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Montreal Exclusivity versus EU law – Round II

The Montreal Convention of 1999 (‘MC’) lays down uniform rules governing liability under the contract of carriage by air. It is a well-established principle in domestic, European Union and international law that its provisions are exclusive: passengers cannot seek redress under the domestic law of contracting parties. Article 29 states that

In the carriage of passengers, baggage and cargo, any action for damages, however founded, whether under this Convention or in contract or in tort or otherwise, can only be brought subject to the conditions and such limits of liability as are set out in this Convention […]

It is uncontroversial that a lack of remedy in casu cannot outflank the Montreal provisions – for example in the case of psychological harm which does not fall within the Convention’s notion of ‘damage’ (Sidhu v British Airways). How far, however, does this exclusivity of the Montreal regime extend?

This question has been the subject of extensive litigation in recent years, following the enactment of EU Regulation 261/2004 on compensation and assistance to passengers in the event of denied boarding and of cancellation or long delay of flights. Air operators repeatedly challenged its validity, notably by reference to Article 29 MC. In Case C-344/04 ex parte IATA, the Grand Chamber of the Court of Justice of the European Union (‘CJEU’) held that it would be wrong to assume ‘that the authors of the Convention intended to shield [air] carriers from any other form of intervention’ [45] and found that the Regulation’s ‘standardised and immediate assistance and care measures’ were therefore entirely consistent with the MC [48]. Despite significant resistance from industry and academic commentators, the CJEU has repeatedly confirmed this interpretation of Article 29 MC.

Hook v British Airways and Stott v Thomas Cook promises to reopen the issue of Montreal Exclusivity, albeit in a new context: the rights of disabled passengers under EU law. The joint appeals are a crucial test whether the principles developed in ex parte IATA can be applied to secondary EU legislation more broadly.

Facts

The claimants suffered from several breaches of the EU’s Disability Regulation (EC) No 1107/2006, as implemented in the United Kingdom by the Civil Aviation (Access to Air Travel for Disabled Persons and Persons with Reduced Mobility) Regulations 2007 (SI 2007/1895), notably as regards appropriate seating arrangements. In response to their claims, British Airways and Thomas Cook seek to rely on the Montreal Convention’s exclusivity provisions, as incorporated into EU law by Regulation (EC) 889/2002.

Court of Appeal

Giving the only substantive judgment for the Court of Appeal, Maurice Kay LJ found in favour of the airlines on the basis of Article 29 MC:

 The real injuries to [the claimants’] feelings […] were sustained at times when the Montreal Convention governed their situations. Its exclusivity both provided and limited their rights and remedies. Accordingly, their claims for compensation for injury to feelings could not succeed. [54]

The Issues on Appeal

In a hearing scheduled for November 20, 2013 the Supreme Court, constituted of Baroness Hale and Lords Neuberger, Reed, Hughes and Toulson, will have to consider whether the Montreal Convention can operate to exclude a claim for damages arising from a breach of EU law. This raises several important issues:

 

–        to what extend can the well-established line of exclusivity cases (such as Sidhu) be relied upon in the case of ‘novel’ heads of claim?

–        on what basis, if any, can claims under the EU’s Disability Regulation be distinguished from claims under the Passenger Rights Regulation, which have been held to fall outside the scope of  the MC?

–        should the exclusivity of the Montreal Convention be determined by reference to a ‘timeline’ of events (as the Court of Appeal’s judgment seems to suggest), or by the type of damage sustained by passengers (the approach favoured by the CJEU)?

The case furthermore engages broader issues of effective remedies for breach of EU law, and may well join the long list of preliminary references concerning the relationship between EU Regulations and the Montreal Convention.

Wider Implications

The proceedings in Hook v British Airways and Stott v Thomas Cook have already attracted significant attention from the Equality and Human Rights Commission; with the Secretary of State acting as a further intervener. The Supreme Court’s decision will also be scrutinised closely by passenger groups and airlines internationally: the present author is aware of upcoming exclusivity challenges in several jurisdictions, both under general passenger rights legislation, and individual fundamental rights. Given the strong approach to comity in international aviation litigation, the outcome of this case will be seen an important confirmation of, or challenge to, the CJEU’s well-established interpretation of the Montreal Convention.

Dr Jeremias Prassl is a Law Fellow at St John’s College, Oxford and regularly writes about EU Aviation Law at EUtopia.