Decision No. 217-C-A-2007

May 1, 2007

File No. M4120-3/06-08489

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COMPLAINT

[1] On March 2, 2006, Tamaris Hudson filed with the Complaints Investigation Division (hereinafter the CID) the complaint set out in the title. On December 12, 2006, Mrs. Hudson advised that she wished to pursue this matter formally before the Canadian Transportation Agency (hereinafter the Agency), given that the parties had been unable to reach a satisfactory agreement despite the intervention of the CID.

[2] In a letter dated January 4, 2007, Mrs. Hudson and Air Canada were advised of the Agency's jurisdiction in this matter and were requested to advise if they agreed to have the comments they had filed with the CID considered as pleadings before the Agency.

[3] On January 5, 2007, Air Canada advised that it wished to file additional comments and that, as such, it does not agree that the comments previously filed with the CID be considered as pleadings before the Agency.

[4] In Decision No. LET-C-A-12-2007 dated January 18, 2007, the Agency initiated pleadings.

[5] On February 15, 2007, Air Canada filed its answer, and on February 23, 2007, Mrs. Hudson filed her reply.

[6] Pursuant to subsection 29(1) of the Canada Transportation Act, S.C., 1996, c. 10, the Agency is required to make its decision no later than 120 days after the application is received unless the parties agree to an extension. In this case, the parties have agreed to an extension of the deadline until May 1, 2007.

ISSUE

[7] The issue to be addressed is whether Air Canada applied the terms and conditions of carriage relating to liability for the carriage of checked baggage specified in the carrier's tariff governing travel between points in Canada and points in the United States of America (hereinafter the Tariff) in effect at the time of the incident, as required by subsection 110(4) of the Air Transportation Regulations, as amended, SOR/88-58 (hereinafter the ATR), and whether the present case involves a violation of Article 17(2) of the Montreal Convention.

POSITION OF THE PARTIES

[8] Mrs. Hudson indicates that on July 27, 2005, she and her son travelled with Air Canada on Flight No. AC8161 from Edmonton to Calgary, and then on Flight No. AC572 to Los Angeles, California. She states that when she arrived in Los Angeles, she noticed that one of her suitcases was unzipped, but did not look in it at that time. Mrs. Hudson indicates that when she arrived at her final destination, i.e., Sun City, California, about 1½ hours later, she checked her suitcases and discovered that the plastic container holding her watercolour paintbrushes was missing. Mrs. Hudson submits that, over the next five days following her arrival in Sun City, she made repeated phone calls to Air Canada's lost and found contact number, but no one returned her calls. She indicates that she then filed, by e-mail, a lost baggage claim with Air Canada and that in response, she was given a temporary claim number, and was instructed to call the carrier's Baggage Services. Mrs. Hudson submits that when she called Baggage Services, she was told to purchase replacement items within 21 days from the date of her flight and to send her receipts to Air Canada for reimbursement. Mrs. Hudson further submits that when she explained that she would not be back home within the 21-day deadline, she was told to buy the replacement items as soon as she returned home.

[9] Mrs. Hudson indicates that after returning to Edmonton on August 20, 2005, she promptly purchased 17 replacement watercolour paintbrushes, ranging in price from $4.38 to $120.70, and an X-Acto knife, at a total cost of $636.45, that she provided Air Canada with the receipts for reimbursement on August 31, 2005, and that the carrier subsequently rejected her claim for a variety of reasons, including on the basis that the carrier's liability does not extend to art objects. In support of her claim, Mrs. Hudson filed with the Agency a copy of her receipts, along with two statutory declarations, signed by herself and her art teacher, respectively, attesting that Mrs. Hudson replaced the same number of watercolour paintbrushes and that they are of similar quality to those that were lost.

[10] Air Canada submits that, based on the Tariff, the carrier does not accept to carry valuable items whether placed in a passenger's checked baggage or otherwise placed in the care of Air Canada. Air Canada adds that the word "valuable" must be given its ordinary meaning found in The Canadian Oxford Dictionary, namely something which has "considerable importance or worth". In this regard, Air Canada points out that Mrs. Hudson's set of watercolour paintbrushes is worth almost four times more than the price she paid to purchase her ticket to travel from Edmonton to Los Angeles and return. Air Canada is therefore of the opinion that a set of watercolour paintbrushes that is worth $636.45 should be considered a "valuable" item.

[11] Air Canada maintains that, pursuant to the Tariff, the carrier does not agree to carry fragile items in checked baggage, and that watercolour paintbrushes qualify as artistic items, which in turn, are classified as fragile items.

[12] Air Canada submits that the items for which Mrs. Hudson is seeking reimbursement are valuables and fragile within the meaning of the Tariff and that, as such, the carrier is exempted from liability for the loss of such items.

[13] Air Canada asserts that the Tariff provisions related to baggage liability conform with Article 17(2) and Article 26 of the Montreal Convention. Air Canada argues that because the Montreal Convention does not dictate which items the carrier must and/or should accept to carry, it is left to the discretion of the carrier to determine which items it will agree or refuse to carry, and that the carrier's liability under the Montreal Convention is restricted to the items that it actually agrees to carry.

[14] Mrs. Hudson submits that Air Canada's contention that her belongings are valuable because they cost more than the fare that she had purchased is inaccurate. Mrs. Hudson further maintains that her watercolour paintbrushes are neither artistic items on their own nor fragile, but rather are tools used to create artistic items.

APPLICABLE LEGISLATIVE AND REGULATORY PROVISIONS

[15] The Agency's jurisdiction over the present complaint is set out in subsection 110(4) and section 113.1 of the ATR, which provide that:

110.(4) Where a tariff is filed containing the date of publication and the effective date and is consistent with these Regulations and any orders of the Agency, the tolls and terms and conditions of carriage in the tariff shall, unless they are rejected, disallowed or suspended by the Agency or unless they are replaced by a new tariff, take effect on the date stated in the tariff, and the air carrier shall on and after that date charge the tolls and apply the terms and conditions of carriage specified in the tariff.

113.1 Where a licensee fails to apply the fares, rates, charges, terms or conditions of carriage applicable to the international service it offers that were set out in its tariffs, the Agency may

(a) direct the licensee to take corrective measures that the Agency considers appropriate; and

(b) direct the licensee to pay compensation for any expense incurred by a person adversely affected by the licensee's failure to apply the fares, rates, charges, terms or conditions of carriage applicable to the international service it offers that were set out in its tariffs.

The Tariff provisions

[16] Rule 195AC, Conditions and charges for acceptance of special items, of Air Canada's Tariff in effect at the time of the incident, provides, in part, that:

The following are special items or types of items that will be accepted as baggage by specified carriers subject to the conditions shown. The exclusion of carriers from a paragraph does not imply that those carriers will not accept the item; unless otherwise indicated, the excluded carriers will accept the item subject to the general terms of acceptance in Rule 190. Charges prescribed in this rule are applicable from the point at which the item is accepted to the point to which the item is transported.

...

(K) FRAGILE ITEMS

(1) Upon request, a fragile and/or bulky item will be carried as cabin-seat baggage subject to the provisions in Rule 215.

(a) Articles not acceptable in checked baggage or when otherwise placed in the care of the carrier: Carrier does not agree to carry in checked baggage, or when otherwise placed in the care of the carrier; money, jewelry, silverware, negotiable papers, securities, or other valuables, computers, cameras, cellular phones, business documents, samples, liquids, perishables or prescription drugs.

(b) AC does not agree to carry fragile items as checked baggage, or when otherwise placed in the care of the carrier, unless they are appropriately packaged in the original factory-sealed carton, a cardboard mailing tube, or a container or case specifically designed for shipping such items. Carrier agrees to carry such items without the appropriate packaging upon execution by the passenger of a Limited Release tag at time of check-in (see below for form of Limited Release tag applicable). Unsuitably or inadequately packed items will be carried but only upon completion of a Limited Release tag at time of check-in (see paragraph (4) below).

(2) Classes and Examples of Fragile and/or Perishables Items

The classes of items listed below are deemed by carrier to be fragile or perishable or otherwise unsuitable as checked baggage and are subject to the conditions of acceptance set forth in paragraph (1) above.

(a) Artistic Items

Paintings, drawings, statues or other sculptures, plastics, and plaster of paris molds and casts

...

[17] Rule 230AC, Liability - Baggage, of Air Canada's Tariff in effect at the time of the incident, provides, in part, that:

...

For the purpose of international carriage governed by the Montreal Convention, the liability rules set out in the Montreal Convention are fully incorporated herein and shall supersede and prevail over any provisions of this tariff which may be inconsistent with those rules.

The Montreal Convention

[18] Article 17(2) of the Montreal Convention provides that:

The carrier is liable for damage sustained in case of destruction or loss of, or of damage to, checked baggage upon condition only that the event which caused the destruction, loss or damage took place on board the aircraft or during any period within which the checked baggage was in the charge of the carrier. However, the carrier is not liable if and to the extent that the damage resulted from the inherent defect, quality or vice of the baggage. In the case of unchecked baggage, including personal items, the carrier is liable if the damage resulted from its fault or that of its servants or agents.

ANALYSIS AND FINDINGS

[19] In making its findings, the Agency has carefully considered all of the evidence submitted by the parties during the pleadings. The Agency has also examined the Tariff, as well as the Montreal Convention.

[20] Air Canada submitted that pursuant to Rule 195AC of the Tariff, it does not accept to carry valuable items in checked baggage or otherwise placed in the care of the carrier, and that a set of watercolour paintbrushes worth $636.45 is to be considered a valuable item. Air Canada also indicated that it does not agree to carry fragile items, and that artistic items, such as watercolour paintbrushes, should be considered fragile.

[21] As to Air Canada's argument that watercolour paintbrushes are "valuable" items, the Agency does not subscribe to Air Canada's interpretation of the Tariff. The Agency finds that such interpretation is unreasonable and inconsistent with the general understanding of what constitutes a valuable item, i.e., something which has "considerable importance or worth" (The Canadian Oxford Dictionary). Indeed, in the present case, the Agency notes that in light of the evidence filed, the most expensive paintbrush that was lost was worth $120.70. All things considered, the Agency is of the opinion that such an item cannot reasonably be considered as a valuable item in accordance with Air Canada's Tariff.

[22] With respect to Air Canada's argument that it should not be held liable for the loss of the watercolour paintbrushes because they qualify as "fragile" items, the Agency notes that Rule 195AC of Air Canada's Tariff sets out classes and examples of fragile items that the carrier does not accept to carry and for which it is not liable. Upon review of Rule 195AC, the Agency finds that this provision cannot reasonably be interpreted as excluding the carrier's liability for items such as watercolour paintbrushes. Such items are not "easily broken, or weak" and they accordingly do not fall within the common understanding of what constitutes a "fragile" item (The Canadian Oxford Dictionary).

[23] The Agency further notes that a watercolour paintbrush is not an item included in Air Canada's "Fragile or Perishable" items exclusion list, even under the heading of "Artistic Items". With respect to Air Canada's submission that a paintbrush is an "artistic item", as was correctly pointed out in Mrs. Hudson's submissions, the Agency is of the opinion that a "paintbrush" is not an artistic item, but rather a tool used to create artistic items.

[24] In light of the foregoing, the Agency is of the opinion that the exemptions of Rule 195AC referred to by Air Canada do not apply in the present case. The Agency therefore finds that Air Canada should be held liable for the loss of the watercolour paintbrushes.

[25] Furthermore, the Agency points out that, in any event, should the type of watercolour paintbrushes involved in the present case have been explicitly excluded from the carrier's liability as "fragile" or "valuable" items, such provision would likely be found to be unreasonable under section 111 of the ATR as such items cannot reasonably be excluded as being fragile or valuable when compared to the items typically carried in passengers' baggage.

[26] The Agency has examined the receipts and the statutory declarations filed by Mrs. Hudson in support of her claim, and finds that they are reasonable and that they fairly represent the value of the lost items.

[27] Lastly, in light of the Agency's interpretation of Rule 195AC, and considering that, pursuant to the Tariff, Air Canada is liable for the loss of the watercolour paintbrushes, the Agency is satisfied that the present case does not involve a violation of Article 17(2) of the Montreal Convention.

CONCLUSION

[28] Based on the above findings, the Agency concludes that by refusing to compensate Mrs. Hudson, Air Canada wrongly applied Rule 195AC of the Tariff and contravened subsection 110(4) of the ATR.

[29] Accordingly, the Agency, pursuant to section 113.1 of the ATR, hereby directs Air Canada, within thirty (30) days from the date of this Decision, to pay Mrs. Hudson the amount of $636.45, which represents the total paid by Mrs. Hudson to buy replacement items.

[30] Air Canada is required to advise the Agency once compensation has been provided to Mrs. Hudson.

Members

• Gilles Dufault
• Beaton Tulk