Chapter § 3.01 PROBLEM AREAS

JurisdictionUnited States
Publication year2021

§ 3.01 Problem Areas

The recent growth in the travel industry has also been reflected in increasing consumer demand for travel services provided by cruise ship, railroad, bus and rental car companies.

[1] Cruise Ships and Risky Shore Excursions

Modern cruise vessels are best viewed as floating deluxe hotels1 that transport their guests from exotic port to exotic port where the passengers stay a few hours for shopping, and to participate in often risky shore excursions,2 such as snorkeling, scuba diving, parasailing and touring local sites. Demand for cruise services appears to be supply driven and is dominated by two cruise lines, Royal Caribbean and Carnival Corporation.3

A study compared the Titanic at 882 feet long and weighing 46,328 tons with the 3,838 passenger Voyager of the Seas at 1,020 feet long and weighing 142,000 tons.4 In 2009, the Oasis of the Seas, the world's largest cruise ship, was launched. It "measures 1,187 feet long and has seven themed 'neighborhoods', was built over two years at a reported cost of $1.5 billion. Its 16 decks offer capacity for more than 5,000 guests and 2,000 crew members—as well as 12,000 plants."5 With more and more ships being built, the cruise lines are broadening the appeal of a cruise vacation6 and encouraging passengers to purchase a variety of products and services sold onboard the cruise ships,7 including shore excursions8 and art.9 In addition, cruises may be promoted to special groups, such as professionals and dancers.10

[a] Florida: Cruise Capital of the World

"Florida is one of the nation's premier maritime states, with over 1,000 miles of coastline and many more thousands of square miles of navigable territorial waters. Florida is also the cruise capital of the world. In 2004, the North American cruise industry— defined as 'those cruise lines that primarily market their cruises in North America'— embarked over eight million passengers through U.S. ports (including at least seven million U.S. residents). Of those passengers, 4.7 million-58 percent of all U.S. cruise embarkations—boarded their vessels in one of Florida's five cruise ports; and Florida itself had 1.5 million resident cruise passengers in 2004. Carnival Corporation (Carnival) and Royal Caribbean Cruises, Ltd. (RCCL) together control nearly three- fourths of the entire North American cruise industry. Norwegian Cruise Line (NCL) is another important carrier. All three are incorporated outside the U.S. but maintain their principal places of business in Miami. All of their ships, which primarily sail from U.S. ports, are nevertheless registered in foreign nations such as Panama, Liberia or the Bahamas and fly foreign flags, so they and their operators are generally not subject to most U.S. corporate income tax, health, safety and wage laws. Today, all cruise tickets contain carriers' private restrictions on the time and locale of passenger lawsuits. Most carriers' proprietary tickets require written claims to be presented within six months or less after an incident and suits to be filed within a year or less. The geographical venue selected for passenger lawsuits by Carnival, RCCL and NCL is Miami. Cruise lines, by being able to force passengers from throughout the world to sue a carrier in a single U.S. locality within a very short time, have long enjoyed a dominant 'home court' litigation advantage."11

[b] The Downside of Rapid Expansion

As the industry grows and more and more ships cross the seas, there are bound to be further incidents like those that have peppered the evening news.

In 2000, a fire on Carnival's Tropicale caused the ship to drift in the Gulf of Mexico for an entire day—during a tropical storm, no less—before the crew were able to restart the engines and return to port.12

[c] Common Cruise Passenger Problems

Common problems experienced by cruise passengers include death,13 physical injuries,14 both onboard the cruise ship and during shore excursions, medical malpractice,15 failing to have state of the art medical facilities and highly trained medical personnel onboard to care for injured passengers,16 port skipping, itinerary changes and delays,17 assaults,18 rapes,19 robberies,20 misrepresentations21 about the itinerary and the accommodations, facilities and services onboard ship, discomfort22 arising from Legionnaires Disease, Norwalk Virus, tainted food and water, sailing into tropical storms, malfunctioning air conditioning, water purification systems and toilets, lost, damaged or stolen baggage,23 illegal dumping of oil and other environmental crimes,24 deceptive port charges25 and other misleading and deceptive marketing practices,26 the enforcement of over-reaching clauses in cruise contracts27 including forum selection28 and choice of law29 clauses, disclaimers of liability30 and limitations of recoverable damages31 short time limitations in which to file physical32 and non-physical injury33 claims and commence lawsuits, restrictive cancellation policies34 and under funding of bonds to protect passenger deposits,35 failure to accommodate and assist handicapped passengers and comply with the Americans with Disabilities Act,36 and recommending shore excursions without properly investigating whether foreign service providers are licensed, insured, have safe track records and comply with local safety regulations.37

[d] 21st Century Cruising, 19th Century Rights

While a cruise vacation may very well be the best travel value available, consumers should be aware that the cruise ship's duties and liabilities are governed not by modern, consumer oriented common and statutory law, but by 19th century legal principals,38 the purpose being to insulate cruise lines from the legitimate claims of passengers.39

Although recent years have seen the expansion of consumer rights against airlines,40 domestic hotels,41 international hotels,42 tour operators, both U.S.43 and those in the European Community,44 travel agents,45 informal travel promoters,46 and depository banks,47 there has been little, if any, progress in the expansion of the cruise passenger's rights and remedies. It is clear that when compared to other travel consumers, cruise passengers are at a distinct disadvantage in prosecuting their claims.

[e] The Franza Sea Change and New Duties for Cruise Lines

[i] The Evolution of Cruise Passenger Rights

Maritime law as it relates to cruise ships touching U.S. ports has been particularly resistant to modern theories of travel consumer rights.48 Specifically, U.S. maritime has until 2014, when the Eleventh Circuit decided Franza v. Royal Ca rib bean Cruises, Ltd.,49 adhered to two inter-related legal principles. First, that travel purveyors such as cruise lines may insulate themselves from the liability for the tortious and contractual misconduct of independent contractors, both on and off the cruise ship. Second, that the relationship between cruise ship and passenger is exclusively defined by the passenger contract. The Franza court challenged both of these nearly universally accepted rules and implicitly approved of a host of newly defined duties of cruise lines, especially as related to assigning responsibility for the medical malpractice of the ship's medical staff and for the tortious misconduct of shore excursion operators.

[ii] The In de pen dent Contractor Rule

The concept that an airline, cruise line, hotel, resort or tour operator should be able to insulate itself from liability for the tortious and contractual misconduct of so called independent contractors was universally accepted by the Courts on land and sea, until very recently.

[A] The Barbetta Rule

In the context of maritime law, the near universal enforcement of the rule in Barbetta v. S/S Bermuda Star,50 insulating a cruise ship from liability for the medical malpractice of the ship's medical staff, is a perfect example of the independent contractor rule.

[B] The Franza Case

Maritime law, as it related to passengers, has been best described as 21st Century Cruise Ships and 19th Century Passenger Rights.51 However, the 11th Circuit Court of Appeals recently decided to dramatically transport passenger rights, at least in part, into the 21st Century. In Franza v. Royal Ca rib bean Cruises, Ltd.,52 a medical malpractice case, the court explained:

"We decline to adopt the rule explicated in Barbetta, because we can no longer discern a sound basis in law for ignoring the facts alleged in individual medical malpractice complaints and wholly discarding the same rules of agency that we have applied so often in other maritime tort cases. . . . As Justice Holmes famously put it, we should not follow a rule of law simply because 'it was laid down in the time of Henry 4th', particularly where 'the grounds upon which it was laid down have vanished long since, and the rule simply persists from blind imitation of the past. . . . Here, the roots of the Barbetta rule snake back into a wholly different world. Instead of nineteenth-century steamships . . . we now confront state-of-the- art cruise ships that house thousands of people and operate as floating cities. . . . In place of truly independent doctors and nurses, we must now acknowledge that medical professionals routinely work for corporate masters."

[iii] The Contractual Relationship Rule

Until recently, the relationship between travelers and suppliers, including cruise ships and tour operators, was governed by contracts, often printed in nearly invisible print and loaded with self-serving and unconscionable clauses, both substantive and procedural in nature. These contracts, regardless of whether the traveler saw or agreed to the terms therein, were routinely enforced. Indeed, there were cases which held that promises made in advertising material would not be enforced because they were disclaimed or limited by contractual clauses. In essence, the suppliers or tour operator's contractual definition of their relationship to the consumer was nearly universally...

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