In a recent case, the plaintiff, Claudio Bedo, filed a lawsuit seeking full compensation for damages caused by a travel agency, Almundo.com SRL, and a carrier, Qatar Airways.

Facts

Bedo purchased three flights to get from Buenos Aires to Rio de Janeiro through Almundo.com. The flight from Buenos Aires to Sao Paulo was operated by Qatar Airways and the flight from Sao Paulo to Rio de Janeiro by another carrier.

On the day that the plaintiff bought the tickets, he received an email from Almundo.com confirming that his transaction had been successful. The following day, Bedo received another email from Almundo.com which detailed his travel itinerary.

The plaintiff realised that his connection in Sao Paulo involved flights in two different airports (Guarulhos International Airport and Viracopos Airport), which are situated far apart. As a result, he would have limited time to make the connection to Rio de Janeiro.

The plaintiff asked to change his flight from Sao Paulo to Rio de Janeiro, but the travel agency declined and informed Bedo that he was not entitled to a refund. As a result, the plaintiff did not take the Qatar Airways flight and instead purchased a flight with Aerolíneas Argentinas.

The plaintiff argued that he had acted in good faith and that, because of the facts outlined above, he had suffered stress and damage to his peace of mind. Bedo made a claim against Qatar Airways and Almundo.com for the reimbursement of the price of his ticket, as well as material, punitive, moral and psychological damages.

Background

The plaintiff argued that when a contract of carriage involves a consumer, the following laws must be applied:

  • the laws regarding the contract of carriage included in Articles 1,092 to 1,112 of the Civil and Commercial Code; and
  • Law 24,240 on Consumer Protection.

Bedo also invoked Law 18,829 on Travel Agents to argue that Almundo.com had been responsible for organising his itinerary and filed a lawsuit before the National Commercial Court in Buenos Aires City.

Competent jurisdiction

After analysing the lawsuit and the responses presented by Almundo.com and Qatar Airways, the court resolved:

  • the law to be applied; and
  • the competent jurisdiction to resolve the case.

The court decided that, as the claim was based on the activities of an air carrier, the Aeronautical Code and not the Consumer Protection Law should apply. Further, the court cited Executive Decree 565/08, which establishes:

  • the Aeronautical Law's autonomy and integrity; and
  • that commercial transportation carriers are excluded from the consumer regime.

Notably, when Law 24,240 on Consumer Protection was amended by Law 23,361, Congress deleted Article 63. Nonetheless, the Executive had vetoed this change via Executive Decree 565/08. The decree stated that Article 63 must remain in force based on:

  • Sidhu v British Airways and El Al Israel Airlines v Tseng;
  • EU Flight Delay Compensation Regulation (261/2004); and
  • Resolution 1532/98, issued in 1998 by the Ministry of Economy and Public Works and Services to regulate the contract of air transportation and complement the Montreal Convention for the Unification of Certain Rules for International Carriage by Air.

According to the court, Argentina's air carrier regime is regulated by Resolution 1532/98, which:

  • approves the general conditions of air transport contracts; and
  • governs domestic and international passenger and cargo transport services operating in Argentina.

As the Bedo case concerned the activities of an air carrier, it was under federal jurisdiction in accordance with Article 198 of the Aeronautical Code. As a result, the National Commercial Court declared itself incapable of hearing the case and sent it to the Federal Civil and Commercial Justice Court.

Further, the National Commercial Court resolved that the mediation consumer and the consumer justice systems, established by Law 26,993, were inadequate for mediating air transportation cases.

The court based its decision on Article 63 of Law 26,361, which establishes that for cases concerning air carriers, the Aeronautical Code, international conventions and the Consumer Law 24,240 (on a supplementary basis) apply.

Comment

The Bedo case established that commercial aviation matters are subject to a complete and systematic set of legal standards, which are integrated at an international level through public and private treaties that govern global air transportation. These include the Chicago Convention and its annexes with regard to public law and the Montreal Convention with regard to private law, to which almost all countries are party. As a result, commercial aviation passengers must file claims through this regulatory framework, which expressly provides air passengers with consumer protection.

The parties can appeal the abovementioned decision. Nonetheless, it sets a favourable precedent for the Argentine aviation industry, as it ordered the application of international conventions rather than local law and federal jurisdiction instead of commercial national jurisdiction. This application of international conventions by the Argentine courts is important, as it establishes the limited liability that is generally overlooked by domestic legislation.

For further information on this topic please contact Elizabeth Mireya Freidenberg at Freidenberg Freidenberg & Lifsic by telephone (+54 11 4311 4991) or email (emf@emfrl.com.ar).

This article was first published by the International Law Office, a premium online legal update service for major companies and law firms worldwide. Register for a free subscription.