Court rules that rejected pre-litigation settlement demand does not create entitlement to attorneys’ fees under Montreal Convention

Bytska v. Swiss International Air Lines, Ltd. (N.D. Ill. Nov. 28, 2016).  In her 45-page complaint, the passenger/plaintiff alleged that Swiss and Ukraine International Airlines were liable under the Montreal Convention and EU 261 due to delays in her flights from Kiev to Chicago via Zurich.  As part of her claim under the Convention, the plaintiff requested attorneys’ fees under Article 22(6) of Montreal Convention due to the airlines’ “failure to respond” to her “written pre-suit settlement offer.”

The court dismissed the plaintiff’s EU 261 claim, as well as her untimely Montreal Convention claim against UIA, leaving only her claim under the Convention against Swiss.  Although no judgment had been entered in the case, the plaintiff filed a motion seeking an award of over $16,000 in attorneys’ fees under Article 22(6), which provides as follows:

The limits prescribed in Article 21 and in this Article shall not prevent the court from awarding, in accordance with its own law, in addition, the whole or part of the court costs and of the other expenses of the litigation incurred by the plaintiff, including interest.  The foregoing provision shall not apply if the amount of the damages awarded, excluding court costs and other expenses of the litigation, does not exceed the sum which the carrier has offered in writing to the plaintiff within a period of six months from the date of the occurrence causing the damage, or before the commencement of the action, if that is later.

The plaintiff argued that she was entitled to an award of attorneys’ fees under Article 22(6) because Swiss had failed “to meaningfully consider plaintiff’s pre-suit settlement offer.”  Swiss contended that the phrase “in accordance with its own law” in Article 22(6) meant that the entitlement to fees was to be determined by federal or Illinois law, and both federal and Illinois courts follow the “American Rule,” i.e., a party cannot recover its fees without a statute or contract providing for fee-shifting.  As support, Swiss cited a 2009 opinion in which the Fifth Circuit ruled that the Convention does not “provide an independent basis” on which attorneys’ fees can be awarded.

The court agreed with Swiss.  It ruled that, “[b]y its plain terms, then, Article 22(6) allows a court to apply its own domestic law when deciding whether, and to what extent, to award attorney fees and costs” and that the provision “permits this court, subject to its second sentence, to apply the American rule and the body of substantive and procedural law it would otherwise apply to decide a request for costs and attorney’s fees.”  Because the plaintiff had failed to show that she was entitled to an award of fees under that body of law, the court denied her motion.


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