Qantas claims it doesn’t sell tickets to flights but ‘bundle of rights’ in defence against ACCC case
Qantas has claimed it doesn’t sell customers tickets to any particular flight, but rather a “bundle of rights” that includes alternative options in the event of cancellations, as it responds to allegations it sold tickets to thousands of already cancelled flights.
The embattled airline revealed its view as it filed its legal defence responding to the Australian Competition and Consumer Commission’s (ACCC) legal action alleging it had advertised and sold tickets for more than 8,000 flights that it had already cancelled in its internal system.
Qantas also claimed that informing customers that it had already cancelled flights they were booked on would have created “uncertainty and frustration” and overwhelmed its phone lines, as the airline accuses the competition watchdog of ignoring the realities of the aviation industry.
In late August, the ACCC levelled historic allegations – which were seen to have hastened the exit of former chief executive Alan Joyce – that Qantas continued to advertise and sell 8,000 tickets on its website for an average of two weeks, and in some cases up to 47 days, after cancelling the flights.
The alleged false, misleading or deceptive conduct occurred between May and July 2022, when the watchdog found the airline cancelled about 15,000 out of 66,000 domestic and international services. Separate to advertising and selling already cancelled flights, the ACCC has also accused Qantas of taking 18 days on average to notify ticketholders on more than 10,000 flights that their service had been cancelled.
Gina Cass-Gottlieb, chair of the ACCC, previously said she wants to see Qantas hit with penalties of at least $250m, which is twice the current record penalty.
In its concise statement of defence filed with the court, Qantas claimed sections of consumer law that the ACCC has accused it of breaching in relation to providing a service do not apply, because the airline did not supply customers with carriage on any “particular flight”, but rather “a bundle of contractual rights”.
Qantas said the bundle of rights were consistent with its “promise to do its best to get consumers where they want to be on time”. The bundle of rights included being rebooked on alternative options upon cancellation, but “expressly excluded any guarantee of flight times”.
In the filed statement, Qantas noted that when booking, customers agreed to “prominent and plain English statements” in its terms and conditions acknowledging “that flight times are not guaranteed and do not form part
of my contract of carriage”.
On Monday, Qantas reiterated the period in question in 2022 had been a time of “massive upheaval” in aviation after pandemic border closures, and when it was the only Australian carrier flying internationally.
“Restarting flying after the Covid shutdowns proved a challenge for the whole industry, with staff shortages and supply chain issues coinciding with huge pent-up demand. Qantas cancelled thousands of flights as a result and there were many unacceptable delays. While we restarted safely, we got many other things wrong and, for that, we have sincerely apologised,” it said in a media statement outlining its defence.
However, Qantas maintained that airlines are never able to guarantee flights will take off when scheduled.
“In purely legal terms, the ACCC’s case ignores a fundamental reality and a key condition that applies when airlines sell a ticket. While all airlines work hard to operate flights at their scheduled times, no airline can guarantee that. That’s because the nature of travel – when weather and operational issues mean delays and cancellations are inevitable and unavoidable – makes such a guarantee impossible.”
“The ACCC’s case relates to cancelled flights that were left on sale for longer than 48 hours. We acknowledge there were delays and we sincerely regret that this occurred, but crucially, it does not equate to Qantas obtaining a ‘fee for no service’ because customers were re-accommodated on other flights as close as possible to their original time or offered a full refund.”
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For passengers who had booked on to flights when the airline still intended to operate them, before they were cancelled in its internal system, Qantas said that “where the flights were to depart well into [the] future”, notifying customers as soon as the decision was made to cancel a service “would have resulted in a significantly more frustrating customer experience”.
“If we had sent texts to thousands of customers a week saying their flight had been cancelled and we would get back to them on their alternative flight options, we would have created a lot of needless uncertainty for those customers and even longer call centre wait times.”
Central to Qantas’ defence is an explanation of how its regular cancellation notification protocol for ticketholders broke down due to “the sheer scale of the changes we were dealing with during this period”, and how this led to already cancelled flights continuing to be advertised and sold to new customers.
“We couldn’t remove these flights from sale automatically while also providing impacted customers with alternative flights. Given these flights were being cancelled well in advance of travel, we wanted to offer our customers alternatives rather than the uncertainty and frustration that would have existed if we had simply pushed through the cancellation in our system before we were able to offer alternative flights to get them to their destination.
Qantas said “some of the longer delays were due to human error and process failures”.
“This was not done for commercial advantage,” the airline said. “Mistakes were made. While this level of upheaval is hopefully never repeated, we have strengthened our systems and processes to make sure it doesn’t happen again,” Qantas said.
A case management hearing is scheduled for 8 November.
Qantas’ claims come ahead of the airline’s annual general meeting on Friday, amid calls for board changes and pay cuts for senior leaders in response to a range of sagas that also include it facing hundreds of millions in compensation for illegally outsourcing ground handlers and customer fury that have seen it become the most complained about company to the ACCC for the past two years.