On September 17, 2015, the European Court of Justice (“ECJ”) issued its latest interpretation of European Union Regulation (EC) No 261/2004 (“EC 261”). In van der Lans v. KLM, Case C-257/14, the ECJ was asked whether an unexpected technical problem with an aircraft, which the airline could not have detected during routine maintenance, could qualify as an “extraordinary circumstance.”
EC 261 is a passengers’ rights regulation that requires airlines to compensate passengers traveling through Europe with fixed amounts of damages (ranging from 250 to 600 Euros depending on distance traveled and other qualifying factors), when they are delayed in reaching their final destinations. The regulation does not require compensation in the event the delay is caused by “extraordinary circumstances” and the airline has taken all “reasonable measures” to avoid the delay.
The van der Lans decision has been viewed by some as confirmation that aircraft technical problems do not qualify as “extraordinary circumstances” under EC 261. Although the ECJ did not rule that no technical problems can qualify as an “extraordinary circumstance,” the ECJ’s decision further narrows the circumstances in which a delay caused by technical or maintenance issues could give rise to the defense.
The action was commenced by a passenger who experienced a 29-hour flight delay when a KLM aircraft scheduled to fly her from Quito, Ecuador to Amsterdam, Netherlands experienced an unexpected engine failure. According to KLM, the engine failed because two component parts suddenly and unexpectedly developed defects prior to reaching their average lifetime, at which point the manufacturer had warned of potential failure. In essence, the failures were not expected and the air carrier was not at fault for not anticipating their failure. Because replacement parts were not available in Quito, they had to be flown in from Amsterdam before the aircraft could takeoff, thus contributing to the extended delay. The passenger requested that KLM compensate her in accordance with EC 261, but KLM denied the request on the ground that unforeseen aircraft defects, such as these, qualify as “extraordinary circumstances”—specifically under the category of “unexpected flight safety shortcomings”—for which no compensation is owed. The District Court in Amsterdam, which referred the case to the ECJ, wrestled with the issue of whether the unexpected technical failure at issue qualified as an “unexpected flight safety shortcoming,” a category of “extraordinary circumstances” that the ECJ recognized in 2008 in Wallentin-Hermann, Case C-549/07, or whether it was merely an example of a technical problem inherent in the normal operation of the aircraft, for which the airline was obligated to pay.
The District Court of Amsterdam referred ten questions to the ECJ for a preliminary ruling, which the ECJ narrowed to a single issue: Whether a “technical problem, … which occurred unexpectedly, which is not attributable to defective maintenance and which was not detected during regular tests, falls within the definition of ‘extraordinary circumstances’ within the meaning of [EC 261]?”
The ECJ first reaffirmed its ruling in the Wallentin-Hermann case that since the functioning of an aircraft inevitably gives rise to technical problems, “technical problems which come to light during maintenance of aircraft or on account of failure to carry out such maintenance cannot [alone] constitute . . . ‘extraordinary circumstances.’” Although the Wallentin-Hermann decision begins with this declaration, it specifically leaves open the possibility that airlines can be exempt from liability in the event of manufacturing defects. In Wallentin-Hermann, the ECJ recognized that not all technical problems are routine or within the control of the airline, “such as defects revealed by the manufacturer of the aircraft comprising the fleet of the air carrier concerned,” which impinge on flight safety and, thus, could fall within the category of “unexpected flight safety shortcomings.” In van der Lans, the District Court asked the ECJ to address this exception and to determine to what extent manufacturing defects could exculpate an airline from its duty.
The ECJ found that the defective component parts in KLM’s aircraft were not the type of technical problems for which the “extraordinary circumstances” defense applied. The ECJ stated that, while the “premature malfunction of components of an aircraft constitutes an unexpected event,” “such a breakdown remains intrinsically linked to the very complex operating system of the aircraft” and that it is understood that “no component of an aircraft lasts forever.” Thus, a technical defect, even if it is “unexpected,” is both routine and in the “control” of the airline.
The court was then careful to differentiate between individual unexpected failures affecting a single aircraft, such as the issue affecting the KLM flight, from manufacturing defects affecting an entire “fleet” of aircraft, to which this defense could still apply. The court implied that in order for an airline to be relieved of its duty to compensate passengers, the defect must be more than an isolated incident and there may have to be some form of “indication” or declaration from the manufacturer, or a competent authority, that there is a problem affecting an entire fleet of aircraft.
Part of the reasoning behind the ECJ’s decision to limit this defense further is that EC 261 expressly affords airlines the right to seek reimbursement from a third-party, such as a manufacturer, for causing a flight cancellation or delay for which compensation must be paid. Thus, according to the court, EC 261 puts the onus of both paying passengers and seeking recompense from the true party at fault on the air carrier.
Accordingly, the ECJ’s decision in van der Lans v. KLM undoubtedly expanded the responsibility of airlines to compensate plaintiffs and narrowed the category of technical problems that qualify as “extraordinary circumstances.” It, however, did not obliterate it. It should be remembered that the “extraordinary circumstances” analysis is a fact-specific determination that cannot be categorically determined.
Relief Outside of the EU is Not a Bar to Recovery
In addition to the extraordinary circumstances defense, the ECJ also addressed a jurisdictional issue for EC 261 claims. The French Government challenged the validity of the proceedings, arguing that EC 261 was inapplicable to the plaintiff’s delay because relief was available to her under Ecuadorian law. EC 261 states that it applies to all carriers departing the European Union but only to European carriers when departing countries outside of but arriving within the EU. According to the French government, there is a discrepancy among the translations of the law into the various languages of the European Union relating to how EC 261 applies to aircraft departing non-EU countries.
In the Czech, German, English, Italian, and Dutch versions, compensation for flights departing a non-EU country is available so long as the passengers have not “actually obtained” compensation in the non-EU country. Whereas, in the Spanish, French, and Romanian versions, EC 261 can be interpreted to exclude passengers traveling from jurisdictions where compensation is “available” to them, “regardless of whether or not [they] actually received them.” Although the ECJ refrained from declaring which translation is correct, the court stated that the regulation itself does absolve the airline from paying EC 261 compensation if alternate compensation is merely available in the non-EU country. The court was careful to note that the national law of member-states may have an effect on whether the availability of remedies outside of the EU affects compensation, but it did not evaluate the extent of such effect.