Monday, July 12, 2004
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Local Forum Rejected for Suit Over Alaska Cruise Virus Outbreak
Appeals Court Upholds Enforcement of Selection Clause Unseen Until Voyage Was Paid For
By KENNETH OFGANG, Staff Writer/Appellate Courts
A forum selection clause set out in a cruise line’s standard passenger contract is enforceable even if the passenger did not read it and did not receive the contract until after the cruise was paid for on a no-refunds basis, the Court of Appeal for this district has ruled.
Div. Seven, in a June 9 opinion by Presiding Justice Dennis Perluss, affirmed Los Angeles Superior Court Judge George Wu’s dismissal of a proposed class action filed by Beverly Hills attorney Gary Schlessinger. The case must be heard in federal district court in Seattle, where a nearly identical class action has been brought, the appellate panel ruled.
The appellate panel Friday certified the opinion for publication. But Justice Earl Johnson Jr., who had originally signed it, backed away and filed a concurring opinion saying his colleagues reached the correct result but were establishing too broad a precedent.
Schlessinger was a passenger on a July 2002 Holland America cruise on which over 200 people reportedly became ill as a result of exposure to the Norwalk virus. He filed suit two months later, naming his wife and two other passengers as plaintiffs.
Schlessinger’s complaint alleged that Holland America Lines failed to warn passengers on the cruise from Vancouver to the Alaska ports of Juneau, Skagway, Glacier Bay, and Ketchikan that they were at risk of exposure to the virus.
CDC Report
According to the Centers for Disease Control, 176 passengers and crew members on a July 18 cruise on Holland America’s Ryndam reported gastrointestinal symptoms later determined to have been caused by the virus. The cruise line undertook what the CDC described as “aggressive sanitation and disinfection procedures” once the cruise ended in Vancouver July 25.
Those measures, however, did not prevent further spread of the virus on the succeeding cruise, on which Schlessinger and his wife were passengers. The CDC, whose officials boarded the vessel in Ketchikan, found nothing wrong with the food and water on board and said the outbreak was likely a result of person-to-person contact.
The ship was taken out of service for a week after the cruise “to break the cycle of the Norwalk virus being spread” and to permit “a systematic cleaning and sanitizing of the vessel,” the CDC said. There were no further problems on the Ryndam, but Holland America and other lines later saw outbreaks of Norwalk virus on other ships.
Motion to Dismiss
Holland America Lines moved to dismiss the Los Angeles Superior Court suit on erroneous-forum grounds. It pointed to the forum selection clause, which requires that any dispute between the line and its passengers be litigated in Seattle, where Holland America is based, and that it be heard in U.S. District Court there unless jurisdictional barriers require that it be brought in state court.
In opposition to the motion, Rose Schlessinger filed a declaration saying she never received the cruise brochure, which pointed out that the cruise contract contained a forum selection clause and advised that the contract could be accessed on the company’s Website. Schlessinger further declared that she never viewed the Website, and that she was informed she could not get a refund if she cancelled within 23 days of departure.
It was undisputed that Holland America does not send out cruise contracts until final payment is made, and that in this case the contracts were mailed to the plaintiffs’ travel agent 16 days before the cruise.
In a statement of decision, Wu concluded that the forum selection clause was enforceable under federal maritime law because the plaintiffs had the opportunity to read the contracts before they departed.
He also cited other problems with the California forum, saying it was unlikely that Schlessinger—as a class member and spouse of a named plaintiff—would be allowed to serve as class counsel.
Wu added that it would be improper to create what would in effect be a subclass of litigants in California while the rights of the remaining passengers were being litigated in Washington, and that since the defendant was not located in California and the events resulting in the suit did not occur here, the doctrine of forum non conveniens likely required dismissal as well.
In concluding that the trial judge was correct, Perluss said that under maritime law, passengers may be bound by a contract they have not read, as long as they have had an opportunity to read it. Neither the fact that the contract was offered on a take-it-or-leave-it basis nor the existence of financial penalties associated with cancellation changes the rule, he added.
He distinguished Corna v. American Hawaii Cruises, Inc. (D.Hawaii 1992) 794 F.Supp. 1005. The court in that case held that standby passengers who received their tickets only two to three days before departure were not bound by the forum selection clause because they were not given the opportunity to reject the contract without forfeiting the entire fare.
Unlike the passengers in Corna, Perluss explained, Rose Schlessinger and her fellow plaintiffs booked the cruise months in advance and had multiple opportunities to view the contract. They could have done so online, obtained the brochure, or called their travel agent, the presiding justice reasoned.
Justice Fred Woods concurred, but Johnson said he feared “the broad language used in the opinion might affect trial court decisions involving situations far more egregious than the one before this court.”
Corna, he argued, “represents the correct approach and should apply not just to last minute standby passengers, but to anyone who receives their ticket a short time before boarding the ship and subject to forfeiture if they decide to cancel,” especially “when, unlike the instant case, the forum provided is Timbuktu, or its equivalent.”
Johnson said he was concurring in the result primarily because he agreed with the trial judge that grounds existed for dismissal even if the forum selection clause was not enforced.
The case is Schlessinger v. Holland America, N.V., B166213.
Copyright 2004, Metropolitan News Company