Passengers seeking compensation for a cruise holiday plagued by COVID-19 in the early days of the pandemic claim a contract excluding them from participating in a class action is unfair.
A Ruby Princess voyage which departed Sydney on March 8, 2020 quickly became one of the first major outbreaks of the virus and resulted in the deaths of 28 people who had been on board.
Former nurse Susan Karpik, a Canadian citizen living in the British Columbia province, is heading a class action against cruise company Carnival.
Carnival trades under the Princess Cruises name and is the operator of the Ruby Princess, Bermuda-registered Princess Cruise Lines.
Ms Karpik said the company failed in its duty to take reasonable care of passengers aboard the ill-fated cruise.
But the company argued passengers were subject to various terms and conditions, depending on which version of the contract they signed.
Of the 2651 passengers on board, 696 were parties to United States contract which contained a class action waiver clause.
There were 1796 passengers subject to the Australian terms, which had no such waiver, and 159 to the United Kingdom terms and conditions.
Overseas passengers were therefore excluded from engaging in the class action but Ms Karpik, who signed a US version of the contract, is leading the fight to get back in.
Her lawyer Justin Gleeson told the High Court a section of Australian Consumer Law made a term of a consumer contract void if it was unfair.
He argued that in carrying out business in Australia, Carnival submitted to Australian laws and the term of the US contract waiving the right to engage in class action was unfair.
"There were 2600 people on the same vessel, experiencing the same cruise," Mr Gleeson said.
"It is perfectly acceptable to Princess to accept a class action claim from 1700 (Australian) passengers.
"What did Princess do to prove a legitimate interest to accept they could exclude 700 other people from that action? They did nothing."
Mr Gleeson went on to explain the waiver clause was unfair because it limited the rights of passengers to sue the carrier, but placed no such limit on litigation options for the carrier.
"A barrier has been erected to prevent passengers engaging in litigation when there is no equivalent barrier for the carrier," he said.
"Before the service has been provided or a dispute has happened ... before the passenger has any option to consider pursuing class action, their decision has been made for them.
"The contract is being forced by one party on to another."
The cruise line's lawyers argued in their submission when a contract provided for the resolution of disputes in a forum other than an Australian court, and pursuant to a law that upholds the validity of a class action waiver, there is "no imbalance caused to those rights under the contract by the class action waiver clause".
The commonwealth attorney-general is seeking to intervene in favour of Ms Karpik.
The hearing will continue on Friday.
