Determination No. A-2019-241
DETERMINATION by the Canadian Transportation Agency (Agency) – Inquiry into WestJet’s international scheduled tariff provisions related to schedule delays, schedule irregularities, and denied boarding.
SUMMARY
[1] On August 16, 2019, the Agency initiated, on its own motion, an inquiry into whether certain terms and conditions of WestJet’s International/Transborder Passenger Rules and Fares Tariff No. WS-1, NTA(A) No. 518 (Tariff) are just and reasonable, taking into consideration the requirement for air carriers to apply the minimum obligations set out in the Air Passenger Protection Regulations, SOR/2019-150 (APPR).
[2] During the course of the Agency’s analysis, it became evident that WestJet’s Tariff was unclear. This lack of clarity precludes the Agency from making a final assessment regarding the reasonableness of the terms and conditions themselves.
[3] Accordingly, the Agency finds that the Tariff does not meet the requirement set out in the Air Transportation Regulations, SOR 88/58, as amended (ATR), providing that the terms and conditions be clearly stated. The Agency orders WestJet to provide a proposed revised tariff containing terms and conditions that clearly articulate the specific obligations that WestJet undertakes toward its passengers, which must meet or exceed the minimal requirements of the APPR that apply to WestJet as a large carrier. WestJet must provide the proposed tariff to the Agency by March 18, 2020. If WestJet’s proposed tariff language is clear, the Agency will proceed to assess its reasonableness.
BACKGROUND
[4] On July 15, 2019, the first set of APPR provisions came into effect, requiring air carriers to meet new obligations toward their passengers in the areas of communications, denied boarding, tarmac delay, lost and damaged baggage, and the transportation of musical instruments. On December 15, 2019, additional provisions setting out air carriers’ obligations in respect of flight delays and cancellations and the seating of children came into effect. All APPR provisions are now in force.
[5] Shortly after the coming into force of the first round of APPR requirements, the Agency received a complaint by two passengers who alleged that on July 22, 2019, they were denied boarding by WestJet and were not provided with the treatment and compensation to which they are entitled to under the APPR.
[6] The passengers stated that between the time they checked in online and the time they reached the boarding gate, WestJet had changed their reservation. According to the passengers, they were removed from their originally scheduled flight and placed on a later flight as a result of WestJet’s decision to operate their original flight with a smaller aircraft.
[7] Under the APPR, passengers who are denied boarding are entitled to compensation if boarding is denied for reasons within the control of the carrier and is not required for safety.
[8] It was reported in the media, and alleged by the passengers, that WestJet categorized these circumstances as a “flight delay” rather than a “denial of boarding” and, in doing so, made reference to the provisions in its Tariff related to schedule delays and schedule irregularities.
[9] The passengers’ account raised the possibility that the terms and conditions of WestJet’s Tariff related to schedule delays and schedule irregularities were being interpreted and applied in a manner that was inconsistent with the denied boarding requirements of the APPR.
[10] On August 16, 2019, the Agency issued Decision No. LET-A-56-2019 (Direction) in which it initiated, on its own motion, an inquiry into whether the terms and conditions of WestJet’s Tariff are just and reasonable, taking into consideration the requirement for air carriers to apply the minimum obligations set out in the APPR. The Agency directed WestJet to provide a written submission addressing this matter and, specifically, explaining the types of circumstances to which WestJet believes that the provisions of its Tariff related to schedule changes and schedule irregularities do and do not apply, and the types of circumstances to which the APPR’s provisions related to denied boarding do and do not apply.
[11] WestJet filed its submission on August 30, 2019, responding to the Agency’s Direction.
PRELIMINARY MATTER
[12] In its submission, WestJet posed a number of hypothetical questions to the Agency related to the interpretation and application of the APPR. The Agency finds that these matters are outside the scope of this inquiry. The Agency has published a number of guides that provide information to the public and the air industry about the APPR’s requirements and application. The Agency has also responded to, and will continue to respond to, specific questions about the requirements of the APPR as part of its ongoing dialogue with stakeholders. WestJet can use these sources of information to obtain any required clarification about its obligations under the APPR.
THE LAW
[13] The obligations prescribed by the APPR are deemed, under subsection 86.11(4) of the Canada Transportation Act, S.C., 1996, c. 10, as amended (CTA), to form part of an air carrier’s tariff to the extent that a carrier’s tariff does not provide more advantageous terms and conditions of carriage.
[14] As set out in sections 110 and 111 of the ATR, air carriers are required to abide by the terms and conditions set out in their tariffs, and those terms and conditions must be just and reasonable.
[15] Pursuant to subsection 111(1) of the ATR:
All tolls and terms and conditions of carriage, including free and reduced rate transportation, that are established by an air carrier shall be just and reasonable and shall, under substantially similar circumstances and conditions and with respect to all traffic of the same description, be applied equally to all that traffic.
[16] Pursuant to section 122 of the ATR, a tariff for international carriage must contain certain information, including:
a. the terms and conditions governing the tariff generally, stated in such a way that is clear as to how the terms and conditions apply to the tolls named in the tariff;
…
c. the terms and conditions of carriage, clearly stating the air carrier’s policy in respect of at least the following matters, namely,
…
v. failure to operate the service or failure to operate the air service according to schedule,
vi. flight delay,
vii. flight cancellation,
viii. delay on the tarmac
ix. denial of boarding,
x. the rerouting of passengers,
…
xxi. any other terms and conditions deemed under subsection 86.11(4) of the Act to be included in the tariff, and
….
[17] Pursuant to section 26 of the CTA:
The Agency may require a person to do or refrain from doing any thing that the person is or may be required to do or is prohibited from doing under any Act of Parliament that is administered in whole or in part by the Agency.
POSITION OF WESTJET
[18] In its submission, WestJet acknowledges that the two passengers who filed a complaint with the Agency were indeed denied boarding within the meaning of the APPR, and not simply delayed as originally communicated to them. WestJet indicates that it will be contacting the passengers to explain the situation and provide the compensation for denied boarding required under the APPR.
[19] In respect of its Tariff, WestJet notes that on July 3, 2019, following the coming into force of the APPR, it provided the Agency with an amendment to its Tariff that included the following text:
The obligations of the carrier under the Air Passenger Protections Regulations (APPR) form part of the tariff and supersede any incompatible or inconsistent term and condition of carriage set out in the tariff to the extent of such inconsistency or incompatibility, but do not relieve the carrier from applying terms and conditions of carriage that are more favourable to the passenger than the obligations set out in the APPR.
[20] WestJet maintains that its Tariff properly captures the provisions of the APPR, and, as such, is just and reasonable and in accordance with section 111 of the ATR. WestJet also undertakes to revise and file updated tariffs once the Agency issues sample tariff provisions.
ANALYSIS AND FINDINGS
[21] The regulatory framework applicable to international air services imposes a number of requirements on air carriers when they establish their terms and conditions of carriage. One of the purposes of these requirements is to provide protections to passengers. For example, a tariff must, at a minimum, include terms and conditions relating to the matters specified in section 122 of the ATR, and those terms and conditions must be clear, consistent with the APPR, reasonable, and not unjustly discriminatory.
[22] Based on the language used in the ATR and the APPR, and in accordance with the principles developed in previous Agency decisions, deciding if these requirements have been met requires answers to the following questions:
- Does the tariff contain terms and conditions relating to all matters listed under section 122 of the ATR?
- Are the terms and conditions clear; that is, would a reasonable person conclude that the rights and obligations of both the carrier and passengers are stated in such a way as to exclude any reasonable doubt, ambiguity, or uncertain meaning?
- Do the obligations of the carrier to its passengers under its tariff meet or exceed the requirements of APPR that are applicable to that carrier?
- Are the terms and conditions reasonable; that is, do they strike a balance between the rights of passengers to be subject to reasonable terms and conditions of carriage and the particular carrier’s statutory, commercial, and operational obligations?
[23] If, after examining the first two questions, the Agency finds that certain terms and conditions are missing or unclear, it may be difficult or impossible to know with a reasonable level of certainty the specific obligations that the carrier has assumed toward its passengers. In such a case, the Agency will not be able to assess WestJet’s Tariff’s consistency with the APPR or its reasonableness until the issues of incompleteness and/or lack of clarity are addressed.
[24] In this case, WestJet has argued that its Tariff is just and reasonable because it includes an incorporation by reference statement indicating that the APPR provisions form part of its Tariff and supersede any incompatible or inconsistent term or condition of carriage.
[25] The Agency finds that such incorporation by reference is not, in and of itself, adequate to provide passengers with clarity on their entitlements in situations covered by the APPR, notably because some of WestJet’s Tariff language continues to reflect policies that applied prior to the coming into effect of the APPR and that are inconsistent with the minimum obligations of the APPR.
[26] When examining WestJet’s Tariff, it is impossible to determine with confidence whether a certain situation, such as the one encountered by the two passengers who filed the complaint, will be considered as a denial of boarding or a schedule change. A reasonable person reading WestJet’s Tariff would not be able to conclude that the rights and obligations of both the carrier and passengers are stated in such a way as to exclude any reasonable doubt, ambiguity, or uncertain meaning. The fact that WestJet’s own employees erroneously interpreted the two passengers’ situation as a schedule irregularity instead of a denial of boarding supports the conclusion that WestJet’s Tariff language is insufficiently clear.
[27] WestJet’s Tariff defines the term “schedule irregularity” in two different ways:
[28] Rule 1 defines a schedule irregularity as:
a. Delays in the scheduled departure or arrival of the carrier’s flight resulting in the passenger missing his/her onward connecting flights or any other delay or interruption in the scheduled operation of the carrier’s flight, or;
b. Cancellation of flight, or omission of a scheduled stop, or
c. Substitution of aircraft or of a different class of service, or;
d. Schedule changes which require rerouting of a passenger at departure time of his or her original flight
[29] Rule 75(b)(1) defines a schedule irregularity as:
- Delays in the scheduled departure or arrival of the carrier’s flight;
- Cancellation of flight, or omission of a scheduled stop, or;
- Change of schedule itinerary which require rerouting of a guest at departure time of his or her original flight. Exception: Schedule irregularity does not include force majeure events.
- The carrier will not guarantee and will not be held liable for cancellations or changes to times that appear on the passenger’s tickets due to force majeure. However, in the case of international transportation, a passenger may invoke the provisions of the convention regarding liability in the case of passenger delay. (see rule 55.)
- In the case of schedule irregularities, the carrier will give priority for assistance to any person with a disability and unaccompanied minors.
- The carrier whose flight experiences a schedule irregularity will make onward arrangements for the passenger.
[30] These two definitions are inconsistent and could be a source of confusion for passengers and for WestJet staff charged with meeting the carrier’s obligations to its passengers.
[31] Moreover, the inclusion of “substitution of an aircraft” in Rule 1(c) could create overlap between this definition of “schedule irregularity” and the definition of “denied boarding” in subsection 1(3) of the APPR. In the case of an aircraft substitution, passengers reading WestJet’s Tariff would be left to wonder whether their situation is a schedule irregularity governed by Rule 75 or a denied boarding under Rule 100, and what treatment and compensation they are entitled to receive.
[32] Furthermore, Rules 75, 100, and 110 of WestJet’s Tariff describe its policies in respect of schedule irregularities, benefits that a passenger may be entitled to under the carrier’s “Traveller’s Right Provisions,” and denied boarding. Some of the content of these Rules is inconsistent with the provisions found in the APPR that apply to flight delays and cancellations, tarmac delays, and denied boarding. For example, Rule 110 – Denied Boarding Compensation does not reference the different categories of flight disruption and different carrier obligations, which are set out in sections 10, 11, and 12 of the APPR. Similarly, the rerouting options found in Rule 110(A)(1) to (4) do not reflect the minimum obligations as set out in sections 17 (Alternative travel arrangements – within carrier’s control) and 18 (Alternative travel arrangements – outside carrier’s control) of the APPR.
[33] Finally, WestJet has failed to reflect the minimum amount of compensation for inconvenience that it owes passengers in instances of denied boarding within the carrier’s control, and the manner in which that compensation will be paid, as set out in section 20 of the APPR. At the time of the flights related to the complaint, the APPR provisions with respect to denied boarding were in effect, yet WestJet’s Tariff continued to contain provisions that more closely reflected denied boarding requirements in the United States of America and did not meet the APPR’s minimum requirements.
CONCLUSION
[34] In light of the foregoing, the Agency finds that WestJet’s Tariff does not meet the requirements of completeness and clarity, as described in the first two of the four questions listed near the beginning of this section. These issues must be addressed before the Agency can complete its analysis of the third and fourth questions, which deal with consistency with the APPR and reasonableness.
ORDER
[35] The Agency orders WestJet to provide the Agency, by March 18, 2020, with a proposed revised tariff that addresses the issues of completeness and clarity identified above, and that fully reflects the APPR and, in WestJet’s view, meets the standard of reasonableness. In undertaking these revisions, WestJet may draw upon the language of the Agency’s sample tariff, which will be published in early 2020.
[36] The Agency will complete its assessment of WestJet’s Tariff upon receipt of the proposed language.
Member(s)
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