Decision No. 30-C-A-2021

SUMMARY

[1] The applicants filed an application with the Canadian Transportation Agency (Agency) against the respondent regarding a flight delay.

[2] The applicants seek the following compensation in relation to the delay:

• EUR 1,200 for delay pursuant to Regulation (EC) No 261/2004 of the European Parliament and of the Council (Regulation (EC) No 261/2004); and
• CAD 84.75 for an additional day of dog boarding.

[3] The Agency will address the following issues:

• Did the respondent properly apply Rule 105(B)(5) of the terms and conditions set out in its International Passenger Rules and Fares Tariff No. AC-2 Containing Local and Joint Rules, Regulations, Fares and Charges on Behalf of Air Canada Applicable to the Transportation of Passengers and Baggage Between Points in Canada/USA and Points in Areas 1/2/3 and Between the USA and Canada, NTA(A) No. 458 (Tariff) with respect to the Convention for the Unification of Certain Rules for International Carriage by Air – Montreal Convention (Montreal Convention), as required by subsection 110(4) of the ATR?
• Did the respondent properly apply Rule 80(C)(2) of its Tariff with respect to compensation under Regulation (EC) No 261/2004?
• Did the respondent properly apply section 13 of the Air Passenger Protection Regulations, SOR/2019-150 (APPR) and Rule 80(C) of its Tariff as it relates to communication?

[4] For the reasons set out below, the Agency finds that the respondent properly applied the terms and conditions of carriage set out in its Tariff with respect to the Montreal Convention, and that the respondent properly applied its Tariff when it declined to compensate the applicants pursuant to Regulation (EC) No 261/2004. However, the Agency also finds that the respondent did not properly apply the communication requirements of Regulation (EC) No 261/2004, as incorporated in the Tariff by reference in Rule 80(C)(2). Nonetheless, the Agency finds that the applicants incurred no reasonable expenses as a result of this Tariff violation and, therefore, makes no order.

BACKGROUND

[5] On August 25, 2019, the applicants were scheduled to return to Toronto, Ontario, from Venice, Italy, on the respondent’s flight. The flight was delayed arriving at its final destination by approximately 4 hours and 35 minutes.

[6] Earlier during these proceedings, the respondent requested that the Agency dismiss the application under section 42 of the Canadian Transportation Agency Rules (Dispute Proceedings and Certain Rules Applicable to All Proceedings), SOR/2014-104 (Rules), because ENAC, the designated Italian enforcement body for Regulation (EC) No 261/2004, had previously dismissed claims related to the same flight disruption. These claims do not appear to have involved the applicants.

[7] In Decision No. LET-C-A-61-2020, the Agency rejected the request to dismiss and decided to hear the application. The Agency acknowledged that the decision of ENAC may be relevant to the application. However, the Agency also found that the fact that ENAC is the designated Italian enforcement body for the European regulations does not preclude the Agency from having jurisdiction over the respondent’s application of the Tariff. Consistent with Decision No. 15-C-A-2019 (Heaney v Air Canada), the Agency has the authority to interpret Regulation (EC) No 261/2004 in this case within the meaning of subsection 110(4) of the ATR because the regulation is incorporated by reference into the Tariff at Rule 80(C)(2).

THE LAW AND RELEVANT TARIFF PROVISIONS

[8] Subsection 110(4) of the ATR requires that a carrier operating an international service apply the terms and conditions of carriage set out in its tariff.

[9] If the Agency finds that an air carrier has failed to properly apply its tariff, subsection 113.1(1) of the ATR empowers the Agency to direct the air carrier to:

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

(b)  pay compensation for any expense incurred by a person adversely affected by its failure to apply the fares, rates, charges or terms and conditions that are applicable to the service it offers and that were set out in the tariff.

[10] Subsection 13(1) of the APPR, requires the carrier to communicate the following information to a passenger in the case of a flight disruption:

(a)  the reason for the delay, cancellation or denial of boarding;

….

[11] With respect to paragraphs 13(1)(b) to (d), subsection 34(2) of the APPR states:

Subsections 2(1) and (2), paragraphs 10(3)(b) and (c), 11(3)(b) and (c) and (4)(b) and (c), 12(2)(b) to (d) and (3)(b) to (d) and 13(1)(b) to (d) and sections 17 and 18 do not apply in respect of a delay or cancellation of a flight before December 15, 2019.

[12] Subsections 13(2) and 13(3) of the APPR set out the timing of the communication:

(2) In the case of a delay, the carrier must communicate status updates to passengers every 30 minutes until a new departure time for the flight is set or alternate travel arrangements have been made for the affected passenger.

(3) The carrier must communicate to passengers any new information as soon as feasible.

[13] Article 19 of the Montreal Convention establishes liability rules for damages incurred as a result of flight delay:

The carrier is liable for damage occasioned by delay in the carriage by air of passengers, baggage or cargo. Nevertheless, the carrier shall not be liable for damage occasioned by delay if it proves that it and its servants and agents took all measures that could reasonably be required to avoid the damage or that it was impossible for it or them to take such measures.

[14] The relevant provisions of the Tariff are set out in the Appendix, including the relevant provisions of Regulation (EC) No 261/2004.

1. DID AIR CANADA PROPERLY APPLY ITS TARIFF WITH RESPECT TO THE MONTREAL CONVENTION?

Positions of parties and findings of fact

THE APPLICANTS

[15] The applicants submit that they were told at the gate that a crew member became ill the day before; and they argue that the respondent could have done more during this time to make arrangements for an alternate crew in order to prevent the delay. The applicants also argue that staffing issues are within the control of the respondent.

[16] The applicants submit that they had to pay for an extra day of dog boarding as a result of the delays that they experienced.

THE RESPONDENT

[17] The respondent states that on August 25, 2019, the morning before the flight was scheduled to depart, one of the flight attendants was deemed unfit to fly due to acute appendicitis. This left the respondent with insufficient crew to safely operate the flight, pursuant to the Canadian Aviation Regulations, SOR/96-433 (CARS).

[18] In order to mitigate the damage as required by the Montreal Convention, the respondent submits that it arranged for a replacement crew member to be placed on the next available flight to Venice from Athens, Greece, on Aegean Airlines. The respondent explained that it has limited replacement crew available at foreign destinations, but it keeps standby crew in Athens, approximately two hours away from Venice by air travel, in order to mitigate flight delays in Europe. The respondent submits that having a replacement crew travel from Canada would have taken longer, and the replacement crew would have exceeded crew duty time limits once they arrived in Venice.

FINDINGS OF FACT

[19] Although the applicants state that they were told that the crew member became ill the day before the flight, the documentation filed by the respondent indicates that the crew member became ill the morning of the flight on August 25, 2019. The respondent then arranged for a replacement crew member to travel to Venice from Athens on Aegean Airlines.

Analysis and determinations

[20] The onus is on the applicants to establish, on a balance of probabilities, that the carrier has failed to properly apply the terms and conditions of carriage set out in its tariff.

[21] Article 19 of the Montreal Convention provides that a carrier will be liable for damage occasioned by delay unless “it proves that it and its servants and agents took all measures that could reasonably be required to avoid the damage or that it was impossible for it or them to take such measures.”

[22] The Agency finds that the delay caused by the crew member’s unexpected illness was outside the respondent’s control. However, even though the cause of the delay was outside the respondent’s control, it was still required to take all reasonable steps to avoid the damage for the dog boarding expense claimed by the applicants.

[23] In this case, the Agency finds that the respondent took all reasonable measures to prevent the damage by arranging for a replacement crew member for the flight, thereby minimizing the length of the delay experienced by the applicants. Specifically, Air Canada was able to locate reserve crew in a nearby city and bring them in. The Agency is of the view that a carrier cannot necessarily be expected to have staff on call in every city from which it provides air service.

[24] Consequently, the Agency finds that the respondent properly applied Rule 105(B)(5) of its Tariff.

2. DID THE RESPONDENT PROPERLY APPLY ITS TARIFF WITH RESPECT TO COMPENSATION UNDER REGULATION (EC) NO 261/2004?

Positions of the parties

THE APPLICANTS

[25] The applicants submit that they are entitled to compensation pursuant to Regulation (EC) No 261/2004 due to the length of the delay. As noted above, the applicants argue that the respondent could have done more to prevent the delay.

THE RESPONDENT

[26] The respondent submits that the Agency should put considerable weight on the decision of the designated Italian enforcement body, which found that the flight delay for the impacted flight was caused by the sudden illness of a crew member, an extraordinary circumstance for which no compensation is owed under Regulation (EC) No 261/2004. In particular, the respondent refers to the principle of comity and notes that ENAC has expertise in interpreting Regulation (EC) No 261/2004. It also submits that the ENAC decision has not been overturned. Similar to its arguments in relation to the Montreal Convention, in order to mitigate the delay, as required by Regulation (EC) No 261/2004, the respondent submits that it arranged for a replacement crew member.

Analysis and determinations

[27] As noted above, Regulation (EC) No 261/2004 is incorporated by reference into the respondent’s Tariff in Rule 80(C)(2) and the Agency may interpret it as part of the Tariff in order to determine if the respondent properly applied the Tariff pursuant to subsection 110(4) of the ATR. As a result, the Agency interprets the provisions of the regulation based on its plain language, in the context of the Tariff and consistent with any legal principles in Canadian law that are relevant to the issues raised in the application.

[28] Regulation (EC) No 261/2004 requires the carrier to provide passengers with a specific amount of compensation in relation to flight disruptions that meet the criteria set out in the regulation. No compensation is owed if the flight disruption is caused by “extraordinary circumstances” as referred to in Article 5(3). In order for the carrier to rely on this defence to avoid paying compensation, it must demonstrate that it has taken “all reasonable measures” to avoid the delay.

[29] Based on the documentation filed by the respondent, the Agency finds that the crew member’s illness constituted an extraordinary circumstance and that the respondent took all reasonable measures to avoid the delay by arranging for the alternate crew member. Although ENAC’s decision is not determinative of the Agency’s findings on this issue, the Agency notes that its findings are consistent with those of ENAC.

[30] Therefore, the Agency finds that the respondent properly applied the Tariff when it declined to compensate the applicants pursuant to Regulation (EC) No 261/2004.

3. DID THE RESPONDENT PROPERLY APPLY SECTION 13 OF THE APPR AND RULE 80(C) OF ITS TARIFF AS IT RELATES TO COMMUNICATION?

Positions of the parties and finding of fact

THE APPLICANTS

[31] The applicants argue that they were not provided with timely information about the delay and plans for rescheduling. The applicants submit that they were told at the gate that the crew member became ill the day before the flight, but that they were only informed of this at the time of the delayed departure. They also allege that they were not informed of their right to compensation under Regulation (EC) No 261/2004 nor the Montreal Convention.

THE RESPONDENT

[32] The respondent submits that it provided timely information regarding the reason for the delay as required by paragraph 13(1)(a) of the APPR and Rule 80 of its Tariff. In addition to providing passengers with the reason for the delay at the airport, the respondent submitted evidence that the applicants were set up to receive email notifications, as well as evidence that the passengers on the flight who elected to receive notifications were notified electronically of the reason for the delay.

FINDINGS OF FACT

[33] Although the applicants allege that they were only informed of the cause of the delay verbally at the gate, the evidence filed by the respondent supports that the applicants were set up to receive electronic notifications, and that electronic notices were sent regarding the cause of the delay.

[34] However, there is no evidence that the applicants received any notifications in relation to Regulation (EC) No 261/2004.

Analysis and determinations

[35] The provisions of the APPR with respect to standard of care and compensation for inconvenience were not yet in force at the time the applicants travelled, so the carrier did not have to inform the applicants of any recourse in relation to those provisions under subsection 13(1) at the time, as set out in section 34 of the APPR. However, paragraph 13(1)(a) of the APPR nonetheless required the carrier to communicate the reason for the delay, and subsections 13(2) and 13(3) set out the timing and frequency of communication. Rule 80(C)(3) of the Tariff also set out similar requirements to communicate the reason for the delay in a timely manner.

[36] As noted above, the burden of proof is on the applicants to establish that the Tariff was not properly applied. In this case, the Agency finds that the evidence supports that the applicants received communications from the respondent and were informed of the reason for the delay in a timely manner. The incident occurred that morning, not the day before. As a result, the Agency finds that the respondent properly applied Rule 80(C)(3) of the Tariff and section 13 of the APPR.

[37] However, there are also communication requirements under Regulation (EC) No 261/2004, which, as noted above, is incorporated by reference into Rule 80(C)(2) of the Tariff. Specifically, Article 14(2) of Regulation (EC) No 261/2004 requires the carrier to provide each passenger affected by a delay of at least two hours with a written notice setting out the rules for compensation and assistance in line with the regulation.

[38] Based on a plain language reading of the requirement, in the context of the Tariff, the Agency finds that the applicants were entitled to a written notice regarding their rights in relation to Regulation (EC) No 261/2004. As the applicants’ claim that they did not receive such a notice is unopposed, the Agency finds that the respondent did not comply with this requirement.

[39] Pursuant to section 113.1 of the ATR, the Agency has the power to award reasonable expenses in relation to the respondent’s failure to apply its Tariff. However, the Agency finds that the failure to provide such a notice to the applicants in this case did not result in any expenses, as there is no evidence that the provision of this notice would have prevented the applicants from incurring their dog boarding expenses.

[40] As a result, although the Agency finds that the respondent did not properly apply Rule 80(C)(2) of its Tariff, the Agency makes no order.

CONCLUSION

[41] The Agency finds that the respondent properly applied the terms and conditions of carriage set out in its Tariff with respect to the Montreal Convention. The Agency also finds that the respondent properly applied its Tariff when it declined to compensate the applicants pursuant to Regulation (EC) No 261/2004. However, the respondent did not properly apply Rule 80(C)(2) of its Tariff with respect to the communication requirements of Regulation (EC) No 261/2004.

As the applicants incurred no expenses as a result of the respondent not properly applying Rule 80(C)(2) of the Tariff, the Agency makes no order.

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APPENDIX TO DECISION NO. 30-C-A-2021

International Passenger Rules and Fares Tariff No. AC-2 Containing Local and Joint Rules, Regulations, Fares and Charges on Behalf of Air Canada Applicable to the Transportation of Passengers and Baggage Between Points in Canada/USA and Points in Areas 1/2/3 and Between the USA and Canada, NTA(A) No. 458

Rule 5 – APPLICATION OF TARIFF

A) GENERAL

….

(2) International transportation shall be subject to the rules relating to liability established by, and to all other provisions of the Convention for the Unification of Certain Rules Relating to International Transportation by Air, signed at Warsaw, October 12, 1929, or the Convention for the Unification of Certain Rules International Carriage by Air (Montreal Convention of 1999) or such convention as amended, whichever may be applicable to the transportation hereunder. Any provision of these rules which is inconsistent with any provision of said Convention shall, to that extent, but only to that extent, be inapplicable to international transportation.

Rule 80 – SCHEDULE IRREGULARITIES

(A) GENERAL

….

(2) Carrier not responsible

carrier assumes no responsibility for passenger making connections not included as part of the itinerary set out in the ticket. Carrier is not responsible for changes, errors or omissions either in timetables or other representations of schedules. The carrier will not guarantee and will not be held liable for cancellations or changes to flight times that appear on passengers’ tickets due to force majeure, including labour disruptions or strikes. However, a passenger may invoke the provisions of the Convention regarding liability in the case of delay.

….

(C) SCHEDULE IRREGULARITY

….

(2) In the case of a schedule irregularity, AC shall implement the provisions of this rule, unless applicable local law provides otherwise. In particular, for flights departing from the following countries, Air Canada will apply the provisions of the following legislations: European Union and Switzerland: EC Regulation No. 261/2004; Israel: Aviation Services Law (Compensation and Assistance for flight cancellation or change of conditions), 5772-2012; Turkey: Regulations on Air Passenger Rights (SHY-Passenger)

(3) Given that passengers have a right to information on flight times and schedule changes, Air Canada will make reasonable efforts to inform passengers of delays, cancellations and scheduled changes and to the extent possible, the reason for the delay or change.

Rule 105 LIABILITY OF CARRIER

(B) LAWS AND PROVISIONS APPLICABLE

(5) 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.

Regulation (EC) No 261/2004 of the European Parliament and of the Council (Regulation (EC) No 261/2004),

Article 5 Cancellation

3. An operating air carrier shall not be obliged to pay compensation in accordance with Article 7, if it can prove that the cancellation is caused by extraordinary circumstances which could not have been avoided even if all reasonable measures had been taken.

The preamble states:

….

(14) As under the Montreal Convention, obligations on operating air carriers should be limited or excluded in cases where an event has been caused by extraordinary circumstances which could not have been avoided even if all reasonable measures had been taken. Such circumstances may, in particular, occur in cases of political instability, meteorological conditions incompatible with the operation of the flight concerned, security risks, unexpected flight safety shortcomings and strikes that affect the operation of an operating air carrier.

(15) Extraordinary circumstances should be deemed to exist where the impact of an air traffic management decision in relation to a particular aircraft on a particular day gives rise to a long delay, an overnight delay, or the cancellation of one or more flights by that aircraft, even though all reasonable measures had been taken by the air carrier concerned to avoid the delays or cancellations.

….

Article 14 Obligation to inform passengers of their rights

2. An operating air carrier denying boarding or cancelling a flight shall provide each passenger affected with a written notice setting out the rules for compensation and assistance in line with this Regulation. It shall also provide each passenger affected by a delay of at least two hours with an equivalent notice. The contact details of the national designated body referred to in Article 16 shall also be given to the passenger in written form.