, and was shown the itinerary and small map for the cruise to New Zealand on the Ovation of the Seas in a Royal Caribbean International glossy brochure. The travel consultant did not show her the terms and conditions at the back of the brochure (the RCL AU terms).
The travel consultant took details of the family, accessed the booking system, and printed a quote for the cruise. Mrs Browitt confirmed her acceptance of the quote, and the travel consultant issued an invoice for the cruise fare, payable to Flight Centre.
The invoice included the Flight Centre terms and conditions, which the travel consultant took Mrs Browitt through. She signed the invoice. Underneath where she signed were the words:
You acknowledge that you are 18 years of age or older and that you understand and agree with the above Booking Terms and Conditions and our Privacy Policy.
Mrs Browitt paid the deposit. The payment constituted acceptance of the offer of the cruise evidenced by the invoice. Mrs Browitt received booking confirmation by email which stated: Thank you for your booking. In the footer was a hyperlink to the RCL AU terms.
The Court found that Mrs Browitt’s attention was not drawn specifically to RCL’s terms and conditions, but had Mrs Browitt asked to see them they were readily available – both in the brochure and on the website – and she would have had the opportunity to read them before signing the Flight Centre invoice.
Were the booking terms and conditions legally binding on the Browitts?
For the RCL AU terms to be legally binding on the Browitts, the Court had to find that the booking was made with those terms.
Two questions need to be answered in the affirmative.
1. Was Flight Centre the agent of Mrs Browitt, RCL or both?
The Court said:
“There is no question that Flight Centre was appointed as agent of RCL for the purpose of selling cruise packages on RCL’s customer terms and conditions.”
As a consequence, Flight Centre had full knowledge of the RCL AU terms.
The Court found that in the booking process, Flight Centre had offered the RCL AU terms to Mrs Browitt, and that she had authorised Flight Centre to make the booking as her agent, subject to the RCL AU terms.
Therefore Flight Centre was also the Browitt’s agent, and Flight Centre’s knowledge of the RCL AU terms can be attributed to Mrs Browitt.
2. Did the RCL AU terms form part of the cruise contract?
The Court found that Mrs Browitt’s signature on the invoice was sufficient to make the RCL AU terms form part of her cruise contract – see Toll (FGCT) Pty Ltd v Alphapharm Pty Ltd [2004] HCA 52; 219 CLR 165. Because of the signature, it was not necessary to prove that Mrs Browitt’s attention had been drawn to the terms.
Who were the contracting parties?
The key question in this case was whether as drafted, Royal Caribbean Cruises was also a party to the cruise contract or had the benefit of the RCL AU terms, in addition to RCL Cruises.
For a variety of reasons, after interpreting the terms, the Court decided that Royal Caribbean Cruises was not a party, nor a third party beneficiary.
The reasons included that the phrase ‘Either Royal Caribbean Cruises or RCL Cruises’ did not mean both of them. RCL Cruises was the ship operator and it is logical that the booking contract be with it as the carrier party.
Also, the clause was drafted narrowly – it was ‘any dispute or claim’ not ‘any dispute arising out of or in connection with’ the cruise booking.
Nor were the roles of Royal Caribbean Cruises and RCL Cruises intertwined.
Therefore, under the doctrine of privity of contract, Royal Caribbean Cruises could not rely upon the exclusive jurisdiction clause to prevent the Browitts from pursing a proceeding against it in Florida.
Is the Florida proceeding vexatious or oppressive?
There are two bases on which an Australian court might by anti-suit injunction prevent a party subject to its jurisdiction commencing or continuing a suit in a foreign forum.
One basis is when it is necessary for the protection of the court’s own proceedings or processes (if the foreign proceeding interferes with a proceeding pending in the Australian court).
The other basis is that a court may in the exercise of its equitable jurisdiction make orders in restraint of unconscionable conduct or the unconscientious exercise of legal rights. That is, if the foreign court proceedings are vexatious or oppressive.
The Court concluded that the there was no interference with its own proceedings or processes and the Florida proceeding was not vexatious or oppressive:
“Given that there are no parallel proceedings on foot or contemplated in Australia, the Florida proceeding is where Royal Caribbean Cruises’s head office is located and where various acts and omissions by Royal Caribbean Cruises which are relied on in the Florida proceeding as giving rise to the liability of Royal Caribbean Cruises are alleged to have occurred, and Mrs Browitt and Ms Browitt enjoy certain legitimate juridical advantages in Florida (i.e., higher damages, assessment of damages by a jury, and certain procedural advantages), the pursuit of the Florida proceeding is entirely legitimate and in no sense unconscionable.”