An Australian class action over a deadly coronavirus outbreak on board the Ruby Princess cruise ship cannot include passengers from the United States, an appeal court has found.
In a majority decision on Friday, the Federal Court ruled the claim by Patrick Ho - one of 696 passengers whose contracts were deemed to be subject to US terms and conditions - be stayed.
Chief Justice James Allsop and Justice Sarah Derrington - with Justice Steven Rares dissenting - allowed the appeal by Carnival plc, the time charterer of the vessel, and Princess Cruise Lines Ltd, the owner and operator of the vessel.
They had challenged a judge's 2021 decision rejecting a preliminary application to stop a "sub-group" of overseas passengers from being part of the action.
Many passengers contracted coronavirus and 28 died after the outbreak on the Ruby Princess which left Sydney on March 8 and returned on March 19 2020 after sailing via a number of ports in New Zealand.
Susan Karpik commenced representative proceedings against Carnival and Princess, with the group being made up of passengers, executors and close family.
She alleges the respondents negligently and in breach of their duties of care allowed the voyage to proceed and failed to take adequate measures to protect passengers from the risk of COVID-19.
They also allegedly failed to warn passengers of the risk of contracting the disease.
Further, they allegedly engaged in misleading or deceptive conduct and breached their consumer guarantees under the Australian Consumer Law.
Of the 2651 paying passengers on board, the respondents alleged that 696 contracted their cruise on US terms and conditions and 159 contracted on UK terms and conditions.
The balance are said to have contracted on Australian terms and conditions.
The differing conditions include a class action waiver clause in the US terms.
Justice Angus Stewart had ruled it wasn't necessary or appropriate at this early stage of the proceedings to determine the law applicable to the US and UK sub groups' negligence claims.
He noted a stay on the US passengers would result in the fracturing of the litigation with essentially identical claims being brought in the Federal Court and any stayed claims being brought in the US.
But the Appeal Court ruled that the terms of carriage between Carnival/Princess and Mr Ho were governed by the US terms and conditions incorporating the exclusive jurisdiction clause and the class action waiver.
It concluded those clauses ought to be given effect and Mr Ho's claim should be stayed.
The court ordered the matter be remitted to Justice Stewart for determination of the extent to which its reasons affect the claims of other members of the class action.
