EU regulation 261/2004 sets out a road map for all circumstances where airline passengers can seek compensation for denied boarding, cancellation of flights and extended delays.
The airline sector reeled in horror at the scale of expense it had to cover during the volcanic ash crisis, ultimately having to finance extended delays, including accommodation and food costs for many thousands of stranded passengers.
In 2012, the European Court extended the rights of passengers to be compensated when their flight was cancelled, to those experiencing a delay in excess of three hours. The extended regime has exposed the airline sector to professional ‘claims farmers’, passenger claims law firms and others demanding compensation and taking a slice of the winnings as their fees. The latest legal cases involve technical defects and whether the delays these cause still give rise to compensation under the regulation.
The airlines position
Not surprisingly, the airline sector has been seeking to address this increasing liability with the domestic regulator, the Civil Aviation Authority (CAA) and with Europe. This has met with a degree of success, with the European Commission issuing a memo in March 2013 suggesting a variety of changes to the current regulation, such as extending the right to compensation from a delay of three hours to five hours for flights within the EU, and to nine hours or 12 hours for international flights.
The CAA produced its own opinion in April 2013 about what technical defects to an aircraft would amount to extraordinary circumstances (and thus enabling the airline to escape payments of compensation), including failure of certain equipment vital for the safe operation of the aircraft, and other technical defects which were apparent to the flight crew.
The legal position
We all want aircraft to fly only when they are entirely safe. Aircraft are highly technical pieces of equipment, and we rely on regulations, as well as each airlines’ engineers, crew and other experts to ensure that any technical defects to an aircraft that affect its safe operation require the aircraft to be grounded until the defect is remedied.
The case of Wallentin-Hermann v Alitalia severely restricted the scope of technical defects which could amount to an extraordinary circumstance, where if the airline could show that it had taken all reasonable measures to prevent these leading to a delay or cancellation, would rescue the airline from having to compensate delayed passengers.
The language is not easy to interpret, but states that only technical faults that are “not inherent in the normal exercise of the activity of the carrier concerned and are beyond the actual control of that carrier on account of its nature of origin” might give rise to an extraordinary circumstance.
This issue has raised its head again the case of Huzar v Jet2.com, which was decided on November 5, 2013. The decision is of a relatively junior court (an appeal from a district judge at Stockport County Court, to the circuit judge at Manchester County Court) but is being relied upon increasingly by claimants, particularly where they are advised by specialist claimant advisers.
In the Huzar case, the aircraft suffered an unexpected technical problem isolated to defective wiring in the fuel valve circuit. The technical defect was such that a specialist engineer was sent from the UK to fit the new parts. This resulted in the aircraft arriving late to its destination by about 27 hours.
The airline argued that it should not have to compensate passengers because the technical failure severely prejudiced the safety of the operation of the aircraft, and the technical defect was unexpected, unforeseen and unforeseeable. The defect occurred within the expected lifespan of the parts and could not have been predicted by routine and regular inspection.
These concepts were accepted for the purpose of argument before the judge, but the judge found that it did not matter how the technical problem was identified – whether by routine maintenance, as a result of warning light or any other manner.
Equally, it did not matter that the defect was unexpected and unforeseeable. The resolution of the technical problem was a matter entirely for the carrier and, therefore, the cause of the defect (the defective wiring) could be disregarded – once a technical defect was identified, then the carrier had to resolve it and, accordingly, compensation payments were payable, and this was not an extraordinary circumstance.
The present position
Urgent steps are being taken by the carrier to take the Huzar case to the Court of Appeal. It is hoped that the appeal will be heard in May this year, and this will clarify the position for airlines and passengers. Currently, the European recommendations for changes to the current Regulation 261/2004 are moving slowly, and it is ironic that the CAA is working on clarifying which safety defects might amount to extraordinary circumstances, while the latest legal decision appears to suggest that none are likely to qualify.