Important judgment of the Court of Justice of the European Union on the compensation of passengers in case of flight delay
The judgment delivered by the Court of Justice of the European Union (“The Court”) on 7 March 2018 handled numerous complex cases (Cases C-274/16, c-447/16 and C-448/16) dealing with the same subject: the compensation of passengers for the delay of a flight and the competent jurisdiction in the case of a dispute appears between the passenger and the airline responsible for the delay.
In all three judgments, the Court pronounces the same decision: The airline which has carried out the first segment of a connecting flight, in a Member State, may be attacked before the courts of the final destination in another Member State. This is the case when the individual flights have been booked for the entire flight and the significant delay on arrival is due to an incident that took place on the first of the flights.
One of the cases concerns passengers who booked connecting flights from Spain to Germany with a German airline (Air Berlin). These reservations covered all entire plane ride. In that judgment, the Court reiterates that Article 5 of the Brussels 1 Regulation does not require the conclusion of a contract between two persons, but it presupposes the existence of a legal obligation freely granted by one person to another and on which the plaintiff's action is based. (CJEU 28 January 2015, Case C-375/13, paragraph 39). Article 3 (5) of Regulation No 261/2004 states that “where an effective air carrier has not entered into a contract with the passenger and he is fulfilling obligations under the regulations, he shall be deemed to act on behalf of the person who entered into the contract with the passenger concerned”.
The first domestic flights in Spain were made by the Spanish airline Air Nostrum which works for Air Berlin. During these flights, a delay occurred and the passengers missed their second flight to Germany and arrived at the final destination 4 hours late.The German courts have been seized by passengers to claim compensation from Air Nostrum under the Air Passenger Rights Regulation. The German judges asked, to the CJEU, to clarify the ambiguous situation and indicate if the provisions of ‘’the Brussels I Regulation” should be apply and if German Courts are competent to rule the dispute.Those provisions indicated that a defendant domiciled in another Member State may be summoned, in a contractual matter and more particularly in the case of supply of services, to the Court of the place where the services were or should have been provided.
In this case, Air Nostrum company must be considered as fulfilling voluntary obligations to passengers; these obligations are based on the air transport contract concluded between Air Berlin and the passengers. The passengers will be able to attack the Spanish company before the German jurisdiction.In another case, it is a Chinese airline which had concluded a contract of carriage including a Berlin-Beijing flight with correspondence in Brussels. The flight to Brussels could not be realized because of a refusal (not justified) of the company. The passenger made a claim for compensation before the German judge.The question is: Does the German Court have jurisdiction to deal with the dispute between the Chinese airline and the passenger?
According to the Brussels 1 Regulation: A person / company domiciled in a Member State may be summoned to another Member State, more specifically to the Member State in which the services were or should have been provided. In this case, the company had its headquarters in China and did not have any branches in the European Union. In this respect, the Court recalls that, if the defendant (in this case, Hainan Airlines) is not domiciled in the territory of a Member State, international jurisdiction is governed by the law of that Member State and not by the law of the Brussels I Regulation. That is to say, it is necessary to look what the national law of each country recommend in order to find the jurisdiction competent to resolve the dispute.
In conclusion, the Court of Justice of the European Union once again clarifies its case law in the area of "air" disputes. In the light of the Brussels 1 Regulation and this new case-law, the rules established are favorable to passengers and may be unfavorable to airlines. These companies will have to be attentive when they deal with so-called "correspondence" flights. If the companies make a mistake, they might have to defend themselves before a Court in another Member State and that would make their defence more complicated.
Regulation (EC) No 261/2004 of the European Parliament and of the Council of 11 February 2004 establishing common rules on compensation and assistance to passengers in the event of denied boarding and of cancellation or delay important of a flight.
Council Regulation (EC) No 44/2001 of 22 December 2000 on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters.