Carriage of passengers and definition of conduct barring limitation under the LLMC (Cour de cassation, 18 June 2014, No 13-11.898)

Whilst on board a vessel in a maritime natural reserve in Corsica (France), a passenger was seriously injured in a fall of more than two metres on the foredeck in rough seas. The passenger and his employer sued the shipowner and its P&I Club for compensation for the damage suffered as a result of the accident.

The accident occurred before the entry into force in France of EC Regulation 392/2009 of 23 April 2009, which implements the Athens Convention amended by the 2002 Protocol, and the claim was brought under the French domestic provisions (the Code des transports).

The Code des transports provides that there are two types of liability: ‘fault’ liability and ‘strict’ liability. A carrier is responsible for the death or injury of a passenger where it is the result of unseaworthiness of the vessel or a fault of her operators. A carrier may also be strictly liable for personal injury or death in the case of a “shipping incident”, even if this was not the carrier’s fault. These “shipping incidents” include shipwreck, capsizing, collision, the stranding of a ship or explosion or fire onboard.

The Supreme Court (Cour de cassation) confirmed that the carrier had breached its safety obligation by not warning the passengers about the harsh conditions (rough sea) and was therefore responsible for the damages suffered by the passenger and his employer.

Despite its rather small value of around €95,000, the claim exceeded the limits of liability pursuant to article 7 of the 1976 Convention on Limitation of Liability for Maritime Claims (LLMC Convention), as enacted by French law at the time1.

The carrier argued that it was entitled to limit its liability because it had not committed any fault which would prevent it from doing so. The LLMC defined such a fault as a “personal act or omission, committed with the intent to cause such loss, or recklessly and with knowledge that such loss would probably result”.

The Cour de cassation held that the carrier’s failure to inform the passengers of the weather conditions or advise them to remain seated or prevent them from going on deck amounted to inexcusable conduct. The court held that this inexcusable conduct should deprive the carrier of the right to limit its liability. The Courused an objective test to imply that the carrier knew that damage could occur in such circumstances, and that the carrier accepted this risk when failing to advise its passengers.

This decision illustrates the manner in which French courts interpret “conduct barring limitation” in the carriage of passengers.

However, the Cour de cassation has recently taken a different view on carriage of cargo, adopting a stricter application of the terms of the LLMC. The court required the claimant to prove that the owner hadactual knowledge that damage would occur in such circumstances, and that he recklessly accepted the likelihood of this damage occurring.

EC Regulation 392/2009 of 23 April 2009 entered into force in December 2012 and applies to most French domestic carriage. There is as yet no case law on its application, and which test the French courts will apply to bar limitation of liability under the Regulation remains to be seen. The courts may follow the decisions where knowledge was implied ‘objectively’, or they might require a claimant to prove that the owner of the vessel had ‘actual’ knowledge.

It is also worth noting that the P&I Club disputed the admissibility of the victim’s direct action before the Court of Appeal. The latter, however, considered that the action was admissible since it was subject to French law, which allows direct action against the liability insurer for any type of claim. The new Regulation 392/2009 specifically authorises a passenger or a relative to bring a direct action against a P&I insurer.

Cour de cassation guidance to distinguish between cruise operator and seller of travel package under French travel package regulations (Cour de cassation, 16 Jan. 2013, No°11-28.881; Court of Appeal of Aix en Provence 11 September 2014)

French courts regularly deal with the issue as to whether French travel package regulations (Code du tourisme), which provide for strict liability in case of non-performance of the contract, should apply to cruise operators and whether cruises should be regarded as package travel holidays. So far, the courts have mostly decided that the combination of a cruise and pre- and post- carriage is a package subject to the package travel regulations.

The decisions in the Cour de cassation on 16 January 2013 and the Court of Appeal on 11 September 2014 specifically dealt with insurance coverage, and whether travel agent insurance could cover a cruise cancellation.

The operator organised travel for around 40 people which included air carriage, a cruise with meals and on-shore excursions, hotel bookings, visits and road transportation. The cruise was cancelled due to the detention of the vessel in Chile. The insurance company denied coverage on the grounds that the operator deliberately refused to obtain additional coverage for cruise operations although it was acting as a cruise operator.

The Cour de cassation held that the operator fulfilled the criteria provided by the French package travel regulations and that the pre-arranged combination of cruise, transport and other tourist services was a package subject to these regulations. Therefore, there was no need for this operator to obtain additional coverage for its liability as cruise operator and the passengers’ claim was therefore covered.