CTA Decision 378-C-A-2000

DECISION NO. 378-C-A-2000

May 31, 2000

IN THE MATTER of a complaint filed by Jan Witvoet against Bradley Air Services Limited also carrying on business as First Air and/or Ptarmigan Airways and/or Northwest Territorial Airways and/or NWT Air concerning the damage to one of his checked baggage, the loss of some items included in the baggage and the subsequent loss of the baggage following its repair, after a trip from Montréal to Kuujjuaq on January 11, 1999.

File No. 4370/F151/99

APPLICATION
On October 8, 1999, Jan Witvoet filed with the Canadian Transportation Agency (hereinafter the Agency) the complaint set out in the title.

On November 18, 1999, Bradley Air Services Limited also carrying on business as First Air and/or Ptarmigan Airways and/or Northwest Territorial Airways and/or NWT Air (hereinafter First Air) filed its answer to the complaint and, on January 20, 2000 and April 10, 2000, filed additional comments.

Pursuant to subsection 29(1) of the Canada Transportation Act, S.C., 1996, c. 10 (hereinafter the CTA), the Agency is required to make its decision no later than 120 days after the application is received unless the parties agree to an extension. In this case, the parties have agreed to an extension of the deadline until May 31, 2000.

ISSUES
The issues to be addressed are whether First Air clearly states in its tariff:

i) its policy with respect to refusal to transport goods, in accordance with subparagraph 107(1)(n)(viii) of the Air Transportation Regulations, SOR/88-58, as amended (hereinafter the ATR);

ii) its limits of liability respecting goods, in accordance with subparagraph 107(1)(n)(x) of the ATR;

iii) exclusions from liability respecting goods, in accordance with subparagraph 107(1)(n)(xi) of the ATR.

FACTS
Mr. Witvoet travelled from Montréal to Kuujjuaq on January 11, 1999. Upon arrival in Kuujjuaq, one piece of his checked baggage was reported missing. The baggage arrived the next day in a severely damaged condition and some items were missing. A Damaged Baggage Report was filed by First Air's personnel in Kuujjuaq. On January 13, 1999, Mr. Witvoet provided a list of missing items to First Air and requested compensation.

POSITIONS OF THE PARTIES
Mr. Witvoet submits that upon his arrival in Kuujjuaq, one of his suitcases was missing. Although the suitcase arrived the next day, it was in a severely damaged condition and certain items, such as compact disks and computer software on compact disks, were missing.

Mr. Witvoet maintains that it was First Air's responsibility to transport and deliver his baggage in an appropriate and secure way and that he holds First Air accountable for the damage to his suitcase and for the loss of his personal belongings.

First Air submits that the liability of the air carrier for loss or damage to baggage is governed by the Carriage by Air Act, R.S.C., 1985, c. C-26 and the terms of a passenger's ticket, as set out under Conditions of Contract appearing thereon. First Air states that the Carriage by Air Act indicates that air carriers cannot be held responsible for missing valuables for which a prior declaration has not been made. The carrier maintains that a passenger should identify and declare at check-in that he or she is carrying valuables in checked baggage.

In response, Mr. Witvoet points out that, according to the notice of baggage liability limitation found on the IATA cover of First Air's ticket issued to him in Montréal, liability for loss, delay or damage to baggage is limited, unless a higher value is declared in advance and additional charges are paid. Mr. Witvoet also refers to a statement in the notice which indicates that, for travel wholly between points in Canada, liability is limited to CAD$750.00. In Mr. Witvoet's opinion, even though he did not declare a higher value, First Air is still liable up to the maximum amount of non-declared missing items.

First Air submits that IATA rules and regulations do not apply to domestic travel. The carrier also refers to its Domestic General Rules Tariff No. CDGR-1 (Rule 190(A)(3)(b), on Acceptance of Baggage, and Rule 230(B)(1), on Exclusions from Liability), which describes its liability with respect to valuables.

With respect to the damaged baggage, First Air states that it had the suitcase repaired and sent to Mr. Witvoet. First Air submits that as Mr. Witvoet never received the repaired suitcase, it sent him a cheque to cover its replacement cost.

ANALYSIS AND FINDINGS
The Agency considers consumer complaints by ensuring that the provisions of the CTA, as well as those of its related regulations, including the ATR, are complied with by air service operators.

Section 55 of the CTA defines a tariff as a schedule of fares, rates, charges and terms and conditions of carriage applicable to an air service or other incidental services. Subsection 67(1) of the CTA provides, among other matters, that the holder of a domestic licence shall publish and make available for public inspection its tariffs for the domestic service it offers.

Carriers operating domestic air services are free to establish their own terms and conditions of carriage provided that they are set out in a tariff as required by subsection 67(1) of the CTA. Pursuant to paragraph 107(1)(n) of the ATR, tariffs shall contain the terms and conditions of carriage clearly stating the air carrier's policy in respect of, among other matters: (Emphasis added)

(viii) refusal to transport passengers or goods,

(x) limits of liability respecting passengers and goods,

(xi) exclusions from liability respecting passengers and goods.

Accordingly, the Agency has to determine whether the air carrier has published, displayed or made available a tariff that clearly states the carrier's policy with respect to matters such as limits of liability and exclusions from liability respecting goods, as well as the refusal to transport goods.

In the case at hand, the terms and conditions of carriage applicable to First Air's flight from Montréal to Kuujjuaq on January 11, 1999 were governed by the air carrier's Domestic General Rules Tariff No. CDGR-1 in effect at the time of travel.

Rule 190(A), General Conditions of Acceptance, of First Air's Domestic General Rules Tariff No. CDGR-1 provides, in part, that:

(3)(b) Carrier does not agree to carry in checked baggage or when otherwise placed in the care of the carrier, money, jewelery, silverware, negotiable papers, securities or other valuables, business documents, samples, liquids, and perishable items. (Emphasis added)

Rule 230-7F, Liability - Baggage, of First Air's Domestic General Rules Tariff No. CDGR-1 further provides, in part, that:

(A)(2) Liability for the loss of, damage to, or the delay in delivery of, baggage or other personal property ... shall not be more than 750 dollars per passenger unless a higher value is declared in advance and charges are paid pursuant to carriers regulations as defined in paragraph (C). In the event, the liability of the carrier shall be limited to such higher declared value. In no case shall the carriers liability exceed the actual loss suffered by the passenger. All claims are subject to proof of amount of loss.

(B) Exclusions from Liability

(1) Carrier shall not be liable for the loss, damage, or delay in delivery of fragile or perishable articles, money, jewelry, silverware, negotiable papers, securities, or other valuables; spirits; business documents; band/orchestra equipment; household items; office equipment, cameras/ accessories or samples included in the passenger's checked baggage, with or without the knowledge of the carrier. (Emphasis added)

As for the carrier's policy on refusal to transport passengers or goods and on exclusions from liability, the Agency finds that the reference to "other valuables", as found in Rule 190(A), General Conditions of Acceptance, and Rule 230-7F(B)(1), Exclusions from Liability, is unclear, ambiguous, and thus is subject to interpretation. In order to meet the requirements of paragraph 107(1)(n) of the ATR, an exclusion from a general policy found in a tariff must clearly and specifically identify the elements contained in the said exclusion. Accordingly, if First Air intended or intends to refuse to transport such objects as musical albums and computer software on compact disks, then its domestic tariff must clearly state so.

In light of the above, the Agency notes that it was difficult for Mr. Witvoet to assess whether the carrier accepts or restricts its liability with respect to objects such as musical albums and computer software on compact disks. The rule of statutory interpretation ejusdem generis examined by the Supreme Court of Canada in National Bank of Greece (Canada) v. Katsikonouris, [1990] 2 S.C.R. 1029, provides that where general words follow an enumeration of particular things, it will normally be appropriate to limit the general term to the genus of the narrow enumeration that precedes it. As such, a reasonable person would expect the nature of the term "other valuables", as found in Rule 190(A), General Conditions of Acceptance, and Rule 230-7F(B)(1), Exclusions from Liability, to be limited to type of genus or like class or nature as of the narrow enumeration that precedes it. Accordingly, a reasonable passenger could expect the air carrier to accept, without exclusion from liability, objects such as the ones carried by Mr. Witvoet. The Agency notes this was not done in the present case.

With respect to limits of liability respecting goods, the Agency finds that First Air has complied with the regulations as its tariff contains, as provided by subparagraph 107(l)(n)(x), provisions relating to the limits of liability respecting passengers and goods.

CONCLUSION
In light of the above findings, the Agency concludes that First Air has contravened paragraph 107(1)(n) of the ATR because its domestic tariff does not clearly state the carrier's policy with respect to refusal to transport goods, and exclusions from liability respecting goods.

Accordingly, the Agency, pursuant to section 26 of the CTA, hereby requires First Air to refrain from publishing, displaying or making available a tariff in contravention of paragraph 107(1)(n) of the ATR.

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