16 JUNE 2014

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Article from BTNews 16 JUNE 2014

COMMENT: Air travel price hike

Flying could get very much more expensive following a judgement at the High Court ruling in favour of a passenger who was left waiting for 27 hours for his flight due to engineering delays.
 
Hannah Clipston, Partner at law firm Thomas Eggar, comments on the ruling:
 
“In the context of flight delay compensation, the Court of Appeal has clarified in Huzar v Jet2.com that extraordinary circumstances are unlikely to cover delays caused by technical problems.  The Court has made it clear that technical problems are not extraordinary if they arise from the ‘normal exercise of the activity of the air carrier concerned.’
 
“Bearing in mind the significance of the decision, Jet2.com may appeal to the Supreme Court. 
 
“However, in the meantime, airlines (especially budget airlines) may need to look at their business models to ensure that they have built into their ticket prices and preserved a contribution to any potential flight delay compensation claims. 
 
“In the long term, this may mean that flight prices rise as airlines try and cope with the probable increase in compensation claims.”

Business Travel News  w
ill censure the efforts of an airline when it is clearly in breach of its obligations, but this whole matter is in serious danger of getting out of control. 

Sadly it looks likely that only the lawyers will prosper.  The firm that acted for Mr Huzar was quick to seek more business.  “We would happily take on anyone’s claim that has been previously rejected by the airline or the CAA on grounds of a technical problem.  If the CAA won’t back the consumer then Bott & Co are more than happy to do so,” said David Bott, a Senior Partner. ‘No win no fee’ can be very profitable.

If you buy an airline ticket sometimes the air carrier is left with single figure revenue once the government tax and airport handling fees are taken off, let alone sales commission whether it be ticket agency or plastic card handler, and what is known as ‘direct operating costs’. The public and the courts only see the bottom line fare.  Is insurance due to very heavy delay fines to be added also? 

EU regulation 261/2004 sets out the compensation details.  Huzar v Jet2.com would seem to indicate that these rules include technical delays.  Does the airline sue a third party if an outside provider of (engineering) services lets it down? 

BTN  believes that safety delays (engineering) should be part of the purchased flight package.

Airlines are insured but in other forms of claims (say against local councils and hospital trusts) insurance companies have been known to take the easy way out and just pay up.  The problem for travellers is that the airlines will just take it on the chin and put the costs onto the ticket price.  The only winners could be the lawyers with the hurt party gaining a sum that was not worthwhile fighting for.

BTN  is not sure of the answer but some common sense must prevail.

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