Decision No. 71-C-A-2017

May 1, 2017

APPLICATION by Jeffrey Cuthbert and Robert Cuthbert (applicants) against Air Canada carrying on business as Air Canada rouge and as Air Canada Cargo (Air Canada).

Case number: 
16-04422

SUMMARY

[1] The applicants filed an application with the Canadian Transportation Agency (Agency) regarding Air Canada’s refusal to offer them denied boarding compensation as required by its International Passenger Rules and Fares Tariff, NTA(A) No. 458 (Tariff), with respect to travel on Air Canada’s Flight No. 2107 from San José, Costa Rica to Toronto, Ontario, Canada, on March 14, 2015.

[2] The applicants are seeking denied boarding compensation and a written apology from Air Canada regarding its alleged failure to treat them fairly and in a manner that was consistent with how it treated other passengers. In addition, the applicants are seeking a declaration from the Agency that Air Canada’s Tariff is not clear regarding denied boarding compensation for travel from Costa Rica to Canada.

[3] Air Canada acknowledged that its Tariff does not indicate its denied boarding policy for flights from Costa Rica to Canada. Accordingly, Air Canada filed a proposed revised Tariff Rule 90 with the Agency on December 6, 2016. Proposed Tariff Rule 90(E)(2) provides for an electronic travel voucher valued at US$300 as denied boarding compensation to affected passengers for flights departing Costa Rica. The applicants argue that this amount is unreasonable.

[4] The Agency will address the following issues:

  1. Is Air Canada’s Proposed Tariff Rule 90(E)(2) regarding denied boarding compensation for flights departing Costa Rica reasonable within the meaning of subsection 111(1) of the Air Transportation Regulations, SOR/88-58, as amended (ATR)?
  2. Did Air Canada properly apply the terms and conditions set out in its Tariff, as required by subsection 110(4) of the ATR, and if not, what remedy is available to the applicants?

[5] For the reasons provided below, the Agency finds that Air Canada’s Proposed Tariff Rule 90(E)(2) is unreasonable. Therefore, the Agency orders Air Canada to file a revised Tariff Rule 90(E)(2), by June 13, 2017. The Agency also finds that Air Canada did not properly apply the terms and conditions set out in its Tariff in its treatment of the applicants. Therefore, the Agency orders Air Canada to compensate the applicants in the amount of CAN$1,350 each, by June 13, 2017.

BACKGROUND

[6] On March 12, 2015, the applicants boarded their return flight, Air Canada’s Flight No. 1807, from San José to Toronto. However, as the aircraft was taxiing for departure, the captain announced that the airport had to close due to a volcanic eruption and that all flights were cancelled.

[7] The applicants were informed that an Air Canada representative would be present at the baggage claim area to advise them of how to proceed. However, no such attendant was present. Instead, the applicants talked to the pilot of Flight No. 1807, who indicated that there would be a single replacement flight that the applicants would be able to take, but he could not inform them of when it would depart.

[8] On March 13, 2015, the applicants investigated and learned that the replacement flight would not depart that day.

[9] On March 14, 2015, the applicants again investigated and learned that a replacement flight (Flight No. 2107) would be departing that day at 5:15 p.m.

[10] Upon arrival at the Juan Santamaria International Airport (Airport) at 1:45 p.m., the applicants attempted to check in and receive their boarding passes at the Air Canada check-in counter. Four other travellers from the same cancelled flight, who had been staying at the same hotel as the applicants, received boarding passes for the replacement flight. However, the applicants were told that they would not be able to board the aircraft. No explanation was given. Instead, an Air Canada Customer Service Manager referred the applicants to Air Canada Reservations.

[11] After being placed on hold for 40 minutes, the applicants explained their situation to an Air Canada Reservations agent, who informed them that they were on the passenger list for the replacement flight; that they would be able to board the aircraft; and that they should proceed to the check-in counter to get their boarding passes. The applicants explained that they had already been to the check-in counter and had been informed that they would not be able to board the replacement flight. The agent told them that she would call the Air Canada Help Desk to assist them in their efforts to obtain boarding passes for the replacement flight.

[12] After placing the applicants on hold for 20 minutes, the agent informed them that she had spoken with an Air Canada Help Desk representative who told her that the applicants would not be able to board the replacement flight because Air Canada had overbooked it.

[13] The applicants, along with eight other travellers who had not been permitted to board the replacement flight, then met with an Air Canada Customer Service Manager and learned that Air Canada had allowed 100 passengers from the March 13 cancelled flight to board the replacement flight, but not the applicants (who were originally scheduled to depart on the March 12 cancelled flight).

[14] Air Canada offered ground transportation to the applicants to Liberia, Costa Rica (a five hour drive), so they could take an alternate flight from Liberia to Montréal, Quebec, Canada on March 16, and then travel to Toronto on March 17. The applicants declined these travel arrangements.

[15] In an attempt to secure a flight home, the applicants’ mother contacted their travel agent in Toronto, who found them a return flight with United Airlines, Inc. (United) with a connection in the United States of America. However, while searching for flights themselves, the applicants noticed that Air Canada was selling seats for a direct flight from San José to Toronto on March 15. The applicants arrived early at the Airport on March 15, at about 11:30 a.m., in the hopes of being able to board the 6:25 p.m. direct flight to Toronto. The applicants were told by an Air Canada Customer Service Manager that it was extremely unlikely that they would be able to board the flight because it was overbooked. The applicants once again contacted Air Canada Reservations. The agent with whom they spoke then contacted the Air Canada Help Desk to discuss the issue. She then informed them that it was extremely unlikely that they would be able to board the flight. About one hour before the departure of the flight, an Air Canada Customer Service Manager informed the applicants that they would be able to board the flight.

[16] The applicants departed San José at around 6:00 p.m. on March 15, and arrived in Toronto, after a delay in Nassau, Bahamas for a refuel, at 4:03 a.m. on March 16.

PRELIMINARY MATTER

Request for an apology

[17] The applicants request that the Agency direct Air Canada to issue a written apology regarding its failure to treat the applicants fairly and in a manner that was consistent with how it treated other passengers.

[18] In 18-C-A-2015">Decision No. 18-C-A-2015 (Enisz v. Air Canada), the Agency stated the following at paragraph 9:

The Agency is not a court of inherent jurisdiction and as such, cannot coerce an expression of opinion or more specifically a letter of apology. The Agency is a creature of statute and the authority to order that letters of apology be provided would have to be expressly provided for in the Canada Transportation Act, S.C., 1996, c. 10, as amended (CTA). There is nothing in the CTA that empowers the Agency to order such an apology.

[19] The Agency does not have jurisdiction to direct an air carrier to apologize. Accordingly, the Agency cannot consider this specific request of the applicants.

THE LAW

[20] The statutory extracts and tariff provisions relevant to this matter are set out in the Appendix.

ISSUE 1: IS AIR CANADA’S PROPOSED TARIFF RULE 90(E)(2) REGARDING DENIED BOARDING COMPENSATION FOR FLIGHTS DEPARTING COSTA RICA REASONABLE WITHIN THE MEANING OF SUBSECTION 111(1) OF THE ATR?

The applicants’ position

[21] The applicants argue that it is more appropriate to compare Air Canada’s proposed denied boarding compensation amount with those of WestJet and Porter Airlines Inc. (Porter) rather than those of non-Canadian air carriers such as Nature Air, Copa Airlines and OceanAir Linhas Aéreas S/A (Avianca) because a large percentage of WestJet’s and Porter’s passengers are Canadians, and they both operate numerous routes from non-Canadian destinations to Canada and from Canada to non-Canadian destinations. The applicants further argue that both Air Canada and WestJet operate routes from Costa Rica to Canada and from Canada to Costa Rica.

[22] Furthermore, the applicants indicate that Nature Air only operates routes in Central America, and Copa Airlines and Avianca operate very few routes from non-Canadian destinations to Canada or from Canada to non-Canadian destinations.

[23] The applicants submit that Air Canada’s denied boarding compensation is unreasonable as it does not compare to the amounts offered by other Canadian air carriers. They argue that when a passenger is involuntarily denied boarding on a WestJet or Porter flight from an international destination (other than the United States of America), and the passenger is delayed for more than four hours, they are entitled to denied boarding compensation in cash equal to 400 percent of the total ticket price to the passenger’s destination or first stopover, with a maximum of US/CAN$1,350. The applicants contend that, if a passenger agrees to accept denied boarding compensation in the form of travel vouchers, this amount would be at least 300 percent of the cash compensation without any maximum cap on the value of the travel vouchers.

[24] The applicants add that the amount proposed by Air Canada for compensation is less than 17 percent of the denied boarding compensation amount provided by Air Canada for the reverse flight (Canada to Costa Rica) and of the amount provided in the Agency’s Sample Tariff, namely CAN$800, for a delay of over four hours.

[25] The applicants claim that as the denied boarding compensation amounts in WestJet’s and Porter’s tariffs and in the Agency’s Sample Tariff are the same to and from a foreign country, the denied boarding compensation for flights from Costa Rica to Canada should be at least as high as the denied boarding compensation for flights from Canada to Costa Rica. In other words, as Air Canada offers CAN$800 from Canada to Costa Rica, it must offer at least CAN$800 from Costa Rica to Canada. The applicants also argue that for a Canadian, being denied boarding in Costa Rica is at least as stressful and inconvenient as being denied boarding in Canada, if not more, as most Canadians do not speak the local language in Costa Rica. Thus, it is unreasonable for Air Canada to offer lower compensation to someone stranded in Costa Rica than in Canada.

[26] The applicants argue that the difference between Air Canada’s denied boarding compensation from Costa Rica to Canada and from Canada to Costa Rica represents an arbitrary and unreasonable distinction, which is solely based on the point of origin.

Air Canada’s position

[27] Air Canada argues that WestJet and Porter are not appropriate comparisons as WestJet’s network is overwhelmingly domestic, transborder and sun destinations, and that it has only recently added Ireland and the United Kingdom to its offerings, while Porter operates short-haul domestic and transborder flights exclusively.

[28] Air Canada claims that it has benchmarked its denied boarding compensation for flights departing Costa Rica against that awarded by other air carriers operating out of Costa Rica. Air Canada submits that, while some American air carriers have simply adopted the same scheme as required by the United States Department of Transportation’s Regulation No. 14 CFR Part 250 for flights departing the United States of America (Delta Air Lines, Inc., JetBlue Airways Corporation and Southwest Airlines Co., and also adopted by WestJet, a Canadian air carrier), others like American Airlines, Inc. have established a range of compensation (from US$75 to US$800).

[29] Air Canada states that other American air carriers have taken the approach that denied boarding compensation is only payable for non-US and Canadian originating flights where local laws or international laws require it (United and Alaska Airlines, Inc.), and that some South American and Central American air carriers do not award denied boarding compensation to passengers who are denied boarding in Costa Rica (Avianca), unless they have volunteered for denied boarding (Nature Air and Copa Airlines).

[30] Air Canada submits that within this framework, its denied boarding compensation of a US$300 electronic travel voucher is an appropriate balance between its legal requirement (no compensation) and the passengers’ rights, as Costa Rica has chosen not to regulate denied boarding compensation. Air Canada states that it is therefore free to decide the compensation amount it will award, unless otherwise constrained by local laws or applicable international laws.

Analysis and determinations

[31] Subsection 111(1) of the ATR states that:

All tolls and terms and conditions of carriage, including free and reduced rate transportation, that are established by an air carrier shall be just and reasonable and shall, under substantially similar circumstances and conditions and with respect to all traffic of the same description, be applied equally to all that traffic.

[32] The Agency has stated in previous decisions (e.g. 249-C-A-2012">Decision No. 249-C-A-2012) that in order to determine whether a term or condition of carriage applied by an air 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.

[33] When balancing the passengers’ rights against the air 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.

[34] The Agency finds that, in this case, the applicants presented a compelling case that Air Canada’s statutory, commercial and operational obligations fail to outweigh the rights of passengers to be subject to reasonable terms and conditions of carriage. The applicants provided strong arguments that Air Canada’s competitors should be Canadian-based companies and that these companies are providing a much higher denied boarding compensation from Costa Rica to Canada. The applicants also made persuasive arguments that it is unreasonable that Air Canada provides a much higher compensation on the same route if the flight departs Canada instead of Costa Rica. This reasoning is consistent with 442-C-A-2013">Decision No. 442-C-A-2013 (Azar v. Air Canada).

[35] By contrast, Air Canada submitted insufficient evidence to justify that the air carriers it listed are valid comparators or competitors; how its proposed denied boarding compensation amount of a US$300 electronic travel voucher is an appropriate denied boarding compensation amount; or how a higher compensation would place it at a meaningful commercial disadvantage with respect to its competitors.

[36] For the above reasons, the Agency finds that Air Canada’s Proposed Tariff Rule 90(E)(2) is unreasonable within the meaning of subsection 111(1) of the ATR, and orders Air Canada to amend its Tariff to compare with the terms and conditions of other Canadian air carriers operating scheduled international services between Canada and Costa Rica.

ISSUE 2: DID AIR CANADA PROPERLY APPLY THE TERMS AND CONDITIONS SET OUT IN ITS TARIFF, AS REQUIRED BY SUBSECTION 110(4) OF THE ATR, AND IF NOT, WHAT REMEDY IS AVAILABLE TO THE APPLICANTS?

The applicants’ position

[37] The applicants submit that they were involuntarily denied boarding on replacement Flight No. 2107 and that they were not offered denied boarding compensation, as required by Air Canada’s Tariff. The applicants argue that they were denied boarding based on the following considerations.

[38] First, they had been informed by an Air Canada pilot that there would be a single replacement flight for their cancelled flight and that they would be able to travel on that flight.

[39] Second, they arrived more than three hours before the replacement flight’s scheduled departure to receive boarding passes, and other travellers in the same fare class who arrived at the check-in counter before and after the applicants were all issued boarding passes.

[40] Third, an agent from Air Canada Reservations initially informed them that they would be able to board the replacement flight, but then later informed them that they would not because Air Canada had overbooked it.

[41] Fourth, in a meeting with an Air Canada Customer Service Manager, the applicants were advised that they had not been permitted to board the replacement flight because Air Canada had allowed about 100 passengers from the March 13 cancelled flight to board the replacement flight instead of the applicants, who had been scheduled to depart on March 12. The applicants submit that it was unreasonable for Air Canada to pool together passengers from the March 12 and March 13 cancelled flights. The applicants argue that, for the purposes of determining who would be boarding the replacement flight, Air Canada should have given priority to passengers from the March 12 cancelled flight over passengers from the March 13 cancelled flight.

[42] The applicants allege that an Air Canada representative provided denied boarding compensation to one of the other travellers who had been denied boarding on the same flight, but that they were not.

Air Canada’s position

[43] Air Canada argues that it is important to make a distinction between re-accommodation and denied boarding, citing 119-C-A-2015">Decision No. 119-C-A-2015 (Aronitz v. WestJet). Air Canada points out that denied boarding is a commercial decision to oversell certain flights by certain amounts, depending on the market, in order to maximize capacity utilisation. Air Canada argues that the applicants did not experience denied boarding, but a schedule irregularity caused by severe weather outside of its control. Air Canada states that this is governed by Tariff Rule 80 in effect at the time of the events.

[44] Air Canada submits that it organized a replacement flight on March 14 to transport passengers stranded from the flights cancelled on March 12 and 13. However, the replacement flight only had a capacity of 211 seats, and the two cancelled flights had a combined total of 272 seats. Air Canada states that it intended to move the remaining passengers by ground transportation from San José to Liberia (a five-hour drive) so that they could travel on a scheduled flight from Liberia to Toronto. Air Canada states that, in anticipation of this, it planned to substitute the usual aircraft for the flight from Liberia with a 146-seat aircraft to transport additional passengers.

[45] According to Air Canada, it does not operate a priority system based on the sequence of flight cancellations. Air Canada states that all stranded passengers were pooled together, irrespective of when their original flights were cancelled. Air Canada adds that priority was given to passengers with disabilities, unaccompanied minors, and other passengers requiring special accommodation or with tight international connections. Air Canada argues that, as such, the applicants were considered a lower priority for re-accommodation.

[46] Air Canada claims that the applicants were not permitted to board the replacement flight because they did not have confirmed seats on the flight, which is a requirement for denied boarding compensation. Air Canada states that the applicants did not complete the check in online and were never assigned seat numbers.

Analysis and determinations

[47] In accordance with a well-established principle on which the Agency relies when considering such applications, the onus is on the applicant to prove, on a balance of probabilities, that the air carrier has failed to properly apply, or has inconsistently applied, the terms and conditions of carriage set out in its tariff.

[48] Air Canada argues that the events that occurred constitute a schedule irregularity under Tariff Rule 80, which states that schedules are not guaranteed, and in the event of a schedule irregularity (outside the air carrier’s control), the air carrier will, among other things: (1) carry the passenger on another of its aircraft on which space is available without additional charge; (2) endorse to another air carrier with which it has an agreement the unused portion of the ticket for purposes of rerouting; (3) reroute the passenger; and (4) make an involuntary refund if it cannot perform any of the foregoing in a reasonable amount of time.

[49] The applicants argue that this is a case of denied boarding under Tariff Rule 90, which defines denied boarding as a situation “when [Air Canada] is unable to provide a previously confirmed space due to there being more passengers holding confirmed reservations and tickets than for which there are available seats on a flight.” However, the Agency has previously found in 95-C-A-2016">Decision No. 95-C-A-2016 (Janmohamed v. Air Transat) that de facto or constructive denied boarding can also arise, which may not fit the traditional situation of denied boarding.

[50] In Janmohamed v. Air Transat, the Agency found that it was not necessary for the passengers to present themselves at the gate for boarding to qualify for denied boarding compensation, when their previously confirmed seats had been cancelled by the air carrier well in advance and without the consent of the passengers. The Agency stated the following at paragraphs 19 and 20:

[…] The fact is that there were insufficient seats to accommodate the applicants, despite the fact that they had previously confirmed seats, and that they were involuntarily moved to another flight. This is a case of de facto or constructive denied boarding.

The Agency appreciates that this situation may be unique, and not a typical case of denied boarding that normally occurs at the gate. However, effectively, the applicants were involuntarily denied boarding on their original flight because Air Transat elected, unilaterally, to give preference to other passengers who had been moved to their flight with the effect that the flight became oversold, resulting in prejudice to the applicants. Rather than wait for the applicants to arrive at the airport and deny them boarding at that time, they were instead moved, without their consent, to another flight in advance. The effect is the same. The applicants were not permitted to board their original flight because there was no longer room for them. It was oversold and they were “bumped”.

[51] The Agency finds that, as in Janmohamed v. Air Transat, the actions of the air carrier in this situation have created a case of de facto or constructive denied boarding. The four actions which, when considered together, created this situation of de facto or constructive denied boarding are as follows:

  • First, on March 14, Air Canada dispatched an aircraft to operate the replacement flight with the knowledge that this aircraft had insufficient capacity to re-accommodate all of the passengers stranded by the two cancelled flights of March 12 and March 13. Therefore, Air Canada knowingly created a situation where it had advance knowledge that a certain number of stranded passengers, all of whom had confirmed seats on their original flights, would be unable to board the replacement flight.
  • Second, although Air Canada argues that the applicants were never in fact actually booked on the replacement flight because their passenger status code was QK (“ghost status with no meaning”) and not HK (hold confirmed), Air Canada did create a potential booking for the applicants on that flight. Furthermore, the applicants had confirmed seats on their original flight.
  • Third, two Air Canada employees, including a pilot and an Air Canada Reservations agent, initially informed the applicants that they would be able to board the replacement flight.
  • Finally, the Air Canada Reservations agent, after checking with the Air Canada Help Desk, subsequently told the applicants that they could not board Flight No. 2107, despite what they had initially been told by two Air Canada employees, because Air Canada had overbooked the flight. This was confirmed by Air Canada, which admitted that it will sometimes overbook flights, such as Flight No. 2107, in case some confirmed passengers do not present themselves for the flight (statement of a manager of customer recovery and service improvement dated November 25, 2016, at paragraph 13).

[52] In this situation, de facto or constructive denied boarding arises where:

  • Air Canada sent an aircraft with insufficient capacity for all of the stranded passengers who held confirmed seats on the original flights;
  • Air Canada created a potential booking for the applicants for that aircraft;
  • Air Canada’s employees informed the applicants that they would travel on that aircraft; and,
  • ultimately, Air Canada did not permit the applicants to travel because it had overbooked the flight.

[53] Although on their own any one of these factors might not suffice to constitute denied boarding, the combination of these four actions in this particular case creates a situation of de facto or constructive denied boarding.

[54] Consequently, the Agency finds that Tariff Rule 90 regarding denied boarding applies in this case, and the applicants are entitled to denied boarding compensation.

[55] The Agency notes the submission of the applicants, uncontested by Air Canada, that no volunteers were solicited from among the passengers to relinquish their seats in exchange for compensation. As this was a situation of de facto or constructive denied boarding, Air Canada was obliged to follow the denied boarding procedures set out in Tariff Rule 90, including the request for volunteers to relinquish their seats.

Denied Boarding Compensation

[56] Air Canada has been servicing the Costa Rican market for over a decade; yet, due to an oversight admitted by Air Canada, the Tariff in place at the time of the applicants’ scheduled departure from Costa Rica did not indicate its denied boarding compensation policy for flights departing Costa Rica. This omission is contrary to subparagraph 122(c)(iii) of the ATR, which provides that a tariff must contain the air carrier’s policy in respect of compensation for denial of boarding.

[57] Section 113.1 of the ATR provides that the Agency may direct an air carrier to take the appropriate corrective measures and pay compensation for its failure to apply the terms and conditions set out in its tariff. However, due to Air Canada’s own oversight, the Tariff did not set out the terms and conditions respecting denied boarding required by the ATR. Therefore, section 113.1 does not apply. As a result, the Agency cannot award compensation to the applicants based on this provision.

[58] Subsection 27(1) of the CTA allows the Agency to “make any order or grant any further or other relief that to the Agency seems just and proper”. The Agency finds that it is unjust and improper that an air carrier, by failing to comply with its regulatory obligations under the ATR, can deprive a passenger of compensation to which they would otherwise be entitled pursuant to section 113.1 of the ATR. Accordingly, pursuant to subsection 27(1) of the CTA, the Agency orders Air Canada to compensate the applicants.

[59] In determining the appropriate amount of compensation, the Agency has weighed the following considerations:

  • First, the only other Canadian air carrier operating a scheduled international service to Costa Rica is WestJet. According to Rule 110(G)(3) of WestJet’s International and Transborder (US) Tariff, NTA(A) No. 518, WestJet offers denied boarding compensation for a delay at arrival by more than four hours equivalent to 400 percent of the total ticket price to the passenger’s destination or first stopover, with a maximum of US/CAN$1,350.
  • Second, the applicants calculate that they each paid CAN$362.59 for Flight No. 1807 from San José to Toronto, CAN$362.59 being half of the CAN$725.18 that each of the applicants paid for the round-trip flights between Toronto and San José. Accordingly, if WestJet’s tariff were applied, the applicants would be entitled to denied boarding compensation in the amount of CAN$1,450.36 each (400 percent of CAN$362.59), except that this exceeds the maximum compensation payable under WestJet’s tariff, which is CAN$1,350. Therefore, the applicants would each receive CAN$1,350.

[60] Consequently, in this case, where the alternative would be to deny the applicants compensation due to Air Canada’s failure to comply with its regulatory obligations under the ATR, the Agency orders Air Canada, pursuant to subsection 27(1) of the CTA, to compensate each of the applicants in the amount of CAN$1,350, by June 13, 2017.

CONCLUSION

[61] The Agency finds that Air Canada’s Proposed Tariff Rule 90(E)(2) is unreasonable. The Agency also finds that Air Canada did not properly apply the terms and conditions set out in its Tariff in its treatment of the applicants.

ORDER

[62] In light of the above findings, the Agency orders Air Canada, by June 13, 2017, to compensate each of the applicants in the amount of CAN$1,350 and to provide the Agency with its revised Tariff Rule 90(E)(2).


Appendix

Air Transportation Regulations, SOR/88-58, as amended

110 (4) Where a tariff is filed containing the date of publication and the effective date and is consistent with these Regulations and any orders of the Agency, the tolls and terms and conditions of carriage in the tariff shall, unless they are rejected, disallowed or suspended by the Agency or unless they are replaced by a new tariff, take effect on the date stated in the tariff, and the air carrier shall on and after that date charge the tolls and apply the terms and conditions of carriage specified in the tariff.

113.1 If an air carrier that offers an international service fails to apply the fares, rates, charges or terms and conditions of carriage set out in the tariff that applies to that service, the Agency may direct it to

(a) take the corrective measures that the Agency considers appropriate; and

(b) pay compensation for any expense incurred by a person adversely affected by its failure to apply the fares, rates, charges or terms and conditions set out in the tariff.

122 Every tariff shall contain

[...]

(c) the terms and conditions of carriage, clearly stating the air carrier’s policy in respect of at least the following matters, namely,

[…]

(iii) compensation for denial of boarding as a result of overbooking,

[…]

International Passenger Rules and Fares Tariff, NTA(A) No. 458

Rule 80 - Schedule irregularities

(A) General

(1) Schedules not guaranteed.  Times and aircraft type shown in timetables or elsewhere are approximate and not guaranteed, and form no part of the contract of carriage. Schedules are subject to change without notice. No employee, agent or representative of Carrier is authorized to bind Carrier by any statements or representation as to the dates or times of departure or arrival, or of the operation of any flight. It is always recommended that the passenger ascertain the flight's status and departure time either by registering for updates on their electronic device, via the Carrier's web site or by referring to airport terminal displays.

(2) Carrier not responsible. Carrier assumes no responsibility for passenger making connections not included as part of the itinerary set out in the ticket. Carrier is not responsible for changes, errors or omissions either in timetables or other representations of schedules. Carrier is not responsible for non-compensatory or unforeseeable damages caused by delay, such as damages resulting from passenger's purpose of travel or personal schedule at arrival. The Carrier will not guarantee and will not be held liable for cancellations or changes to flight times that appear on passengers' tickets due to force majeure, including labor disruptions or strikes. However, a passenger may invoke the provisions of the Convention regarding liability in the case of delay.

(3) Best efforts. Carrier undertakes to use its best efforts to carry the passenger and baggage with reasonable dispatch, but no particular time is fixed for the commencement or completion of carriage. Subject thereto Carrier may, without notice, substitute alternate carriers or aircraft and may alter the route, add stopovers or omit the stopping places shown on the face of the ticket in case of necessity.

(B) Operating Carrier to arrange alternate transportation

The Carrier operating that flight that is experiencing the schedule irregularity will make the alternative transportation arrangements for the passenger and will apply its own tarmac delay contingency plan in the event of a tarmac delay.

(C) Schedule Irregularity

(1) Definition: Schedule irregularity means any of the following:

(A) Delay in scheduled departure or arrival of a Carrier’s flight

(B) Flight cancellation, omission of a scheduled stop, or any other delay or interruption in the scheduled operation of a Carrier’s flight, or

(C) Substitution of equipment or of a different class of service, or

(D) Schedule changes which require rerouting of passenger at departure time of the original flight.

[…]

(4) In the event of a scheduled irregularity, Carrier will either:

(A) Carry the passenger on another of its passenger aircraft or class of service on which space is available without additional charge regardless of the class of service; or, at Carrierʼs options;

(B) Endorse to another air Carrier with which Air Canada has an agreement for such transportation, the unused portion of the ticket for purposes of rerouting; or at Carrierʼs option;

(C) Reroute the passenger to the destination named on the ticket or applicable portion thereof by its own or other transportation services; and if the fare for the revised routing or class of service is higher than the refund value of the ticket or applicable portion thereof as determined from Rule 100, Carrier will require no additional payment from the passenger but will refund the difference if it is lower or,

(D) If the passenger chooses to no longer travel or if Carrier is unable to perform the option stated in (A), (B) or (C) above within a reasonable amount time, make involuntary refund in accordance with Rule 100 […] or,

(E) Upon request, for cancellations within Air Canada’s control, return passenger to point of origin and refund in accordance with Rule 100 as if no portion of the trip had been made (irrespective of applicable fare rules), or subject to passenger’s agreement, offer a travel voucher for future travel in the same amount; or, upon passenger request;

(F) For cancellations within Air Canada’s control, if passenger provides credible verbal assurance to Air Canada of certain circumstances that require his/her arrival at destination earlier than options set out in subparagraph (A) above, or, for On My Way customers, for cancellations within or outside Carrier’s control, Air Canada will, if it is reasonable to do so, taking all circumstances known to it into account, and subject to availability, buy passenger a seat on another carrier whose flight is schedule to arrive appreciably earlier than the options proposed in (A) above. Nothing in the above shall limit or reduce the passenger’s right, if any, to claim damages, if any, under the applicable Convention, or under the law when neither Convention applies.

(5) Except as otherwise provided in applicable local law, in addition to the provisions of this Rule, in case of scheduled irregularity within its control (and outside its control, for On My Way customers) Air Canada will offer:

(A) For a schedule irregularity lasting longer than 4 hours, a meal voucher for use, where available, at an airport restaurant or our on board cafe, of an amount dependant on the time of day.

(B) For a schedule irregularity lasting overnight or over 8 hours, hotel accommodation subject to availability and ground transportation between the airport and the hotel. This service is only available for out of town passengers.

(C) If passengers are already on the aircraft when a delay occurs, Air Canada will offer drinks and snacks if it is safe, practical and timely to do so. If the delay exceeds 90 minutes and circumstances permit, Air Canada will offer passengers the option of disembarking from the aircraft until it is time to depart.

[…]

Rule 90 - Denied boarding

(A)When Air Canada is unable to provide previously confirmed space due to there being more passengers holding confirmed reservations and tickets than for which there are available seats on a flight, Air Canada shall implement the provisions of this Rule, except for employee and industry discounted travel, unless applicable local law provides otherwise. […]

(B) Request for volunteers

(1) Air Canada will request volunteers from among the confirmed passengers to relinquish their seats in exchange for compensation, the amount and form of which will be at Air Canada's discretion.

(2) Once a passenger has voluntarily relinquished his seat, he will not later be involuntarily denied boarding unless he was advised at the time he volunteered of such possibility and the amount of compensation to which he would be entitled.

(3) The request for volunteers and the selection of passengers to be denied boarding shall be in a manner solely determined by Air Canada.

(C) Boarding priorities

(1) If a flight is oversold, no passenger may be involuntarily denied boarding until Air Canada has first requested volunteers to relinquish their seats.

(2) In the event there are not enough volunteers, other passengers may be involuntarily denied boarding in accordance with Air Canada boarding priority policy. Passengers with confirmed reservations will be permitted to board in the following order until all available seats are occupied:

(A) Disabled passengers, unaccompanied children under 12 years of age and others for whom, in Air Canada's assessment, failure to carry would cause severe hardship;

(B) Passengers paying business (J cabin) or premium economy (O cabin);

(C) All other passengers, based on itinerary, fare paid status of loyalty program membership and the time in which the passenger presents herself for check in without advance seat assignment.

(D) Transportation for passengers denied boarding when a passenger has been denied boarding, either voluntarily or involuntarily

(1) A passenger will be considered to have been denied boarding when

(A) The passenger presented himself for carriage in accordance with this Tariff: having complied fully with Air Canada applicable reservation, ticketing, immigration formalities, check-in and boarding within the time limits and at the location set out in Rule 70; and,

(B) It must not have been possible to accommodate the passenger on the flight on which he held confirmed reservations and the flight must have departed without him.

(2) In such instances, Carrier will:

(A) Carry the passenger on another of its passenger aircraft or class of service on which space is available without additional charge regardless of the class of service; or, at Carrier’s option;

(B) Endorse to another air carrier with which Air Canada has an agreement for such transportation, the unused portion of the ticket for purposes of rerouting; or at Carrier’s option;

(C) Reroute the passenger to the destination named on the ticket or applicable portion thereof by its own or other transportation services; and if the fare for the revised routing or class of service is higher than the refund value of the ticket or applicable portion thereof as determined from Rule 90(D), Carrier will require no additional payment from the passenger but will refund the difference if it is lower; or,

(D) If the passenger chooses to no longer travel or if Carrier is unable to perform the option stated in (A) thru (C) above within a reasonable amount of time, make involuntary refund in accordance with Rule 90(D), or upon request, for denied boardings within Air Canada's control, return passenger to point of origin and refund in accordance with Rule 90(D)(2)(A), as if no portion of the trip had been made (irrespective of applicable fare rules), or subject to passenger's agreement, offer a travel voucher for future travel in the same amount; or, (E) upon passenger’s request,

(E) For denied boardings within Air Canada's control, if passenger provides credible verbal assurance to Air Canada of certain circumstances that require his/her arrival at destination earlier than options set out in subparagraph (A) thru (C) above, Air Canada will, if it is reasonable to do so, taking all circumstances known to it into account and subject to availability, buy passenger seat on another carrier whose flight is scheduled to arrive appreciably earlier than the options proposed in (A) thru (C) above.

[…]

Member(s)

P. Paul Fitzgerald
Sam Barone
Stephen Campbell
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