Loss on overseas holidays has always presented travellers and tour companies with a number of difficulties in determining the basis of liability and the jurisdiction in which cases should be heard.

2018 saw the conclusion of long running jurisdiction legislation following the tragic death of noted jurist Sir Ian Brownlie in a car accident in Cairo. That concerned a direct action against the hotel operator. Of course in other instances the package travel regime permits British travellers to pursue direct claims against a tour operator for the default of an overseas service provider such as a hotel. The limits of that were examined in some respects in April 2018 where the English Court of Appeal addressed the liability of a tour operator for the sexual assault and rape of a holidaymaker by an electrician employed at the hotel where she was staying. In doing so, the court found that Kuoni Travel was not liable contractually, nor under the Package Travel, Package Holidays and Package Tours Regulations 1992 (the "1992 Regulations").

The holidaymaker ("X") had been on her way to the hotel reception when a uniformed employee told her there was a shortcut she could take and led her to an engineering room where he physically assaulted and raped her.

X sued Kuoni for "improper performance" of the contract she entered into with them as the organiser of the holiday she booked. Her claim was based on both her contract with Kuoni and on regulation 15 of the 1992 Regulations. The judge held that there was no improper performance or breach of the contract. The judge went further and determined that if the hotel had been sued (which it had not been here), it would not have been vicariously liable for the sexual assault committed by its employee. The consideration of vicarious liability principles here may suggest that if the hotel is not deemed vicariously liable, then it is less likely that liability will be assigned further upstream to Kuoni.

When interpreting the contractual obligations, Kuoni had an obligation to provide the "holiday arrangements" booked by X to a reasonable standard. The judge concluded that the expression "holiday arrangements" did not include the actions of a member of the hotel's maintenance team, who was known to be such to X, in directing X to the hotel reception. This was not part of his employment. In relation to the vicarious liability of the hotel, the conduct was insufficiently connected with the acts which the employee was authorised to do in the ordinary course of his employment.

Regulation 15 of the 1992 Regulations related to the liability for proper performance of obligations under the contract. The judge concluded that in order for there to be a breach of the Regulations, the event in question had to be one which the hotel could "with all due care foresee or forestall" (regulation 15(2)(c)(ii)), and this was not the case in this instance. The court held that the purpose of the Regulations "was not to facilitate a claim against a package tour operator for wrongful conduct by an employee of a supplier, even if that conduct was not part of the role in which he was employed and even if the supplier would have been vicariously liable under either domestic law or the foreign law applicable to the supplier".

This case was decided prior to the entry into force of Directive (EU) 2015/2302 on package travel and linked travel arrangements, which was transposed in the Package Travel and Linked Travel Arrangements Regulations 2018 (the "2018 Regulations") in the UK. Regulation 15(2) of the 2018 Regulations makes the organiser liable to the traveller for the performance of the travel services included in the contract. Regulation 16(4) states that a traveller is not entitled to compensation for damages if the lack of conformity is attributable to a third party unconnected with the provision of the travel services included in the package travel contract, and is unforeseeable or unavoidable. It remains to be tested whether this case would arrive at the same judgment were it to be considered under the 2018 Regulations. However, the principles of regulation 15(2)(c) of the 1992 Regulations, and those of 16(4) of the 2018 Regulations both appear to support the conclusion in this case that the incident was too remote and unforeseeable to amount to a breach of contract or a breach of the relevant regulations.