Zaiwalla & Co wins in the UK Court of Appeal

December 21 2021

The Court of Appeal has today handed down judgment in the dispute between Ms Kanaka Durga Chelluri and Air India Ltd. The dispute centred on whether a passenger with a single booking departing from one country outside the EU/UK, and arriving at another country outside the EU/UK is entitled to compensation under the EU regulation for a delay in the arrival at their final destination in circumstances where the third of the four legs that made up that single reservation was late leaving Heathrow.

In a significant development for the aviation industry, the Court of Appeal found in favour of Zaiwalla & Co's client, Air India Ltd., stating previous European Court of Justice case law clearly reaffirmed the single unit principle for a multiple leg journey made under the same booking and there was no reason why this principle should not be applied to this case and in circumstances where the Claimant’s journey originated from a UK/non-EU destination.

The decision prevents a further blow to airlines, which would have compounded the disruption caused by COVID-19.

The Claimant passenger had appealed a decision from the lower courts that the Claimant was not entitled to compensation under the EU regulation (as amended by the UK Withdrawal Act) for a delay in the arrival at their final destination as their flight was with a non- EU/ UK airline and originated from Missouri, a non-EU/UK destination. The Claimant failed in their appeal.
The Claimant had booked to fly from Missouri – Detroit – London Heathrow – Mumbai.  The Claimant connection from London Heathrow to Mumbai departed late and caused the Claimant to arrive late at their final destination of Mumbai. However, despite the connection from London being delayed, previous ECJ case law (Case C-537-17 Wegener v Royal Air Maroc SA (2018) Bus.L.R. 1366) has stated that all legs of a flight flown under the same booking should be viewed as a single unit. The lower courts applied this principle and, if this principle is applied, and as the flight originated from Missouri, the Claimant did not depart from a UK/EU destination and was therefore not entitled to compensation further to article 3(1) (a) of the EU Regulation.
The facts of Wegener were that a passenger was entitled to compensation as he had booked a flight from London – Casablanca – Algiers and, despite the connecting flight from Casablanca, a non-EU/UK state, having been delayed, as the flight originated from London and the journey had been flown under the same booking, in accordance with the single unit principle the Claimant was entitled to compensation.

In the Court of Appeal, the Claimant argued that, especially considering the overriding principles of passenger protection in EU case law, it was not the purpose of the ECJ to bar a Claimant compensation when making their decision in Wegener if the Claimant’s first leg, with a connecting flight in UK/EU country, departed from a non-EU/UK country. They tried to argue that Wegener was decided solely in relation to the Claimant’s entitlement to compensation (article 7 of the EU regulation) and did not address the territorial gateway under 3 (1) (a), whether or not the Claimant departed from a UK/EU destination. Further, the Claimant argued that the passengers should be able to ‘have their cake and eat it’. Claimants should be entitled to compensation if their flight originated from a UK/EU destination but the delay was from a non-EU/UK destination and, in addition to this, Claimants should not be prevented from claiming compensation if the flight originated from a non- EU/UK airport, with a delayed connection from a UK/EU state.

The Court of Appeal rejected the appeal. EU case law after Wegener clearly reaffirmed the single unit principle for a multiple leg journey made under the same booking. The court saw no reason why this principle should not be applied to this case and in circumstances where the Claimant’s journey originated from a UK/non-EU destination. They acknowledged the principle of passenger protection but this principle did not mean that passengers should be entitled to compensation in every circumstance. Article 3(1) (a) of the EU Regulation was a territorial gateway to compensation and it should not be undermined by the principle of passenger protection. The passenger could not ‘have their cake and eat it’.

What is significant about this decision is that this is one of the first cases where the Court of Appeal post Brexit has been asked to determine EU law. The intention of ECJ judges when making their decisions, such as in Wegener, was discussed at the hearing and yet the Court of Appeal chose to not interpret these principles differently. This is despite an Attorney General commentary being released in October which stated in its discussion that just because a passenger’s journey originated from a non -EU/UK destination this does not necessarily mean that they are not entitled to compensation.  In addition, the number of claims made against airlines would multiply if the Claimant had succeeded in the appeal which would have had a potentially substantial economic impact on airlines. 

A link to the full judgment can be found here.

Daniel's comments have been featured in Flight GlobalUK Aviation NewsProkerala, The Assam Tribune, The Free Press JournalThe Pioneer, Daijiworldap7am, and Legal Week. The Law Society Gazette also published an article regarding this, here.

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