Aviation and aerospace Newsletter February 2015 Contents Canadian Supreme Court upholds Canadian Supreme Court upholds exclusivity of Montreal Convention in exclusivity of Montreal Convention in context of language rights context of language rights Page 1 On 28 October 2014, the Supreme Court of Canada issued Dangerous goods and the evolving regulatory environment to ensure the a 5-2 decision dismissing an action brought by passengers safety of their carriage and avowed francophones Michel and Lynda Thibodeau for Page 5 Air Canada’s failure to provide services in French as well Regulation (EC) 261/2004 and as English on several international flights in violation of ‘extraordinary circumstances’ – recent developments Canada’s Official Languages Act (the “OLA”). The decision Page 9 addressed a tension between Canadian domestic law, Australian court dismisses passenger which provides remedies for language rights violations, claim brought 22 years after the event Page 12 and the Montreal Convention (to which Canada is a state party), which does not. Ultimately, the majority concluded, The Cape Town Convention and repossession insurance correctly in our opinion, that Canada’s obligations under Page 14 the Montreal Convention trumped the OLA with respect to AVN67B/C: Observations from the international transportation governed by the Convention. lessor/lender perspective Page 19 Canada’s Official Languages Act Pure mental harm arising from The OLA is a Canadian federal statute aimed at ensuring “respect for damage by aircraft – proposed English and French as the official languages of Canada” and the “equality changes to laws in Australia of status and equal rights and privileges as to their use in all federal Page 26 institutions….” OLA § 2(a). The statute seeks to “support the development of English and French linguistic minority communities and generally advance the status and use of the English and French languages within Canadian society” and to “set out the powers, duties and functions of federal institutions with respect to the official languages of Canada.” OLA §§ 2(b) and (c). The OLA fosters the recognition and use of both English and French in Canadian Society and establishes the Office of the Commissioner of Official Languages, who is empowered to conduct investigations, make recommendations and report. Under the statute, a person who has made a complaint to the Commissioner in relation to certain parts of the OLA may apply to Canadian Federal Court to “award such remedy as it considers appropriate and just under the circumstances.” OLA § 77(4). Air Canada is subject to the OLA by virtue of the Air Canada Public Participation Act, R.S.C. 1985, c. 35 (4th Supp._.), and the airline therefore must ensure, inter alia, that members of the public can obtain available services in either English or French “in Canada or elsewhere” where there is “significant demand” for services in that language. OLA § 22 (b). The Montreal Convention The decision Canada is a party to the Montreal Convention, adopted The Thibodeaus filed complaints regarding these into Canadian law via the Carriage by Air Act. When incidents with the Canadian Commissioner of Official the Convention governs, it limits the type of claims Languages, which conducted an investigation, upheld that can be brought against international air carriers. the complaints, and closed their file after Air Canada Specifically, the Convention permits claims for death put in remedial measures with respect to its bilingual or bodily injury, destruction, damage or loss of baggage services. The Commissioner audited Air Canada and cargo, and for delay. Montreal Convention, Arts. with respect to its bilingual services and issued 17 to 19. As to whether any other type of action for recommendations to which Air Canada responded. damages is permitted, the Convention provides: In addition to their complaints to the Commissioner, In the carriage of passengers, baggage and cargo, the Thibodeaus filed an action in Canadian Federal any action for damages, however founded, Court under the OLA with respect to the breaches whether under this Convention or in contract or of their language rights, seeking institutional orders in tort or otherwise, can only be brought subject against Air Canada and damages – damages for the to the conditions and such limits of liability as language rights violations, including punitive and are set out in this Convention without prejudice exemplary damages. The Federal Court recognized the to the question as to who are the persons who conflict between the OLA and the Montreal Convention have the right to bring suit and what are their but concluded that the power to award damages under respective rights. In any such action, punitive, the OLA prevailed over the Montreal Convention in face exemplary or any other non-compensatory of the conflict and directed Air Canada to pay USD 6,000 damages shall not be recoverable. in damages (USD 1,500 per incident) to the Thibodeaus for moral prejudice, pain and suffering and loss of Montreal Convention, Art. 29 (“Basis of Claims”) enjoyment of their vacation. With respect to plaintiffs’ The incidents request for an institutional order, the Federal Court Over a four- month period in 2009, Air Canada failed found that the issues were not isolated problems, and to provide Michel and Lynda Thibodeau with services directed Air Canada to institute a monitoring process in French on three international flights between with respect to its language-rights obligations. the United States and Toronto and on one occasion Air Canada appealed the Federal Court’s decision with at the Toronto Pearson International Airport. More respect to the damages award concerning the three specifically, on a January 2009 flight from Toronto incidents that occurred on board the Air Canada flights to Canada, Air Canada did not have a bilingual and with respect to the structural order. The Federal flight attendant to provide service in French to the Court of Appeal set aside the damages award but agreed Thibodeaus. On the return flight from Atlanta, the with the lower court that the Montreal Convention pilot’s announcements were made in English without would bar plaintiffs’ claims for damages unless the OLA’s translation into French. On a May 2009 flight from remedial powers trumped the Montreal Convention. Charlotte, North Carolina to Toronto, Air Canada However, unlike the lower court, the Federal Court of again failed to provide services in French (allegedly Appeal did not see a conflict between the Convention ordering a 7-Up in French from a flight attendant and and the OLA because the OLA permits the court to instead receiving a Sprite) and, upon arrival at the issue remedies that are “appropriate and just”, and in Toronto airport, an announcement regarding baggage determining whether a remedy is so must consider that collection was made only in English. damages are not permitted in circumstances where the Montreal Convention applies. The Federal Court of Appeal also overturned the structural order because of insufficient evidence and because the structural order was too vague to enforce. 2 The Supreme Court of Canada granted leave to appeal embarking or disembarking (Article 17); for destruction (and gave appellant status to the Commissioner of or loss of, or damage to, baggage while in charge of the Official Languages of Canada). carrier (Article 17); for destruction or loss of, or damage to, cargo during carriage (Article 18) and for damaged In its decision, the Supreme Court first considered caused by delay (Article 19). whether the Montreal Convention excludes monetary damages under the OLA, agreeing with the lower The majority then discussed the three main purposes courts that it does. The Court noted that at the heart of the Convention (i.e., uniformity of rules governing of the appeal was the “exclusivity principle” of the claims arising from international air transportation, Montreal Convention, i.e., the proposition that the limiting liability against air carriers, and balancing only types of liability against air carriers arising from protection of the air carriers with the interests of those international transportation are those permitted by seeking recovery against the air carriers), and how the Convention itself, excluding claims for liability the first two could only be achieved if the Montreal under local law. In the Court’s view, the appellants Convention provides the exclusive set of rules to were asking the Court to reject the exclusivity of the matters covered by the Convention. Montreal Convention to find that Air Canada could The majority also found overwhelming support in the be subjected to liability under local law, the OLA, “strong current of international jurisprudence” showing even when the underlying events occurred during the that, with respect to matters that fall within the scope course of international air transportation. of the Montreal Convention, carriers can only be In support of its conclusion that the Montreal subjected to the types of damages actions that are set Convention is the exclusive source of a passenger’s forth in the Convention. remedies with respect to events that occur on board The majority rejected appellants’ argument that their international flights, the Court first discussed the language rights claims under the OLA fell outside text and purposes of the Montreal Convention. With the scope of the Montreal Convention because the respect to the text, the majority analyzed Article 29, claims were “quasi-constitutional” and/or “public the provision embodying the “exclusivity principle,” law” claims that sought “public damages” as opposed which states: to “private damages.” The majority found that the Article 29 – Basis of claims Thibodeaus’ action certainly was one “for damages” from events arising during an international flight In the carriage of passengers, baggage and cargo, – the Federal Court had awarded the Thibodeaus any action for damages, however founded, monetary damages for moral prejudice, pain and whether under this Convention or in contract suffering and loss of enjoyment of their vacation.