Ali v Malaysian Airline System Berhad (ACN 000 996 903) (Civil Claims) [2007] VCAT 1967

The proceeding is struck out for want of jurisdiction.

1. The applicants' claim arises out of alleged loss of baggage, damage to baggage or delay in delivering baggage at Cairo airport on an outgoing flight on which they were passengers and at Melbourne airport on an incoming flight on which they were passengers. The respondent was the carrier.

2. At a jurisdictional hearing on 3 October 2007 the respondent submitted that the Tribunal has no jurisdiction to hear and determine the proceeding. Ms Ellyard of Counsel appeared for the respondent. Two of the three applicants appeared in person. Ms Ellyard presented a very comprehensive submission of law. Several times during the hearing I asked the applicants whether they wished me to adjourn the hearing so that they could obtain legal advice and prepare an answering submission. They said that they did not. At the end of the hearing I reserved my decision.

3. Australia and Egypt are parties to the Montreal No. 4 Convention, which is the Convention for the Unification of Certain Rules Relating to International Air Carriage by Air signed at Warsaw on 12 October 1929 (the Warsaw Convention) as amended, including the amendment effected by Montreal Protocol No. 4 signed at Montreal on 25 September 1975. Australia and Egypt each became parties to the convention on 14 June 1998.

4. In Part IIIC of the Civil Aviation (Carriers' Liability) Act 1959 (Commonwealth), as amended ("the Commonwealth Act"), section 25J defines "the Convention" to mean the Montreal No. 4 Convention.

(1) Subject to the Part, the Convention has the force of law in Australia in relation to any carriage by air to which the Convention applies, irrespective of the nationality of the aircraft performing that carriage.

(2) A reference in this Part to the Convention is to be read, unless the contrary intention appears, as a reference to the Convention as having the force of law because of this action.

1. Chapter III of the Montreal No. 4 Convention provides for the liability of a carrier with respect to the death of or injury to a passenger and for the loss of, damage to or delay in the carriage of baggage or cargo, and for the delay in the carriage of passengers.

2. Articles 18 to 30A comprise Chapter III of the Montreal No. 4 Convention.

3. Article 18 paragraph 1 provides that the carrier is liable for damages sustained in the event of the destruction or loss of, or damage to, any registered baggage if the occurrence which caused the damage so sustained took place during carriage by air. Article 19 provides that the carrier is liable for damage occasioned by delay in the carriage by air of passengers, baggage or cargo.

4. Article 24 paragraph 1 provides that in the carriage of passengers and baggage, any action for damages, however founded, can only be brought subject to the conditions and limits set out in the Convention.

1. An action for damages must be brought, at the option of the plaintiff, in the territory of one of the High Contracting Parties, either before the Court having jurisdiction where the carrier is ordinarily resident, or has his principal place of business, or has an establishment by which the contract has been made or before the Court having jurisdiction at the place of destination. 2. Questions of procedure shall be governed by the law of the Court seised of the case.
2. Other articles within Chapter III of the Convention afford defences for the carrier or limitations of liability of the carrier.

7. In Sidhu v British Airways PLC and others [1996] UKHL 5; [1997] AC 430 at 447 Lord Hope of Craighead, with whom the other members of the House of Lords agreed, expressed the view that the purpose of the Montreal No. 4 Convention is that, in all questions relating to the carrier's liability, it is the provisions of the Convention which apply and that the passenger does not have access to any other remedies, under the common law or otherwise. The correctness of that view was assumed in Povey v Qantas Airways Ltd [2005] 216 ALR and accepted in Siemens v Schenker [2001] NSWSC 658; [2001] 162 FLR 469 at paragraph 18.

8. The Montreal No. 4 Convention is set out in Schedule 5 of the Commonwealth Act. By virtue of sections 25K of the Commonwealth Act that Convention must be treated as if its provisions were those of the Commonwealth Act itself.

9. In the light of the authorities set out above I consider that Chapter III of the Montreal No. 4 Convention, now having the force of a Commonwealth statute, has displaced other causes of action and created new ones, as well as having set out a regime for the determination of those causes of action.

10. That regime includes the necessity to pursue any of those causes of action in a "Court".
11. Ms Ellyard submitted that "the Court" in Article 28 means a court capable of exercising federal judicial power, which this Tribunal is not.

In Re Maltall Pty Ltd v Bevendale [1998] 14 VAR 368 at 382 Deputy President Macnamara expressed "the extreme difficulty of reaching a confident conclusion" on the question of whether this Tribunal was a "court" for the purposes of section 86 of the Trade Practices Act 1974 (Commonwealth) and so invested with jurisdiction to grant relief under Part V of that Act. After a very thorough examination of the question the Deputy President expressed the opinion that the Tribunal is not a "court" for those purposes. An important consideration was that Tribunal members do not have the security of tenure that the Commonwealth Constitution prescribes as an essential feature of federal courts. Members of this Tribunal are appointed for five year terms only.

Article 28 is, I think, concerned with specifying territorial limits rather than jurisdictional limits of judicial bodies within a particular territory. Nevertheless, it specifies that an action for damages must be brought within "the Court" and nowhere else, and that specification has the force of a federal statute which has created causes of action.

Deputy President Macnamara has brought to my attention two recent decisions. In Commonwealth v Wood [2006] FCA 60; [2006] 227 ALR 631 a single Judge of the Federal court, Heerey J., held that the Tasmanian Anti-Discrimination Tribunal was a "court" capable of exercising federal jurisdiction. His Honour's reasoning, if applied to this Tribunal, would characterise this Tribunal as a "court" for the purpose under discussion. The New South Wales Court of Appeal, however, in Trust Company of Australia Ltd v Skiwing Pty Ltd [2006] 66 1 NSWLR 77 disapproved of the reasoning of Heerey J, and reached conclusions which seem to me to be consistent with and supportive of the opinion expressed by Deputy President Macnamara in Maltall.

In conformity with that opinion I conclude that this Tribunal, not being "the Court" of a kind stipulated in Article 28 of the Montreal No. 4 Convenition, has no jurisdiction to hear and determine this proceeding. I conform with that opinion because of the support it gets from the reasoning in Skiwing and because I regard it as persuasive. The conformity has the virtue of achieving consistency of Tribunal decisions, although that alone would not be an adequate reason for one having reached the above conclusion.

An action for damages relating to mishaps to baggage on international flights - and, I think, all other actions for damages that arise out of international flights, if they are among the ones created by Chapter III of the Montreal No. 4 Convention - cannot be brought in this Tribunal but must be brought in a Court that has been invested with federal jurisdiction.

It has not been necessary for one to express any opinion about the Tribunal's jurisdiction to hear and determine other claims arising under the Commonwealth Act, and so I express no opinion.

There will be an order that the proceeding is struck out for want of jurisdiction.