MacRobertson Miller Airline Services v Commissioner of State Taxation

MacRobertson Miller Airline Services v Commissioner of State Taxation - [1975] HCA 55 - HCA 1975 case summary — Zoe

[30]

However, quite apart from the particular terms of the ticket in the instant case, the issue of a ticket by an airline operator neither constitutes an agreement nor a memorandum of an agreement. I apprehend that the normal procedure in making a reservation of a seat on an aeroplane flight is that inquiry is made of the airline operator or its agent, usually being a travel agent, whether, having regard to existing reservations, a seat is available on a nominated flight. If it is, the appropriate fare is paid or promised to be paid and a ticket appropriate to the reservation issued. Now, supposing the airline ticket does not contain an express promise to carry the ticket holder on the nominated flight, it could be inferred from this procedure that the airline company by the issue of the ticket had bound itself by agreement to carry the intending passenger on the specified, or for that matter on any, flight, a promise which being broken would require the payment of damages. On a proper analysis of the procedure described, the airline operator was not in contractual relations with the intending passenger until it had provided him with a seat on the aeroplane. Then, in consideration of the fare prepaid, such obligations as the conditions of the ticket impose on the airline operator attached. The issue of the ticket, in my opinion, is mainly a receipt for the payment of the fare, though it also stipulates an occasion when the fare may not be refundable though actual carriage has not ensued. The payment made on the making of the reservation ought, in my opinion, to be regarded as no more than the prepayment of the fare payable for an actual carriage performed. Having regard to the known continguencies of airline operation it would be incongruous to infer the making of a promise to carry from the mere payment of the fare and its acknowledgment by the issue of a ticket. The ticket, apart from any specific terms it might contain, would not be regarded as entitling its holder to a place on a particular flight. It should be regarded as doing no more than denominate the carriage which, if performed, will earn the prepaid fare. If, as in the present case, the ticket contains terms of carriage, these will, given the performance of the denominated carriage, regulate the relationship of the parties during and in connexion with such carriage and thus their respective rights in relation thereto.

[47]

It is enough to refer to three authorities, over a span of almost a hundred years, in which, when the ticket itself contains conditions or a reference to conditions elsewhere available, the passenger's acceptance of the carrier's offer is treated as occurring some time after issue of the ticket. In Parker v. South Eastern Railway Co. [14] Bramwell L.J., on three occasions referred to the passenger being afforded, if he wishes, the opportunity of reading the conditions on a ticket which is proffered to him before becoming bound by them, that is, before the contract can be regarded as concluded, and see also per Baggallay L.J. [15] . Then in Hood v. Anchor Line (Henderson Brothers) Ltd., Lord Finlay L.C. and Lord Parmoor both referred to this. Lord Finlay said that "when the passenger or his agent gets the ticket he may examine it before accepting, and if he chooses not to examine it when everything reasonable has been done to call his attention to the conditions he accepts it as it is" [16] . Lord Parmoor said: "If an intending passenger, either personally or through his agent, has reasonable notice that the ticket or document handed to him by a carrier contains certain conditions, and accepts the document or ticket as handed to him without objection, and without taking the trouble to make himself acquainted with such conditions, he must be taken to have assented to them" [17] , and see also per Viscount Haldane [18] . In the Shoe Lane Parking Case [19] Lord Denning refers to the acceptance of the ticket and its retention without objection as being regarded as an acceptance because of the theory "that the customer, on being handed the ticket, could refuse it and decline to enter into a contract on those terms". Megaw L.J. says, of customers of a car park to whom tickets are issued which refer to conditions displayed on the premises, that they must have "a fair opportunity, before the contracts are made, of discovering the conditions by which they are to be bound" [20] . Such a customer, who, by the issue of a ticket, becomes the recipient of an offer, must be afforded an opportunity of learning, from the ticket, what are the terms of that offer before he can be said to have accepted it.

[71]

But at the same time there can be no doubt that the passenger, even if he did not obtain the issue of the ticket and the accompanying promise of carriage, does enter into a contractual relationship with the carrier. However, his contract arises when he presents the ticket and embarks on the carriage. He will be bound by any special conditions of the carriage, not because he was a party to the executory contract when the ticket was issued but because he presents the ticket and embarks on the carriage with knowledge of the conditions upon which the carrier accepts him for that carriage. Where the agreement for carriage at or about the time of the purchase of the ticket is not made by the proposed or named passenger, and probably even where it is so made, there are really two agreements: first, the executory agreement which is made by the tender of the ticket to the purchaser and its acceptance in return for the price, and, secondly, the agreement between the actual passenger and the carrier which arises upon the passenger presenting himself with the ticket to the carrier. Thus the ticket is an offer capable of acceptance by the promisee on the executory contract of carriage and, after that acceptance, will be an offer to the proposed passenger capable of acceptance by him by presentation of that ticket. But in neither case is it the actual agreement of carriage or a memorandum of that agreement. In Cooke v. Midland Railway Co. [36] , an employer bought railway tickets in bulk for his employees. It was held that nevertheless there was a contract between an employee and the railway company, and that the railway company was liable for breach of contract to the employee. In Hobbs v. London & South Western Railway Co. [37] , the plaintiff Hobbs took tickets for his wife and children for travel from Wimbledon station to Hampton Court station. They all took places in the train, but the train went on another branch, and they all were obliged to get out at Esher station, some miles further away from the plaintiff's house. The wife caught cold on the long walk, and it was held that she was entitled to damages and so was the husband on his separate account. Blackburn J. stated that the duty of the railway company was a duty arising out of a contract [38] . It is clear that the wife must have been regarded as a contracting party by embarking on the railway carriage with her ticket.

[74]

Where the original contracting party and the passenger are different, there are on analysis found to be the two contracts. In the present case, the purchaser of the ticket and the passenger were the same person, but it cannot be said that the ticket itself was the agreement. The ticket nowhere states the parties to the executory contract of carriage created at the time of its issue. It is to be observed that, by the special conditions, the expression "the passenger" means the passenger to whom the ticket is issued or who is carried by virtue of the issue thereof. The form of ticket is not a promise by the appellant to X in consideration of him paying the fare to carry X from point A to point B, and if the promise is not certainly stated, then it does not appear to me that the document could be regarded as the agreement with that promisee or as a memorandum of that agreement. Despite some earlier authority to the contrary, Ramsbottom v. Mortley [39] , and statements of text writers, e.g. Halsbury's Laws of England, 3rd ed., vol. 33, p. 295, the agreement or memorandum of agreement which is brought to duty, though it may not need to be signed, must contain all the terms of the agreement including the parties. This appears from the later case, Ward v. Lord Londesborough [40] . Maule J. stated that Ramsbottom v. Mortley [39] was certainly inconsistent with what was said in Moore v. Garwood [41] and further said that, to make an agreement chargeable with stamp duty, it must contain the whole terms agreed on [42] . It is clear that, in that case, the Court declined to take the view that any writing which contained some evidence of a contract but not the whole evidence, was a sufficient memorandum, the view which had been taken in the earlier case. I think that this must be correct. Though the words in the schedule distinguish the case where an agreement or memorandum is only evidence of a contract and the case where an agreement or memorandum is obligatory upon the parties from its being a written instrument, it seems to me that these words in the schedule are intended to distinguish between the formal signed instrument in writing and the memorandum which the parties intend to contain all the terms of a preceding oral contract. In each case all the terms must be expressed and, if the document is not signed, then the identity of the contracting parties must otherwise appear. For this reason also, I cannot regard a ticket which names a passenger, but does not expressly state an agreement with that passenger, or anyone else, to carry him, and thus does not name the passenger as the obligee under a presently constituted agreement, as anything more than it purports to be, a ticket.

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Judgment (79 paragraphs)

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