Legal Issue: The challenge to the validity of regulations adopted by the Canadian Transportation Agency (CTA) for compensating air passengers for various delays, losses, and inconveniences experienced during international air travel.
Key Points:
Background Legislation: The Transportation Modernization Act (2018) amended the Canada Transportation Act (1996), creating a new section (s. 86.11). This mandates the Agency to impose obligations on air carriers, especially regarding flight delays, cancellations, denied boarding, and baggage issues.
Regulations Challenged: The Air Passenger Protection Regulations, imposing obligations and liabilities on air carriers for tarmac delays, flight cancellations, and other issues in the context of domestic and international air travel.
Airlines' Argument: The regulations exceed the CTA's authority, contravene Canada's international obligations under the Montreal Convention, and possess impermissible extraterritorial effects, thus violating international law principles.
Federal Court of Appeal Decision (2022): Dismissed the appeal except for the provision on liability for temporary loss of baggage, deemed ultra vires of the CTA.
Supreme Court of Canada Ruling (2023): Dismissed the appeal, except regarding s. 23(2) of the Regulations concerning liability for temporary loss of baggage.
Conclusion:
The Supreme Court of Canada largely upheld the validity of the Air Passenger Protection Regulations. It found that the majority of the regulations did not exceed the Agency’s statutory authority and were consistent with Canada’s international obligations, except for the specific provision on baggage loss liability. The decision emphasizes the balance between international treaty obligations and domestic regulatory power in the context of air travel consumer protection.
