Thursday, 13 October 2011

More compensation to air passengers - CJEU in case Sousa Rodríguez and Others

13 October 2011: CJEU case C-83/10 Sousa Rodríguez and Others

The CJEU decided today a case concerning interpretation of the Regulation (EC) No. 261/2004 establishing common rules on compensation and assistance to passengers in the event of denied boardng and of cancellation or long delay of flights (see the comments on the opinion of the AG in: Compensation for cancelled flight). Article 2(1) of this Regulation defines cancellation as:

"the non-operation of a flight which was previously planned and on which at least one place was reserved"

Article 5 of the Regulation gives passengers rights to claim: assistance by the operating air carrier (in accordance with Article 9) and compensation (in accordance with Article 7). Article 12 states that passengers have a right to claim further compensation than the one provided for in the Regulation.

The dispute concerned a flight of Air France from Paris to Vigo (Spain). A few minutes after the flight took off as planned, the pilot decided to return to the departure point, Charles de Gaulle airport in Paris, due to a technical failure of the plane. Three passengers were offered a flight the next day from Paris Orly to Porto (Portugal), from where they travelled to Vigo by taxi. Another traveller got a seat on a flight the same day, from Paris to Vigo via Bilbao. All other passengers were offered a flight the following day from Paris to Vigo, scheduled at the same time as the one that had broken down. Only one passenger was provided with accommodation at Air France's cost or received any assistance from that airline. Seven passengers brought an action against Air France for damages for breach of contracts of carriage by air. They demand damages in the amount as prescribed by Article 7 (250 euro each), one of the passengers claims also costs he incurred for his transfer by taxi from Porto to Vigo. Another applicant claims repayment of his meal costs at the Paris airport, as well as those in respect of his dog's being kept in boarding kennels for a day longer than initally expected. All other passengers also claim an additional compensation for non-material damage they consider they have suffered.

Was the flight cancelled?

Firstly, Air France tried to defend itself by claiming that there was no 'cancellation' in this case, as defined by the Regulation, which would mean that they would not have to provide any compensation as per the Regulation. They had claimed, therefore, that the flight took off according to the schedule, so it may not be perceived as cancelled nor as delayed. 

The CJEU had no problem stating that this factual situation could be seen as 'cancellation', as well. The court reminded that:

"a flight consists, in essence, of an air transport operation, being as it were a ‘unit’ of such transport, performed by an air carrier which fixes its itinerary" (Par. 27)

An itinerary is an essential element of the flight, as the flight is operate with the carrier's pre-arranged planning in mind.

"As the term ‘itinerary’ means the journey to be made by aeroplane from the airport of departure to the airport of arrival according to a fixed schedule, it follows that, for a flight to be considered to have been operated, it is not enough that the aeroplane left in accordance with the scheduled itinerary, but it must also have reached its destination as appearing in the said itinerary. The fact that take-off occurred but that the aeroplane then returned to the airport of departure without having reached the destination appearing in the itinerary means that the flight, as initially scheduled, cannot be considered as having been operated." (Par. 28)

The above means that also when cancellation happened due to practical circumstances (returning the plane from its way towards destination to its port of origin due to mechanical failure) and not due to an express decision cancelling it, it should still be perceived as cancellation. (Par. 29) As a result:
 
"the answer to the first question is that ‘cancellation’, as defined in Article 2(1) of Regulation No 261/2004, must be interpreted as meaning that, in a situation such as that at issue in the main proceedings, it does not refer only to the situation in which the aeroplane in question fails to take off at all, but also covers the case in which that aeroplane took off but, for whatever reason, was subsequently forced to return to the airport of departure where the passengers of that aeroplane were transferred onto other flights." (Par. 35)

What kind of compensation could the passengers claim?

 
The CJEU makes clear that passengers rights to compensation provided for in the Regulation is of a minimum nature. (Par. 37) Article 12 on 'further compensation' intends to make sure that passengers are compensated:
 
"for the entirety of the damage that they have suffered due to the failure of the air carrier to fulfil its contractual obligations" (Par. 38)
 
National courts are therefore allowed to order the air carrier to compensate damage arising, for passengers, from breach of contract of carriage by air on a legal basis other than the Regulation, e.g. on the basis of the Montreal Convention and national law provisions. (Par. 38) The Montreal Convention refers to damages (Chapter III) as including both material and non-material damage (see: case C-63/09 Walz). This means that passengers are free to claim non-material damage within 'further compensation' as described by Article 12 of the Regulation. (Par. 41)
 
It's interesting to note what the CJEU did with compensation of the expenses that the passengers incurred due to the failure of the carrier to fulfill its obligations to assist on the basis of Article 8 and 9 of the Regulation (reimbursement of ticket or re-routing to final destination, cost of transfer between the airport of arrival and originally scheduled airport, meal, accommodation, communication costs etc.). These expenses may not be seen as part of 'further compensation' regulated by Article 12 of the Regulation. (Par. 42-43) That does not mean, however, that consumers may not claim compensation for these expenses, if the air carrier fails to fulfil these obligations voluntarily. (Par. 44)
 
What if the consumers based their claims on the breach of Article 12 of the Regulation and did not mention breach of Article 8 and 9 thereof?
 
"there is nothing in Regulation No 261/2004 that precludes the award of compensation in respect of a failure to fulfil the obligations provided for by Article 8 and Article 9 therein, if those provisions are not invoked by the air passengers." (Par. 45)

This means that the national court may adjudicate of its own motion that there was a breach of these provisions of the Regulation and award damages to the passengers.
 
This is a very interesting case that once again makes it clear that air carriers need to fulfil all the legal obligations that are placed on them in respect of cancelled and delayed flights and not try to look for loopholes in these regulations.

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