September 2017
PFD | Litigation

Airline overbooking and remedies for passengers

By Jean-François Carrier Lawyer

In summer, many Québecers fly to destinations around the world on holidays or a trip of a lifetime.

But the dream can quickly become a nightmare when passengers cannot check in or board their flight due to overbooking: when the airline oversells seats on an airplane. We all recall the unfortunate situation encountered by a United Airlines passenger this spring and hope to never experience something similar.

Whether they occur at the time of the departure or return flight, the consequences differ from one traveller to the next but still all relate to the concept of delay-a missed connection, loss of travel days, accommodation and transportation costs, missed excursions or working days, etc.

When an airline prevents customers from checking in or boarding a flight because of overbooking, what are their rights and remedies?

When an individual is refused travel because a flight is oversold, the airline generally offers compensation of several hundreds of dollars immediately. The amount varies from one carrier to the next based on the delay and destination. Some airlines also require that passengers sign a release, and it is then impossible for travellers to claim all the damages they suffered at a later date. We very much doubt the validity of a release signed in a vulnerable time for the passenger. Indeed, it seems potentially abusive for airlines to provide compensation and require the signing of a release when a passenger has just been refused access to a flight and cannot fully assess the actual impacts and damages brought about by the situation.

In certain cases, the compensation provided by airlines is a sufficient and proper remedy. These cases, however, are rare.

But passengers who suffered significant damages may turn to the Québec courts. In nearly all cases, the action is taken before the Small Claims division of the Court of Québec, since these types of damages rarely exceed $15 000.

The caselaw developed by the Small Claims division to resolve disputes between passengers and airlines and more specifically those pertaining to delays is sometimes contradictory. Some judges apply the principles arising from the Montréal Convention, which has been ratified by many countries around the world and is incorporated into the Carriage by Air Act, while others claim that the Montréal Convention does not apply. Instead, they turn to the Civil Code of Québec in a suppletive manner.

Even so, regardless of the law that the Court chooses to apply, airlines are deemed responsible and travellers who experience negative consequences due to overbooking recover the same amounts. Depending on the evidence presented, the Court may order the reimbursement of any additional accommodation or transportation costs or another airline ticket or the compensation of the travel expenses that the passenger was not able to benefit from (e.g. hotel at the destination, excursions, etc.), salary losses or any other damages related to the strain and inconveniences.

The only distinction between the laws is the amount to which the passenger may be entitled: the Montréal Convention limits the total sum in damages caused by delays to $7 500, while there is no ceiling set out in the Civil Code of Québec.

Also, the responsibility of an airline in the case of delays brought about by bad weather, a mechanical failure or any other reason other than overbooking is also outlined in the provisions of the Montréal Convention and Civil Code.

Finally, it is important to note that the federal government introduced new regulations in May to modify certain legal provisions on air transport. Among the aims of these regulations is to provide a framework for the practice of overbooking to ensure that passengers are properly compensated. The government of Canada has therefore mandated the Canadian Transportation Agency, which oversees the application of transportation-related laws, to establish a minimum amount of compensatory indemnity paid out to travellers impacted by overbooking - an increasingly common practice - which is currently at the entire discretion of the airlines.

With the significant development of air travel around the world, the implementation of the federal government's new regulations should hopefully reduce the impacts and damages experienced by travellers when a flight is overbooked and render legal action unnecessary.