Coronavirus

Canadian Airlines Getting Sued for Not Refunding Coronavirus Cancellations

A proposed class-action lawsuit against Air Canada, WestJet, Air Transat, Sunwing, and Swoop is for people owed a refund for a flight canceled by the COVID-19 outbreak.

by Anne Gaviola
Mar 30 2020, 5:16pm

Legal action has started on behalf of Canadian airline customers who aren’t getting refunded for cancelled flights. Photo by Ethan McArthur courtesy of Unsplash

This article originally appeared on VICE Canada.

Air Canada, WestJet, and other Canadian airlines are facing a potential class-action lawsuit for not offering refunds to the thousands of people who are owed money for flights that were canceled due to the COVID-19 pandemic.

On Friday, Mission, B.C. resident Janet Donaldson filed the suit in federal court on behalf of travelers whose contracts state that they are entitled to refunds by Air Canada, WestJet, Air Transat, Sunwing, and Swoop. Donaldson’s WestJet flight from Vancouver to New York in April was cancelled after the federal government banned non-essential travel.

According to court documents, the suit claims that the airlines should not be allowed to hold onto customers’ money “indefinitely for a purchase that... (they) may or may not wish to make in the future.”

VICE reached out to Air Canada, WestJet, Air Transat, Sunwing, and Swoop. Both Air Transat and Sunwing would not comment on the lawsuit and both are offering 24-month travel credits.

According to Christophe Hennebelle, Transat A.T.’s vice president of human resources and corporate affairs, the situation “has placed an extraordinary burden on the industry, which puts its very existence into question.” He said a two-year credit is “an acceptable solution” for customers. “We are confident that they will be able to travel again in a not-too-remote future, once the crisis is over.”

Air Canada, WestJet, and Swoop have not replied to requests for comment.

Right to a refund

Simon Lin, is a lawyer with British Columbia-based firm Evolink Law Group, which is overseeing the legal case.

He said many people may not realize they are legally entitled to a refund. Last Wednesday, the Canadian Transportation Agency (CTA), the federal airline regulator, posted a “Statement on Vouchers” on its site.

The statement says some airline contracts provide for refunds in certain cases “but many have clauses that airlines believe relieve them of such obligations in force majeure situations.” It advises that during a pandemic it would be appropriate “for airlines to provide affected passengers with vouchers or credits for future travel, as long as these vouchers or credits do not expire in an unreasonably short period of time.”

According to Lin, the statement on vouchers is just a recommendation and is not legally binding.

In a written response to VICE, the CTA said the voucher statement “seeks to provide guidance in a situation without precedent.”

The judicial system across the country is on pause right now because of the coronavirus crisis, so it will take longer than usual for the proposal to be heard. When that happens, if a federal judge decides that the case has merit and is in the interest of a large group of people, anyone who bought a ticket before March 11 this year and was set to travel after March 13 but has not been given a refund, stands to benefit.

Lin said if the suit goes ahead it has the potential to be the biggest of its kind. According to the suit, the class action could involve tens of thousands, if not hundreds of thousands, of people.

Sarnia, Ontario resident Samantha Borquez-Perez hopes the lawsuit goes ahead. The 28-year-old was booked on her first flight outside of Canada, to Cuba in April for a holiday.

When she found out the flight was cancelled on March 18, she figured she would be getting her money back, as stated in her contract with Air Transat. Instead, she was offered a voucher to be used within two years. Borquez-Perez said the voucher is useless to her, especially because she was laid off from her retail jobs with the Ontario government-mandated shutdown. Plus, she’s expecting her third child in August.

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Samantha Borquez-Perez told VICE she needs a refund to pay bills. Photo supplied

“On top of financial issues, not working, and expecting my third child, I will now be out of $1,250. The 24-month voucher is fine for those who travel often or have that luxury of going on vacation,” she said. “This voucher does nothing for me. I can’t even resell it.”

COVID-19 and extraordinary circumstances

Lin acknowledged that these are unprecedented times, but said, “You can’t in broad strokes say everything is ‘force majeure’ and cancel every single contract out there.”

The unforeseeable circumstances would have to provably render the airlines unable to perform the service, but also unable to provide the refund.

VICE spoke with several people who showed us messages from airlines or customer service representatives saying that they did not have the resources to give them a refund. Some were told that refunds would bankrupt the airlines.

According to Lin, and corroborated by other legal experts, a lack of money is not a defense in law. He said that if it’s a matter of a lack of human resources to manually process a refund then a short delay before people get their money back “would be acceptable.”

But the legal process could take many months and some people can’t wait. Gabor Lukacs, the founder of the Air Passenger Rights advocacy group, said the federal government should do something to help those who are out of pocket. Air Passenger Rights has started a petition calling on Marc Garneau, the federal minister of transport, to force airlines to issue refunds in this “consumer crisis.” More than 11,000 people have signed so far. Lukacs is also spreading the word about the legal action.

In an email to VICE, Amy Butcher, the director of communications for Garneau’s office, said, “Our first priority is returning Canadians abroad who wish to return as soon as possible. We expect air carriers will do their best to work with passengers, their partners, and others in the transportation sector to provide the assistance they can under these extraordinary circumstances.” Butcher goes on to say that “all Canadians should know that this government has their back, and we will not hesitate to act further to protect them.”

Until then, Lukacs suggested that people get in touch with the airline directly and demand a refund, in the original form of payment, based on what their contract outlines—and document everything. If that doesn’t work, they can dispute the charge on their credit card.

That wasn’t an option for Borquez-Perez, who paid for the trip in cash and debit. She said the class action was her only hope in getting her money back.

“This is a hard time for everybody, and if I was able to use the voucher in the time being I would accept it. But considering my situation, loss of income and employment, my legal rights, I should be able to get my full refund,” she said.

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