X v Kuoni Travel Ltd – current state of play

The Supreme Court today handed down judgment in this pivotal case for the travel industry and unanimously decided to refer to the Court of Justice of the European Union. The question before the Supreme Court was whether the respondent tour operator was liable to the appellant customer for breach of contract and/or under Reg 15 of the Package Travel, Package Holidays and Package Tours Regulations (SI 1992/3288) (“PTR”).

Snapshot of decisions so far

In 2010 the appellant and her husband entered into a contract with Kuoni for a package holiday to Sri Lanka.  They were due to stay at the Club Bentota hotel (the Hotel). Whilst on the package holiday, X  was sexually assaulted by N who was working at the Hotel as an electrician. N was on duty and wearing a uniform.

X brought proceedings against Kuoni for breach of contract and/or under the PTR and claimed damages for the assault on the basis that Kuoni was liable for the actions of the Hotel employee.

The High Court found there was no “improper performance” of the package and took the view that Kuoni would be able to rely on the statutory defence under PTR as the sexual assault could not be foreseen or forestalled; it was an unforeseeable event that could not have been prevented by the Hotel.

The Court of Appeal came to a majority decision and dismissed X’s appeal concluding that the employee, N,  was not a supplier within the meaning of provisions of the PTR. . The package did not include the employee’s conduct as this fell outside duties for which N was employed by the Hotel.

The dissenting view of Lord Justice Longmore was that “The whole point of the [Package Travel] Directive and the regulation is that the holidaymaker should have a remedy against his contractual opposite and it should be left to the tour operator to sort out the consequences with those whom it has itself contracted.”

The issues for the Supreme Court to determine were:

  1. Whether the rape and assault of X constituted improper performance of Kuoni’s obligations under the contract;
  2. If so, is any liability of Kuoni in respect of N’s conduct excluded under the contract and/or Section 15 (2) ( c ) of the 1992 Regulations.

Supreme Court judgment

The Supreme Court did not give a definitive judgment today but has referred the two issues to the European Court of Justice for clarification:

  1. Where there has been a failure to perform or an improper performance of the obligations arising under the contract of an organizer or retailer with a consumer to provide a package holiday to which the Directive* applies, and that failure to perform or improper performance is the result of the actions of an employee of a hotel company which is a provider of services to which that contract relates:
  • Is there scope for the application of the defence set out in the second part of the third alinea to article 5(2); and, if so,
  • By which criteria is the national court to assess whether that defence applies?
  1. Where an organiser or retailer agrees to provide a package holiday to which the Directive* applies, and the hotel provides the contracted services, is an employee of the hotel company a “supplier of services” under article 5(2) of the Directive?

Implications for the travel industry

As matters stand, the implications for the travel industry are far reaching and significant. If a hotel’s employee (or third party in whatever capacity) is deemed at all times a supplier of services, then the tour operator would appear to become liable under the PTR irrespective of what the employee has done.

This raises important questions as to the ability to rely upon the defences permitted within Regulation 15(2)(c) of the PTR as they become potentially ineffective if the appeal is allowed.

There are clear concerns that this could provide a forum for a wide range of claims to be brought, if third parties fall within the definition of “supplier” of the package, even though the Tour Operator has no real control over and cannot feasibly foresee what has happened.

Such reference to the European Court is clearly required to assist in clarifying and providing the necessary guidance. However it will mean further delay. Until such time, the status quo remains.

* Council Directive 90/314/EEC of 13 June 1990 on package travel, package holidays and package tours


Written by Sarah Murray-Smith and Deborah Sayers at BLM

Regulating the Internet – the Online Harms White Paper consultation

There is no doubt that there is a need and a public desire for regulation of the internet and social media to protect the vulnerable. In April this year, the government published its Online Harms White Paper, which sets out its proposals to make the UK the safest country in the world to be online.  It’s described as “a world-leading package of online safety measures that also supports innovation and a thriving digital economy”, and its two top priorities are to tackle unlawful and unacceptable activity online, including Child Sexual Exploitation and Abuse (CSEA) online.  A consultation on the white paper is currently live, with responses due by  11.59pm on 1 July 2019.

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Government called to re-set parameters for NDAs

As a result of the recent inquiry into sexual harassment in the House of Commons, which urged the Government to review the use of non-disclosure agreements (NDAs) in sexual harassment claims, the Women and Equalities Committee was tasked with carrying out an inquiry to look at the widespread use of NDAs in cases where any form of harassment or other discrimination is alleged.

On 11 June, 2019 the Women and Equalities Committee published its report on the use of NDA’s in discrimination and harassment cases.

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Abuse in football – Bob Higgins

Bob Higgins, the former youth football coach, who was recently found guilty of 46 charges of indecently assaulting 24 boys, mostly involving trainees at Southampton and Peterborough United between 1971 and 1996, has now been sentenced to 24 years and three months in jail.

Southampton FC has published a formal apology on its website to all victims and survivors of the abuse by Higgins, stating that it “recognises that some of the boys under our care suffered exposure to abuse when they should have received protection from any form of harm. For this, the club is deeply sorry.”

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Supreme Court judgment: CN & GN v Poole BC

CN & GN v Poole BC [2019] UKSC 25

At long last the awaited decision from the Supreme Court in the case of CN & GN v Poole Borough Council was handed down on 6 June.

All have sympathy with the family’s experience of abuse from neighbours. The issue before the court was whether Poole BC as the local authority with the child care function should be held responsible for the actions of third parties.

The hearing before the Supreme Court took place on 16 and 17 July 2018 and the judgment has been eagerly anticipated by all those involved in litigation against local authorities for alleged negligence in the context of their conduct of child protection statutory duties and powers and whether there is a common law duty of care.

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Supreme Court judgment expected in CN & GN v Poole BC

D-Day for failure to remove cases

The long-awaited decision of the Supreme Court in the CN & GN v Poole Borough Council litigation will be handed down at 9.45am on 6 June 2019.  This decision will consider the nature and scope of the duties owed by local authorities to children living in their areas, more specifically whether social workers owe a duty to protect children from harm caused by third parties.

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Lambeth – a scheme making progress

On the 1 April 2019 the Lambeth Children’s Home Redress Scheme, which has been operational since the 1 January 2018, reported on its progress.

The scheme had received 1,115 applications by mid-March this year. Applications have in the main been from England, though applications have also been received from the USA, Australia, Canada and Europe.

Cllr Jack Hopkins, Lambeth council leader, said:

“As the new leader of this council I am committed to our pledge to survivors that this council will not be like previous administrations and will continue to face up to the past.

 “This scheme is incredibly important as it acknowledges how very badly our former children’s home residents were let down. We know that many former children’s homes residents will never be able to forgive the council for their childhood experiences.

 “But we are determined to do all we can to deliver swift and compassionate redress to those who have waited so long to even have acknowledgement of the suffering they experienced. I want to apologise to abuse survivors of behalf of the council.”

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