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Class action ‘may cost Scenic Tours $16 million’

September 1, 2017 Headline News No Comments Email Email

Over a thousand unhappy passengers have successfully sued Scenic Tours after flooding in Europe and itinerary changes ruined their river cruise holidays. The NSW Supreme Court handed down its decision yesterday.

Heavy rainfall in France and Germany in April and May 2013 caused rivers to rise and extensive flooding. Itineraries were changed.

Yesterday in the NSW Supreme Court, Justice Peter Garling found Scenic Tours had breached Australian Consumer Law by not telling passengers about the weather disruptions. The company should have given customers the option of postponing or cancelling their trips, the judge said.

Most passengers in the class action would be entitled to a refund, damages and interest, ABC News reported, adding that lawyers for the plaintiffs estimate Scenic Tours may have to pay out about AUD 16 million.

The company was also ordered to pay costs.

After the decision, solicitor for the plaintiffs Ben Hemsworth of Somerville Legal said outside the court that “a group of ordinary Australians” had paid a lot of money “thinking they were going to get a luxury cruise”.

Instead “they ended up being out on buses and taken to places they weren’t expecting and hotels that they weren’t expecting”.

The lead plaintiff in the class action, David Moore, and his partner Janette Howell spent their life savings on the cruise, with Moore paying AUD 13,100 for his cruise. Other customers involved in the class action paid similar amounts.

Yesterday’s judgement in the NSW Supreme Court noted: “In its brochure, which Mr Moore read, the founder and managing director of Scenic, Mr Glen Moroney, invited Mr Moore and other guests to join Scenic for “… a once in a lifetime cruise along the grand waterways of Europe” during which, whilst on board a Scenic ship, they would “ … be immersed in all inclusive luxury”. Mr Moroney assured readers of Scenic’s brochure that their entire journey would be “truly unforgettable”.

“Mr Moore claims that his journey was, on the contrary, one which he would rather forget.”

Scenic Tours, in a defence statement filed with the court, had said it did not believe it was liable for loss and damage. The contract signed by the plaintiffs stated that “cruise itineraries may be varied due to high or low water levels, flooding…[and] circumstances beyond our control”; along with other provisos.

A Scenic spokesperson told the ABC the company would review the judgment in detail before making specific comment. The company’s practice was to deliver itineraries as close to schedule as possible without compromising on safety or comfort, the spokesman said.

The case came to industry attention last year when a lawyer for the plaintiffs said that what should have been a luxury river cruise experience had been turned into something resembling a “backpackers’ Contiki tour” – a statement which caused a few ripples at Contiki, a company with no connection to the case.

Justice Garling concluded in the NSW Supreme Court yesterday that Moore was entitled to compensation under Australian Consumer Law “for a breach of the due care and skill guarantee by Scenic amounting to a total of AUD 12,990 plus interest. He has also established breaches of the purpose and result guarantees.”

The judge awarded Moore the sum of AUD 12,990, “being the sum of AUD 10,990 (awarded for compensation for loss of value) and AUD 2000 (awarded as damages under s 267(4) of the ACL [Australian Consumer Law]), plus interest. In doing so, the Court rejected Mr Moore’s alternative argument that he was entitled to a significant refund of the monies which he paid, as money had and received.”

One part of Justice Garling’s judgement reads: “In considering the question posed by [section] 268(a) of the ACL, I am satisfied that Mr Moore himself, and his fellow passengers, would not have acquired the services had they been ‘fully acquainted’ with the nature and extent of the failure to comply with the guarantees contained in [section] 61 of the ACL.

“Putting it differently, had Mr Moore and his fellow passengers been told, or come to realise, that they would have little, if any, cruising on European rivers, and would have had a substantial part of their intended cruise provided by motorcoach transport with a variety of different accommodations requiring them to pack and unpack on a number of occasions, they would not have acquired them.”

The court yesterday stood the proceedings over to 15 November 2017 at 9.30am “for the determination of the appropriate orders to be made including the determination of any Notices of Motion for costs.  The parties have liberty to apply on 2 days’ notice.”

Anyone wishing to read the decision, which includes many points of interest too lengthy to run here, may do so on:

Written by Peter Needham

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