Peggy Sharon Keren Marco January 4 2023 Court provides guidance on exclusive cause of action under Montreal Convention and ASL Levitan, Sharon & Co | Aviation - Israel Peggy Sharon, Keren Marco Aviation IntroductionBackgroundFactsDecisionCommentIntroductionThe Lod Central District Court recently examined the relationship between:the Convention for the Unification of Certain Rules for International Carriage by Air Montreal 1999 (the Montreal Convention); andthe Aviation Services Law (compensation and assistance due to cancellation of flight or change in its conditions) 2012 (ASL).The Court struck out various causes of actions that did not derive from the ASL in a motion to certify a class action against El Al Airlines Ltd.(1)BackgroundThe Montreal Convention was adopted as a domestic law in Israel under the Carriage by Air Law 1980, with effect from 20 March 2011. The Montreal Convention deals with passengers' claims for compensation due to flight delays, among other things.According to article 29 of the Montreal Convection and clause 10 of the Carriage by Air Law, the cause of action according to the Montreal Convention is an exclusive one. This means that in cases where the Montreal Convention applies, a passenger can only file a claim based on the provisions of the Montreal Convention – it is not possible to base a claim on other causes of actions available under the Israeli law.In 2012, the Israeli legislature enacted a new law: the ASL. The ASL deals with passengers' rights in situations such as where flights are delayed or cancelled or passengers are denied boarding.The cause of action under the ASL is not exclusive. Clause 16 of the ASL states: "Nothing in this law will derogate from any other provision of a law, including from the right of a passenger to compensation according to any law."In recent years, there has been an increase in the number of class action proceedings filed against airline companies, among others, regarding issues such as flight delays and cancellations. In various cases, mainly in class actions, the claimants have based their claims on causes of action afforded not only by the ASL or the Montreal Convention, but also by tort laws or the Contract Law, among others.FactsA motion to certify a class action was filed against El Al. The applicant claimed for damages (on behalf of the class members) resulting from flight cancellations and delays.The certification motion included the following causes of actions:breach of the provisions of the ASL;breach of contract;misleading acts according to the Consumer Protection Law;breach of statutory duties;negligence;breach of the autonomy of the will; andunlawful enrichment.The Court had to decide whether the principle of exclusive cause of action applied in this case – that is, whether the applicants were only entitled to claim for causes of actions and losses that were included in the ASL.El Al's arguments El Al argued that there was no basis for the certification motion relating to the claim for statutory compensation according to the ASL. According to clause 20(e) of the Class Action Law 2006, the courts are not allowed to award exemplary damages or damages without proof of the loss in class action proceedings.In addition, in view of the "exclusive cause of action" rule provided by the Montreal Convention, the applicants in this case were not entitled to base their claim on causes of action that were outside the scope of the ASL or the Montreal Convention. Further, the applicants were not entitled to claim for compensation for other losses that were not included in the ASL.Applicants' responseThe applicant replied that according to clause 16 of the ASL, which provides that the law does not derogate from any other provisions of the law, it is left to the passenger to decide under which law and on which causes of action the claim is filed.DecisionThe Court stated that the ASL is a specific law that was legislated later than the Carriage by Air Law. The legislature would have been aware of the rights and remedies afforded by the Montreal Convention, so the ASL aimed to add to those rights and remedies.The Court referred to a previous judgment(2) in which it had been decided that in view of the specific wording of the exclusive cause of action provided by the Montreal Convention, where the Montreal Convention applies, the carrier cannot be sued for causes that are not based on the ASL.The Court further stated that clause 16 of the ASL could not assist the applicants in this case since this clause does not establish additional rights to claim for losses beyond those included in the ASL or the Montreal Convention.The state of Israel submitted a position paper in another case(3) in which it noted that direct damage caused by the delay of a flight and that is not included in the ASL can be claimed only under the Montreal Convention due to the exclusivity of the cause of action. This position was presented to the Court as a reason to leave in the claim only the causes outside the ASL.As a result, the Court struck out all causes of actions other than those which derived from the ASL.CommentDuring the covid-19, pandemic the aviation industry was almost shut down. Now that airlines have substantially increased their volume of operations, it is important to understand the potential exposure for airlines in relation to passenger claims in cases of flight delays or cancellations.This ruling provides some clarity regarding this potential exposure, in relation to both individual passengers' claims and class action proceedings.For further information on this topic please contact Peggy Sharon or Keren Marco at Levitan, Sharon & Co by telephone (+972 3 688 6768) or email ([email protected] or [email protected]). The Levitan, Sharon & Co website can be accessed at www.israelinsurancelaw.com.Endnotes(1) Akiva Barak & Others v Israel El Al Airlines Ltd, Lod Central District Court, CA 46233-02-17.(2) Golan v El Al, Lod District Court, CA 60667-01-19, 18 August 2020.(3) Skornik v El Al, CC 66890-11-16, 6 November 2019.