Italy: Italian Supreme Court En Banc Rules In Favour Of The Jurisdiction Of Italian Courts In Disputes Against Foreign Airlines

By its recent decision No. 3561 of 13 February 2020, the Italian Supreme Court en banc provided a complete solution to the controversial objection of lack of jurisdiction of Italian courts over compensation claims relating to international flights with tickets bought online, an objection often raised by foreign airlines to have proceedings involving air carriers held before domestic courts.

The case originates from a request made, in proceedings before the Justice of the Peace of Bella (PZ) by a couple of Italian citizens, who sued a renowned low-cost airline company, seeking compensation for the cancellation of their Barcelona to Naples return flight, pursuant to Article 7 of Regulation (EU) 261/2004 ¹, plus compensation for non-pecuniary and pecuniary damages due to the unexpected costs incurred for new tickets to return to Italy, hotel accommodation and food.

Such request was rejected by the carrier, which - after entering an appearance - pleaded the lack of jurisdiction of the Italian court having regard to clause 2.4 of the General Terms and Conditions of Carriage ², actually ticked by the purchasers online - according to the point-and-click system in use - in order to complete the process of electronic purchase of tickets, arguing that jurisdiction should lie with Irish courts.

According to the airline, the jurisdiction of Irish courts can be inferred from the criteria set out in Regulation (EU) 1215/2012 on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters, with a focus on Article 25, which allows the parties to confer exclusive jurisdiction upon the courts of a Member State according to pre-established criteria, provided it is done in writing, and with the specification that, in online trade, 'in writing' means any communication by electronic means which provides a durable record of the agreement.

Against said objection, the plaintiffs referred the matter to the Italian Supreme Court, seeking a preliminary ruling on jurisdiction.

The Supreme Court, on hearing the case, made the due premise that, as a general interpretative criterion, in the light of the constant case law of the Court of Justice and of the Supreme Court en banc itself, clauses on prorogation of jurisdiction must be interpreted in a strictly narrow sense, since, in order to identify the court having jurisdiction over claims for compensation for delay in the performance of air transport services suffered by purchasers domiciled in Italy, even if the contract entered into with the airline contains a clause on prorogation of jurisdiction, the connecting factors set out in Article 33 of the Montreal Convention shall apply ³.

Article 49 of the Convention expressly however provides that all clauses included in the contract of international carriage regulated by the Convention that infringe its rules shall be null and void.

Furthermore, according to the Court, the reconstruction of the airline company, which invoked Articles 25 and 17 of Regulation (EU) 1215/2012 ⁴ to identify the court having jurisdiction, deeming them prevailing over the Montreal Convention, cannot be shared. It is indeed the Regulation itself that, to prevent any conflicts, in its whereas clause 35 provides that "this Regulation should not affect conventions relating to specific matters to which the Member States are parties" and, in Article 71, that "[t]his Regulation shall not affect any conventions to which the Member States are parties and which, in relation to particular matters, govern jurisdiction or the recognition or enforcement of judgments".

Therefore, since Italy (like Ireland) is a party to the Montreal Convention, one should have regard to the above international law provision to identify the court having jurisdiction in the specific case.

As a consequence - so the decision concludes -, "jurisdiction lies with Italian courts having regard to both the connecting criterion of the place of destination of the journey and the connecting criterion of the place of business of the carrier through which the contract has been made". Such place, according to the Supreme Court en banc, "coincides, in case of online purchase of tickets for international air transport [...], with the domicile of the purchasers as the place in which they became aware of the acceptance of the proposal made by sending the order and the relevant payment electronically".

In short, therefore, the Supreme Court en banc has (perhaps) put an end to the frequently-raised objection of lack of jurisdiction of Italian courts in relation to delay and/or cancellation of international flights, balancing the interests of the parties involved (carrier and consumer), to limit the distorting effects of forum shopping and to prevent travelers from being forced to turn to foreign authorities to have their rights acknowledged. Furthermore, the general conditions of carriage of the different carriers will also have to be amended accordingly.

Footnotes

1. which provides that, in the event of cancellation of a flight, passengers shall receive compensation amounting to EUR 600.00 for all flights of more than 3500 km, EUR 400.00 for all flights between 1500 km and 3500 km and EUR 250.00 for all flights of less than 1500 km.

2. which reads: "Except as otherwise provided by the Convention or applicable law, your contract of carriage with us, these Terms & Conditions of Carriage and our Regulations shall be governed by and interpreted in accordance with the laws of Ireland".

3. which reads: "1. An action for damages must be brought, at the option of the plaintiff, in the territory of one of the States Parties, either before the court of the domicile of the carrier or of its principal place of business, or where it has a place of business through which the contract has been made or before the court at the place of destination. 2. In respect of damage resulting from the death or injury of a passenger, an action may be brought before one of the courts mentioned in paragraph 1 of this Article, or in the territory of a State Party in which at the time of the accident the passenger has his or her principal and permanent residence and to or from which the carrier operates services for the carriage of passengers by air, either on its own aircraft or on another carrier's aircraft pursuant to a commercial agreement, and in which that carrier conducts its business of carriage of passengers by air from premises leased or owned by the carrier itself or by another carrier with which it has a commercial agreement. 3. For the purposes of paragraph 2, (a) "commercial agreement" means an agreement, other than an agency agreement, made between carriers and relating to the provision of their joint services for carriage of passengers by air; (b) "principal and permanent residence" means the one fixed and permanent abode of the passenger at the time of the accident. The nationality of the passenger shall not be the determining factor in this regard. 4. Questions of procedure shall be governed by the law of the court seized of the case".

4. Such articles regulate the effectiveness of choice-of-court agreements as well as the criteria for determining jurisdiction over consumer contracts.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.