Aviation: e-ticketing jurisdiction under the Montreal Convention 1999

United KingdomScotland

A court in Quebec recently considered the jurisdiction rules under the Montreal Convention 1999 and rejected the suggestion that a “place of business” can include the location of computers used to purchase airline tickets.

Background

The claimants in Charbonneau et al v Scoot Pte Ltd each claimed CAD$2,000 from an airline for baggage that they lost while taking a flight between Hong Kong and Singapore. It was agreed that the Montreal Convention governed the claim, under which the carrier argued that the court in Quebec did not have jurisdiction over the litigation, pursuant to Article 33(1). That article provides:

“An action for damages must be brought, at the option of the plaintiff, in the territory of one of the States Parties, either before the court of the domicile of the carrier or of its principal place of business, or where it has a place of business through which the contract has been made or before the court at the place of destination.”

The claimants argued that jurisdiction in Quebec was validly established because:

(1) Canada is a state party and a claim could be brought in any state party at the option of the plaintiff; or

(2) The carrier had “a place of business” in Canada on the basis that the claimants had purchased their tickets online while in Quebec.

The court rejected both arguments.

Although an action must be brought in the territory of one of the States Parties, the court noted that the first argument failed because it clearly ignored the full text of Article 33(1).

On the second argument, the judge acknowledged a logic to the claimants’ position that Quebecois courts should have the power to hold Scoot accountable for any wrongful acts arising from its internet sales in Quebec. However, the judge noted that it was not possible to make that ruling because “this is not what the Montreal International Convention says". The court held that it would be a misinterpretation of Article 33(1) to hold that the location of a personal computer should be a place of business through which a contract was made.

Comment

There is no settled interpretation defining the phrase “the place of business through which the contract has been made”. One authority in the UK, Noble Caledonia Ltd v Air Niugini Ltd (2017) considered a similar concept from the Civil Procedure rules, and decided that the airline, incorporated in Papua New Guinea, was not “carrying on its activities” in England by virtue of having an arrangement with a local agent (upon whom a claim was served). The judge noted that the agent in that case had several such arrangements, limited authority as agent and was only paid on commission based on sales made.

The Canadian Court’s decision against considering a computer terminal as a place of business is consistent with the notion in Air Niugini that an agent can work for several principals at once, since the internet allows an airline to reach large numbers of potential customers. However, context is clearly important. The fact that judge was sympathetic to the claimant’s argument suggests that a different decision might have been reached if the location of the passenger at the time of entering into the contract was the same as where the ticket was issued, collected, or received.

Article 33 is a self-contained code within the Convention dealing with jurisdiction, meaning that it determines which State has the legal authority to hear a case. It gives effect to the policy behind the Convention to prevent an airline from defending disputes in multiple jurisdictions as part of the bargain for having relinquished the freedom to contract out of the liability. As the Canadian court alluded to, a broad interpretation would interfere with the purpose of the Convention. However, the prevalence of e-ticketing together with a focus on consumer protection (especially in EU courts), suggests that there is potential for a wider interpretation should the right case appear in the future.

Further reading:

Charbonneau v Scoot Pte Ltd 2018 QCCQ 1645.