HM Revenue and Customs (HMRC) have been unsuccessful in their appeal against a decision that a...
Under Article 5(3) of Regulation (EC) 261/2004 (Regulation 261), an airline is not obliged to pay compensation where flights are delayed or cancelled due to 'extraordinary circumstances' which could not have been avoided even if all reasonable measures had been taken. The Supreme Court has ruled that a pilot being absent due to illness is not an extraordinary circumstance.
A couple were booked on a flight from Milan to London in January 2018. The flight was cancelled due to the captain being unwell, and they were rebooked onto a later flight, arriving at London City Airport about two and a half hours later than their original scheduled arrival time. They put in a claim for compensation, but the airline refused to pay.
The couple's initial challenge to that decision and their first appeal were unsuccessful. They then made a further appeal to the Court of Appeal. By the time that appeal was heard, the UK had left the EU, raising the question of whether Brexit affected their claim. The Court concluded that Regulation 261 applied as amended by the Air Passenger Rights and Air Travel Organisers' Licensing (Amendment) (EU Exit) Regulations 2019. Allowing the appeal, the Court found that staff illness and the need to accommodate it was a fact of commercial life that was in no way out of the ordinary. The airline appealed to the Supreme Court.
The Court disagreed with the Court of Appeal's finding that it was the amended version of Regulation 261 that applied. This was contrary to the principle that the applicable law is that in place when the material events occur. It would mean that the relevant law in respect of two identical events that occurred on the same day might be different, depending on the progression of the respective cases.
However, the Court of Appeal's finding that pilot illness was not an extraordinary circumstance was upheld. The Supreme Court noted that since the Court of Appeal's ruling, the Court of Justice of the European Union (CJEU) had handed down a similar decision in TAP Portugal v Flightright GmbH. While decisions of the CJEU are not binding on UK courts post-Brexit, the Supreme Court considered TAP Portugal to be persuasive, although it added that it would have reached the same conclusion in any event. The Court of Appeal had found that there was no authority to support the proposition that staff illness was an extraordinary circumstance: TAP Portugal now provided strong support for the conclusion that it was not. The airline's appeal was dismissed.
