Mark Pestronk
Q: I understand that travel agencies have a legal duty to advise their clients about important information that they would not necessarily know or be expected to find out on their own. What about our legal duties to warn suppliers? Suppose we know a client who has a contagious disease or is mentally unstable is about to take a cruise that we booked. Do we have a duty to warn the cruise line about the passenger?
A: An agent has a legal duty to his or her principal to disclose needed information. A leading legal text on the agency relationship states that an agent must "use reasonable efforts to give his principal information which is relevant to affairs entrusted to him and which, as the agent has notice, the principal would desire to have and which can be communicated without violating a superior duty to a third person."
So to the extent that a travel agency acts as an agent for the cruise line in your example, the foregoing rule would apply, and the agent might be required to report what they know to the cruise line. However, the cruise lines uniformly hold that a travel agency is actually not an agent of the line.
Carnival's standard travel agency agreement provides that, "Travel agency is not an agent of Carnival." Every other cruise line has similar verbiage, though not as succinct as Carnival's.
Further, after perusing several agreements between cruise lines and agencies, I found no separate obligation for the agency to report any particular information to the line. Therefore, you probably have no legal duty to the cruise lines to tell them anything at all about the client.
No such disclaimers can be found in the ARC agreement governing the airline-agent relationship; the agreement clearly makes the appointed agency a legal agent of the carrier. Since the information about the client's condition is clearly information that "the principal would desire to have," you have a duty to report it to the airline.
The ARC agreement spells out this obligation: "The Agent shall deliver to the Carrier such specific ... particulars in connection with a client or the transportation as may be proper to enable the Carrier to render efficient service to its passengers."
What if the client's condition is not something that he or she would like you to report? Does the client's desire constitute a "superior duty to a third person" that trumps your duty to the airline under the general rule quoted above?
The statutory prohibitions against disclosure of a person's health information, such as those in the Health Insurance Portability and Accountability Act, do not apply to travel agencies. Nevertheless, under general principles of agency law, agents have a duty not to disclose the confidential information of the principal. However, that duty does not apply when an agent represents both sides of a transaction with the consent of both parties.
In such cases, the agent is called a "dual agent," and the legal rule of dual agency is that the agent "has a number of fiduciary duties to each principal at all times, including duty to inform each principal of facts which may be valuable to principal."
So you do indeed have a legal duty to tell a supplier about a client's health condition if you act as agent for the supplier.