X v Kuoni. The Final Chapter

9th August 2021 by Sarah Prager

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The Supreme Court has now handed down its long awaited judgment in X v Kuoni Travel Ltd [2021] UKSC 34.

 

Background

Those who have followed X v Kuoni in its long journey through the High Court, Court of Appeal, Supreme Court and Court of Justice of the European Union will be familiar with the facts, but by way of reminder:

Mrs X and her husband entered into a package holiday contract with Kuoni for return flights to Sri Lanka and two weeks’ all-inclusive accommodation at a hotel in July 2010.

The booking conditions incorporated into the contract, which were standard terms used in the industry, provided that: ‘Your contract is with [Kuoni]. We will arrange to provide you with the various services which form part of the holiday you book with us’. Clause 5.10(b) of the contract provided that:

‘… we will accept responsibility if due to fault on our part, or that of our agents or suppliers, any part of your holiday arrangements booked before your departure from the UK is not as described in the brochure, or not of a reasonable standard, or if you or any member of your party is killed or injured as a result of an activity forming part of those holiday arrangements. We do not accept responsibility if and to the extent that any failure of your holiday arrangements, or death or injury is not caused by any fault of ours, or our agents or suppliers; is caused by you; … or is due to unforeseen circumstances which, even with all due care, we or our agents or suppliers could not have anticipated or avoided.’

In the early hours of 17th July 2010, whilst making her way through the grounds of the hotel to the reception, X came upon N, an electrician and hotel employee, who was on duty and wearing the uniform of a member of the hotel staff. After offering to show X a shortcut to reception, N lured her into an engineering room where he raped and assaulted her.

At first instance, Judge McKenna dismissed the claim on the grounds that “holiday arrangements” in clause 5.10(b) did not include a member of the maintenance staff conducting a guest to reception. He further held, obiter, that Kuoni would in any event have been able to rely on the statutory defence under regulation 15(2)(c)(ii) of the Package Travel, Package Holidays and Package Tours Regulations 1992 (“the PTR”) because the assault was an event which could not have been foreseen or forestalled even with all due care. The Court of Appeal (Sir Terence Etherton MR, Longmore and Asplin LJJ) dismissed the appeal by a majority (Longmore LJ dissenting).

The Questions Referred

On a further appeal, the Supreme Court decided that a referral to the CJEU was necessary to determine the appeal. In essence, the issues referred were as follows:

It is important to note that the CJEU was asked to assume for the purposes of its decision that (1) a member of maintenance staff conducting a guest to reception was within the scope of the ‘holiday arrangements’ contracted for and (2) the rape and assault constituted improper performance of the contract. Neither issue had been determined by the Supreme Court.

The Decision of the Court of Justice of the European Union

The CJEU determined that:

  1. An employee is not a ‘supplier of services’ since he has not concluded any agreement with the package travel organiser, but merely performs work on behalf of a supplier of services.
  2. However, an organiser may be liable for the acts or omissions of an employee of a supplier of services, where they constitute improper performance of an obligation under the contact.

The Court held that:

  1. The deliberate act of an employee of a supplier of services is not an ‘event’ which could not be ‘foreseen or forestalled’.

The exemption from liability provided by article 5(2)(iii) of Directive 90/314 refers to situations in which the non-performance or improper performance of the contract is due to an event which ‘the organiser or the supplier of services, even with all due care, could not foresee or forestall’.

The Court held that an organiser may rely on the exemption:

(i) even if the event is not unusual, provided it cannot be foreseen; or,

(ii) even if it is not unforeseeable or unusual, provided it cannot be forestalled.

However,

 

The Supreme Court

The Supreme Court, in an admirably brief judgment handed down by Lloyd Jones unanimously allowed Mrs X’s appeal from the decision of the Court of Appeal, finding that:

Comment

The decision of the Supreme Court relates to the operation of the 1992 Regulations, of course; but the proceedings in the claim have been going on for so long that these Regulations have now been replaced by the Package Travel and Linked Travel Arrangements Regulations 2018. Nevertheless, the judgment is an indicator that under the new Regulations the scope of the duty of the tour operator under Regulation 15 is likely to be interpreted widely, whilst the scope of its potential defences under Regulation 16(4) is likely to be interpreted narrowly. Furthermore, it is now clear (if it was not before) that a tour operator is liable for the deliberate acts and omissions of the employees of its suppliers within that wide scope.

 

Sarah Prager is a Barrister with 1 Chancery Lane
She can be contacted at sprager@1chancerylane.com

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