October 2005
TRADE AND TRANSPORT BRIEFLY
Aviation Special Edition
The High Court of Australia
has recently delivered two judgments that clarify passengers’ rights
against commercial airlines in relation to claims brought
pursuant to the Civil Aviation (Carriers’ Liability)
Act 1959
In the decision of Air
Link Pty Limited v Paterson, the Court held that
a failure to specifically plead the relevant provisions
of the Civil Aviation (Carriers’ Liability) Act 1959
(Carriers’
Act) will not extinguish an otherwise good action that has
become time barred if the action has been properly commenced
and sufficient facts pleaded. In the decision of Povey
v Qantas Airways Limited and British Airways Plc, the
Court held that a failure to warn of the risk of deep vein
thrombosis (DVT) is not an “accident” for the purposes of
the Warsaw Convention regime. Both
judgments will have a significant impact on personal injury
litigation that is commenced against commercial carriers
in Australia (and also in overseas jurisdictions
where it is determined that Australian law is the applicable
law).
High Court ends Plaintiff
Passengers hopes in DVT claims
In Povey, the High Court was concerned
with the question of whether passengers were able to claim
compensation for DVT originating from travel on commercial
airline flights. Mr Povey was a passenger who travelled
to London economy class aboard Qantas on 15 February 2000
and returned from London aboard British Airways, again travelling
economy class, on 18 February 2000. Following his travel,
Mr Povey developed a pulmonary embolism resulting in him
suffering a stroke which in turn inflicted him with permanently
impaired mobility and breathing. He was a member of
a class of passengers numbering in excess of 500 who brought
proceedings against various airlines and the Civil Aviation
Safety Authority (CASA) claiming damages for DVT. Mr
Povey was selected from the class as a typical case to enable
argument to proceed as to whether the claim could be brought
against the airlines.
Application of the Warsaw Convention
in Australia
Airlines are not, in respect of international
flights or flights with an interstate element, subject to
the ordinary rules of negligence. In such cases, the
liability of airlines is governed by the Warsaw Convention,
as modified by the Hague Protocol and Montreal Protocol Number
4. The Warsaw Convention has become part of Australian
law by reason of the provisions of the Carriers’ Act. In
general terms, the Convention provides that where a passenger
sustains injuries as a result of an accident on board an
aircraft or during embarkation or disembarkation, he is prima
facie entitled to compensation up to the limit provided in
the Convention (although the limit of liability can be raised
by the airline, and Qantas and many other large airlines
are signatories to the IATA
“Intercarrier Agreement” by which they have agreed to accept
unlimited liability under the Convention).
Article 17
Article 17 of the Warsaw Convention states:
“The carrier is liable for damage
sustained in the event of the death or wounding of a passenger
or any other bodily injury suffered by a passenger, if
the accident which caused the damage so sustained took
place on board the aircraft or in the course of any of
the operations of embarking or disembarking”
Previous judicial consideration of the
meaning of “accident” in Article 17
In the decision of Air France v
Saks the US Supreme Court held that an “accident”,
for the purposes of Article 17, arises only if a passenger’s
injury is “caused by an unexpected or unusual event
or happening that is external to the passenger”. This
interpretation was subsequently followed in Australia,
the UK and much of the Common Law world.
Submissions of MrPovey
In essence, Mr Povey argued that at the time
of his flights, the airlines possessed sufficient knowledge
about the dangers of DVT which required them, as part of
their operating procedures, to:
- give a warning that DVT was a risk in normal flight conditions;
- warn travellers about the consequences of DVT; and
- encourage passengers to take steps which might avoid
the onset of DVT.
Mr Povey alleged the accident occurred because
both Qantas and British Airways failed to do any of the above
and contended that such inaction amounted to an “unexpected
or unusual event or happening” of the type contemplated
in the Saks decision.
Submissions of Qantas and British Airways
Qantas and British Airways, on the other hand,
argued that whether or not a warning was desirable, the failure
to give a warning could not be described as an accident,
because an accident, within the meaning of Article 17, equated
to some event or happening that was unusual and could be
described as accidental. The airlines contended that
all of the flight conditions were common, normal and expected
and there was therefore no event which occurred which was
unusual or unexpected.
Judgment
All of the Judges in the High Court agreed that
the airlines’ submissions regarding the meaning of the word “accident”
were correct and that the airlines’ failure to warn of the
dangers of DVT could not be described as an accident. Six
of the seven Judges who heard the appeal also agreed that
certain circumstances alleged by Mr Povey in his Statement
of Claim, if proved, were also incapable of giving rise to
an “accident”.
However, McHugh J considered that these circumstances, namely
flight attendants offering Povey alcoholic beverages, tea
and coffee during the flights and discouraging him from moving
around the cabin of the aircraft, were capable of amounting
to an accident because what was necessary for an accident
was the unintended and unforeseeable consequences of a voluntary
or intended act of a person other than the person who suffered
the injury.
Future actions for DVT
Notwithstanding the High Court’s decision, there
are still some cases where, if the passenger develops DVT,
there may be liability on the part of the airline. Such
cases derive from acts of the cabin crew or flight crew which
are not usual or expected. Thus a lengthy delay and
the concomitant requirement for passengers to remain in their
seats is likely still to qualify as an accident. Similarly,
a hijack would probably also constitute an accident as would
a defective seat which compromises a passenger’s ability
to move. In each of these cases, there is an event
that is not usual or expected. The focus on such events,
however, also brings a further problem with it, namely, whether
that particular event has caused DVT. The causes of DVT are
not clear and are defined by reference to risk factors rather
than proven causal connection. Until such time as further
research is capable of revealing how DVT develops, passengers
who can satisfy the requirement of their DVT being an accident
nevertheless still face the hurdle of proving that the airline
is liable for it.
Note: Norman Waterhouse’s Special Counsel,
Malcolm Davies, represents United Airlines, Delta Airlines,
and Hawaiian Airlines and their insurers in the abovementioned
class action.
Failure to specifically
plead Carriers’ Act will not extinguish an otherwise good
claim.
In Air Link Pty Limited v Paterson,
on appeal from the Supreme Court of New South Wales, litigation
had been commenced by way of a Statement of Claim in which
Mr Paterson sought damages from Air Link for personal injuries
sustained whilst disembarking from aircraft at Dubbo Airport.
Part IV Carriers Act
Part IV of the Carriers’ Act comprises
section 26 to 41. Section 36 provides that:
“The liability of a carrier under this Part
in respect of personal injuries suffered by a passenger,
not being an injury that results in the death of the passenger,
is in substitution for any civil liability of the carrier
under any law in respect of the injury."
Problems with Statement of Claim
Mr Paterson’s Statement of Claim failed to refer
to Part IV of the Carriers’ Act and instead, framed
the action in common law tort and contract. Air Link
responded by filing a Defence in which it pleaded that its
carriage of Mr Paterson had been subject to Part IV and that
its liability under Part IV in respect of the alleged injuries
was in substitution for any civil liability under any other
law. Mr Paterson was subsequently permitted to amend
his Statement of Claim to plead an action based exclusively
on Part IV, so as to ensure that his cause of action was
correctly pleaded. However, Air Link then argued that,
as the amendment had been made more than two years after
the event, Mr Paterson’s action had been extinguished and
should be struck out.
The Issues
The High Court had to consider two issues:
- was Mr Paterson’s action extinguished at the expiration
of the two-year limitation period?
- if an action is not brought within the limitation period,
is a plaintiff able to amend his Statement of Claim so
as specifically refer to Part IV of the Carriers’ Act?
Was Mr Paterson’s action extinguished?
Section 34 of the Carriers’ Act (which
is identical to Article 29 of the Warsaw Convention regime)
states:
“The right of a person to damages
under this Part is extinguished if a claim is not brought by
him or for his benefit within two years after the date
of arrival of the aircraft at the destination,
or where the aircraft did not arrive at the destination:
(a) the date… the
aircraft ought to have arrived at the destination; or
(b) the date
on which the carriage stopped
whichever is the later”.
Mr Paterson’s claim against Air Link had been
commenced within the relevant two year period. The
issue the Court had to deal with was the meaning of the words “if
a claim is not brought by him”.
The applicable New South Wales procedural legislation
allowed for amendments to the Statement of Claim outside
the limitation period. In that regard, Mr Paterson
argued that, despite there being no specific reference to
the Carriers’ Act in the original Statement of Claim,
sufficient facts were pleaded to demonstrate that the action
was being brought pursuant to the Carriers’ Act and
thus had been brought within the two year time limit.
Air Link responded to Mr Paterson’s argument
with some very strong arguments. In particular Air
Link submitted:
- The action brought was not one pursuant to Part IV, being
the only right given in such circumstances by Australian
law, but rather for a superseded common law right that
no longer existed. It was therefore misconceived,
unless it could be retrospectively amended and completely
re- expressed.
- In circumstances where the legislature has effectively
abolished earlier forms of civil liability of air carriers,
Courts should not struggle to reinterpret actions clearly
framed in terms of superseded law so as to change the character
into something they were not intended to be.
- There was no recital of particular facts in the Statement
of Claim that were essential to bring an action within
Part IV. In particular, there was no allegation that
what happed to Mr Paterson was an “accident” (a pre condition
not without difficulties, as demonstrated in the Povey decision). In
the circumstances, the problem was therefore not one of
surplusage or inadequate description in the facts pleaded
but misdescription and misconception that deprived Mr Paterson’s
action of the essential character necessary to enliven
rights to damages under the Carriers’ Act.
Despite concluding that it was “beyond argument”
that the original Statement of Claim did not intend to plead
an action based on Part IV of the Carriers’ Act but
only one based on the common law of negligence and contract
(being claims abolished by Section 36 of the Carriers’ Act),
the High Court unanimously held that Mr Paterson’s imperfectly
pleaded claim amounted to a claim brought within two years
of the date of the arrival of the aircraft. However,
the Court stressed that it did not follow that any claim
at all, brought within the interval of the two years, would
satisfy Part IV Carriers’
Act and save the person with a claim for damages from
extinguishment of that right. On the contrary, the
process must still qualify as a claim pursuant to Part IV. In
that regard, Kirby J made the following comments:
“True, the pleading of the Statement
of Claim is inadequate by orthodox pleading standards…
However, this cannot determine the character of the action
for present purposes. Clearly the action claims a right to
damages. It is brought by Mr Paterson who is identified
as an air passenger. It concerns carriage by an aircraft.
It specifies the date of carriage. It sufficiently
nominates the circumstances of an event which is clearly
capable of description as an accident… Obviously there were
mistakes and inadequacies in the facts pleaded in the Statement
of Claim. But the character of Mr Paterson’s action
was clear enough. To plead it correctly under Part
IV of the Carriers’ Act no new ideas were
required. Clearly, it would have been preferable for
the pleading to have addressed the Carriers’ Act and
its terms. However, the fundamental purpose
of pleading is to state the essential facts and to notify
the opposite party of the claims being made” [our
emphasis]
Can a Trial Court allow amendments to
the pleading beyond the two year limitation period?
Section 79 of the Judiciary Act 1903
stipulates that state procedural legislation is binding on
courts exercising federal jurisdiction in so far as the legislation
is consistent with federal legislation. The claim brought
by Mr Paterson was an action brought under the Carriers’
Act which is federal legislation. Accordingly,
the Court in which Mr Paterson’s claim was initiated was
exercising federal jurisdiction. In that regard, the
Court held that if an action had not been brought properly
or pleaded sufficiently so as to invoke the Carriers
Act within the two year time limit, Section 79 of the Judiciary
Act could not operate to permit an amendment correcting
the pleading.
The Court’s reasoning was that to allow an amendment
would have had the effect of the extending the time to file
proceedings beyond the two year period prescribed by the Carriers’ Act. As
the state procedural legislation and the Carriers’ Act were
inconsistent, the latter prevailed, in accordance with Section
109 of the Australian Constitution.
Dealing with inadequate Statements of
Claim
The Air Link decision will no doubt be relied upon
by plaintiff solicitors who find themselves in the embarrassing
position of having to substantially amend pleadings out-of-time
as a result of lack of familiarity with Part IV of the Carriers’
Act. However, the High Court has made it clear
that filing a Statement of Claim in which a claim framed
in common law tort and/or contract is pleaded within the
two year period for commencement of a Part IV action will
not necessarily be sufficient to ensure the proceedings have
been commenced in time. The essential elements of an
action brought pursuant to Part IV of the Carriers’ Act must
be included (if only by accident, rather than design, as
was the case with Mr Paterson’s solicitors). If not,
the action will be extinguished at the expiration of the
two-year limitation period and no state procedural legislation
will be able to cure deficiencies after this time. Accordingly,
whenever a plaintiff fails to specifically plead the cause
of action provided for in Part IV of the Carriers’ Act,
solicitors representing defendant airlines should carefully
consider whether the essential elements of Part IV have been
pleaded.
For further information about the issues covered
in the articles above, please contact James Harb, Malcolm
Davies or Christopher Keane on
+ 61 2 9023 0100.
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