Source: https://www.otc-cta.gc.ca/eng/ruling/264-c-a-2013
Timestamp: 2018-07-21 02:25:21
Document Index: 379944495

Matched Legal Cases: ['art 1', 'art 1', 'art 1', 'art 1', 'art 1', 'art 1', 'art 1', 'art 250', 'art 1', 'art 250', 'ART 1', 'art 1', 'art 1', 'art1', 'art 1', 'art 1', 'art 1', 'art 1', 'art 1', 'art 1', 'art 1', 'art 1', 'art 1', 'art 1', 'ART 1', 'art 1', 'art 1', 'art 1', 'art 1', 'art 1', 'art 1']

Decision No. 264-C-A-2013 | Canadian Transportation Agency
Decision No. 264-C-A-2013
COMPLAINT by Dr. Rima Azar against Air Canada.
M4120-3/12-02098
[1] Dr. Rima Azar filed a complaint against Air Canada with the Canadian Transportation Agency (Agency) respecting damages incurred due to baggage delay, certain portions of Rules 60 and 89 (Part 1)(E)(1)(a) of Air Canada’s International Passenger Rules and Fares Tariff No. AC-2, NTA(A) No. 458 (Tariff) governing denied boarding compensation and check-in time limits, and her entitlement to a compensation. Dr. Azar requests that the Agency:
direct Air Canada to reimburse her for the sum of CAD$141.79 for out-of-pocket expenses occasioned by the delay of her checked baggage;
direct Air Canada to pay her denied boarding compensation for having been denied boarding;
disallow Rule 89(Part 1)(E)(1)(a) of the Tariff;
impose upon Air Canada a denied boarding compensation amount that is similar to and/or comparable to its major competitors on routes to and from points in the European Union; and,
order Air Canada to pay her costs on a full indemnity basis.
Reasonableness of Air Canada’s denied boarding compensation policy
[2] One of the issues raised by Dr. Azar in her complaint is that Air Canada’s international denied boarding compensation policy, set out in Tariff Rule 89(Part 1)(E)(2), is unreasonable in that it provides a significantly lower denied boarding compensation to passengers who travel from Canada to the European Union relative to that provided to passengers travelling in the opposite direction. As a remedy, Dr. Azar asks that the Agency impose upon Air Canada a denied boarding compensation amount that is similar and/or comparable to its major competitors on routes to and from the European Union. This issue has also been raised in a separate complaint against Air Canada, but with regard to its domestic denied boarding compensation policy.
[3] As both complaints relate to the same issue, the Agency finds it appropriate to place that aspect of Dr. Azar’s complaint in abeyance pending the Agency’s issuance of its final decision respecting Air Canada’s domestic denied boarding compensation policy. The parties will be promptly notified of the next steps following the issuance of the Decision.
[4] Dr. Azar purchased a round-trip ticket for travel with Air Canada on the following outbound itinerary:
Flight No. AC8941, operated by Jazz Aviation LP, as represented by its general partner, Aviation General Partner Inc. carrying on business as Air Canada Jazz, Jazz and Jazz Air, from Moncton, New Brunswick to Toronto, Ontario, Canada, scheduled to depart at 5:50 p.m. on February 18, 2011;
Flight No. AC880, operated by Air Canada from Toronto to Paris, France, scheduled to depart at 8:15 p.m. on February 18, 2011;
Flight No. ME212, operated by Middle East Airlines Airliban S.A.L. (MEA) from Paris to Beirut, Lebanon, scheduled to depart at 1:40 p.m. on February 19, 2011.
[5] Due to “aircraft rotation”, Flight No. AC8941, departing from Moncton, arrived at Toronto at or around 7:48 p.m., that is, 38 minutes after its scheduled arrival time. At 7:01 p.m., Air Canada cancelled Dr. Azar’s booking for Flight No. AC880, her connecting flight, and assigned her seat to another passenger. Air Canada then placed Dr. Azar on another flight departing at approximately 8:35 p.m., and she arrived at her destination of Beirut within 25 minutes of her originally scheduled arrival time.
[6] Dr. Azar’s checked baggage was delayed upon her arrival in Beirut on February 19, 2011. As a result, Dr. Azar purchased personal items totalling CAD$141.79. Dr. Azar’s checked baggage was made available to her on February 22, 2011. When Dr. Azar returned to the Beirut-Rafic Hariri International Airport (Beirut Airport) to pick up her checked baggage on that day, MEA paid Dr. Azar US$100. Dr. Azar also incurred approximately CAD$57.80 in costs to travel to and from the Beirut Airport to pick up her delayed baggage.
[7] On February 11, 2013, Air Canada filed with the Agency a revised Tariff Rule 60(D)(3) amending, among other things, the deadline for passengers to present themselves at the boarding gate from “55 minutes” to “at least 30 minutes”.
Is Dr. Azar entitled to damages occasioned by the delay of her checked baggage and, if so, in what amount?
Was Dr. Azar denied boarding and, if so, what amount of denied boarding compensation is she entitled to?
Is Air Canada’s Tariff Rule 89(Part 1)(E)(1)(a) clear within the meaning of section 122 of the Air Transportation Regulations (ATR)?
Is Air Canada’s Tariff Rule 89(Part 1)(E)(1)(a) just and reasonable within the meaning of subsection 111(1) of the ATR?
Did Air Canada correctly apply Tariff Rules 60(D)(3)-(4)?
Are Air Canada’s Revised Tariff Rules 60(D)(3)-(4) reasonable within the meaning of subsection 111(1) of the ATR?
Should Dr. Azar be awarded costs, pursuant to section 25.1 of the Canada Transportation Act, S.C., 1996, c. 10, as amended (CTA)?
[8] The relevant Tariff Rules in effect at the time of Dr. Azar’s travel and the Tariff Rules that have been revised since her travel are set out in Appendix A. The provisions of the Convention for the Unification of Certain Rules for International Carriage by Air – Montreal Convention (Convention) and the legislation relevant to this Decision are set out in Appendix B.
[9] The Agency’s jurisdiction in matters respecting international tariffs is set out in Part V, Division II, International Tariffs of the ATR.
[10] Subsection 110(4) of the ATR requires that tariffs must be consistent with the provisions of the ATR, which includes section 122.
[11] Section 122 of the ATR requires that the terms and conditions of carriage contained in the carrier’s tariff clearly state the carrier’s policy in respect of, at a minimum, specified matters.
[12] Paragraph 122(a) of the ATR provides that:
(a) the terms and conditions governing the tariff generally, stated in such a way that it is clear as to how the terms and conditions apply to the tolls named in the tariff.
[13] Subparagraph 122(c)(iii) of the ATR provides that:
[14] The Agency found in Decision No. 249-C-A-2012 (Lukács v. WestJet) that an air carrier meets its tariff obligation of clarity when the rights and obligations of both the carrier and the passenger are stated in such a way as to exclude any reasonable doubt, ambiguity or uncertain meaning.
[15] A carrier is required not only to set out its policies in the carrier’s tariff, but also to ensure that with respect to international flights, its tariff is just and reasonable within the meaning of subsection 111(1) of the ATR.
[16] Subsection 111(1) of the ATR states:
[17] The Agency has stated in previous decisions, such as in Decision No. 249-C-A-2012, that to determine whether a term or condition of carriage applied by a carrier is “reasonable” within the meaning of subsection 111(1) of the ATR, a balance must be struck between the rights of passengers to be subject to reasonable terms and conditions of carriage and the particular air carrier’s statutory, commercial and operational obligations.
[18] The terms and conditions of carriage are set out by an air carrier unilaterally without any input from passengers. The air carrier sets its terms and conditions of carriage on the basis of its own interests, which may have their basis in purely commercial requirements. There is no presumption that a tariff is reasonable.
[19] When balancing the passengers’ rights against the carrier’s obligations, the Agency must consider the whole of the evidence and the submissions presented by both parties and make a determination on the reasonableness or unreasonableness of the term or condition of carriage based on which party has presented the more compelling and persuasive case.
ISSUE 1: IS DR. AZAR ENTITLED TO DAMAGES OCCASIONED BY THE DELAY OF HER CHECKED BAGGAGE AND, IF SO, IN WHAT AMOUNT?
[20] Dr. Azar submits that her checked baggage was delayed within the meaning of Article 19 of the Convention. She states that her baggage was not delivered to her at the time of her arrival in Beirut but was made available to her only three days later. She maintains that pursuant to Article 19, Air Canada is liable for damages occasioned by the delay, unless it can meet its burden of proof to show the existence of the required extenuating circumstances. Dr. Azar points out that in instances of delay, Article 36(3) of the Convention grants passengers a right of action against both the first carrier and the last carrier, and the carrier that performed the carriage during which the destruction, loss, damage or delay took place. At the same time, Article 36(3) makes all these carriers jointly and severally liable for damages related to baggage.
[21] Dr. Azar asserts that she incurred two types of damages as a result of the delay of her checked baggage: (1) transportation costs and loss of time related to having had to return to the Beirut Airport to collect her baggage; and (2) out-of-pocket expenses totalling CAD$141.79 related to the purchase of personal items. Dr. Azar points out that she has no further claim regarding her transportation costs and loss of time as MEA already compensated her for them; however, she was never compensated for her out-of-pocket expenses.
[22] To substantiate her outstanding claim, Dr. Azar provided a copy of her receipts for the out‑of‑pocket expenses she incurred.
[23] Air Canada submits that in making a claim for damages, Dr. Azar does not account for the US$l00 she received from MEA. Air Canada argues that, although Dr. Azar contends that the US$100 provided to her by MEA was for the inconvenience associated with picking up her baggage at the airport, MEA’s policy is to offer the US$100 compensation to refund passengers for expenses associated with delayed baggage, and not for inconvenience. To support its position, Air Canada provided an e-mail from Raja Saadeh, MEA’s Director of Customer Relations, who states, in part, that: “[…] it is MEA’s policy to give USD 100 for immediate necessities.” Mr. Saadeh also states that: “PAP arrived BEY on 19 February and bag delivered on the 22nd. Furthermore, amount claimed as per receipts given to us pap is CAD 142.”
[24] Air Canada argues that in accordance with the Convention, Dr. Azar should only be compensated for out-of-pocket expenses associated with the delay of her baggage, up to the amounts set out in Article 22 of the Convention. Air Canada adds that non-compensatory damages such as loss of time and inconvenience are not recoverable pursuant to Article 29 of the Convention.
[25] Air Canada notes that international carriers such as Air Canada, Société Air France carrying on business as Air France and MEA are parties to Multilateral Interline Traffic Agreements to allow easy transfer and protection of passengers and their baggage. For ease of traceability, when a passenger’s bag is delayed, such claim, regardless of where the passenger’s bag was delayed, is best handled by the final carrier who is charged to settle with the passenger according to the international conventions on behalf of all the air carriers involved and then, after the fact, settle any refund between the air carriers.
[26] Air Canada states that it remains willing to offer Dr. Azar any amounts related to out‑of‑pocket expenses for which she has not yet been compensated, once presented with the required evidence associated with the amounts claimed for said expenses, as required by Tariff Rule 55(C)(3). As such, Air Canada is willing to compensate Dr. Azar in the amount of CAD$41.79, which takes into account the US$100.00 she has already received from MEA.
[27] Dr. Azar does not dispute that she received US$100 from MEA, but she submits that this amount was provided as a compensation for other claims, which have been settled to her satisfaction and which she is not pursuing before the Agency.
[28] Dr. Azar submits that as Air Canada is relying on the payment made by MEA to reduce its obligation to her, Air Canada bears the onus to demonstrate, on a balance of probabilities, that Dr. Azar received such a payment (which is undisputed), but also that the payment was in relation to the same expenses that Dr. Azar is seeking before the Agency. Dr. Azar points out that Air Canada presented no acknowledgement of receipt or release of liability signed by Dr. Azar to substantiate that the payment made by MEA was in any way related to the expenses claimed in this proceeding.
[29] Dr. Azar finds it difficult to believe that an air carrier would make a payment to settle a claim under the Convention without seeking a confirmation or acknowledgement of receipt of the payment and/or a signed release from further claims for the same incident.
[30] Dr. Azar states that, on a balance of probabilities, the payment made to her by MEA was not made to settle a claim under the Convention for delay, but rather a gesture of goodwill as compensation for her inconvenience and/or her transportation costs related to being forced to return to the Beirut Airport to reclaim her delayed baggage instead of the air carrier delivering the baggage to her accommodations.
[31] Dr. Azar submits that Air Canada has presented only one document that purports to support its theory that the payment made by MEA to Dr. Azar was a partial reimbursement of her purchases, namely, an e-mail sent by MEA’s Director of Customer Relations, to MEA’s Manager in Canada, which was then forwarded to Air Canada’s counsel.
[32] Dr. Azar asserts that the e-mail is neither reliable nor credible and ought not to be given any weight at all, as there is no evidence to suggest that MEA’s Director of Customer Relations personally dealt with Dr. Azar and gave her the payment in question. Dr. Azar also points out that given that Air Canada did not submit a statement from the MEA agent who provided her with the US$100, the Agency ought to draw adverse inference from Air Canada’s failure to do so.
[33] Dr. Azar states that the only reliable and first-hand evidence before the Agency is her sworn affidavit, which reflects that the payment she received from MEA was compensation for her transportation costs and time related to having had to return to the airport to reclaim her baggage. Dr. Azar adds that she has been available to be cross-examined by Air Canada over the past 12 months; however, Air Canada never sought to do so.
[34] Dr. Azar advises that while she retained all of the receipts related to her outstanding claim of CAD$141.79, she discarded the receipts related to her transportation costs, because this claim was already settled to her satisfaction by MEA.
[35] Dr. Azar therefore argues that Air Canada has failed to establish that the expenses she is claiming in this proceeding are the same as the ones for which Dr. Azar received a payment from MEA and, as such, Air Canada ought to reimburse her for out-of-pocket expenses totalling CAD$141.79.
[36] The evidence in this matter demonstrates that neither Dr. Azar nor Air Canada dispute that, pursuant to Article 36(3) of the Convention, Dr. Azar has a right of action against Air Canada for the damages she incurred due to the delayed delivery of her baggage. What is disputed, however, is the amount of compensation owed to Dr. Azar in light of MEA’s US$100 payment to her on February 22, 2011. It is also not disputed that Dr. Azar incurred damages in the amount of CAD$141.79 after purchasing personal items. Dr. Azar states that she also incurred transportation costs in the amount of CAD$28.90 per direction, when she had to return to the Beirut Airport on February 22, 2011 to reclaim her checked baggage, along with damages related to loss of time.
[37] As submitted by Dr. Azar, Air Canada bears the burden of proving that the US$100 paid by MEA was not just compensation for inconvenience, but also for expenses associated with the delayed baggage. If Air Canada meets that burden, Dr. Azar then bears the burden of proving otherwise by providing convincing evidence.
[38] While the Agency agrees with Air Canada’s submission that Article 29 of the Convention states that non-compensatory damages, such as loss of time, are not recoverable, the Agency is of the opinion that this does not preclude MEA from compensating Dr. Azar in that manner, if it so chooses. Nevertheless, the Agency notes that Air Canada provided an e-mail from MEA’s Director of Customer Relations, who seems to have some knowledge of Dr. Azar’s claim as, in his e-mail, he refers to the day that Dr. Azar arrived in Beirut, the delivery date of her baggage, the amount of Dr. Azar’s claim for damage, and the fact that Dr. Azar’s claim was supported by receipts. He also confirms that it is MEA’s policy to provide passengers US$100 for immediate expenses.
[39] Dr. Azar submits that it is difficult to believe that an air carrier would make a payment to settle a claim under the Convention without seeking confirmation or acknowledgment of receipt of the payment and/or a signed release from further claims for the same incident. The Agency must, however, rely on what the evidence demonstrates as opposed to what one party asserts is difficult to believe. Moreover, the Agency notes that Dr. Azar, herself, makes an unsubstantiated assertion regarding MEA’s usual process and provides no evidence to demonstrate that MEA normally seeks a confirmation or acknowledgement of receipt of payment and/or a signed release. Regarding Dr. Azar’s argument that Air Canada did not submit a statement from the MEA agent who gave her the US$100, the Agency notes that she also did not file any evidence regarding the name of the person who provided the US$100. The burden of proving that the amount of US$100 received by Dr. Azar was for her inconvenience shifted back to Dr. Azar; however, the Agency notes that she provided no evidence that any other MEA agent was involved in the payment of US$100.
[40] In the absence of any convincing evidence from Dr. Azar rebutting Air Canada’s evidence in this regard, the Agency finds it more likely than not that the US$100 provided by MEA to Dr. Azar was meant for partial settlement of her claim and to cover her immediate out-of-pocket expenses, that is, transportation costs and the purchase of personal items.
[41] The Agency notes that Dr. Azar discarded the receipts for her transportation costs associated with her return to the Beirut Airport to reclaim her baggage. The Agency is of the opinion that a party, in endeavoring to prove a fact, must do so by presenting the best evidence available in light of the nature and circumstances of the case. While the production of original receipts of purchase will generally adequately support proof of loss, circumstances may render it unreasonable to require this form of proof. In these situations, it may be unreasonable to expect that such proof is in a complainant’s possession. Other methods such as a sworn affidavit, a declaration or the inherent reasonableness of the expenses claimed could, in some cases, assist in determining the validity of a claim. Furthermore, the Agency notes that Article 22(2) of the Convention does not require proof of loss in the form of receipts of purchase.
[42] Dr. Azar provided receipts totalling CAD$141.79 for out-of-pocket expenses related to the purchase of personal items. She also asserted that it cost her about CAD$28.90 per direction to return to the Beirut Airport, but that she discarded the receipts for this claim as it had already been settled to her satisfaction by MEA. Air Canada does not dispute Dr. Azar’s submission that she returned to the Beirut Airport to pick up her checked baggage and, as such, the Agency finds that it is not unreasonable that a passenger would incur travel costs in this regard.
[43] The Agency accepts Dr. Azar’s evidence in this respect as it accords with common sense and is reasonable, having regard to the circumstances.
[44] The Agency finds, therefore, that in total, Dr. Azar incurred damages in the amount of approximately CAD$199.59, which includes CAD$141.79 for immediate necessities and approximately CAD$57.80 for transportation costs. Considering that MEA provided partial compensation in the amount of US$100, the Agency concludes that Dr. Azar is owed a further CAD$99.59 in compensation from Air Canada.
ISSUE 2: WAS DR. AZAR DENIED BOARDING AND, IF SO, WHAT AMOUNT OF DENIED BOARDING COMPENSATION IS SHE ENTITLED TO?
[45] Dr. Azar submits that she held a valid reservation for Flight No. AC880 on February 18, 2011, but that she was denied boarding on the flight, and was told that her seat had been given away to another passenger.
[46] According to Dr. Azar, it is Air Canada’s position that she was not at the boarding gate for Flight No. AC880 at the 30-minute cut-off time for the 8:15 p.m. flight, which is a condition required under the applicable tariff rules.
[47] Dr. Azar contends that this issue is not merely a dispute of fact, but also gives rise to important questions of law that are novel in this context: “Who bears the burden of proof as to the time that Dr. Azar presented herself at the boarding gate of Flight AC 880?” and “What is the legal definition of ‘involuntary denied boarding’?” Dr. Azar submits that the answers to both of these questions of law are closely related to the legal principles of Article 19 of the Convention.
[48] Dr. Azar points out that in its preliminary determination in Decision No. LET-C-A-80-2011 (Lukács v. Air Canada), the Agency characterized Article 19 of the Convention as one that imposes certain obligations upon the carrier, beyond those of payment of compensation:
A carrier, pursuant to Article 19 of the Convention, is liable for damage occasioned by delay in the carriage of, amongst other matters, passengers, but will 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 it was impossible for them to take such measures.
This provision imposes on a carrier an obligation, namely to transport a passenger as contracted, without delay, failing which there will be a presumption of liability for damage arising from any such delay. With a presumption of liability for delay against a carrier, the Agency is of the preliminary opinion that there is a concomitant obligation for a carrier to mitigate such liability and address the damage which has or may be suffered by a passenger as a result of the delay. Article 19 anticipates this by providing a carrier with a defence to the liability if it can show that it took, or it was impossible to take, all reasonable measures to avoid the damage caused by the delay. This is consistent with an assumption that a carrier, when faced with a presumption of liability, will take whatever action is necessary or possible, within reason, to address an issue which arose as a result of a situation which was within its control. As such, contrary to Air Canada’s contention, Article 19 of the Convention cannot be said to impose no legal obligations on Air Canada.
[49] Dr. Azar notes that in the same Decision, the Agency also concluded that involuntary denied boarding due to overbooking constitutes delay for the purpose of Article 19 of the Convention. She submits that a crucial element of Article 19 is the reversal of the onus: it is not the passenger, but the carrier, that has the burden of proof. She adds that given the vast amount of records and information that carriers keep and are often required to keep, this provision of the Convention strikes the appropriate balance between the rights of passengers and carriers. Indeed, carriers are typically in a much better position to establish the relevant facts.
[50] Therefore, Dr. Azar submits that these legal principles equally apply to claims for denied boarding compensation: The burden of proof is on the carrier opposing a claim for denied boarding compensation to demonstrate that passengers who were denied boarding on a flight on which they held a valid reservation are not entitled to the compensation.
[51] According to Dr. Azar, the notion of “involuntary denied boarding” needs to be defined in a way that is consistent with the principles of the Convention in general, and the carrier’s “concomitant obligation” to mitigate damages which have been or may be suffered by a passenger as a result of the delay. Dr. Azar submits that a key element of “involuntary denied boarding” is that a passenger hold a valid reservation for a flight, and the seat of that passenger is given away to another passenger. She argues that while a carrier should be at liberty to reassign seats of “no‑shows”, this ought not happen to the detriment of diligent passengers, who are delayed for reasons beyond their control, and who are available to board their flights, with perhaps some assistance from the carrier.
[52] Thus, Dr. Azar submits that a passenger with a valid reservation whose seat was given away by a carrier is considered to have been “involuntarily denied boarding” and entitled to compensation, unless the carrier can show that it and its servants and agents took all measures that could reasonably be required to assist the passenger to board the flight, or that it was impossible for them to take such measures.
[53] Dr. Azar states that Flight No. AC8941, which was the first leg of her itinerary, was delayed on February 18, 2011. Consequently, Air Canada had a concomitant obligation to assist her in mitigating the effect of the delay, and in making it to the boarding gate for Flight No. AC880.
[54] Dr. Azar points out that it is a common practice for many European air carriers to assist passengers who arrive on a delayed flight by “fast tracking” them to their connecting flight by escorting and/or transporting them (by vehicle, inside or outside the terminal building) to the appropriate boarding gate. However, Dr. Azar states that in her case, the record is clear that Air Canada did nothing to assist her in reaching the boarding gate for Flight No. AC880.
[55] Dr. Azar states that she was left to her own devices to reach the boarding gate for Flight No. AC880. According to Dr. Azar, she reached the gate around 30 minutes before the departure time, and certainly at a time that would have allowed her to safely board the aircraft. Nevertheless, Dr. Azar was denied boarding on Flight No. AC880.
[56] Dr. Azar submits that while Air Canada claims that she missed the “30-minute cut off time” for Flight No. AC880, that term does not appear in Air Canada’s Tariff. She states that the legal principles of the Convention dictate that if such a “30-minute cut off time” term were part of Air Canada’s Tariff, the burden of proof to demonstrate that she missed the said cut-off time is on Air Canada.
[57] Dr. Azar contends that Air Canada’s conduct in her case was absurd and unreasonable; Air Canada knew that she was on board Flight No. AC8941, and thus Air Canada had a clear knowledge of her whereabouts. She maintains that in spite of this, Air Canada made no effort to assist her in reaching the boarding gate for Flight No. AC880. Moreover, Air Canada gave away her seat on Flight No. AC880 to another passenger, knowing perfectly well that she was proceeding on her own to the boarding gate for Flight No. AC880.
[58] Dr. Azar argues that even if she was a few minutes late with respect to the “30-minute cut off time” (a condition that is not found in Air Canada’s Tariff, and a fact that Air Canada has yet to prove), Air Canada’s failure to comply with its concomitant obligation under the Convention, and provide her with assistance to reach the boarding gate for Flight No. AC880 expeditiously, effectively amounts to an act of involuntary denied boarding. Therefore, Dr. Azar submits that Air Canada is liable to pay her denied boarding compensation as required by its Tariff.
[59] Air Canada submits that the fact that Flight No. AC8941 was delayed and caused Dr. Azar to not be able to successfully board Flight No. AC880 constituted a missed connection, and not denied boarding. Air Canada states that it met its legal and contractual obligations towards Dr. Azar under Tariff Rule 80(D) regarding missed connections, which provides that:
(D)MISSED CONNECTIONS
[60] Air Canada points out that Tariff Rule 80(D) sets out the obligation to arrange for the carriage of the passenger in the event that the passenger misses an onward connecting flight on which space has been reserved because the previous flight was not operated according to schedule.
[61] Air Canada argues that due to the late arrival of Flight No. AC8941, which departed at 6:28 p.m. instead of the scheduled 5:50 p.m. and only arrived at the gate in Toronto at 7:48 p.m. on February 18, 2011, Dr. Azar was not able to successfully make her connecting flight (Flight No. AC880). Air Canada points out that to get from the arrival gate for Flight No. AC8941 to the departure gate for Flight No. AC880, Dr. Azar needed to make a concourse terminal change within Terminal 1 and travel a very long distance between the arrival gate for Flight No. AC8941 and the departure gate for Flight No. AC880. Air Canada adds that Dr. Azar’s baggage could not have been transferred to Flight No. AC880 due to the limited amount of time between the arrival of Flight No. AC8941 and the departure of Flight No. AC880. Air Canada points out that in the case of missed connections, the transfer of baggage, terminal transfers and transit security restrictions must also be taken into account.
[62] Air Canada states that the exception to the payment of denied boarding compensation found in Tariff Rule 89(Part 1)(E)(1) under the requirement to arrive on time clarifies and exemplifies the fact that where such situations are the result of misconnections, the applicable regime is that of misconnections under Tariff Rule 80(D) and not of denied boarding.
[63] According to Air Canada, notwithstanding the foregoing, even if Dr. Azar was considered as having been denied boarding, the conditions to receive denied boarding compensation under Tariff Rule 89(Part 1)(E)(1)(a) were not fulfilled. Air Canada adds that under this Rule, passengers must be acceptable for transportation in accordance with the published tariffs. The obligation to be at the gate within a certain amount of time is set out on Air Canada’s Web site, and in Tariff Rules 60(D)(3)-(4) regarding reservations and applicable time limits, which provide that:
(D)CHECK-IN TIME LIMITS
(3) The passenger must be available for boarding at the boarding gate at least 30 minutes prior to scheduled departure time of the flight on which he/she holds a reservation.
(4) If passenger fails to meet any of these requirements, the carrier will reassign any pre-reserved seat and/or cancel the reservation of such passenger(s) who arrives too late for such formalities to be completed before scheduled departure time. Carrier is not liable to the passenger for loss or expense due to passenger(s) failure to comply with this provision.
NOTE: For the purpose of this rule, check-in is the point for checking baggage and the boarding gate is the point where the boarding pass stub is lifted and retained by the carrier.
[64] Air Canada therefore submits that contrary to Dr. Azar’s allegations, it is impossible that she was present at the gate for Flight No. AC880 on February 18, 2011 within or around the 30-minute cut-off time prior to the departure of Flight No. AC880, due to the late arrival of Flight No. AC8941, which landed at 7:37 p.m., but only arrived at the gate in Toronto at 7:48 p.m.
[65] Air Canada asserts that the obligation to be at the boarding gate at least 30 minutes prior to the departure of international flights is a contractual obligation assumed by the passenger and is necessary for operational reasons. In order to properly carry out the boarding process in a timely manner, Air Canada requires, for international flights, that all passengers be at the gate at this time so that they can board the aircraft at the appropriate time. Air Canada points out that its staff require time to ensure that boarding can be completed, travel documents checked, passengers with special needs accommodated and luggage safely stowed in the overhead bins or under the seat in front of the passenger prior to final passenger count and close of the flight.
[66] Moreover, according to Air Canada, it is a fact that some passengers do not make it to the flight, although they are checked in, either because they checked in from a remote station and never made it to the airport, they are blocked at security (and possibly at customs in the case of passengers transiting from the United States of America), or they get “waylaid”. Air Canada submits that during that period, passengers who are standing by for a flight can be assigned a seat that is vacant. The cut-off time to arrive at the gate allows gate agents to ensure that all passengers have boarded when they begin processing the list of standby passengers.
[67] Air Canada also points out that at the time of Dr. Azar’s contract of carriage, the content of Tariff Rule 60(D)(3) on reservations and applicable time limits referred to a 55-minute cut-off time for passengers to be at the boarding gate. However, Air Canada had consistently been applying a 30-minute cut-off time, in accordance with the information communicated to its passengers on its Web site. Air Canada states that once this inconsistency was made known to it, Tariff Rule 60(D)(3) was revised (in April 2012) to reflect this 30-minute cut-off time for passengers to be present at the boarding gate.
[68] Air Canada also points out that the fact that carriers require passengers to comply with boarding gate deadlines is recognized by the Agency in its Fly Smart publication, which informs consumers to be aware that such deadlines exist and vary from carrier to carrier and between domestic and international flights. Air Canada adds that the Agency informs consumers, through this publication, that “If you miss any of them, the carrier may reassign your pre-reserved seat and/or cancel your reservation. In such situations the air carrier has no obligation to put you on a later flight or to refund any portion of your unused ticket.”
[69] Air Canada asserts that Dr. Azar’s claim is unreasonable, in that she arrived at her final destination within 25 minutes of her originally scheduled arrival time. Air Canada asserts that such a situation should not be compensable, and that, for example, under U.S. Regulation 14 CFR Part 250.5, no compensation is required where alternate transportation offered by a carrier allows a passenger to arrive at their final destination not later than one hour after the planned arrival time.
[70] Air Canada states that it vigorously opposes the interpretation set out in the complaint with respect to applying the principles in Decision No. LET-C-A-80-2011. Air Canada points out that in that case, the complaint involved the content of Air Canada’s Tariff provision concerning passenger reprotection options (i.e., passenger rights) where a flight was cancelled or overbooked for reasons within the carrier’s control. Air Canada asserts that Dr. Azar is making an inappropriate and unfounded application of the Agency’s reasoning in this case. Air Canada adds that indeed, the application of the Agency’s opinion on a carrier’s supposed concomitant obligation to mitigate liability should not have the ultimate effect of prohibiting carriers from overbooking flights, which is a practice recognized as being reasonable in light of a carrier’s operational and commercial obligations and is the counterpart of flexible fares that allow modifications of itineraries at the last minute, causing passengers to “no-show” for a flight.
[71] Air Canada points out that overbooking is a known fact in the air transport industry, and the carrier’s right to deny boarding as well as the appropriate level of compensation is provided for in the relevant tariff.
[72] Air Canada submits that there is no legal requirement for a carrier to facilitate the movement of a passenger during connections. This is policy-driven and the extent of assistance directly provided to passengers whose connection is at risk varies depending on the circumstances of the daily operations (e.g. weather conditions and number of irregular operations) in a given airport and on the transit security restrictions. For example, usually, where Air Canada expects a passenger to miss a connection due to the late arrival of a flight, an arrival agent will meet the passenger at the exit of the aircraft and/or intercept them with a new boarding card or rebook them on another flight. Air Canada states that it has no records that could confirm or deny whether Dr. Azar was assisted in any way.
[73] Dr. Azar states that upon the arrival of Flight No. AC8941, she was the first passenger to disembark. She points out that she had no hand luggage or SkyCheck to wait for, and proceeded by running to the boarding gate for Flight No. AC880, and that when she reached the gate, she found three passengers ahead of her in the line for boarding. She submits that when it was her turn to board Flight No. AC880, she was informed that her seat had been reassigned to another passenger. Dr. Azar reiterates that the real question underlying this issue is the distinction between missing a connecting flight and being denied boarding.
[74] Dr. Azar argues that Air Canada’s evidence that Flight No. AC8941 reached the arrival gate at or before 7:48 p.m. does not accord with her recollection; however, she submits that this question need not be decided in her favour to establish that she is entitled to denied boarding compensation. Dr. Azar states that she is therefore prepared to accept that Air Canada’s evidence is correct.
[75] Dr. Azar contends that her submission that when she reached the boarding gate for Flight No. AC880, three passengers were ahead of her in the line for boarding is corroborated by Air Canada’s submissions. She adds that regardless of the time that she reached the departure gate for Flight No. AC880, the uncontradicted evidence before the Agency is that the flight was still boarding, possibly its very last passengers.
[76] According to Dr. Azar, had Air Canada not reassigned her seat to another passenger, she could have boarded Flight No. AC880. Dr. Azar asserts that irrespective of the time that she reached the boarding gate, she was there sufficiently early to be able to board the flight as the other passengers in line in front of her did.
[77] Dr. Azar refers to a decision of the European Court of Justice in a case similar to hers, in which the Court concluded that the concept of “denied boarding” includes situations where the first flight included in the reservation has been subject to a delay with the result that passengers do not arrive on time to board the second flight. Dr. Azar points out that while the Agency is not bound by this ruling, she requests that it be considered.
[78] Dr. Azar argues that Air Canada failed to take the most obvious and simple step to avoid causing her delay, namely, expediting her movement from the arrival gate for Flight No. AC8941 to the departure gate for Flight No. AC880 rather than reassigning her seat to another passenger. She claims that Air Canada had a very good, albeit entirely self-serving, reason to not assist her to board Flight No. AC880; the flight was oversold.
[79] Dr. Azar submits that by reassigning her seat to another passenger even though she was at the departure gate in time to board the flight, Air Canada avoided paying denied boarding compensation that it normally would have to pay to some of the passengers who could not be assigned seats due to the overbooking. Dr. Azar contends that at the same time, Air Canada is attempting to evade paying her denied boarding compensation. Dr. Azar argues that Air Canada ought not be allowed to rely on the consequences of its own actions and/or omissions and/or failure to operate on time to justify its refusal to pay denied boarding compensation. Dr. Azar seeks denied boarding compensation in the amount of 300 euros.
[80] Dr. Azar argues that she was denied boarding on Flight No. AC880, and was told that her seat was given away to another passenger. Air Canada claims that Dr. Azar was not available at the boarding gate at the 30-minute cut-off time for Flight No. AC880, which is a condition required under the applicable Tariff rules.
[81] Given Air Canada’s evidence that Flight No. AC8941 arrived at the gate in Toronto at 7:48 p.m., the Agency finds that it is not possible that Dr. Azar could have presented herself at the boarding gate for Flight No. AC880 at 7:45 p.m. prior to either the 55-minute cut-off time or the revised 30-minute cut-off time.
[82] The Agency is of the opinion that while Air Canada cancelled Dr. Azar’s reservation 74 minutes before the departure of Flight No. AC880, as opposed to 55 minutes (or 30 minutes, pursuant to the current Tariff provision), the fact still remains that Dr. Azar was not available for boarding 55 minutes (the Tariff provision in place at that time) before the scheduled departure of her flight, and as such, she still would not have met the requirement for compensation for denied boarding, even if her failure to board Flight No. AC880 would have been classified as such.
[83] Pursuant to Tariff Rule 89(Part 1)(E)(1)(a), to be compensated for denied boarding, passengers are required to present themselves for carriage at the appropriate time (i.e., at the boarding gate, 55 minutes prior to the scheduled departure time). As Dr. Azar admits that she did not present herself as such, this is a situation of a missed connection, not denied boarding. The Agency therefore finds that Dr. Azar is not entitled to denied boarding compensation.
[84] Dr. Azar seeks 300 euros for denied boarding compensation. The Agency notes that even if it had found that Dr. Azar was denied boarding and was consequently entitled to denied boarding compensation as a result of Air Canada’s contravention of subsection 110(4) of the ATR, the Agency could only direct Air Canada to compensate Dr. Azar in accordance with its Tariff, and not according to the legislative requirements of the European Union, as Dr. Azar requests.
[85] The Agency finds that Air Canada met its obligations under Tariff Rule 80(D) in reprotecting Dr. Azar, and took reasonable steps to mitigate the damages to Dr. Azar as a result of the missed connection, and as such, satisfied its obligation pursuant to Article 19 of the Convention. The Agency notes that Dr. Azar arrived at her destination within 25 minutes of her originally scheduled arrival time and, as pointed out by Air Canada, under U.S. Regulation 14 CFR Part 250.5, passengers who arrive at their original destination not later than one hour after planned arrival are not compensated. The Agency also notes that the American compensation regime is one that Dr. Azar finds to be reasonable.
ISSUE 3: IS AIR CANADA’S TARIFF RULE 89(PART 1)(E)(1)(a) CLEAR WITHIN THE MEANING OF SECTION 122 OF THE ATR?
[86] Dr. Azar submits that the legal test for clarity was established by the Agency in Decision No. 2‑C-A-2001 (H. v. Air Canada) and was applied recently in Decision No. 418-C-A-2011 (Lukács v. WestJet):
[...] the Agency is of the opinion that an air carrier’s tariff meets its obligations of clarity when, in the opinion of a reasonable person, the rights and obligations of both the carrier and passengers are stated in such a way as to exclude any reasonable doubt, ambiguity or uncertain meaning.
[87] Dr. Azar maintains that the phrase “at the appropriate time and place” found in Tariff Rule 89 (Part 1)(E)(1)(a) is unclear, as that phrase could mean checking in with the carrier by a prescribed time, or being at the boarding gate by a prescribed time, or being at the boarding gate simply before the closing of the gate and the end of the boarding process. Dr. Azar also contends that the phrase is particularly ambiguous in that it is not clear whether the time is determined on a case-by-case basis, or whether it is a predetermined amount of time prior to the flight’s departure.
[88] Dr. Azar is of the opinion that the wording of Tariff Rule 89(Part 1)(E)(1)(a) ought to be substituted with a wording that removes any possible ambiguity.
[89] Air Canada recognizes that it has the obligation to set out clear and unambiguous tariffs, in accordance with section 122 of the ATR. In reference to the legal test established by the Agency, Air Canada points out that the obligation of clarity is not considered as synonymous with “accurate” but, rather, refers to, in the context of the Tariff provision, “easy to understand, self‑evident or plain”.
[90] Air Canada maintains that Tariff Rule 89(Part1)(E)(1)(a), as drafted at the time of Dr. Azar’s contract of carriage, was clear, and in response to Dr. Azar’s objection to the phrase “at the appropriate time and place”, Air Canada notes that Dr. Azar does not recognize the remaining portion of Rule 89(Part 1)(E)(1)(a). Air Canada states that the phrase “at the appropriate time and place” is followed by specifying language, which serves to indicate the requirement of being present at the appropriate time and place. More specifically, Air Canada points out that subparagraph (i) sets out that this requires having complied fully with Air Canada’s applicable reservation, ticketing, check-in and reconfirmation procedures, and subparagraph (ii) sets out that this requires being acceptable for transportation in accordance with Air Canada’s published tariffs. Air Canada adds that to be acceptable for transportation in accordance with its Tariff, the phrase “at the appropriate time and place” refers to the cut-off time before which a passenger must be present at the gate, which is indicated in Tariff Rule 60(D)(3) on reservations and applicable time limits.
[91] Air Canada submits that as part of the revision it carried out in response to Decision No. 250‑C‑A-2012 (Lukács v. Air Canada), Rule 89(Part I)(E)(1)(a) now reads as follows: “The passenger must present himself for carriage at the appropriate time and place in accordance with this tariff: having complied fully with AC applicable reservation, ticketing, check-in and boarding [...]”
[92] Air Canada also points out that the current wording used by Air Canada in Rule 89(Part 1)(E)(1)(a) parallels the wording found in the Compensation for Passengers Involuntarily Denied Boarding section of the Sample Tariff drafted by the Agency, which sets out the following: “The passenger holding a confirmed and ticketed reservation must present him/herself for carriage at the appropriate time and place, having complied fully with the carrier’s requirements related to ticketing, check-in and reconfirmation procedures and having met all requirements for acceptance for transportation published in the carrier’s tariffs.”
[93] Dr. Azar submits that the phrase “at the appropriate time and place” is unclear in both the Tariff provision in effect at the time of her travel and the current version of the Tariff.
[94] Dr. Azar makes reference to Decision No. LET-C-A-29-2011 (Lukács v. Air Canada) in which the Agency advised that the material appearing on the Agency’s Web site is provided solely for information purposes and, due to timing of posting of amendments, may not always reflect the most recent Agency decisions. In this respect, Dr. Azar submits that it is up to the Panel to consider and decide whether the impugned Tariff provision is clear, and the Panel is not bound in any way by the Sample Tariff posted on the Agency’s Web site.
[95] Dr. Azar also points out that while Tariff Rule 89(Part 1)(E)(1)(a) may clearly state what it is that the passengers have to do prior to presenting themselves, it fails to state where and when passengers must present themselves to be eligible for denied boarding compensation. She submits that given the length and complexity of the Tariff, it is far from being clear that “at the appropriate time and place” refers to Tariff Rule 60(D)(3), as suggested by Air Canada in its answer, or perhaps some other rules. As such, Dr. Azar states that it has an ambiguous and/or uncertain meaning.
[96] Dr. Azar is of the opinion that the phrase “at the appropriate time and place” in Rule 89(Part 1)(E)(1)(a) ought to be replaced with “at the check-in counter and boarding gate before the cut-off times set out in Rule 60(D)(3)”, if that is indeed what Air Canada means.
[97] The Agency notes that after Dr. Azar filed her complaint, Air Canada filed a revised Tariff Rule 89(Part 1)(E)(1)(a). The Agency will therefore determine whether the current Tariff Rule is clear within the meaning of section 122 of the ATR.
[98] As stated by the parties, the Agency has previously found that an air carrier meets its tariff obligation of clarity when, in the opinion of a reasonable person, the rights and obligations of both the carrier and the passengers are stated in such a way as to exclude any reasonable doubt, ambiguity or uncertain meaning.
[99] The Agency notes Air Canada’s argument that the wording in its current Tariff Rule 89(Part 1)(E)(1)(a) parallels the wording in the Agency’s Sample Tariff. In this regard, the Agency clarifies the intent of the Sample Tariff which is contained in the Important Qualifiers section of the Sample Tariff and is set out below. Based on this, it is clear that the Agency is not bound by the Sample Tariff:
[100] Air Canada’s current Tariff Rule 89(Part 1)(E)(1)(a) states that a passenger must present himself for carriage at the appropriate time and place in accordance with Air Canada’s Tariff. However, in order to understand what constitutes the appropriate time and place and to exclude any reasonable doubt, a passenger would have to either search for or know of the existence of Tariff Rule 60(D)(3). As such, Air Canada’s current Rule 89(Part 1)(E)(1)(a) is unclear because it does not provide complete information when read in and of itself.
[101] The Agency therefore finds that Air Canada’s current Tariff Rule 89(Part 1)(E)(1)(a) creates doubt and uncertainty as to a passenger’s obligations and consequently, it is unclear.
[102] The Agency agrees with Dr. Azar’s submission that the phrase “at the appropriate time and place” found in Air Canada’s current Tariff Rule 89(Part 1)(E)(1)(a) should be replaced with “at the check-in counter and boarding gate before the cut-off times set out in Rule 60”.
ISSUE 4: IS AIR CANADA’S TARIFF RULE 89(PART 1)(E)(1)(a) JUST AND REASONABLE WITHIN THE MEANING OF SUBSECTION 111(1) OF THE ATR?
[103] Air Canada argues that the 30-minute cut-off period is necessary for operational reasons, specifically in consideration of the need to complete tasks such as the transfer of baggage, terminal transfers and security restrictions and to carry out the boarding process in a timely manner. Furthermore, it is also during that period that passengers who are on standby for a flight can be assigned a seat that is vacant. Air Canada contends that the 30-minute cut-off period allows gate agents to ensure that all passengers have boarded when the agents begin the processing of the list of standby passengers.
[104] Dr. Azar states that she does not dispute that it is reasonable to expect passengers to take the necessary steps to present themselves for check-in and boarding by the cut-off time; however, she disputes the reasonableness of making the passengers solely responsible for complying with these requirements in situations where their ability to comply with such requirements is affected by Air Canada’s actions or omissions.
[105] In particular, Dr. Azar submits that Air Canada ought not to be allowed to rely on a passenger’s inability to comply with Tariff Rule 60(D)(3) as a justification for refusing to pay denied boarding compensation if Air Canada is liable in any way for the cause of the passenger’s inability to comply with such Rule. Dr. Azar asserts that Air Canada should not be able to benefit from its own actions or omissions if they lead to passengers being unable to present themselves for check-in or boarding. As an example, she points out that a carrier that closes its check-in counters prematurely or refuses to check in passengers without a cause cannot blame passengers for not checking in or reaching the boarding gate on time. In this regard, she refers the Agency to Decision No. 54-C-A-2006 (McIntyre v. Air Canada).
[106] Dr. Azar therefore argues that Tariff Rule 89(Part 1)(E)(1)(a) is unreasonable to the extent that it applies to passengers who are unable to meet the cut-off times for causes for which Air Canada is liable in any way. Dr. Azar is of the opinion that Air Canada ought to be able to relieve itself from the obligation of paying denied boarding compensation only in cases where the passenger’s failure to comply with the cut-off times is entirely outside of Air Canada’s control.
[107] The Agency notes that after Dr. Azar filed her complaint, Air Canada filed a revised Tariff Rule 89(Part 1)(E)(1)(a). The Agency will therefore determine whether the current Tariff Rule is just and reasonable within the meaning of subsection 111(1) of the ATR.
[108] Air Canada maintains that the 30-minute cut-off period is required for operational reasons.
[109] Dr. Azar argues that Air Canada ought not to be able to benefit from its own actions or omissions if they lead to passengers being unable to present themselves for check-in or boarding. To support this statement, she makes reference to a situation where a carrier that closes its check-in counters prematurely or refuses to check in passengers without a cause cannot blame passengers for not checking in or reaching the boarding gate on time.
[110] With respect to the situation which Dr. Azar describes above, the Agency is of the opinion that every complaint is assessed on its own merits, and that in such a situation, a passenger has an opportunity to present evidence demonstrating that they arrived at the check-in gate prior to the 30-minute cut-off period. The Agency will assess the evidence and make the appropriate finding in consideration of the specific facts and circumstances of this case.
[111] The Agency finds that Air Canada’s submissions respecting this matter are more compelling than those of Dr. Azar. In particular, the Agency agrees with the submissions put forward by Air Canada that operationally, there are many tasks to be completed during that 30-minute time period. The Agency therefore finds that Air Canada’s requirement that passengers be available for boarding 30 minutes prior to the scheduled departure time of the flight strikes a reasonable balance between Air Canada’s statutory, commercial and operational obligations and the passengers’ rights to be subject to reasonable terms and conditions of carriage. As such, the Agency finds that current Tariff Rule 89(Part 1)(E)(1)(a) is neither unjust nor unreasonable.
ISSUE 5: DID AIR CANADA CORRECTLY APPLY TARIFF RULES 60(D)(3)-(4)?
[112] Dr. Azar indicates that Rules 60(D)(3)-(4) permit Air Canada to reassign the seats of passengers who fail to present themselves for boarding at least 30 minutes prior to the scheduled departure time (the previous version of these Rules provided for 55 minutes instead of 30 minutes). She maintains that, in particular, Rules 60(D)(3)-(4) are not based on Air Canada’s belief or expectation of whether the passenger is present at the cut-off time, but rather, Air Canada is required to ascertain whether the passengers are present at the gate.
[113] Dr. Azar submits that Air Canada cancelled her reservation for Flight No. AC880 at 7:01 p.m., that is, not 30 or 55 minutes, but rather 74 minutes before the scheduled departure of the flight. Moreover, Dr. Azar maintains that Air Canada took no steps to ascertain whether she was actually present at the departure gate 30 minutes prior to the departure of her connecting flight, but rather relied on its guess that she would not be at the gate by the cut-off time. Therefore, Dr. Azar argues that Air Canada failed to apply Tariff Rules 60(D)(3)-(4).
[114] Air Canada made no submissions respecting this issue.
[115] Tariff Rule 60(D)(4), in effect at the time of Dr. Azar’s travel, allowed Air Canada to reassign any pre‑reserved seat and/or to cancel the reservation of passengers who, among other things, failed to present themselves at the boarding gate 55 minutes prior to the scheduled departure of their flights.
[116] The evidence provided by Air Canada indicates that it cancelled Dr. Azar’s reservation 74 minutes prior to the scheduled departure of her connecting flight. It is clear that this cancellation was based on Air Canada’s determination that, given the late departure of Dr. Azar’s initial flight, she would not be able to present herself at the boarding gate within the 30 minute cut-off period for her connecting flight. Air Canada operates the dispatch system and, accordingly, knew exactly when Dr. Azar’s aircraft was to arrive.
[117] Based on this evidence, the Agency finds that it would have been impossible for Dr. Azar to be at the boarding gate on time, and as such, it was reasonable for Air Canada to cancel her reservation, based on its knowledge that she could not present herself at the boarding gate for her connecting flight 55 minutes prior to the scheduled departure time of her flight. Accordingly, the Agency finds that Air Canada properly applied Tariff Rules 60(D)(3)-(4) when it cancelled Dr. Azar’s reservation.
ISSUE 6: ARE AIR CANADA’S REVISED TARIFF RULES 60(D)(3)-(4) REASONABLE WITHIN THE MEANING OF SUBSECTION 111(1) OF THE ATR?
[118] Air Canada submits that the obligation to be at the boarding gate at least 30 minutes prior to the departure of international flights is a contractual obligation assumed by the passenger and is necessary for operational reasons. Air Canada point out that to properly carry out the boarding process in a timely manner, Air Canada requires, for international flights, that all passengers be at the gate at this time so that they can board the aircraft at the appropriate time.
[119] In Dr. Azar’s view, there is no doubt that boarding an aircraft does take a certain amount of time, and thus Air Canada needs most (but not all) of the passengers present at the boarding gate at least 30 minutes prior to the scheduled departure time to facilitate the boarding.
[120] Dr. Azar states that there is also no doubt that passengers who control their own movements are responsible to be at the boarding gate 30 minutes prior to the scheduled departure time; however, she submits that it is unreasonable to apply the Tariff Rule to passengers whose movements are controlled and inhibited by Air Canada, such as passengers arriving on delayed connecting flights.
[121] In other words, Dr. Azar contends that while in many cases, Rules 60(D)(3)-(4) serve an important and legitimate purpose of removing no-shows from the passenger list, and thus freeing up seats for other passengers, they fail to distinguish between no-shows and passengers whose whereabouts are known (because they are on connecting flights), but who may be slightly late due to the delay of their connecting flights.
[122] Dr. Azar argues that Air Canada knows and is able to monitor when passengers check in and board every leg of their itinerary. In particular, if the first flight of an itinerary is delayed, then Air Canada knows which passengers may be late to the departure gate of their next flights not because of their own fault, but rather because of the delay of a first leg.
[123] Dr. Azar maintains that although holding flights for connecting passengers is a common industry practice, she does not suggest that Air Canada has an obligation to do so; however, she submits that it is unreasonable for Air Canada to apply the same 30-minute cut-off time to connecting passengers whose previous flights were delayed. Instead, Air Canada ought to apply the shortest cut-off time operationally possible, for those connecting passengers. Dr. Azar adds that according to Air Canada’s own evidence, its standard operational procedures provide for “last calls” 15 minutes prior to the scheduled departure time. According to Dr. Azar, this means that while most passengers should board the flight earlier, Air Canada is still capable of boarding passengers 15 minutes before the scheduled departure time without affecting its ability to meet its operational obligations. She contends that there is therefore no reason for applying a 30‑minute cut-off time to connecting passengers whose previous flights were delayed, and who can reasonably be expected to be late at the departure gates for their next flights as a result of such delays.
[124] Dr. Azar submits that a cut-off time of 15 minutes or shorter ought to apply to such passengers, and Air Canada ought not to be allowed to reassign their seats until such a cut-off time. Dr. Azar therefore argues that Rules 60(D)(3)-(4) are unreasonable to the extent that they apply to passengers on delayed connecting flights.
[125] It is Air Canada’s position that the obligation to be at the boarding gate at least 30 minutes prior to the departure of international flights is a contractual obligation assumed by the passenger and is necessary for operational reasons. Dr. Azar, on the other hand, argues that Air Canada is still capable of boarding passengers 15 minutes before the scheduled departure time without affecting its ability to meet its operational obligations.
[126] The Agency agrees with Air Canada’s position that in light of operational requirements, a cut-off time for boarding needs to be established and that a 30-minute cut-off time is reasonable. The arguments presented by Dr. Azar for a shorter cut-off time for Air Canada’s connecting passengers are not convincing. The Agency is of the opinion that establishing different cut-off times for some passengers would create confusion among passengers and may be perceived by them as being a discriminatory practice. Moreover, a shorter period may indeed hinder Air Canada’s operations, to the detriment of all passengers. Accordingly, the Agency finds that Air Canada’s revised Rules 60(D)(3)-(4) are reasonable.
ISSUE 7: SHOULD DR. AZARBE AWARDED COSTS, PURSUANT TO SECTION 25.1 OF THE CTA?
[127] Dr. Azar states that while not every quasi-judicial body has the power to make an order for costs, section 25.1 of the CTA confers very broad powers upon the Agency with respect to awarding costs. According to Dr. Azar, it appears that the Agency has never exercised its powers pursuant to subsection 25.1(4) of the CTA to establish a scale for taxation of costs, and has been reluctant to award costs. Dr. Azar refers to Decision No. 20-C-A-2011 (Motion by Karen Kipper – Decision No. 309-C-A-2010) , in whichthe Agency stated that:
[...] As a general rule, costs are not awarded, and the Agency’s practice has been to award these only in special or exceptional circumstances. In making its determination in a given case, the Agency considers a combination of factors such as the nature of the application, the length and complexity of the proceeding, whether the Agency held an oral hearing, whether parties have acted efficiently and in good faith, or if a party has incurred extraordinary costs to prepare and defend its application.
[128] Dr. Azar submits that a leading authority on cost awards is the case British Columbia (Minister of Forests) v. Okanagan Indian Band, 2003 SCC 71 (Okanagan Indian Band), in which the Supreme Court of Canada described the traditional principles for awarding costs.
[129] Dr. Azar argues that the Agency is bound by the principles laid down by the Supreme Court of Canada, and as such, the Agency must exercise the powers and discretion conferred upon it by subsection 25.1(1) of the CTA judicially, and the ordinary rules of costs (namely, that costs follow the event) should be followed unless the circumstances justify a different approach.
[130] Therefore, according to Dr. Azar, awarding costs to the successful party against the unsuccessful one ought to be the “general rule” for awarding costs by the Agency, and not awarding costs ought to be the exception.
[131] Dr. Azar notes that the preamble of the Convention recognizes “the importance of ensuring protection of the interests of consumers in international carriage by air and the need for equitable compensation based on the principle of restitution.”
[132] Dr. Azar submits that while Article 22(6) of the Convention explicitly recognizes that costs are to be awarded in accordance with the law of the court seized with the matter, the underlying principles of the Convention strongly militate in favour of awarding costs on a full indemnity basis against carriers who fail to offer compensation to passengers in accordance with the provisions of the Convention.
[133] Dr. Azar states that under the ATR, the Agency has a dual role: to review, disallow, suspend, and substitute tariff provisions on the one hand, and to enforce tariff provisions by ordering carriers to take corrective measures on th1e other hand.
[134] Dr. Azar maintains that the purpose of having a regulatory scheme in place is not merely to resolve disputes between passengers and air carriers, but rather to assist in achieving the objectives stated in section 5 of the CTA. She submits that the statutory obligation to publish, file and apply tariffs imposed upon carriers becomes meaningless if these obligations are not enforced. Dr. Azar points out that individual complaints against carriers brought before the Agency have an important role in enforcing the regulatory scheme that Parliament has put in place by enacting the CTA, and consequently, such complaints serve not only the interests of the individual consumer, but also the entire travelling public. Consequently, consumer complaints brought before the Agency also serve, by their very nature, the public interest.
[135] Dr. Azar states that access to justice has been recognized as a consideration in awarding costs, in particular, in the context of public interest litigation, in the landmark decision of the Supreme Court of Canada in Okanagan Indian Band.
[136] Dr. Azar submits that none of the common cost-reducing methods (such as commencing a class proceeding or a contingency fee agreement) are available to consumers before the Agency. According to Dr. Azar, the Agency has neither jurisdiction nor procedures for adjudicating class proceedings, and the amounts typically involved in individual consumer complaints are too small for contingency fee agreements.
[137] According to Dr. Azar, individual consumers are left with only one avenue to obtain legal representation before the Agency: paying the legal fees from their own resources. These fees significantly exceed the amount of damages sought, and render such complaints economically infeasible if the Agency follows its “general rule” to not award costs to successful consumers.
[138] Dr. Azar therefore argues that awarding costs in favour of consumers who are successful in a proceeding before the Agency is absolutely necessary to ensure that the complaint process remains accessible to the travelling public at large, and not only to the exceptionally wealthy or the legally trained.
[139] Dr. Azar submits that it is important to also reflect on the public policy effect of the Agency’s current “general rule” of not awarding costs, which (as this case exemplifies) encourages air carriers to ignore consumer complaints that could be settled as hoped for by drafters of the Convention, without the involvement of the Agency. According to Dr. Azar, a significant portion of consumers are deterred from pursuing their claims before the Agency due to the associated legal fees, which they would not be compensated for due to the Agency’s “general rule” on costs.
[140] Considering this, Dr. Azar contends that the current “general rule” provides a disincentive for air carriers to settle claims, and encourages them to not take consumer complaints seriously until they are brought before the Agency or a court.
[141] Dr. Azar argues that Air Canada’s deceptive conduct ought to be taken into consideration in the context of costs, and that she ought to be awarded costs on a full indemnity basis.
[142] According to Dr. Azar, these exceptional circumstances warrant an award of costs in her favour and against Air Canada, even under the Agency’s current “general rule”.
[143] Air Canada points out that, as a general rule, the Agency has recognized that costs are not awarded, and that the Agency’s practice is to only award costs in special or exceptional circumstances. Air Canada contends that as specified by the Agency in Decision No. 20‑C‑A‑2011 and Decision No. 418-C-A-2011 (Lukács v. WestJet), when determining whether an award for costs should be granted, the following factors will be taken into account: (1) the nature of the application, (2) the length and complexity of the proceeding, (3) whether the Agency held an oral hearing, (4) whether parties have acted efficiently and in good faith, and (5) whether a party has incurred extraordinary costs to prepare and defend its application (such as where expert evidence is required).
[144] Air Canada submits that costs are therefore only awarded on an exceptional basis where proceedings are complex. For example, the Agency awarded costs in Decision No. 61‑AT‑A‑2008 (Application–by the Estate of Eric Norman, Joanne Neubauer and the Council of Canadians with Disabilities for an award of costs) as the procedures were unusually lengthy, required the preparation of extensive expert evidence and involved a two-stage oral hearing.
[145] Air Canada maintains that the specific provisions of the Convention with respect to amounts and types of damages should not be considered as non-consumer friendly, thereby warranting (according to Dr. Azar) an award of costs. Indeed, the Convention regime should be viewed as a whole, taking all provisions into account. Therefore, Air Canada argues that one must also consider the reversal of the burden of proof and the presumption of fault.
[146] Air Canada states that the Convention was established as a consumer protection mechanism and it cannot be argued as limiting consumer protection when the Convention is considered as a whole. Air Canada also points out that in this case, there are no special or exceptional circumstances to warrant an award of costs. Air Canada is of the view that the costs should not be awarded. In support of its position, Air Canada states that the proceeding was not exceptionally lengthy, nor complex as no expert evidence or oral hearing was necessary.
[147] Dr. Azar states that her argument that the Agency should revisit and refine its general practice with respect to awarding of costs to bring it into line with the ruling of the Supreme Court of Canada in Okanagan Indian Band raises a novel issue that merits serious consideration.
[148] Dr. Azar’s position is that in the absence of an award of costs to compensate passengers for the legal costs they incur in relation to enforcing their rights under the Convention, it becomes economically unfeasible for the vast majority of passengers to enforce these rights. She adds that this, in turn, effectively renders the rights of passengers meaningless, which is a concern from the point of view of public policy, access to justice, and the interest of the Canadian travelling public.
[149] Dr. Azar is of the opinion that Air Canada has failed to act efficiently and in good faith in this proceeding, and has unnecessarily prolonged it.
[150] Dr. Azar submits that in sharp contrast with the two authorities cited by Air Canada in support of not awarding costs, in this case, Dr. Azar is represented by legal counsel. She points out that although the amounts sought are CAD$141.79 for out-of-pocket expenses and 300 euros for denied boarding compensation, due to Air Canada’s refusal to compensate her and the complexity of the case, Dr. Azar has incurred substantial expenses that are extraordinary compared to the amounts sought.
[151] Section 25.1 of the CTA states:
[152] The Agency has full discretion to award costs and, in the past, has relied on a set of general principles in determining whether to award costs, including whether the applicant for an award of costs has a substantial interest in the proceeding, has participated in the proceeding in a responsible manner, has made a significant contribution that is relevant to the proceeding, and has contributed to a better understanding of the issues by all the parties before the Agency. In addition, the Agency may consider other factors, such as the importance and complexity of the issues, the amount of work and the result of the proceeding in justifying an award of costs.
[153] Dr. Azar relies on the Supreme Court of Canada ruling in Okanagan Indian Band, and argues that the Agency is bound by the principles laid down by that Court. To clarify, the question on appeal before the Supreme Court of Canada in that case related to the inherent jurisdiction of the courts to grant costs to a litigant, in rare and exceptional circumstances, prior to the final disposition of a case and in any event of the cause. Also important in that case is that the Supreme Court of Canada referred to judicial proceedings as opposed to quasi-judicial ones such as the Agency proceedings, which in itself, contradicts the submission of Dr. Azar that the Agency is bound by that ruling.
[154] The distinction between judicial proceedings and quasi-judicial proceedings is, as just noted, important, and must be considered. In Bell Canada v. Consumers’ Assoc. of Canada, [1986] 1 S.C.R. 190, the issue that the Supreme Court of Canada had to decide was whether, in the exercise of the discretion to award costs conferred by section 73 of the National Transportation Act, 1987, the Canadian Radio-television and Telecommunications Commission was bound by the principle of indemnification as it is applied in the award of costs by the courts. The Supreme Court of Canada stated:
On the application of the principle of indemnification to the award of costs by the Commission pursuant to s. 73 of the Act, Urie J. expressed himself as follows: The principal issue in this appeal is whether the meaning to be ascribed to the word [“costs”] as it appears in the Act should be the meaning given it in ordinary judicial proceedings in which, in general terms, costs are awarded to indemnify or compensate a party for the actual expenses to which he has been put by the litigation in which he has been involved and in which he has been adjudged to have been a successful party. In my opinion, this is not the interpretation of the word which must necessarily be given in proceedings before regulatory tribunals.
[155] What an award of costs means when judicial courts are dealing with judicial proceedings is not necessarily the same as when a quasi-judicial tribunal, such as the Agency, is dealing with quasi‑judicial proceedings.
[156] Another consideration is that in judicial courts, there are always litigation expenses, even if only for judicial fees to be paid for the issuance of, for example, a statement of claim, a statement of defence, a notice of application, a notice of motion, a requisition for a hearing date, a notice of appeal and a subpoena. The Agency, however, does not charge fees for the filing of applications, responses, replies and motions or other documents.
[157] The Agency as a quasi-judicial tribunal is, by its very nature, a tribunal where a party can successfully plead without representation by counsel. For the vast majority of consumer complaints, including successful ones, the complainant is not represented by counsel.
[158] With respect to the argument of Dr. Azar that proceedings before the Agency involve an adversarial process, strict deadlines and complex legal arguments that are clearly beyond the legal knowledge and skill of an average air passenger, the Agency reminds Dr. Azar of the existence of the Canadian Transportation Agency General Rules, SOR/2005-35, as amended (General Rules). The General Rules set out a full procedural code for proceedings before the Agency that can be used by an individual who is self represented.
[159] Dr. Azar is of the opinion that awarding costs in favour of consumers who are successful in a proceeding before the Agency is absolutely necessary to ensure that the Agency’s complaint process remains accessible to the travelling public at large, and not only to the exceptionally wealthy or the legally trained. Dr. Azar is also of the opinion that a significant portion of consumers are deterred from pursuing their claims before the Agency due to the associated legal fees, which they would not be compensated for due to the Agency’s general rule on costs. It is not clear, because it is unsupported, on what basis Dr. Azar makes such arguments. The Agency has been in existence for a long time, the complaint process is as accessible as it can be and the Agency points out that these arguments have, to date, only been raised by Dr. Azar.
[160] With respect to Dr. Azar’s contention that Air Canada engaged in deceptive conduct, has failed to act efficiently and in good faith, and has unnecessarily prolonged the proceeding, the Agency does not agree.
[161] As noted in the Preliminary Matter part of this Decision, essentially the same arguments were raised in another case involving Air Canada. No novel issue was raised by Dr. Azar in this case.
[162] In light of the above, the Agency maintains, as it has in past decisions, that an award of costs is warranted only in special or exceptional circumstances. There are no special or exceptional circumstances in this case.
Issue 1: Dr. Azar is entitled to further damages in the amount of CAD$99.59.
Issue 2: Dr. Azar was not denied boarding and, as such, she is not entitled to denied boarding compensation.
Issue 3: Current Tariff Rule 89(Part 1)(E)(1)(a) is unclear.
Issue 4: Current Tariff Rule 89(Part 1)(E)(1)(a) is reasonable.
Issue 5: Air Canada properly applied Tariff Rules 60(D)(3)-(4).
Issue 6: Air Canada’s revised Rules 60(D)(3)-(4) are reasonable.
Issue 7: The Agency will not order costs against Air Canada.
[163] Based on the above findings, the Agency orders Air Canada to:
pursuant to section 26 of the CTA, file with the Agency, by September 9, 2013, a reworded provision with respect to the phrase “at the appropriate time and place”, found in Tariff Rule 89(Part 1)(E)(1)(a), that takes into account the Agency’s finding on clarity set out in this Decision; and,
pursuant to paragraph 113(b) of the ATR, compensate Dr. Azar, by August 12, 2013, in the amount of CAD$99.59 for damages incurred as a result of her delayed baggage.
Tariff Rules in effect at the time of Dr. Azar’s travel
RULE 60 –RESERVATIONS
(1) The passenger is recommended to present himself/herself for check-in at locations designated for such purposes at least 120 minutes prior to scheduled departure time of the flight on which he/she holds a reservation in order to permit completion of government formalities and departure procedures. Passengers must check-in, with his/her baggage, at least 60 minutes prior to scheduled departure time.
China 150 min (recommended check in)
Venezuela 120 min must check-in 180 min (recommended check in)
France 150 min (recommended check in)
Israel 180 min (recommended check in)
Grand Cayman 180 min (recommended check in)
London Heathrow 180 min (recommended check in)
(2) Check-in times passenger must check in via self-service device, or through an AC agent within the aforementioned check-in times. Passengers checking baggage are also subject to the above check-in times.
(3) The passenger must be available for boarding at the boarding gate at least 55 minutes prior to scheduled departure time of the flight on which he/she holds a reservation.
Caracas 30 minutes
Grand Cayman 45 minutes
Tel Aviv 60 minutes
(4) If passenger fails to meet any of these requirements, the carrier will reassign any pre‑reserved seat and/or cancel the reservation of such passenger(s) who arrives too late for such formalities to be completed before scheduled departure time. Carrier is not liable to the passenger for loss or expense due to passenger(s) failure to comply with this provision.
RULE 80 –REVISED ROUTINGS, FAILURE TO CARRY AND MISSED CONNECTIONS
RULE 89 – DENIED BOARDING COMPENSATION
In addition to providing transportation in accordance with (D), a passenger who has been denied boarding involuntarily will be compensated by AC as follows:
(1)Conditions for Payment
(a) The passenger must present himself for carriage at the appropriate time and place:
(i) having complied fully with AC applicable reservation, ticketing, check-in and reconfirmation procedures; and,
(ii) being acceptable for transportation in accordance with AC published tariffs.
(2)Amount of Compensation
Subject to the provisions of (E)(1)(a) AC will tender liquidated damages in the amounts in cash or a credit voucher good for travel on AC as follows: Caribbean/Bermuda to Canada, compensation by cash is equal to the value of coupons remaining to an online or interline destination, or next stopover points, maximum is CAD 200.00. Compensation by MCO (credit voucher), is equal to twice the value of coupons remaining to an online or interline destination or next stopover point, minimum is CAD 100.00, maximum is CAD 500.00.
From Venezuela, compensation to passengers must equal 25% of the value of the ticket to be paid by cash, by electronic bank transfer, cheque, or in accordance with an agreement signed with the passenger, with travel vouchers or other services.
MCO (credit voucher)
Canada to Mexico/Mexico to Canada
CAD 100.00 CAD 200.00
Canada to all other destinations
CAD 200.00 CAD 500.00
Asia to Canada (excluding Japan and Korea)
CAD 300.00 CAD 600.00
Japan to Canada (compensation offered in cash only)
(paid by bank transfer)
Seoul to Canada - Y class
(compensation in cash only)
Seoul to Canada - J class
USD 600.00 not applicable
South America/South Pacific to Canada
From Sao Paulo to Toronto
USD 750.00 USD 1500.00
(3)Time of Offer of Compensation
(a) Compensation will be offered to, and if accepted, receipted by the passenger on the day and at the place where the denied boarding occurs.
(b) In the event the alternate transportation departs before the offer can be made, it shall be made by mail or other means within 24 hours after the time the failure to accommodate has occurred.
Tariff Rules that were revised since Dr. Azar’s travel
The passenger is recommended to present himself/herself for check-in at locations designated for such purposes at least 120 minutes (Exception for Caracas and Tel-Aviv: 180 minutes) prior to scheduled departure time of the flight on which he/she holds a reservation in order to permit completion of government formalities and departure procedures. Passengers must check-in, with his/her baggage, at least 60 minutes (Exception for Caracas: 90 minutes and Tel-Aviv: 75 minutes) prior to scheduled departure time.
Check-in times passenger must check in via self-service device, or through an AC agent within the aforementioned check-in times. Passengers checking baggage are also subject to the above check-in times.
The passenger must be available for boarding at the boarding gate at least 30 minutes (Exception for Tel-Aviv: 60 minutes) prior to scheduled departure time of the flight on which he/she holds a reservation.
If passenger fails to meet any of these requirements, the carrier will reassign any pre-reserved seat and/or cancel the reservation of such passenger(s) who arrives too late for such formalities to be completed before scheduled departure time. Carrier is not liable to the passenger for loss or expense due to passenger(s) failure to comply with this provision.
(a) The passenger must present himself for carriage at the appropriate time and place in accordance with this tariff:
having complied fully with AC applicable reservation, ticketing, check-in and boarding [...]
(paid by bank transfer) not applicable
USD 400.00 not applicable
Seoul to Canada- J class
regulation and strategic public intervention are used to achieve economic, safety, security, environmental or social outcomes that cannot be achieved satisfactorily by competition and market forces and do not unduly favour, or reduce the inherent advantages of, any particular mode of transportation;
rates and conditions do not constitute an undue obstacle to the movement of traffic within Canada or to the export of goods from Canada;
3. As regards baggage or cargo, the passenger or consignor will have a right of action against the first carrier, and the passenger or consignee who is entitled to delivery will have a right of action against the last carrier, and further, each may take action against the carrier which performed the carriage during which the destruction, loss, damage or delay took place. These carriers will be jointly and severally