The claimant and her husband booked a package holiday in Sri Lanka with the defendant tour operator. While they were staying at a hotel on the tour, in the early hours of the morning she was looking for reception. An electrician employed by the hotel offered to conduct the claimant to reception but then sexually assaulted her. She sued the defendant for improper performance of the contract, basing her claim on the contract for the package holiday organised and sold by the defendant, and regulation 15 of the Package Travel, Package Holidays and Package Tours Regulations 1992 which transposed Council Directive 90/314/EEC on package travel, package holidays, and package tours into English law. It was common ground that the contract was intended to give effect to the Regulations. The judge held that there had been no improper performance or breach of contract and, if there had been a breach of regulation 15 of the 1992 Regulations, the defendant had a defence because the assault was an event which the hotel could not “with all care foresee or forestall” within regulation 15(2)(b). He further held that the hotel, if it had been sued, would not have been vicariously liable for the sexual assault committed by its employee.
On the claimant’s appeal—
Held, appeal dismissed (Longmore LJ dissenting). In determining whether the defendant was contractually liable due to fault on the defendant’s part or that of its agents or suppliers on the ground that any part of the holiday arrangements was not of a reasonable standard, the expression “holiday arrangements” had to be interpreted objectively, having regard to the terms of the contract as whole, and attributing to the relevant words the meaning which reasonable persons in the position of the parties would have understood them to bear. The judge had correctly concluded that “holiday arrangements” did not include a person who was known to the hotel guest to be a member of the hotel’s maintenance team, conducting the guest to reception, which formed no part of the functions for which he was employed. At the time when the contract had been made, reasonable people would not have understood that the defendant was promising that such activity would be carried out to a particular standard. That was the correct conclusion whether or not, as a matter of the applicable law, the hotel was vicariously liable directly for the conduct of the electrician. Nothing in the Package Travel, Package Holidays and Package Tours Regulations 1992 gave a different colour to the meaning of “holiday arrangements” in the relevant contractual clause. The judge had been right to conclude that the defendant was not liable either under the express terms of the relevant clause or regulation 15 of the 1992 Regulations since the electrician was not a “supplier” within the meaning of those provisions. The hotel was the supplier of any services performed by him. The defendant’s contractual relationship was with the hotel for the provision of hotel accommodation and services. Nothing in regulation 15 suggested any other meaning was to be given to “supplier” in the relevant clause. Whether or not the hotel was vicariously liable for the electrician’s wrongdoing, the defendant’s liability was excluded since the failure of the holiday arrangements was due to unforeseen circumstances which, even with all due care, could not have ben anticipated or avoided by the defendant, its agents or suppliers within the relevant clause or regulation 15(2)(c)(i)(ii).
Robert Weir QC and Katherine Deal (instructed by Irwin Mitchell llp) for the claimant.
William Audland QC (instructed by MB Law) for the defendant.