Langford v RCL Cruises Ltd t/as Royal Caribbean Cruises - [2023] FCA 626 - FCA 2023 case summary — Zoe

[40]

Introduction 1 There are six sets of proceedings before me arising out of the eruption at 2.11 pm on 9 December 2019 of a stratovolcano located 48 km to the north-east of New Zealand's North Island in the Bay of Plenty, known as Whakaari or White Island. The applicants in the proceedings were passengers on a cruise aboard the vessel MV Ovation of the Seas (Ovation of the Seas). Most of the applicants were participating in a shore excursion known as the "White Island Volcano Experience Cruise and Guided Exploration" (the Shore Excursion), although some remained on board the vessel. A large number of the passengers who participated in the Shore Excursion were killed or injured. 2 Ovation of the Seas is owned by Ovation of the Seas Inc, which is incorporated in Liberia. That company is a subsidiary of the second respondent, Royal Caribbean Cruises Ltd (RCCL). RCCL is incorporated in Liberia, and registered in Florida in the United States of America as a foreign profit corporation. RCCL is engaged in the business of marketing and operating passenger cruises under the brand "Royal Caribbean International". The head office of RCCL is in Miami, Florida, USA, and it is from there that its business is primarily managed. The first respondent, RCL Cruises Ltd (RCL), trading as Royal Caribbean Cruises, is another subsidiary of RCCL. Between 5 April 2016 and 5 April 2020, RCL was the operator and bareboat charterer of Ovation of the Seas. RCCL appears to have been engaged by RCL under a series of contracts to perform certain functions on board Ovation of the Seas. 3 The applicants in the proceedings before me have commenced proceedings in Florida in the USA, which I describe in further detail below. All those proceedings are against RCCL, and not RCL. The applicants have subsequently commenced these proceedings against RCL and RCCL in the Federal Court of Australia, in the circumstances to which I refer below. In each case, the applicants seek a temporary stay of the proceedings in this Court pending the outcome of the proceedings in Florida. Those applications are opposed by RCL and RCCL.

[41]

The Proceedings in Florida 4 Dealing first with the claim by Mr Jesse Langford, at the time of the eruption Jesse, together with his parents, Anthony and Kristine, and his sister, Winona, were participating in the Shore Excursion. Anthony, Kristine and Winona all died from injuries sustained during the eruption, and Winona's body was not recovered from the island. Jesse survived the eruption but suffered burns to 54% of his total body surface area, causing scarring and disfigurement. I should note that I have used first names in this judgment for convenience, and without intending any disrespect. On 1 February 2022, Jesse, for himself and as representative of the deceased estates of Anthony, Kristine and Winona, by Complaint and Demand for Jury Trial commenced proceedings against RCCL in the Circuit Court of 11th Judicial Circuit in and for Miami-Dade County, Florida, USA (the Langford Complaint). ID Tours New Zealand Ltd (ID Tours) and White Island Tours Ltd (White Island Tours) were also named as defendants in the Langford Complaint, although the Complaint against White Island Tours has been dismissed, and an application for dismissal by ID Tours is yet to be heard. 5 The Langford Complaint seeks damages for the injuries Jesse sustained during the eruption. Losses are also claimed on behalf of the deceased estates of Anthony, Kristine and Winona. Nine counts are pleaded in the Langford Complaint against RCCL. 6 Relevantly, Jesse maintains in the Langford Complaint that the Shore Excursion was "arranged for, sponsored, recommended, operated and/or sold by RCCL", and that RCCL: (a) made representations about the Shore Excursion that it knew, or, through the exercise of reasonable care, could have known were false or misleading; (b) was negligent in selecting or retaining ID Tours or White Island Tours to lead the Shore Excursion; and (c) failed in its duty to warn Jesse, Anthony, Kristine and Winona of the risks of participating in the Shore Excursion and in that respect Jesse pleads that RCCL knew or ought to have known that on 18 November 2019 the volcanic alert level (VAL) for the island had been raised from 1 to 2 and remained at that level on 9 December 2019. VAL 2 is volcanic activity that is "moderate to heightened volcanic unrest". The most likely hazards for VAL 2 are pleaded as "volcanic unrest hazards, potential for eruption hazards", and eruption hazards may include explosions, ballistics (flying rocks), ash and volcanic gases. 7 The general maritime law of the United States and/or Florida state law is specifically pleaded as governing the causes of action set out in the Langford Complaint. 8 Next, there are three sets of proceedings commenced by members of the Cozad family. At the time of the eruption, John Cozad and his son, Christopher, were participating in the Shore Excursion. Christopher was killed as a result of the eruption, and John was severely burnt. Christopher's wife, Bianca, and one of their daughters, Emily, who had remained on the cruise ship, each suffered nervous shock by reason of Christopher's death. Bianca and Emily were both financially dependent on Christopher, for which Bianca makes a claim for loss of dependency on behalf of herself and Emily. 9 On 9 November 2021, John commenced proceedings against RCCL by Complaint and Demand for Jury Trial in the Circuit Court of 11th Judicial Circuit in and for Miami-Dade County, Florida, USA. ID Tours and White Island Tours were also named as defendants in the Complaint filed by John. On 28 March 2022, John filed a Notice of Partial Voluntary Dismissal with respect to the claims against White Island Tours. The Complaint filed by John seeks damages for the injuries sustained during the eruption. Ten counts are pleaded in the Complaint. 10 On 26 January 2022, the Estate of Christopher Cozad commenced proceedings by Complaint and Demand for Jury Trial against RCCL in the same Circuit Court in Florida. ID Tours and White Island Tours were also named as defendants, but on 28 March 2022, the Estate filed a Notice of Partial Voluntary Dismissal with respect to the claims against White Island Tours. The Complaint filed by the Estate seeks damages on behalf of all survivors of the Estate who are entitled to recover following Christopher's death during the eruption. Nine counts are pleaded in the Complaint. 11 Relevantly, both Complaints (which I refer to together as the Cozad Complaints) allege that the Shore Excursion was "arranged for, sponsored, recommended, operated and/or sold by RCCL", and that RCCL: (a) made representations about the Shore Excursion that it knew, or, through the exercise of reasonable care, could have known were false or misleading; (b) was negligent in selecting or retaining ID Tours or White Island Tours to lead the Shore Excursion; and (c) failed in its duty to warn John, Bianca and Emily of the risks of participating in the Shore Excursion, with specific reference to the allegation that RCCL knew or ought to have known that on 18 November 2019 the VAL for the island had been raised from 1 to 2 and remained at that level on 9 December 2019. 12 As with the Langford Complaint, the general maritime law of the United States and/or Florida state law is specifically pleaded as governing the causes of action set out in the Cozad Complaints. 13 Proceedings have also been commenced by Marion and Nicholas London, who also participated in the Shore Excursion and sustained severe burns to their bodies, disfigurement and psychiatric injury. On 9 November 2021, Marion and Nicholas London commenced proceedings against RCCL by Complaint and Demand for Jury Trial in the Circuit Court of 11th Judicial Circuit in and for Miami-Dade County, Florida, USA (the London Complaint). ID Tours and White Island Tours were also named as defendants in the London Complaint. The London Complaint seeks damages for the injuries Marion and Nicholas sustained during the eruption, and ten counts are pleaded in the London Complaint. 14 Relevantly, Marion and Nicholas allege in the London Complaint that the Shore Excursion was "arranged for, sponsored, recommended, operated and/or sold by RCCL", and that RCCL: (a) made representations about the Shore Excursion that it knew or, through the exercise of reasonable care, could have known were false or misleading; (b) was negligent in selecting or retaining ID Tours or White Island Tours to lead the Shore Excursion; and (c) failed in its duty to warn Marion and Nicholas of the risks of participating in the Shore Excursion with specific reference to the VAL having been raised on 18 November 2019 from 1 to 2 and remaining at that level on 9 December 2019. 15 The general maritime law of the United States and/or Florida state law is specifically pleaded as governing the causes of action set out in the London Complaint. 16 Proceedings have also been commenced by a number of passengers represented by Shanahan Tudhope Lawyers. In relation to two of those applicants, Sharon Lay-Hui Ooi and Davin Mark Luke Leung Ho, a temporary stay of their proceedings in this Court has already been ordered with the consent of RCL and RCCL on 5 May 2023, that stay to operate pending final determination of proceedings which they have commenced in Florida. There remain three applicants in that group whose application for a temporary stay has not been consented to, namely Leanne Ean-Hui Ooi, Alice Xiaoman Zhang, and her daughter, Annie Yongan Lu. Each of those three passengers suffered burns to their bodies along with significant psychological injuries. Each of them commenced proceedings against RCCL on 27 January 2022 in the Circuit Court in Florida, making allegations which are not materially different from those already referred to in the other Complaints. 17 In relation to all of the proceedings commenced in Florida, the evidence before me is that the damages likely to be recovered in Florida are significantly higher than could be expected to be awarded by this Court. The proceedings in Florida also offer greater rights to discovery, the power to depose witnesses, and the right to a jury trial. It is well recognised in Australia that these are legitimate juridical advantages: Wigmans v AMP Ltd [2021] HCA 7; (2021) 270 CLR 623 at [42] (Kiefel CJ and Keane J); Royal Caribbean Cruises Ltd v Browitt [2021] FCA 653 at [9] and [122] (Stewart J). Accordingly, the proceedings in Florida have been commenced in the jurisdiction where RCCL is headquartered, and which offers the applicants legitimate juridical advantages. Although documents filed by RCCL in the proceedings in Florida refer to the Complaints in Florida as a "brazen" act of "forum shopping", no such submission has been made to me, and RCL and RCCL do not submit that the advantages sought to be gained by commencing proceedings in Florida are not legitimate juridical advantages.

[42]

The Federal Court Proceedings 18 In each of the proceedings in Florida to which I have referred, RCCL has challenged the claims by the applicants that the Circuit Court in Florida has jurisdiction to hear and decide their Complaints. The basis of that challenge is a contention by RCCL that it has the benefit of an exclusive jurisdiction clause in favour of New South Wales under the contractual terms by which the various cruise tickets were purchased. On or about 17 November 2022, the attorneys for Jesse Langford advised that a "holding action" be commenced in Australia to preserve claims which Jesse may have under Australian law. There was also concern about the expiry of a three year limitation period under the law of New South Wales in relation to claims for personal injury. Accordingly, on 9 December 2022, Jesse commenced proceedings in this Court against RCL and RCCL, alleging that RCL and RCCL breached the consumer guarantees contained in ss 60 and 61 of the Australian Consumer Law (ACL), being Schedule 2 to the Competition and Consumer Act 2010 (Cth), as well as claims for breach of contract and misrepresentation. RCCL's motion to dismiss the Langford Complaint was due to be heard in May 2023, but that did not occur. 19 On the same day, 9 December 2022, John, Emily and Bianca Cozad each commenced proceedings in this Court against RCL and RCCL making allegations to substantially the same effect as those made by Jesse Langford. That was in response to motions filed by RCCL in the Circuit Court in Florida for those proceedings to be dismissed on the ground of improper venue. Accordingly, the proceedings commenced by John, Bianca and Emily in this Court have been brought to protect their interests in the event that the motions in Florida for those proceedings to be dismissed are successful and accordingly the Complaint in Florida cannot proceed. Again, the basis of RCCL's challenge in Florida is the submission concerning an exclusive jurisdiction clause in favour of New South Wales. 20 Also on 9 December 2022, Marion and Nicholas London commenced proceedings in this Court against RCL and RCCL by reason of the motion filed by RCCL in Florida for the London Complaint to be dismissed on the ground of improper venue, in reliance on an exclusive jurisdiction clause in favour of New South Wales. 21 Also on 9 December 2022, the passengers represented by Shanahan Tudhope Lawyers commenced proceedings in this Court in light of the jurisdictional challenge made in relation to their Complaints in Florida, also arising out of the contention that RCCL had the benefit of an exclusive jurisdiction clause in favour of New South Wales. As I have indicated above, a temporary stay has been agreed by consent with RCL and RCCL in relation to two of those applicants, but there remain three applicants for whom a temporary stay is opposed, namely, Leanne Ooi, Alice Zhang and Annie Lu. In the case of Leanne Ooi, RCCL's motion in Florida to dismiss her Complaint has already been decided adversely to RCCL, and the parties are awaiting judgment on an appeal to the Third District Court of Appeals of Florida. 22 In summary, it is the strong preference of all applicants before me to proceed with their Complaints in Florida. The proceedings which they have commenced in this Court are no more than a fall-back position in the event that the proceedings in Florida are dismissed by reason of the jurisdictional challenge made by RCCL, or are otherwise unsuccessful.

[43]

Applicable Legal Principles 23 It is important to note that the present applications before me are for a temporary stay of the proceedings in this Court pending the outcome of the proceedings in Florida. Neither RCL nor RCCL complain that these proceedings are vexatious or oppressive, nor do they seek an anti-suit injunction to restrain any of the applicants from carrying on the Florida proceedings. The present applications may therefore be contrasted with the proceedings decided by Stewart J in Royal Caribbean Cruises Ltd v Browitt [2021] FCA 653, in which RCCL and RCL unsuccessfully sought an anti-suit injunction to restrain two other passengers from pursuing proceedings in Florida against RCCL. It should be noted, however, that Stewart J at [107] held that RCCL was not a party to the agreement containing the exclusive jurisdiction clause in favour of New South Wales, and that clause did not purport to confer any benefit on RCCL. Accordingly, Stewart J held that there was simply no basis on which RCCL could rely on the clause. That conclusion is not challenged in the present applications. 24 The power of the Court to grant a temporary stay of this kind is an aspect of its general power to control its own proceedings, and it is exercisable where proceedings are pending in another court and it is desirable that those proceedings should proceed to their conclusion first, recognising the general principle that it is undesirable that two courts should determine the same dispute: Michael Wilson & Partners Ltd v Emmott [2021] NSWCA 315; (2021) 396 ALR 497 at [105] (Brereton JA, with whom Leeming JA and Emmett AJA agreed). Brereton JA referred to this kind of temporary stay as a "case management stay" at [103] and [106], and I respectfully regard that as an apt description of the nature of such a temporary stay, involving as it does no more than the postponement of pretrial preparation steps and any hearing, while the Court retains control over the proceedings. As Brereton JA stated at [103], such a stay does not involve any conclusion as to jurisdiction, or as to appropriate forum, but is a technique for the management of proceedings in the context of proceedings pending elsewhere. As his Honour said at [105], practical considerations based on common sense and fairness guide which action should proceed first. That proposition was also stated by Finkelstein J in this Court in Bella Products Pty Ltd v Creative Designs International Ltd [2009] FCA 868; (2005) 258 ALR 538 at [23]. In that judgment, Finkelstein J also stated that the Court does not apply forum non conveniens principles in considering whether a temporary stay should be granted: at [21]. 25 In dealing with the present applications, there was considerable argument before me, both in writing and orally, as to whether an exclusive jurisdiction clause in favour of New South Wales had been incorporated in the relevant contracts so as to bind the applicants and RCL. In light of the principle that an application for a temporary stay of this kind does not involve any conclusion as to jurisdiction, or as to the appropriate forum, I indicated to the parties during oral argument that I did not regard it as appropriate to make findings on this application as to whether the passengers and RCL were bound by an exclusive jurisdiction clause in favour of New South Wales. I indicated to the parties that I proposed to approach these applications on the basis of an assumption (on the express basis that I am not deciding the point or making any findings on it) to the effect that RCL (but not RCCL) and each of the passengers who are applicants before me are bound by a clause to the effect that any dispute or claim would 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. There was no opposition to that course by any of the parties before me. 26 In a much-cited judgment, which was approved in Henry v Henry [1996] HCA 51; (1996) 185 CLR 571 at 590 (Dawson, Gaudron, McHugh and Gummow JJ), Lockhart J in Sterling Pharmaceuticals Pty Ltd v The Boots Company (Australia) Pty Ltd [1992] FCA 71; (1992) 34 FCR 287 at 291, set out the following non-exhaustive list of considerations relevant to the grant of a temporary stay: • Which proceeding was commenced first. • Whether the termination of one proceeding is likely to have a material effect on the other. • The public interest. • The undesirability of two courts competing to see which of them determines common facts first. • Consideration of circumstances relating to witnesses. • Whether work done on pleadings, particulars, discovery, interrogatories and preparation might be wasted. • The undesirability of a substantial waste of time and effort if it becomes a common practice to bring actions in two courts involving substantially the same issues. • How far advanced the proceedings are in each court. • The law should strive against permitting multiplicity of proceedings in relation to similar issues. • Generally balancing the advantages and disadvantages to each party. 27 There was no dispute concerning the correctness in principle of that list of relevant factors.

[44]

Application to the Present Circumstances 28 In the first place, the proceedings in Florida were commenced well before the proceedings in this Court, the difference being between 10 and 13 months. Twenty witness depositions have taken place in proceedings in Florida relating to the Complaints by the applicants and the evidence before me indicates an ability on the part of the applicants to use those witness depositions in their own proceeding in Florida. On 16 March 2023, the Circuit Court in Florida made a case management order in relation to the Langford Complaint setting out the various pretrial steps to be undertaken in the course of 2023 and early 2024, and stating that each case was "set to be trial-ready in February 2024 for a jury trial", with a trial date to be issued and the parties to adhere to the schedule set out in the case management order. There is evidence before me from Mr Hamilton, an attorney for RCCL in the Florida proceedings, that the reference to a proceeding being "trial ready" simply means a date by which the parties aspire to be ready so as to enable the court to list it for trial, and it is unlikely that the matters will be "trial ready" in February 2024 in light of the pending hearing of RCCL's motion to dismiss, along with any appeals in relation to that motion. Mr Hamilton also says that the hearing of a motion to dismiss in his experience takes two to four months from the filing of the motion to the hearing of the motion, and there may be an interlocutory appeal which can take about 5 months to be "fully briefed", and the court may then reserve its decision. As to the likely timeframe for such a decision, and for the overall conclusion of the trial, Mr Hamilton's evidence appears to me to deal only with the outer limits of what can possibly occur, and does not enable me to form any firm view as to the time period which is likely to eventuate. Counsel for RCL and RCCL accepted that the trial in Florida could take place in March 2024: T84.46-85. To the extent that RCL and RCCL rely upon the possible delays in Florida in dealing with RCCL's motions to dismiss, I give that delay little weight given that it is a delay of RCCL's own making. 29 As to the proceedings in the Federal Court of Australia, none of those proceedings have progressed meaningfully beyond the filing of a statement of claim in each of the proceedings. If a temporary stay were not to be granted, directions would ordinarily be made requiring defences and any other pleadings, discovery and affidavits. Those steps would inevitably cause expense, and the painful task of revisiting the traumatic experiences occasioned by the eruption, particularly in the task of preparing affidavits. Those pretrial tasks will be entirely wasted if the proceedings in Florida are successful. It is submitted on behalf of RCL and RCCL that the fact that the Florida proceedings were commenced by the applicants, arising out of the same factual circumstances, diminishes the significance of the order of commencement. I disagree. The fact that the proceedings in Florida were commenced first by the applicants is a clear demonstration of the strong preference which the applicants have to litigate in Florida, and that the proceedings in this Court are no more than a fall-back position against the possibility that the proceedings in Florida are dismissed or unsuccessful. In my view, the fact that the proceedings in Florida were commenced first is therefore of no less significance in circumstances where the applicants have commenced both sets of proceedings. 30 Second, while the Complaints in Florida and the statements of claim in this Court plead different causes of action, those claims rest upon a common substratum of fact, and give rise to similar issues. It would be plainly undesirable for the two courts, in effect, to compete to determine common facts and issues. There is also a clear risk of inconsistent findings being made by the two courts in relation to common facts and issues, and that is a spectre which should be avoided where possible. 31 Third, the public interest strongly favours avoiding unnecessary expense and use of resources in the proceedings in this Court where those proceedings are no more than a fall-back position for the applicants. If the proceedings in Florida are successful, then the strong likelihood is that the proceedings in this Court will be unnecessary. The interests of justice, and the efficient use of the resources available to the Court, would be better promoted by the determination of the proceedings in Florida before any additional time and costs are incurred in relation to the proceedings in this Court. The public interest favours the just resolution of disputes according to law, as quickly, inexpensively and efficiently as possible, as expressed in s 37M of the Federal Court of Australia 1976 (Cth). The potential waste of resources by insisting that the proceedings in this Court should be fully prepared for trial is anathema to that objective. RCL and RCCL submit that it would be contrary to the public interest for the Florida proceedings to be "relitigated" in this Court, but any proceedings brought to trial in this Court will be subject to any issue estoppels arising from the Florida proceedings and other cognate principles. 32 Fourth, it would be highly undesirable for parallel proceedings to be conducted in the two jurisdictions. This would visit an undue burden on the litigants themselves, particularly given the trauma which they have experienced. It would also be an unnecessary strain on the financial resources of those involved. 33 Fifth, neither RCL nor RCCL has identified any particular disadvantage to them if these proceedings are temporarily stayed. RCL and RCCL complain about delay, but I do not see that delay in itself causes them any prejudice, particularly in circumstances where delay may well lead to RCL's advantage in having the proceedings in this Court effectively rendered moot, and where RCCL's applications for dismissal are the cause of at least some of the delay in the Florida proceedings. RCL is sued only in this Court, and if the applicants succeed in Florida, RCL would not have to spend time and money on these proceedings, nor would it be liable for any judgment if the proceedings here are ultimately not pursued. Counsel for RCL and RCCL says that there is a potential prejudice arising from delay by reason of the potential loss of documentary evidence and the testimony of witnesses. I do not think the potential loss of documentary evidence is realistic in circumstances where all relevant parties, including ID Tour and White Island Tours, are well aware of the litigation both in Florida and in this Court, and can be taken to be conscious of the need to preserve documents which may have any bearing on the issues in those proceedings. There is certainly no evidence of any threat by any party to destroy documentary evidence that may have any relevance to the proceedings. As to lay evidence, I do not have any evidence before me as to the identity of any witnesses who may be called by RCL and RCCL other than its own employees, nor do I have any evidence as to the present cooperativeness of any third party witnesses. In those circumstances, I have no basis to say that the delay in the Australian proceedings may mean that, if they are eventually to be prepared for trial, then witnesses who may have been cooperative in 2023 will no longer be cooperative if and when a trial occurs in Australia. In any event, that evidence may well be relevant to the proceedings in Florida and will therefore not be lost by reason of any delay in the trial of the proceedings in this Court. In those circumstances, I regard the potential for loss of evidence arising from delay as purely speculative, and not a factor of any significant weight in assessing the present applications. 34 Sixth, I regard the circumstances relating to witnesses as a neutral factor. A number of potential witnesses in relation to both sets of proceedings live in Florida, and a number of them live in Australia. There is a further category of potential witnesses who are peripatetic. There is no clear preponderance of witnesses resident in either jurisdiction so as to make this a factor of any particular significance. Further, it is clearly undesirable for the applicants to be forced to revisit their traumatic experiences in preparing their evidence more often than is necessary. 35 Seventh, I do not regard the assumption referred to above concerning the exclusive jurisdiction clause as a factor of any significant weight. On the assumption which I have made, consistently with the submissions advanced on behalf of RCL and RCCL, RCCL does not have the benefit of any exclusive jurisdiction clause. The assumption is that RCL has the benefit of such a clause in favour of New South Wales, and that is the only place where RCL has been sued. A submission was made by RCL and RCCL in writing that the applicants have acted inconsistently with their contractual obligations by commencing the proceedings in Florida against a related company to that with which they contracted, but that submission is inconsistent with the acceptance by RCL and RCCL of the assumption which they agree I should make, and also inconsistent with their acceptance of the correctness of Stewart J's reasoning in Royal Caribbean Cruises Ltd v Browitt. It is also inconsistent with the concession made by counsel for RCL and RCCL that the applicants were entitled to choose to commence proceedings against RCCL in Florida (T71.34-35), which was described as an "inevitable concession" and "entirely appropriate" (T72.14-19). (There may have been a subsequent retreat from that last concession by counsel then saying that there may be legal and jurisdictional reasons why the applicants cannot continue with the Florida proceedings: T72.21-34.) 36 In my view, there is a compelling basis for the grant of the temporary stay sought by each of the applicants. The relevant factors are either strongly in favour of such a stay, or are neutral. It would be an affront to common sense and fairness if I were to force the applicants to undertake further pretrial steps in this Court in preparation for a trial which may never be needed.

Langford v RCL Cruises Ltd t/as Royal Caribbean Cruises - [2023] FCA 626 - FCA 2023 case summary — Zoe