Carnival settles $2.4 million lawsuit that may change how cruise lines handle missed ports

• Carnival has settled a $2.4 million class-action law suit over missed ports
• The case involved a cruise that sailed into a cyclone, and then cancelled two port stops.
• It could have implications for helping cruisers seek refunds and compensations for missed ports in the future.

In a case that could have major repercussions for the handling of consumer rights in relation to cruise, P&O Cruises Australia, owned by Carnival Corporation, have settled for $2.4 million in a case related to a cruise that sailed into bad weather conditions and had to cancel ports.

The company was sued in a class-action lawsuit by passengers after their ship sailed into poor weather conditions that caused “disappointment, frustration, discomfort and distress”.

The case was settled last year with the agreement that Carnival Corporation would pay $2.4 million to the passengers. The settlement was approved last week.

The case could have significant applications for how cruise lines in Australia handle offering refunds and compensation for missed ports and rerouted cruises from now on. 

It could also impact cruise lines, and has the potential to make cruising more expensive. Hitherto, it was accepted that bad weather and terms and conditions were a reasonable defence for an industry that is at the mercy of the weather. Many cruisers accept that a change in weather is an acceptable risk.

This ruling puts that acceptance under the spotlight.

The 2017 seven-day cruise to the Pacific with P&O cruises sailed into a category five tropical cyclone, which quickly led to conditions on the ship worsening.

Guests reported furniture being overturned, meals falling off tables, seawater running through cabins, the ship heavily rocking and more.

The cruise cancelled its following two port stops as a result.

Cruise compensation for missed ports is consistently a hot topic within the Australian cruising landscape, it’s common to see cruises skipping some ports, or rerouting from the Pacific to Australia, often with little to no compensation and no option for a refund. 

While this case was settled out of court, meaning it won’t set precedent, it does set an example to cruise lines that it can be cheaper in the long term to offer immediate compensation, and shows how the face of cruise consumer rights is changing in Australia, as cruise passengers stand up for their rights.

Victoria Roy, Principal Solicitor at Victory Travel & Cruise Lawyers says: “Carnival’s settlement of the Pacific Aria ‘cruise from hell’ class action, which has recently been approved by the Federal Court, should encourage Australian passengers to stand up for their consumer rights.

“Whilst the case settled without the court ruling on liability, it illustrates how cruise lines must abide by the Australian Consumer Law despite the wording of their terms and conditions, and what compensation is available to passengers.”  

Roy says this case should signal to cruisers who have had, or will have similar experiences, that legal recourse is possible.

“As well as recovering the cost of their cruise fare, passengers also recovered compensation for their disappointment, as occurred in the Moore v Scenic Tours class action. 

“Those who have suffered similar avoidable “cruises from hell” should also consider claiming wasted costs associated with their ill-fated cruise – such as airfares to and from their hometown to the port – which were also allowed in Moore v Scenic Tours in certain circumstances.”

Roy makes another crucial point which is that the significant settlement that involved Carnival having to pay both legal costs and compensation, on top of refunding the median cruise price, that this may signal to cruise lines that its more financially savvy to simply offer compensation up-front.

“As well as passengers being compensated, the Federal Court has also approved the passengers’ legal costs of no more than $1,000,000 to be paid by Carnival.  Carnival would have also had to pay lawyers of their own.  It would have been more cost-effective for Carnival to have responded to passenger complaints and compensated them early, than to defend a class action and ultimately pay out a $2.4 million settlement.  

“Readers can use this knowledge to their advantage when making their own complaints to cruise lines about breaches of the Australian Consumer Law.”

Advice on how to seek a refund if you run into similar circumstances, which can be read here

It’s important not to be deterred by the terms and conditions, as you can still seek compensation despite the cruise line reserving the right to change itineraries. .

The impact of this case will prove interesting. For example, if we look at the example of Laura, who had a Disney Cruise Line cruise booked that was rerouted from the South Pacific to Australia without initially being offered a refund.

Given that the P&O case was settled, rather than decided in court, it won’t provide precedent for someone in a situation like Laura, however, it will signal to cruise lines that consumers aren’t powerless and aid cruisers who wish to contact their cruise line and seek a refund, even if they weren’t offered one.

Background to the case

Peter Carter, Legal Practice Director of Carter Capner Law, who managed the case, explains the almost eight-year process of the case.

“We started working with distressed passengers from July 2017. We sent several demands for compensation to Carnival for those passengers in July and October that year.

“All those demands on behalf of passengers aboard the ‘Cruise from Hell’ were ignored.

“We then began investigations as to a possible class action for disappointment damages based on Australian Consumer Law as to the brochure promises made by Carnival as to how enjoyable, exciting and pleasurable their cruise would be. The investigation included collection of evidence from passengers and meteorological & maritime sources.

“The claim was tentatively settled in the course of a mediation in Brisbane held in early October 2024 on the basis Carnival pay each registered member (assuming that after further advertising the number might increase to as many as 750) the median price of the cruise per person $944 plus disappointment damages of $944 per person on top of that. Legal costs of no more than $1mil were also allowed.

“The settlement and legal costs were approved by the court on 12 Feb 2025.”

Further legal info

Mr Carter explains how the case was heavily influenced by rulings in the Moore v Scenic Tours Pty Ltd case. In this case, cruisers who were expecting a river cruise were essentially given a bus tour, due to conditions making it unfavourable to cruise the European waterways.

Roy, explains this case.

“In the Moore v Scenic Tours class action, Scenic Tours did not cancel the cruise when they knew about the bad weather or give passengers the opportunity to cancel.  Instead, Scenic imposed a changed itinerary on the passengers.  The court found that if Mr Moore had been told about the itinerary change in advance, he would have cancelled the cruise.  The court awarded him a full refund.”

Carter says rulings in this case led to the commencement of the class-action for the P&O case.

“The High Court of Australia decided on 24 April 2020 that disappointment damages werent subject to the thresholds and hurdles that apply under the NSW Civil Liability Act: ’ Moore v Scenic Tours Pty Ltd [2020] HCA 17. That decision overturned a 2018 NSW court of appeal decision to the contrary and appeared to clear the way for a viable class action.”Further judgments in Moore v Scenic in April 2022 and  in April 2023 were encouraging enough to engage a KC [King’s Counsel/Barrister] and junior counsel to prepare the court proceedings. The class action was started on 4 May 2023 in the Federal Court in Brisbane.”