Order No. 1990-A-670

November 21, 1990

File No. D2120-L83-2

WHEREAS by letter dated March 13, 1990, Mr. Sylvain Francoeur notified the Agency of his request to Linea Aérea Nacional Chile S.A. (hereinafter Lan Chile) for the refund of an unused Mirabel - Miami ticket showing an air fare of $282.00;

AND WHEREAS by letter dated March 23, 1990, the request by Mr. Francoeur was served on Lan Chile for comment. Lan Chile replied by letter dated April 25, 1990 indicating that it had provided a refund in the amount of $160.50 to l'Agence de Voyages Canandes International Tours Inc.;

AND WHEREAS by letter dated May 7, 1990, Lan Chile was advised that its tariff rule applicable to the refund of unused tickets specified that a penalty of $40.00 would apply to the refund for failure to use confirmed space as ticketed; and Lan Chile was requested to reconsider the matter;

AND WHEREAS by letter dated May 18, 1990, Lan Chile replied stating that the refund of $160.50 represented the air fare less the penalty of $40.00 and the commission of the travel agent. By letter dated May 22, 1990, Lan Chile was advised that its tariff rule contained no provision for deductions other than the $40.00 penalty and that Mr. Francoeur was entitled to a refund of $242.00;

AND WHEREAS Lan Chile replied by letter dated May 30, 1990 stating that travel agents had the right to a commission and that Lan Chile did not know and did not have the right to know how much a passenger paid to a travel agent. Furthermore, Lan Chile stated that it was not responsible for the transaction between Mr. Francoeur and his travel agent and if Mr. Francoeur did not receive his money he had to complain to the travel agent;

AND WHEREAS by letter dated September 21, 1990 Lan Chile was notified by the Agency that on the basis of its tariff rule, Mr. Francoeur was entitled to a refund of $242.00. Moreover, the Agency informed Lan Chile that agreements between an air carrier and travel agents had no relevance to the terms and conditions of carriage contained in a tariff which formed the basis of the contract between the passenger and the air carrier. Lan Chile was advised by the Agency that, pursuant to subsection 110(4) of the Air Transportation Regulations, SOR/88-58 (hereinafter the ATRs), an air carrier is obligated to charge the fares contained in its tariff and to apply the terms and conditions of carriage contained in the tariff. The Agency requested that Lan Chile provide Mr. Francoeur a refund in accordance with its tariff rule and that if Lan Chile failed to do so, the Agency could find Lan Chile in violation of the ATRs;

AND WHEREAS by letters dated September 21 and October 4, 1990, Lan Chile requested that the Agency provide proof that Mr. Francoeur paid $282.00 for his ticket. The Agency notes that the Lan Chile ticket issued to Mr. Francoeur is proof of the air transportation contract between Mr. Francoeur and Lan Chile and that the air fare shown on the ticket is the relevant dollar amount for the purposes of a refund. The Agency is of the opinion that Lan Chile has failed to provide a refund in accordance with its tariff rule and has therefore not abided by subsection 110(4) of the ATRs.

NOW THEREFORE, IT IS ORDERED THAT:

Linea Aérea Nacional Chile S.A. is hereby required to comply with subsection 110(4) of the Air Transportation Regulations and provide Mr. Sylvain Francoeur with a refund in accordance with the provision contained in its tariff. Linea Aérea Nacional Chile S.A. is required to provide proof of compliance within two weeks from the date of this Order.