Australian Unfair Contract Terms Regime Renders Foreign Class Action Waiver Clauses Void

In Short

The Situation: In 2020, a cruise ship in Australian waters, the Ruby Princess, experienced a COVID‑19 outbreak that resulted in an Australian class action. Part of the class were passengers subject to contractual terms governed by US law, including a class action waiver clause. The cruise line sought to stay the claims subject to the class action waiver clause.

The Result: The High Court held that the regime prohibiting unfair contract terms in the Australian consumer protection legislation ("Australian Consumer Law" or "ACL") applies globally to any company that is carrying on business in Australia, and that class action waiver clauses between foreign companies and foreign citizens can be struck down by a court as part of an Australian class action.