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Italian Supreme Court on Art. 33 of Montreal Convention. Jurisdiction criteria under EC261/2004 and air carrier general terms and conditions

The Italian Supreme Court (Corte di Cassazione) has recently ruled on the jurisdiction criteria to apply in judicial claims brought by passengers against airlines, claiming damages for denied boarding, flight cancellation, delay, etc. under EC Regulation 261/2004, even in case the air carrier selected specific prorogation of jurisdiction under Art. 25 of EC Regulation 1215/2012 in favour of Irish courts.

It is well known that EC Reg. 261/04 cases are usually discussed before the Italian Justice of the Peace – JoP – offices, as their value is normally limited below EUR 5,000. It is unusual for these judgments to be challenged up to the Supreme Court; when the controversies are related to jurisdiction issues they are dealt by the Joint Chambers of the Supreme Court.

On 13 February 2020, the Supreme Court (i) affirmed a very important and non-furthermore-disputable principle that should apply in determining the jurisdiction over a dispute between passengers of a member State and air-lines of another member State or extra-EU State which ratified Montreal Convention 1999 and (ii) confirmed a recent principle established by the Supreme Court decision no. 18257 of 19 July 2019 regarding the jurisdiction in case of on-line sale of air tickets.

The Court stated:

"In the matter of international air carriage of persons, the jurisdiction on a claim compensation and damage reimbursement for flight cancellation, shall be deemed under Art. 33 of the Montreal Convention of 1999 criteria (ratified and in force in Italy with Law 12/004) even if the air carriage contract provides for a prorogation of jurisdiction. It is because Montreal Convention shall apply to all the hypothesis of delay during the execution of the transport contracts from the departure to the final destination [thus including the hypothesis of delays listed in EC Reg. 261/04].

It follows that in such cases the Court at the place of destination or at a place of air carrier business through which the contract has been made are competent. In case of online ticket purchase, the Joint Chambers of the Supreme Court confirmed that this latter place is the domicile of the passengers, where the latter received confirmation from the air carrier that their request to purchase a ticket has been accepted".

The above principles, apparently insignificant, due to the clearness of Art. 33 of Montreal Convention 1999, are fundamental to avoid the numerous controversies differently judged by the different JoP in Italy on the issue of jurisdiction.

The case brought to the attention of the Supreme Court was the following one: two passengers, domiciled in Italy, sued an EU air carrier before Italian JoP claiming EC Reg. 261/04 compensation for a flight cancellation. The defendant challenged Italian jurisdiction on the basis that Montreal Convention 1999 does not cover the damages ruled by EC Reg. 261/04, limiting its extension to a simple (and not qualified) delay that shall be proved as well as the damage deriving from the delay by the claimant.

Furthermore, the airline specifically inserted a prorogation of jurisdiction clause in its general terms and conditions, that the passengers accepted – flagging the jurisdiction box – during the online ticket purchase.

According to the air carrier, in such a case the jurisdiction should have been dealt according to EU Reg. 1215/12 general principle and specifically Art. 17, paragraph 3 ("a contract of transport – other than a contract which, for an inclusive price, provides for a combination of travel and accommodation" is not subject to special jurisdiction over consumer contracts) as well as Art. 25 ("If the parties, regardless of their domicile, have agreed that a court or the courts of a Member State are to have jurisdiction to settle any disputes which have arisen or which may arise in connection with a particular legal relationship, that court or those courts shall have jurisdiction, unless the agreement is null and void as to its substantive validity under the law of that Member State. Such jurisdiction shall be exclusive unless the parties have agreed otherwise") as the passengers' choice to accept the exclusive jurisdiction of the Courts proposed by the airline was clear and duly recorded.

The airlines thus sustained the lack of jurisdiction of Italian courts in favour of the one selected as "exclusive" jurisdiction in the contract of transport.

In the recent past it has been experienced contradictory JoP's judgments on such issue, probably due to limited knowledge of aviation international law and on the fact that special law prevails on general one, even if we are discussing on EU principles and legislation.

The thesis sustained by the airline, sometimes awarded by the JoP, limits passengers' capacity to protect their rights, as – notwithstanding the limited value of the claim – they should sue the air carrier before a foreign Country courts with all difficulties related to (i) language, (ii) different legal system; (iii) selection of a legal counsel in a foreign Country and (iv) costs.

Quite surprisingly the Public Prosecutor before the Supreme Court agreed with the airline's defence, but the Supreme Court definitively rejected the application of any law provisions different from Montreal Convention 1999 to determine the jurisdiction in an international carriage by air when both the passengers and the airline States of residence ratified Montreal Convention 1999.

According to the Court, the criteria provided by Art. 33 Montreal Convention have two aims: (i) giving the air carriers certain and previously determined rules for establishing the venue for trial, and (ii) giving the passengers the possibility to have a concrete access to Justice.

With reference to the specific case decided on 13 February 2020, the Supreme Court stated that:

  • Both the passengers' and the airline' States ratified Montreal Convention 1999;
  • EU Reg. 261/04 provides for some passengers protection rules, but it does not exclude the applicability of other laws if not contradictory;
  • As per Section III of the Montreal Convention 1999, it rules all hypothesis of passengers death and injuries (Art. 17); damages to the cargo (Art. 18) and damage related to delay (Art. 19): a flight cancellation usually brings to a delayed arrival at destination (the Supreme Court already clarified that the flight delay and the cancellation are ruled by Montreal Convention 1999 too – judgment no. 18257 /2019 and no. 1584/2018);
  • EU Reg. 1215/2012 principles, according to Art. 71, do not "affect any conventions to which the Member States are parties and which, in relation to particular matters, govern jurisdiction or the recognition or enforcement of judgments";
  • Montreal Convention 1999 is specifically aimed to unify certain rules on international air carriage;
  • Art. 49 of Montreal Convention 1999 specifically states that the clauses of a contract of carriage which decides the law to be applied or alters the rules as to jurisdictions, shall be nulled and void.

For the above reasons, the Supreme Court confirmed the jurisdiction of the Italian Courts and established that even the court territorial competence, according to domestic law, shall be determined with reference to the place of destination of the air transport and/or to the place where the passengers have their domicile, even if the contract of carriage provided for an exclusive jurisdiction of specific EU Courts, at the place of airline residence.

Furthermore as mentioned above, the latest judgement no. 3561/2020 confirmed a recent Supreme Court principle (judgement no. 18257/2019) with reference to jurisdiction in case of air carriage tickets purchased online, even if the purchase took place through a server based in an extra-EU Country.

Considering that many air carriers mainly sell their tickets online, it is difficult, if not impossible, for passengers to understand where the server is based. Therefore and according to the previous comments, Art. 33 Montreal Convention has to be interpreted, in such a way that, in case of passengers who purchased their tickets online with an EU and/or extra – EU air carrier, the territorially competent Court according to Montreal Convention 1999 could be the one at the place of domicile/residence of the purchasers.

The above two important principles should avoid and solve many of the controversies brought before Italian JoP and related to jurisdiction in case passengers claim damages as a consequence of a breach of an air carriage contract when (i) the flight destination is Italy and/or (ii) when the passengers purchased the ticket online at their domicile.