International Air Transport Association v. Canada 2024 SCC 30

Supreme Court of Canada

Outline

Facts

[10] In 2014, the Minister of Transport (“Minister”) launched a review of the CTA. Following this review, Parliament enacted the Transportation Modernization Act, S.C. 2018, c. 10, in 2018; this amended the CTA to add s. 86.11, which stated that “[t]he Agency shall, after consulting with the Minister, make regulations in relation to flights to, from and within Canada, including connecting flights” with respect to a number of areas, notably including carriers’ obligations in case of flight delay, flight cancellation or denial of boarding, and lost and damaged baggage. The Agency published draft regulations thereafter; these came into force in 2019.

[11] As mandated by the addition of s. 86.11 to the CTA, the Regulations establish minimum air carrier obligations towards passengers when flights are delayed, cancelled, when a passenger is denied boarding, or when baggage is lost or damaged. This appeal concerns the provisions of the Regulations dealing with:

(a) standardized amounts of compensation for international flight delays, cancellations and denial of boarding when the disruption occurs for reasons within a carrier’s control and is not required for safety purposes (ss. 12(2)(d), (3)(d) and (4)(d), 19 and 20); and

(b) refunds of baggage fees paid by passengers when the carrier has lost or damaged their baggage on international flights (s. 23).

Issue(s)

[2] The appellants submit that, because the Regulations^[1]Air Passenger Protection Regulations, SOR/2019-150 require that air carriers compensate passengers on international flights when their flights are delayed or cancelled, or when passengers are denied boarding or their baggage is lost or damaged, the Regulations conflict with the Montreal Convention’s exclusivity principle. In light of this purported conflict, and because the Montreal Convention has been implemented by way of the Carriage by Air Act, R.S.C. 1985, c. C-26 (“CAA”), the appellants assert that the Regulations are ultra vires the regulation-making authority given to the Canadian Transportation Agency (“Agency”) by the Canada Transportation Act, S.C. 1996, c. 10 […]

Discussion

[94] Because the Regulations do not provide for an action for damages, but instead create an entitlement to standardized compensation that does not seek to measure a passenger’s loss, they fall outside the scope of Article 29 and do not conflict with the Montreal Convention. The two forms of passenger compensation envisaged by the Regulations and the Montreal Convention are capable of “standing together”. The bargain at the centre of the Montreal Convention remains undisturbed. In actions for damages, passengers continue to enjoy certain evidentiary presumptions “on proof of damage” (Thibodeau, at para. 42) which address “the need for equitable compensation based on the principle of restitution” (Montreal Convention, preamble). Carriers remain shielded from unlimited liability arising from actions for damages related to claims for death or bodily injury, damage or loss of baggage and cargo, and for delay.