The perils of booking when you arrive
25 October 2004

The perils of booking when you arrive

When we travel abroad, particularly on a package holiday, day trips and excursions are a common feature of the holiday. Those who plan their holidays meticulously will pre-plan their excursions and book them at the same time as they pay for the accommodation and travel, typically at a travel agent. However, there are many us who do not have the time or inclination to be so well-organised, and who end up booking excursions after our arrival at the resort. When excursions go terribly wrong, as recently happened so tragically when a tour bus carrying Britons crashed in Austria, the legal position of those on the tour who booked it at home, as part of the package, and those who only booked locally, can differ significantly. As ever, the terms and conditions of the holiday contract, which are enviably enshrined in the small print on the inside cover of a brochure, are crucial in determining the precise nature and scope of the tour operator's express obligations towards the traveller. In Wong Mee Wan -v- Kwan Kin Travel Services Limited [1996] 1 WLR 38, W's daughter bought a package tour of China from the first defendant, a Hong Kong travel company (D1). The all-in price included "transportation as specified in the itinerary".

The tour brochure, which contained the terms of the contract, repeatedly used the word "we" to describe the activities of the tour group ("we will do this" and "we will then do that"). In China, the group was joined by an employee of the second defendant, another travel company (D2). After missing a scheduled ferry, the group was transported to an island on a lake by a speedboat owned by the third defendant (D3) and driven by one of its employees. The speedboat crashed and W's daughter was killed. The judge at first instance found that D3 was liable for the negligent driving of the speedboat, that D2 was negligent in allowing the speedboat to be driven by someone who was not seen to be reasonably competent, and that D1 was in breach of its contractual duty to see that if speedboats were to be used they would be operated by persons of reasonable competence and experience.

The Hong Kong Court of Appeal set aside the judgment against D1 on the grounds that D1 had not held out either D2 or D3 as its employees and a non-delegable primary contractual duty would impose an intolerable burden on a travel firm in arranging a package tour. W, in her capacity as administratrix and dependant of the deceased, appealed. The Privy Council held that if a party agreed to act as agent in arranging services to be provided by others, there would be an implied contractual term that reasonable care and skill would be used in selecting them. If the party agreed to supply services, there was an implied term that he would, as supplier, carry out the services with reasonable care and skill. In the present case, the contract was to be construed as one of the latter type, because undertakings were given to provide, not merely to arrange, the travel.

The obligation to provide services with reasonable care and skill therefore continued to exist even if some of the services were provided by others. D1 was liable for the failure to select a competent boatman and for the boatman's failure to exercise reasonable care and skill in his driving of the boat across the lake. The Privy Council observed that tour operators who find themselves confronted with claims of this nature could protect themselves by negotiating suitable contractual terms with those performing the services (principally by an appropriately worded indemnity clause), arrange insurance cover, or include an exemption clause in the contract with the traveller (although, presumably, subject to the restrictions imposed by section 11 of the Unfair Contracts Terms Act 1977). The legal principles established in Wong Mee Wan and, in particular, the distinction between the arrangement and supply of services, were applied in the case of Sheppard -v- Crystal Holidays Ltd. (Current Law 1997, 3858). S claimed damages for injuries sustained whilst on a skiing holiday. She had booked a package holiday with C and had paid a sum to C in addition to the package price, for the hire of skis, boots, sticks and a lift pass. Although S had the option to book skiing tuition through C at the travel agents, she had chosen not to do so until she arrived at the resort. The terms and conditions in the brochure stated that if the consumer chose not to book skiing tuition through the tour operator, "our local representative will be able to assist you with arrangements locally at the prevailing local rate."

Following her arrival at the resort, S paid a sum of money to C's local representative, who passed it on to a local instructor. S embarked on lessons and alleged that she had suffered injury because the ski instructor had negligently failed to supervise her. Her claim was struck out on the ground that any cause of action that she may have had was against the ski instructor, not C. On the proper construction of the relevant term of the contract, C has agreed, as S's agent, to provide or arrange for the performance of the contract - the giving of the lessons - by a third party, but had not agreed to supply the lessons. It is important to note that S did not allege that C had failed to use reasonable care in the selection of the ski instructor. Presumably, it would have been difficult, if not impossible, for her to prove that an otherwise skilled and competent instructor was unsuitable to take charge of lessons due to an alleged failure to properly supervise. In the absence of a previous history of failure to properly supervise classes, how could the tour operator have been regarded as negligent in its selection of the instructor? The competence of bus and coach drivers is a depressingly common theme to accidents abroad. Preliminary inquiries into the Austrian coach crash suggested that the driver of another vehicle was at fault for overtaking the coach at a bend.

If so, the position of the coach travellers will not differ: their claims would lie against the other driver. It remains to be seen whether that preliminary indication is maintained. But what if the finger of blame points at the driver of a tour coach? It is a rare case where it can be shown that a tour operator has been negligent in the selection of a coach driver, particularly in Europe and North America where national/state driving requirements are so stringent. Screening of drivers by prospective employers ought to eliminate those with relevant motoring convictions, or who might otherwise be unqualified or unsuitable to undertake commercial driving. Accordingly, where local representatives have done no more than to arrange for a coach tour to be provided by others, and have not agreed to supply the tour, then, in the context of sufficiently 'tight' standard terms and conditions contained in the holiday brochure, the tour operator may escape liability towards those travellers who booked a fateful tour locally, at the same time as being liable towards those who booked the tour at the travel agents. This anomaly means that those travellers who are unable to sue the tour operator are then faced with the often daunting, and invidious, task of suing the driver or, more likely, his employer, probably in a foreign court. The moral of the story is clearly to decide which trips one is going to go on in advance, and to book them, as part of the package.