England and Wales Court of Appeal (Civil Division) Decisions

IN THE SUPREME COURT OF JUDICATURE
COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM SHOREDITCH COUNTY COURT
(HIS HONOUR JUDGE GRAHAM QC)

		Royal Courts of Justice Strand London WC2 Wednesday, 31st January 2001

1. LORD JUSTICE TUCKEY: This is the defendant's appeal from the judgment of His Honour Judge Graham given in the Shoreditch County Court on 2nd February 2000 in which he awarded the claimant £9,265.83 plus interest and costs.
2. The defendants are part of a group of companies who operate cruise liners including the vessels "Silver Cloud" and "Silver Wind" out of Fort Lauderdale in Florida. The claim arises out of a cruise which the claimant took on the "Silver cloud" leaving Fort Lauderdale to tour the Caribbean, call at Rio and back to Fort Lauderdale. Neither the claimants nor the defendants retained any record of the actual contract under which this cruise was undertaken although the claimant accepted that he must have signed one of the defendant's standard booking forms.
3. The claimant arranged for the cruise through his travel agent in Guernsey where he lives. He was to travel with his friend, Lady Alliot, and made the booking for both of them. They were to occupy adjoining veranda suites. The judge found that the claimant was the contracting party for both his and Lady Alliot's cruise. He paid the deposit and although the balance was paid by Lady Alliot by credit card, this was to enable her to gain air miles, and followed payment to her by the claimant of that balance.
4. Halfway through the cruise when the ship was in Rio Lady Alliot had to leave for her own reasons. Nevertheless, the claimant intended to continue to use both suites. However, when his singing was interrupted by knocking on the partition between the two suites he discovered that the suite formerly occupied by Lady Alliot was now occupied by two strangers. His case was that when he complained to the purser about this the purser agreed that the claimant would be paid or reimbursed 50 per cent of the fare for Lady Alliot's suite. The judge accepted the claimant's evidence that such an agreement had been made and that the purser had apparent or ostensible authority to make it. Evidence from the defendants in the form of a written statement from one of its officers was to the effect that the purser had no actual authority to make such an agreement.
5. On his return to Guernsey the claimant took the matter up with his travel agent. After some correspondence the defendants issued a cruise credit voucher worth £8,000 to the agent in May 1995.
6. It was the claimant's case that over the following years he wanted to use this credit but had not been able to book another cruise with the defendants to make use of it. When they refused to refund its value in cash, he started these proceedings in November 1998. The defence denied that a contract had been made with the defendant company, that the claimant was party to any contract in respect of the suite occupied by Lady Alliot or that any agreement had been made to reimburse the claimant. In a further document they relied on conditions in the booking form which they said exempted them from liability and alleged that the purser had no authority to make any agreement of the kind alleged.
7. At some time in 1999 the defendants discovered that the claimant had in fact taken another cruise on the Silver Wind in December 1995. Documents in their possession showed, they submitted, that £4,000 of the credit had been used by the claimant against the cost of this cruise. The claimant denied this at trial saying that he paid for this cruise in cash and the judge accepted his evidence about this.
8. There is no doubt that the conduct of this case suffered from the fact that the events with which the Court was concerned occurred five or six years before trial by which time the claimant was in his late seventies and because neither side were able to produce documents which at one time must have existed.
9. This morning we had to deal with an application by the defendants to admit further evidence: Firstly, a statement from the purser whom they had been unable to trace before trial. We rejected this application because we concluded that such a statement could have been obtained with reasonable diligence before trial. This statement was in fact obtained quite simply within 23 days of the trial. It could and should have been obtained in this way before trial.
10. Second, a printout from the travel agent's computer showing the way in which the complainant paid for his second cruise in 1995 on the Silver Wind. This was a document which the claimant should have disclosed on discovery. Both parties submitted statements from the travel agents at trial which suggested that there had been no such cruise. It was only when the defendant's solicitors pressed the principal of the firm that the existence of this record was discovered. We admitted it on Ladd v Marshall grounds.
11. Third, evidence that since trial Lady Alliot had been asking the defendants whether she could use £4,000 credit against the cost of the cruise she was proposing to take. We admitted this evidence for what it was worth on the basis that the parties could argue further about whether it was of any relevance and, if so, what. In the event neither party placed any real reliance on this evidence, and I do not propose to refer to it again.
12. The defendant's attack the judge's decision on three broad fronts. Firstly, the judge's decision that the purser had apparent or ostensible authority was, they submit, wrong. The judge in dealing with this point said:

"I find that the Purser had apparent or ostensible authority to enter into such an agreement. He was in charge of the hotel administration on the vessel and if he had authority to put two passengers in accommodation which had been paid for by another party he would have had apparent authority to compensate that other party for the use of his accommodation."

13. Mr Christensen, who appears for the defendants today but who did not appear below, criticises this conclusion and reasoning in a number of ways. I should add in parenthesis that we are grateful to him for the succinct submissions he has made on behalf of the appellants in this case, having as we understand it only been recently instructed. He says there was no evidence from which the judge could have concluded that the purser had of his own initiative put two passengers in this accommodation. He says the judge's reasoning is flawed because it does not follow that if the purser had authority to relocate passengers on board ship he also had authority to compromise potential claims against his employers, the defendants.
14. He relies on well-known passages from Bowstead for the need for a representation to support a claim for ostensible authority and the need for evidence to be adduced to support a claim for usual authority. There was no such evidence and no evidence that the purser made any particular representation to the claimant.
15. I do not accept these submissions. A cruise ship is a large floating commercial enterprise in which the senior official on board representing the commercial interests of the cruise operator is the purser. He is the equivalent of the hotel manager -- in this case managing a ship rather than a hotel based on land where one might expect more senior management to be on hand. But on a ship, faced with a complaint of the kind the claimant made, one would expect the purser's usual authority to include authority to make the kind of promise relied on by the claimant. The purser must have authorised other passengers being put in the suite formerly occupied by Lady Alliot. Whether or not it followed that he had authority to deal with the claimant's complaint in the way he did was a strong indication that he did. One would expect a purser to have authority to deal with accommodation problems of this kind which must inevitably arise in a large enterprise of this kind.
16. Second, the defendants attack the judge's finding of fact that the agreement alleged was made. They say his finding is perverse. They submit that the claimant's evidence of the agreement was inconsistent with the contemporaneous documents and the travel agent's evidence which was to the effect that he was saying was that it had been agreed that he would get a credit towards another cruise, but not a refund. This, it is argued, is consistent with subsequent events where the defendants contend the claimant used half the agreed credit of £8,000 towards his second cruise and the earlier correspondence where he only asked for reimbursement of £4,000.
17. It is apparent therefore that this attack on the judge's central finding of fact is linked to the defendant's third ground which is that in any event the judge should have found that the claimant had used £4,000 of the credit towards the cost of the 1995 cruise. If this was the case, then, they submit, this substantially undermines the claimant's credibility and so the judge's acceptance of his evidence about what he agreed with the purser.
18. It is convenient to consider this third ground first. The correspondence before the judge shows that in 1995 the second cruise was originally booked for both the claimant and Lady Alliot. However in October 1995 she dropped out and there then followed correspondence between the travel agents and the defendants about the financial consequences of this. This culminated in a letter from the defendants which shows that a deposit of £2,406 had been paid for both passengers to the defendants. Taking account of the claimant's deposit, that is to say £1,103, the statement produced by the defendants shows that the balance due for his cruise was settled by "half cruise credit voucher £ 4,000". After taking account of the deposit for Lady Alliot's cruise and a cancellation charge, a refund was made to her and she was shown by the defendants as being entitled to £4,000 cruise credit.
19. The travel agent's computer printout, to which I have already referred, shows the same calculation as the defendants' under the heading "detailed costing" including the fact that the costs of the claimant's "definite booking" was partly met by a credit of £4,000. Under the heading "payment history" the document shows that the £2,046 deposit was paid to the travel agent not by cash but by access/master card. It is not disputed that the claimant had such a card at the time, although were were told that nothing had been done to see whether or not the credit card records confirmed what the travel agent's computer shows. It seems to me that the totality of this evidence demonstrates conclusively that the claimant did use £4,000 of the £8,000 credit which had been given to pay for the second cruise. This explains why he only claimed £4,000 at first.
20. Mr Bojarski on behalf of the claimant valiantly submitted that the travel agent's computer printout should not be regarded as credible evidence and certainly should not be given such weight as to contradict the unequivocal evidence of the claimant which the judge accepted. I am afraid I cannot accept this submission. The documentary evidence to which I have referred, demonstrates that the claimant was wrong about this. That is not surprising. He was not asked to recall the events surrounding the 1995 cruise until 1999, and at first denied that he had been on a cruise at all at that time. One can well understand after such a lapse of time how someone of this age could make such a mistake. Still more, can one understand that he should have no reliable recollection of how he came to pay for such a cruise. Despite the submissions by the defendants to the contrary, I do not think that such a conclusion undermines the judge's general view of the claimant's credibility. His faulty recollection of these events can be put down to a genuine mistake attributable to his age and the lapse of time between the event itself and the time he was asked to recall it.
21. That brings me back to the second ground. I am not persuaded by the arguments of Mr Christensen that the judge's finding was wrong, still less that it was perverse. It seems to me that from an early stage the claimant was saying that this refund (credit in a general sense) had been agreed on board as a result of his complaint about what had happened. There is therefore no inconsistency which undermines the judge's conclusion.
22. But looking at the matter more broadly and ignoring for the moment the way in which both parties put their case at trial, whatever may or may not have been agreed between the purser and the claimant on board, the correspondence in 1995 culminating in the offer of a credit of £8,000 and the fact that later in the year the claimant utilised £4,000 of that credit towards his second cruise, shows that at that stage at least there was a binding agreement between the claimant and the defendant to the effect that he would be given credit of £8,000 as a result of what had happened. The fact that Lady Alliot appeared to think both before and after this event that she was entitled to half that credit is not to the point. The original agreement was, as the judge found, with the claimant and from the correspondence which followed any subsequent agreement of the kind which I am postulating was also only with the claimant. The claimant then sought to utilise the other £4,000 but was unable to do so because he was not able to book a cruise of the kind he wanted. Mr Christensen rightly accepted that in those circumstances if someone was unable to utilise such a credit after a reasonable time he would be entitled to turn the credit into cash. So whatever way one analyses this case, it seems to me that this claimant was entitled to recover not £8,000 or the sum the judge awarded but £4,000 being the balance of the unused agreed credit resulting from what had happened on the first cruise. I would therefore allow this appeal from the judge's decision and substitute a judgment for £4,000 plus interest from a date which will have to be determined after further submissions.
23. SIR RONALD WATERHOUSE: I agree.

(Further submissions)

(Appeal allowed; claimant to pay applicant's costs of £3333 (assessed by Court); judgment of Court below to be substituted by £4,000 plus interest at 8% from 1996 - £1,093) (Order does not form part of Approved Judgment)