Wednesday, 12 September 2018

The price of a cancelled flight - CJEU in Harms (C-601/17)

Today the CJEU published its judgment in the Harms case (C-601/17), in which it elaborated on the concept of the reimbursement of the ticket price for the cancelled flight, as mentioned in Article 7(3) and 8(1)(a) of the Regulation 261/2004.

In a given case the family Harms (parents with their four children) purchased flight tickets with an airline Vueling Airlines from an intermediary website of opodo.de. Mr Harms paid EUR 1108.88 to Opodo for the flights, whilst Opodo transferred EUR 1031.88 to Vueling Airlines. As the flight has been cancelled, the question arose as to the amount of money that the airlines had to compensate the family with: EUR 1108.88 (returning the full contractual performance of the passengers) or EUR 1031.88 (returning the airlines' unjust enrichment). It is the amount of EUR 77 that was paid for intermediary services that remains contested here.

Regulation 261/2004 uses the wording of the airlines having an obligation to reimburse passengers for the 'ticket' at the 'price at which it was bought', without determining its application only to direct ticket sales by the airlines (para 13). On the one hand, the objective of providing high levels of protection to air passengers requires that they are reimbursed fully, incl. the commission they paid to the intermediary for purchasing their flights. On the other hand, there is a need to balance passengers interests with these of the airlines, which leads the CJEU to set a limitation on the inclusion of the commission in the ticket's price: the air carrier had to have been aware of the commission that was set by the intermediary

The CJEU justifies the introduction of this limitation by referring to previous case law as well as other provisions of Regulation 261/2004, such as the definition of a 'ticket' in Article 2(f), which states that it is a document that has either been issued or authorised by an air carrier. This, pursuant to the CJEU, implies the need for knowledge of the air carrier of the elements of the ticket, incl. its price, and the components of this price. The national court will need to, therefore, inquire whether the air carrier had any knowledge of the commission that Opodo was charging for its services to air passengers. 

It seems safer to advise passengers to purchase their tickets directly from the airlines unless they have a travel insurance that could reimburse them for the amount charged by the intermediary or the intermediary offers such a reimbursement option in their T&Cs.

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