Ritson v RCL Cruises Ltd[2018] QCATA 79

QUEENSLAND CIVIL AND ADMINISTRATIVE TRIBUNAL

REASONS FOR DECISION

1. [1]
   In December 2016 Mr Ritson and his partner went on an 11-night cruise holiday on one of the respondent company’s ships, leaving Sydney on 11 December 2016 and returning on 22 December 2016. They did not enjoy themselves.
2. [2]
   Late the first night on board there was a water leak in their cabin. It was an interior cabin. They were moved to another cabin, this time an exterior cabin with a porthole window.
3. [3]
   The new cabin was a large one for families and was essentially two cabins with connecting interior doors (double cabin). Other people were moved into the adjoining connected cabin and they caused Mr Ritson and his partner some distress.
4. [4]
   The new neighbours snored loudly, spoke loudly and argued and used offensive language. Mr Ritson complained and the respondent’s officers offered another room and other concessions but Mr Ritson refused the offers.
5. [5]
   After making complaint to the respondent when the ship returned Mr Ritson brought an application in the Tribunal initially seeking recovery of all money paid of $3,270.29 for both him and his partner but which was reduced at hearing to just the cost of accommodation, $2,436.78.
6. [6]
   The Tribunal determined that the guarantee as to supply of services with due care and skill pursuant to s 60 Australian Consumer Law (‘ACL’) and the guarantee under s 61 that services will be fit for a particular purpose applied to the contract between Mr Ritson and the respondent. The Tribunal also found, however, that respondent to have responded appropriately to remedy the problems experienced and offered reasonable compensation for the inconveniences caused, all of which was rejected by Mr Ritson.
7. [7]
   The Tribunal found that the guarantees under ss 60 and 61 had not been breached and dismissed Mr Ritson’s claim.
8. [8]
   Mr Ritson now seeks leave to appeal and appeal from that decision.
9. [9]
   Given this is an appeal from a decision made in the Tribunal’s Minor Civil Dispute jurisdiction, leave to appeal must first be obtained before any appeal proceeds.^[1] 
10. [10]
    Leave to appeal will usually only be granted where an appeal is necessary to correct a substantial injustice to the appellant and where there is a reasonable argument that there is an error to be corrected.^[2]
11. [11]
    Mr Ritson claims under the following grounds of appeal:

    1. (a)
       Ground 1: The Tribunal erred in failing to address the applicant’s claim for an order pursuant to section 13(2)(a)(i) of the QCAT Act;
    2. (b)
       Ground 2: The Tribunal erred by misinterpreting and misapplying sections 60 and 61 of the ACL;
    3. (c)
       Ground 3: The Tribunal erred by refusing to allow the appellant to adduce evidence of the audio and video recordings in support of his claim;
    4. (d)
       Ground 4: The Tribunal erred by dismissing the appellant’s claim in its entirety in circumstance where the respondent admitted the services were defective and that a partial refund was fair and reasonable.
12. [12]
    Ground 3, that the Tribunal erred by refusing to allow the appellant to adduce evidence of the audio and video recordings in support of his claim, is appropriately addressed first.

Ground 3

The Tribunal erred by refusing to allow the appellant to adduce evidence of the audio and video recordings in support of his claim

13. [13]
    At hearing of the application for leave to appeal or appeal an application was made to receive the same audio and video evidence. That application was refused.
14. [14]
    The Tribunal made no error in refusing to receive electronic evidence. That is a constant in the Tribunal and is well-advertised.
15. [15]
    In the application for Consumer For Minor Civil Dispute – Consumer Dispute, it is clearly stated in the instructions for completing the form that the Tribunal will not receive electronic evidence.
16. [16]
    That is also stated clearly on the Tribunal’s webpage.
17. [17]
    There was no error in the Tribunal refusing to accept the electronic evidence at hearing, nor given Mr Ritson’s claim that there was noise from the neighbouring cabin is admitted, it is unnecessary for the Appeal Tribunal to hear the electronic evidence to further emphasise the point.

Ground 1 

The Tribunal erred in failing to address the applicant’s claim for an order pursuant to section 13(2)(a)(i) of the QCAT Act.

18. [18]
    Because the Tribunal dismissed the appellant’s substantive claim under the ACL there was no basis for the Tribunal to make any orders under s 13 QCAT Act.
19. [19]
    By s 12 a relevant person may apply to the Tribunal to exercise its jurisdiction in minor civil disputes.  ‘Relevant person’ is defined to include a consumer claiming under a contract between the consumer and a trader.
20. [20]
    Section 13 then follows to state what orders may be made by the Tribunal in a minor civil dispute brought by a relevant person as defined by s 12, such as the said claim by a consumer against a trader in respect of the contract entered between them.
21. [21]
    The ACL imposes various guarantees into any such contract between a supplier of services and a consumer. Where the consumer sues for breach of such a guarantee in the Tribunal, if successful in that ACL based claim the Tribunal may proceed to make an order under s 13. If the consumer is not successful in his claim under the ACL, there is no basis for the Tribunal to make any orders in his favour pursuant to s 13.
22. [22]
    Given the Tribunal found that the guarantees under ss 60 and 61 ACL had not been breached there was no basis for the Tribunal to make any orders under s 13.
23. [23]
    This can be no valid ground of appeal.

Ground 2 

The Tribunal erred by misinterpreting and misapplying sections 60 and 61 of the ACL.

24. [24]
    The incident on the first night of the cruise was a water leak in the ceiling of the cabin booked by Mr Ritson. This was cabin 3013. 
25. [25]
    Mr Ritson and his partner were moved to the double cabin
26. [26]
    Mr Ritson told the Tribunal that on the third night of the cruise, 13 December 2016, a mother and daughter couple moved into the adjacent room. He said he made complaints to the respondent. The implication was that he made immediate complaint.
27. [27]
    At hearing the respondent challenged the suggestion of early complaint. Ms Lobb said at the hearing that it was not until day six of the cruise, on 17 December 2016, that Mr Ritson first complained about the noisy neighbours. She said there was a record about the complaint made in a ship log. A perusal of the log concerned shows however the complaint was made on 18 December 2016 at 11.01 pm, which would make the complaint on day 8 of the cruise, given the cruise commenced on 11 December 2016.   
28. [28]
    The respondent offered to move Mr Ritson and his partner that night, on 18 December 2016, to yet another cabin, 6217, but that was refused. That new cabin was an interior cabin again, the same as the grade of their initial booking. Unfortunately there were no other available cabins.
29. [29]
    According to the log Mr Ritson called back to the guest services officer at 11.50 pm again complaining about the snoring occupant next door. Again cabin 6217 was offered and again Mr Ritson refused that offer and the log notes the basis of refusal was that he did not want to be downgraded. Again he was informed it was holiday season and there were no other available cabins. Mr Ritson said he wanted to be refunded all the money he had paid for the booking and all their expenses on board.
30. [30]
    Another cabin became available the next day, 19 December 2016, cabin 8526, on a different deck, and this time an external cabin, and again an offer was made to move Mr Ritson to this fourth cabin. Mr Ritson said he would let them know if he and his partner wanted to move to this new cabin. At 10.25 pm that night Mr Ritson again called instead to complain about the snoring coming from the next door cabin saying he and his partner could not sleep and asking that someone stop the noise.
31. [31]
    Mr Ritson says the offer of the fourth outside cabin happened on the last day of the cruise. At that point, says Mr Ritson, the cruise was ruined.
32. [32]
    The double cabin where Mr Ritson experienced the problem with the neighbours, has a double connecting door between. The respondent said there had not been other complaints about noise previously.
33. [33]
    The Tribunal‘s reasons for decision were given ex tempore which is the desired method of delivery of reasons for decision in minor civil dispute matters and which accords with the spirit and purpose of the QCAT Act. But it is something that is hard to do in practice. 
34. [34]
    In his submissions Mr Ritson says the Tribunal failed to identify with precision what services were provided which led it into error in identifying relevant breaches of both s 60 and s 61 guarantees. Lets Go Adventures Pty Ltd v Barrett is cited as authority.^[3]
35. [35]
    I agree that the services that were guaranteed to be rendered with due care and skill are not identified succinctly in the reasons for decision. This came about in part because Mr Ritson did not make clear in his initiating application the basis of his claim. He said there that he wanted an order pursuant to s 13 QCAT Act for the respondent to pay money, he wanted damages pursuant to s 267 of the ACL and he wanted his filing fee.  
36. [36]
    There are no pleadings in the Tribunal and the issues to be addressed are generally to be discovered in the parties’ statements of evidence or oral submissions where the matter is an MCD claim. Mr Ritson simply attached copy emails exchanged with the respondent to his application, one of which I note was marked without prejudice.
37. [37]
    At the hearing Mr Ritson referred initially to the water incident and referred to its cause as being defective plumbing. That appears to be why the Tribunal thought his claim was about that. 
38. [38]
    Subsequently however he did say during the hearing that he claimed under s 60 and s 61 of the ACL and that the claim under s 60 concerned the lack of due care moving people into an adjoining room when it was known or should have been known that there was no soundproofing between the rooms.^[4]
39. [39]
    He said the claim under s 61 was on the basis that the room they were moved to was not fit for purpose. It did not provide relaxation and enjoyment which was what was sought on the cruise because there was no soundproofing.
40. [40]
    Most of the hearing however was concerned with the steps taken by the respondent to address Mr Ritson’s complaints.
41. [41]
    The Tribunal concluded that there were no breaches of either the guarantee under s 60 or s 61. Unfortunately it is not clear how the Tribunal came to that conclusion given the Tribunal simply said:^[5]

[T]he respondents, in our view, did more than a reasonable person might expect, given the water damage later that night. They moved the applicants to another cabin. They assisted them with the move. They gave them an upgraded cabin worth $800 in total. They offered to move them twice more. They offered discounts on future cruises…

42. [42]
    Similarly, with respect to the s 61 claim, there is no finding concerning liability under s 61 and the Tribunal relies on the very adequate response by the respondent to Mr Ritson’s complaints to determine that s 61 was not breached.
43. [43]
    On neither issue, whether there had been a s 60 or s 61 breach of guarantee, was there any explanation or basis for the finding that the guarantees had not been breached.
44. [44]
    The service supplier’s response to the complaints only becomes relevant if there is a breach of the guarantees. If a breach occurred the task then becomes to determine whether the service provider’s response was adequate. That then necessitates a determination whether the breach of guarantee was a major or minor failure because different considerations flow from that determination. 
45. [45]
    The Tribunal appears to have conflated entirely distinct issues, that is, the breach of guarantee and remedial steps taken to remedy a breach of guarantee. The Tribunal has thereby fallen into error.
46. [46]
    The matter is significant. A party is entitled to know the basis upon which it has alternatively succeeded or failed at hearing. Though the difficulty in giving ex tempore reasons is understood, and the very busy minor civil dispute jurisdiction calls for such decision making, the Tribunal’s reasons for decision must as a base requirement set out material findings of fact, the applicable law, and how the law applies to the material facts to support the decision made.^[6]
47. [47]
    Leave to appeal must be granted in the circumstances.
48. [48]
    The Tribunal’s error appears to be one of mixed law and fact.^[7] Given that the appeal must be by way of rehearing.^[8] Ground 4, that the Tribunal erred by dismissing the appellant’s claim in its entirety in circumstance where the respondent admitted the services were defective and that a partial refund was fair and reasonable, may be considered in the course of determining the appeal.

The Appeal

49. [49]
    It is appropriate to deal with the claim under s 61 first.

Section 61

50. [50]
    Mr Ritson’s complaint was that the room to which they were moved was not fit for purpose. 
51. [51]
    The first issue is whether Mr Ritson made known, expressly or by implication to the respondent, the particular purpose for which the services were being acquired or the result that he wanted the services to achieve.
52. [52]
    The respondent conducts a business of cruise ships. Generally it can be accepted that cruising on a cruise ship is a holiday experience. It is for the purpose of pleasure and variously entertainment or relaxation or adventure or a mixture of those aims. There are various restaurants on offer, usually gymnasium and other such life style facilities and entertainment including live stage shows, all or most included in the fare. The cruise concerned here was an 11-night South Pacific and Fiji cruise.
53. [53]
    It was clear as between the parties that Mr Ritson wanted a vacation.  In an email from the respondent dated 17 February 2017 the respondent writes:

As a Gold member of our Crown & Anchor Society you are very important to us. I … would like to offer you a warm welcome back from your cruise vacation… We certainly apologise that this affected your vacation experience… This is not indicative of a normal Royal Caribbean International sailing…

54. [54]
    What do the booking documents disclose about what was offered in respect of the cruise? 
55. [55]
    The respondent filed a copy of a document entitled ‘Information, terms and Conditions’, which is described as a condensed version of the full terms and conditions applying accessible via a webpage. In item 2 under item 4 headed ‘What’s Included and Not Included’ it states:

All prices shown on our website and quoted in our brochures are per person in Australian Dollars and are based on two people sharing the specified stateroom grade. Cruise prices include the following where applicable: full board accommodation, on board main meals, entertainment on board ship, gym, some fitness classes, sauna and steam room, on board gratuities (where pre-paid) port charges and taxes.

56. [56]
    Under item 36, ‘Eligibility to Travel and Guest Behaviour’, it states:

On every Royal Caribbean International ship we are committed to providing every guest with an excellent cruise holiday.

57. [57]
    The services offered are therefore an excellent cruise holiday, with two people sharing a cabin of the stated grade, with all meals, entertainment and other holiday type activities provided. 
58. [58]
    I conclude when Mr Ritson booked his cruise it was with a view to enjoying all these vacation benefits. 
59. [59]
    I conclude that in making a booking for such a cruise Mr Ritson made known to the respondent by implication the particular purpose and outcome he wanted to achieve, namely to enjoy the benefits offered by the respondent of a cruise vacation.^[9]
60. [60]
    The cabin grade booked at outset was an interior one to be shared by two people. That grade of cabin was not the most luxurious on board, but one would appropriately expect it to be adequate to contribute to the cruise holiday promised every guest and therefore at minimum comfortable and offering a place to relax and sleep.
61. [61]
    After the incident with the water leak on the first night Mr Ritson was moved to an upgraded external room, 3708, the double cabin. The new cabin was a large one for families, being essentially two cabins with double connecting doors.
62. [62]
    The neighbours who moved into the adjoining cabin were a mother and daughter.  There is no explanation why the other people were moved into the adjoining cabin.  The ship had already left port so they must have been on board since leaving Sydney.  In any case Mr Ritson says the new occupants were very loud and made occupation of the adjacent next door cabin difficult. The new neighbours snored, spoke loudly, argued and used offensive language. 
63. [63]
    Mr Ritson complained. I conclude the first formal complaint about this to the respondent was on 18 December 2016 as recorded in the log previously mentioned.  The log seems very detailed and I conclude if any earlier complaint had been made it would have been dutifully recorded. Mr Ritson was offered another room but he refused to take it.
64. [64]
    Was the respondent in breach of the guarantee as to fitness for purpose under s 61?
65. [65]
    The answer must be yes. The grade of cabin paid for was ‘based on two people sharing the specified stateroom grade’ according to the terms and conditions.
66. [66]
    I determine that the noise from the adjoining occupants was more likely than not loud and intrusive and seriously disturbed Mr Ritson and his partner. The arrangement of a family size set of adjoining cabins divided by two doors was not what was promised to Mr Ritson when he made his booking of a cabin to be shared by two people. The poor sleep which I accept occurred from the loud snoring and other annoyances in having to live close to two strangers in what probably felt more like shared accommodation of four people was also not what was promised Mr Ritson. 
67. [67]
    In result I find the double cabin accommodation was not reasonably fit for the particular purpose made known to the respondent of an excellent cruise holiday with two people sharing a cabin of the stated grade.
68. [68]
    In light of my finding it is not necessary to consider the matter raised by the appellant in Ground 4 of the appeal about an admission of liability of breach of guarantee under s 61. 

Section 60

69. [69]
    Mr Ritson also claimed the respondent breached the guarantee under s 60 of the ACL to render services with due care and skill.
70. [70]
    He says the room they were moved to was not fit for purpose.
71. [71]
    Section 60 ACL requires the supplier of services to exercise due care and skill. That means the provision does not impose strict liability in the absence of some failure of care and skill. It is akin to the common law standard of care imposed by the doctrine of negligence requiring a person to exercise reasonable care and skill in their dealings with others.^[10] 
72. [72]
    There is no evidence of failure of duty to maintain the ship causing the initial water leak. 
73. [73]
    This cruise was entirely booked out. It was Christmas time. There were no cabins of the grade booked available for Mr Ritson to move into at the time of his initial complaint. Generally it seems there were no other cabins except the double cabin available. The ship was at sea. Alternate accommodation at a nearby hotel was not possible. There was, I accept, no alternative for the respondent but to put Mr Ritson in the double cabin. 
74. [74]
    As such I conclude there was no evidence of failure on the part of the respondent to exercise due care and skill in the provision of the double cabin. I cannot accept Mr Ritson’s submission that the respondent was negligent in not having other cabins available. There was another cabin available, and that was the one to which Mr Ritson was moved. I note the respondent’s submission that there have been no other complaints about the double cabin accommodation from other passengers.  It was also a grade higher than the one Mr Ritson booked and as a more expensive external cabin that may well have been enough of a compromise for other people finding themselves having to be moved.
75. [75]
    Indeed before the noisy neighbours moved in the double cabin seems to have been acceptable to Mr Ritson.  As stated, I have determined he only made formal complaint about the double cabin arrangements on 18 December 2016.
76. [76]
    Does the email from the respondent dated 17 February 2017 change that finding? It does not. I consider the letter, which refers to sharing Mr Ritson’s disappointment with the cruise no admission of liability, but rather as it states itself, an exercise from a customer services perspective. I conclude it was simply a public relations attempt to resolve a complaint and hopefully retain Mr Ritson as a customer. 
77. [77]
    I conclude there was no failure of the guarantee under s 60 in these circumstances.

Remedy for Breach

78. [78]
    Was the failure of the s 61 guarantee a major or minor failure?
79. [79]
    Much of the pleasure of a cruise is enjoying the facilities and entertainment and food.  Being able to retire of an evening to a cabin and sleeping is of course part of the pleasure as well but surely not the entire measure of a vacation.
80. [80]
    By s 268 of the ACL a failure to comply with a guarantee with respect to supply of services, such as s 61, is a major failure if certain findings are made. One such which seems appropriate here is that 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, and the services cannot easily and within a reasonable time be remedied to make them fit for such purpose.^[11] There is no question about the services being unsafe, which is another basis upon which a breach may be a major failure.
81. [81]
    The supply of services extended to the provision of adequate vacation accommodation. The failure was the problem created by the noisy neighbours who moved into the next cabin on 13 December 2016. I accept the noisy neighbours’ snoring caused Mr Ritson and his partner annoyance, even great annoyance and disturbed their sleep and enjoyment of the cruise. The complaint was made on 18 December 2016 at 11 pm however, five days after the neighbours moved into the adjacent room of the double cabin. The respondent offered to move the respondent to another cabin that same evening which I conclude would have fixed all the problems.  Accordingly the services were, within a reasonable time, easily able to be remedied.  Accordingly the breach of s 61 was not a major breach.
82. [82]
    If the breach was not a major breach it was a minor breach. By s 267(2) of the ACL if the failure to comply with the guarantee is not a major failure, the remedy available to the consumer is to require the supplier of the services to remedy the failure within a reasonable time.
83. [83]
    I determine that is what was done or offered by the respondent to be done with the offer to move Mr Ritson and his partner to cabin 6217 on two occasions that evening.
84. [84]
    Mr Ritson’s refusal to accept that solution was, I conclude, unreasonable in the circumstances. That solution would have enabled Mr Ritson and his partner to sleep without being disturbed by the snoring neighbours.  Mr Ritson’s refusal to take a cabin of the same grade as his initial booking was again I conclude unreasonable. He had been upgraded for a period of 8 days in the double cabin. But that upgrade I determine was offered only from the perspective of customer relations, not on the basis of any admission of liability or compromise of liability on the part of the respondent. Mr Ritson’s entitlement was still only to the grade of cabin booked which was an interior cabin not an exterior one.
85. [85]
    In all the circumstances it was unreasonable of Mr Ritson to refuse to move back to the grade of cabin he had paid for which would have solved his problems. His claim to recover all or any part of the fares he paid based on a breach of the consumer guarantees of the ACL must therefore be refused.