Arriving at Gate ECJ: more pain

The ECJ is about to ramp up the pressure on air carriers, opening the door to more compensation claims

Last Tuesday (15 May), Advocate General Bot of the European Court of Justice (ECJ) delivered his opinion in the cases of Nelson v Lufthansa and the application of TUI Travel, British Airways, easyJet and IATA. This affirmed the controversial decision of the ECJ Fourth Chamber in the cases of Sturgeon v Condor Flugdienst and Bock v Air France, which provided for fixed compensation for air passengers incurring delays of three hours or more pursuant to Regulation (EC) 261/2004.

This regulation, which came into force on 17 February 2005, provides rights for passengers who are denied boarding, whose flights are cancelled or who incur long delays. These include care and assistance (such as meals or refreshments) while awaiting a later flight and, in the case of denied boarding and flight cancellation, a right to fixed compensation based on the length of the flight.

However, on 19 November 2009 the ECJ, in Sturgeon, extended the right to compensation to include delays of three hours or more in arrival at the destination. This shocked the aviation industry, not least because it introduced a right to fixed compensation for delay where none previously appeared to exist and, in certain situations, such a right arose (after three hours) before a passenger became entitled to a complimentary refreshment (after four hours).

Both referring courts asked the ECJ to review its interpretation in Sturgeon. During this, questions were raised, the most pertinent of which related to compatibility of Sturgeon with the Montreal Convention 1999 (MC99). This provides a set of rules that govern international carriage by air including claims for damage ­occasioned by delay in the carriage by air, but excluding punitive, ­exemplary or non-compensatory damages.

The advocate general considered that no incompatibility arose between MC99 and Sturgeon on the basis that Sturgeon covered generic damage resulting from delay which is the same for each passenger, while MC99 covered individual damage inherent in the reason for travel.

The ECJ will render its final judgment soon. To follow the advocate general’s opinion, which is likely, will erode the MC99 exclusivity principle and force carriers to pay claims for fixed compensation in the event of delays of three hours or more, irrespective of MC99.

Many carriers have pressed the pause button on claims for compensation for delay and should prepare to deal with these swiftly once the judgment is published.

The exemption to the duty to pay compensation in extraordinary circumstances (such as bad weather or technical faults) will become all the more significant, albeit that the ­defence has already been limited by the ECJ in Wallentin v Alitalia and can be difficult and costly to prove.

This opinion could not have come at a worse time for carriers faced with managing delays at Heathrow resulting from long queues at border ­control, which have a knock-on effect on arrivals, turnaround times and ­departures, and may lead to a right to compensation. Whether such delays would qualify as extraordinary remains open for debate.