Evans v Air Canada [2025] HCA 22

High Court of Australia

Facts

These are summarised at [2]:

The issue in this Court arises from a claim, made by two passengers who travelled on an Air Canada flight from Vancouver to Sydney in July 2019, for damages arising from spinal and psychological injury allegedly caused by turbulence experienced on the flight. In the Supreme Court of New South Wales, the passengers sought damages from Air Canada for these bodily injuries under Art 17 of the Montreal Convention, as incorporated into Australian law. Air Canada relied upon a partial defence in Art 21(2) of the Montreal Convention, available where the damage was not due to negligence or any other wrongful act or omission by Air Canada or its servants or agents. Under that partial defence, damages would be subject to a cap that limited the extent of the passengers’ recovery to 113,100 Special Drawing Rights (an international reserve asset created by the International Monetary Fund) which is approximately $240,000 at present exchange rates. The appellant passengers replied that, under Art 25, Air Canada had waived the partial defence in Art 21(2) because the Air Canada Tariff provided in r 105(C)(1)(a) that “[t]here are no financial limits in respect of death or bodily injury”.

Issue(s)

The key issue was Article 25 and what was required in order to waive a condition, limit or defence on the carrier’s part. Had Air Canada waived “by clear and unambiguous language” a defence available to it under the Montreal Convention of 1999?

Discussion

See the following paragraphs of the High Court’s unanimous judgment:

49. Although the meaning of r 105(C)(1)(a) is not to be determined by such [aforementioned] a priori assumptions, the provision must nevertheless be interpreted having regard to its context and purpose. That context and purpose make clear that r 105(C)(1)(a) only describes the effect of Arts 17 and 21 of the Montreal Convention, rather than stipulating a higher limit of liability for the purposes of Art 25 of the Montreal Convention. This interpretation of r 105(C)(1)(a) is supported by five matters of context and purpose.
50. First, r 105(C)(1)(a) is, in its terms, an accurate statement of the meaning of Art 17 of the Montreal Convention. As already explained, the travaux préparatoires to the Montreal Convention are replete with references to liability for personal injury or death within the terms of Art 17 being “unlimited”. Indeed, the limit to the equivalent liability for personal injury or death in the Warsaw Convention was the reason that that Convention had been so controversial. The effect of Arts 17 and 21 of the Montreal Convention is to establish two tiers of liability so that the “no negligence” defence in Art 21(2) will only apply in the second tier; neither Art 17 nor Art 21 imposes any financial limits in respect of the overall Art 17 liability of carriers for death or bodily injury. The limit or threshold is only for the application of the defence in Art 21(2). Rule 105(C)(1)(a) therefore correctly declares that “[t]here are no financial limits in respect of death or bodily injury”. The concern of r 105(C)(1)(a) is the subject matter of (“in respect of”) death or bodily injury. It is not concerned with the limit or threshold for the application of the defence in Art 21(2) of the Montreal Convention.
51. Secondly, r 105(C)(1), like the other provisions of r 105(B) and (C), gives effect to the Canadian Air Transportation Regulations, including the requirement to state the limits of and exclusions from liability respecting passengers and goods. Those Regulations required the Air Canada Tariff to describe the legal effect of multiple instruments since, as Leeming JA observed in the Court of Appeal, passengers on an Air Canada flight could be subject to different legal regimes depending upon the points of connection of the flight.^[1]Air Canada v Evans (2024) 114 NSWLR 433 at 449-451 [58]-[63]. See also Gulf Air Co GSC v Fattouh [2008] NSWCA 225; (2008) 251 ALR 183 at 191 [28]; United Airlines Inc v Sercel Australia Pty Ltd … Continue reading The relevant regimes to which the relevant parts of the Air Canada Tariff are directed include the Warsaw Convention, the 1995/6 IATA Agreements, the Canadian Air Transportation Regulations, and the Montreal Convention.
52. Thirdly, consistently with the purpose of fulfilling the requirements of the Canadian Air Transportation Regulations, each of the preceding and succeeding provisions to r 105(C)(1)(a) does little more than declare the effect of the provisions of the Warsaw Convention, the 1995/6 IATA Agreements, the Canadian Air Transportation Regulations, and the Montreal Convention. For instance, as Leeming JA observed in the Court of Appeal, reference to “in most cases” in r 105(C)(1)(b) and (c) is “the language of a provision which is intended concisely to notify passengers of the limits to which their contract of carriage by air is subject”.^[2]Air Canada v Evans (2024) 114 NSWLR 433 at 454 [75]. The reference to “in most cases” reflects the possibility of exceptional circumstances such as a “special declaration” under Art 22(2) in cases where, for example, a passenger has extremely valuable baggage and is prepared to pay more for a higher limit of liability. So too, r 105C(1)(a) declares the effect of Art 17 of the Montreal Convention.
53. Fourthly, the provision that immediately precedes r 105(C)(1)(a) (namely r 105(B)(5)) is concerned to ensure that the liability rules of the Montreal Convention are “fully incorporated” in the Air Canada Tariff, even to the extent of providing that those rules prevail over any inconsistent provisions of the Air Canada Tariff. Of course, there would be no inconsistency that would arise by Air Canada exercising the power recognised in Art 25 for Air Canada to raise or waive the limit or the threshold applicable to the Art 21(2) defence, or by exercising the power in Art 27 to waive any defence. But, unlike r 105(B)(1), which, in accordance with the terms of the 1995/6 IATA Agreements, waives defences under the Warsaw Convention, r 105(C)(1)(a) does not use the language of waiver. Nor does it use the language of raising or abolishing the limit for the application of the defence in Art 21(2).
54. Fifthly, the appellant passengers’ interpretation of r 105(C)(1)(a) is in tension with Air Canada’s provision in r 105(C)(4) (subject to provision otherwise in the Air Canada Tariff or in applicable laws) that it has a defence to liability for death or injury that is not caused by its negligence. Of course, r 105(C)(4) must be read as subject to the limit or threshold for the application of the “no negligence” defence in Art 21(2). But r 105(C)(4) confirms that Air Canada did not intend to waive that defence.

Useful for

Waiver requires clear and unambiguous wording

Treaty provisions considered

Article 25 MC99

Montreal Convention 1999

Legislation considered

Key subjects or concepts

Counsel or legal team in case

Bret Walker SC

Norton White Lawyers