The cruise line’s typical defences to vicarious liability claims include:
- disclaimers in ticket terms and conditions,
- alleging that the tour operator was an independent contractor
- pointing to a lack of any form of agency between the two parties
- that the cruise line was under no obligation to warn of possible dangers
However, there is now another area of concern for cruise operators; it is a growing number of claims which attempt to attribute liability to the cruise line on the basis of negligent hiring and retention of a shoreside tour operator.
The exact duty of a cruise line when it hires and retains tour operators to provide shore excursions for passengers has not been expressly defined. While there are no statutes or regulations that discuss what is required of the cruise line when selecting a tour operator, common law provides some guidance on the matter. In the common law context, the cruise line’s duty in selecting an operator is akin to that of a travel agent who selects a tour package or operator for it customer. That duty is to make a generalised inquiry into the independent contractor’s reputation and safety record. Hence, if a cruise line inquired into the reputation of the tour operator and found that it was good and that the tour operator had a good safety record, that cruise line would have ostensibly satisfied its duty to its passengers.
It is important to note, however, that there are some legal treatises that state that a duty to select the tour operator appropriately depends on the character of the work to be performed and the danger to which others will be exposed. Under this approach, a cruise line may have a heightened duty to do more to investigate the tour operators before retaining their services. Activities such as zip line operations, scuba diving, bungee jumping and ATV’s come to mind. In those instances, that duty can be satisfied if the tour operator can provide certificates from an accredited or recognized third party regarding the quality and safety of their operations. For instance, in scuba diving tours, if the facility is PADI or NAUI accredited this should be enough to satisfy the cruise line’s duty to select the tour operator appropriately.
That said, cruise lines must be careful not to perform an elaborate investigation if one is not required based on the character or danger of the activity. Going beyond what is required may be interpreted by the courts as the cruise line voluntarily taking on a heightened duty. The bottom line is, unless the cruise line has doubts about (1) the tour operator’s reputation, (2) the tour operator’s safety record or (3) whether the activity has a heighted risk of danger, the cruise line should do no more than perform a generalized inquiry in the tour operator’s reputation and safety record.
To minimise the risk of negligent hiring and retention claims and to provide the best chance of defending them, cruise lines should proceed cautiously before any involvement with a shoreside tour operator. Preparatory investigations should include:
1. Obtaining and reviewing the tour operator’s safety record including the record of any previous accidents or claims;
2. Depending on the nature of the tour, request the tour operator to provide an evaluation by a recognized and/or accredited independent third party of their findings;
3. Request and receive all information on prior accidents or claims which involve the tour operator in question and determine if they were satisfactorily resolved;
4. Documenting all background checks into the tour operator and be able to documentarily produce the steps taken should a claim be filed;
5. Even if initial checking shows a good reputation and safety record, the cruise line should periodically request information from the tour operator to ensure that they are maintaining a good record.
Article by Paul Brewer and Jerry D. Hamilton of Hamilton, Miller & Birthisel LLP.
