Passenger unable to break Montreal Convention baggage liability limit

Bassam v. American Airlines (5th Cir. (La.) July 14, 2008).  Four months after her international flight, American Airlines delivered the passenger’s missing baggage to her.  The passenger claimed that items were missing from the baggage, and she sued the airline in state court for over $5,000 for the value of the missing items.  The airline removed the case to federal court, where the passenger amended her complaint to add a claim for $15,000 for the “embarrassment and upset of not being able to dress and appear in public as was her prior practice.”

American moved for summary judgment on the grounds that (i) the passenger’s recovery for her baggage loss was limited to 1,000 Special Drawing Rights (approximately $1,540 at that time) under Article 22(2) of the Montreal Convention, and (ii) the passenger could not recover anything for her “embarrassment” claim because damages for emotional distress not caused by a physical injury are not recoverable under the Convention.

As to the liability limit issue, the passenger argued that the limit did not apply under Article 22(5) of the Convention; that provision removes the Article 22(2) limit “if it is proved that the damage resulted from an act or omission of the carrier, its servants or agents, done with intent to cause damage or recklessly and with knowledge that damage would probably result” and “it is also proved that such servant or agent was acting within the scope of its employment.”  The passenger contended that “[t]he four (4) month delay in recovery of the luggage, allowing [her] personal belongings to be ransacked and stolen, compounded with [American’s] refusal to take any meaningful steps to help [her] in an obvious time of need, makes [American’s] actions much more egregious, certainly rising to the level of what any impartial traveler would consider ‘willful misconduct’.”  In essence, the passenger argued that, by themselves, the delay in delivery and the losses she incurred eliminated any need for her to prove that the airline actually engaged in the type of conduct described in Article 22(5) that would result in the lifting of the liability limit set forth in Article 22(2).

The trial court rejected the passenger’s arguments and was affirmed by the Fifth Circuit.  On the liability limit issue, the appeals court held that, to break the limit under Article 22(5), a passenger must prove facts showing that airline personnel either (i) intended to cause damage, or (ii) acted recklessly with the subjective knowledge that damage would probably result from their conduct.  The Fifth Circuit held that the passenger had failed to meet this “heavy” burden by merely resting on the allegations in her pleadings regarding the delay in delivery of her baggage and the losses she incurred.  It also affirmed the trial court’s ruling with respect to the passenger’s emotional distress claim.

Note:  Before the trial court, the passenger had also argued that the Article 22(2) limit did not apply because she had not been notified of the limit before her flight.  She cited Article 3(4), which provides that “[t]he passenger shall be given written notice to the effect that where this Convention is applicable it governs and may limit the liability of carriers in respect of death or injury and for destruction or loss of, or damage to, baggage, and for delay.”  The trial court cited the plain language of Article 3(5) in rejecting her argument; that provision states that “[n]on-compliance with the provisions of the foregoing paragraphs shall not affect the existence or the validity of the contract of carriage, which shall, nonetheless, be subject to the rules of this Convention including those relating to limitation of liability.”  The passenger did not raise this issue on appeal.

Note:  On June 30, 2009, ICAO adjusted the liability limits set forth in Articles 21 and 22 of the Montreal Convention due to inflation.  Accordingly, effective December 30, 2009, the liability limit set forth in Article 22(2) was increased from 1,000 SDRs to 1,131 SDRs.  See U.S. Department of Transportation, Inflation Adjustments to Liability Limits Governed by the Montreal Convention Effective December 30, 2009, 74 F.R. 59017-18 (Nov. 16, 2009).

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