Court of Appeal Rules on Air Passenger Compensation

July 11, 2014

Court of Appeal Rules on Air Passenger Compensation

The Court of Appeal has handed down judgments in two cases which clarify the rights of passengers whose flights are delayed.

The first case concerned a Jet2.com flight from Malaga to Manchester which was scheduled to depart at 18:25 on 26 October 2011. The aircraft scheduled to perform the flight experienced a technical problem on its way to Malaga. The problem could not be rectified before the airport closed and was eventually traced to a wiring defect. The passengers had to travel on another aircraft, which left the following evening and arrived in Manchester 27 hours after the original scheduled arrival time.

One of the passengers sought compensation under Regulation EC 261/2004, which covers passenger rights in the event of cancelled or delayed flights. His claim was initially unsuccessful but was upheld on appeal to the County Court. Jet2.com appealed that decision to the Court of Appeal.

The case turned on the meaning of the phrase 'extraordinary circumstances' contained in Article 5(3) of the Regulation. Jet2.com contended that the passenger was not entitled to compensation because the wiring defect was an extraordinary circumstance within the meaning of Article 5(3). However, the Court ruled that, although the defect that caused the delay was unexpected with regard to that particular flight, it would be expected that such defects would occur from time to time. Jet2.com's appeal was therefore dismissed.

This decision will come as a blow to the airline industry, as many similar cases in lower courts have been stayed pending the outcome of this case.

The second case concerned the amount of time passengers have to bring a claim for compensation under the Regulation. In the lower court, the passenger succeeded in his claim that, by virtue of Section 9 of the Limitation Act 1980, a six-year time limit applies under UK law. Thomson Airways, the defendant in this case, appealed, arguing that the two-year time limit contained in the Montreal Convention 1999 should apply. However, the Court of Appeal dismissed the appeal, thus opening the way for a substantial number of further claims.