Big rise in air accident compensation

Compensation for accidents involving international flights will rise significantly once Parliament passes a new bill paving the way for Sri Lanka to accede to the Montreal Convention of 1999.

The ‘Carriage by Air’ Bill, once passed, will give effect to the Convention for the Unification of Certain Rules for International Carriage by Air, otherwise known as the Montreal Convention, adopted by a diplomatic meeting of International Civil Aviation Organisation (ICAO) member states in 1999.

The new bill, gazetted on Friday, will allow for the awarding of far higher compensation for passengers killed or injured in an aviation accident involving international flights.

Under the country’s current laws, compensation in case of aviation accidents is governed by the Warsaw Convention and the Hague Protocol,

where compensation for aviation accidents is lower, said H.M.C. Nimalasiri, Director General of the Civil Aviation Authority (CAA).

As per existing legislation, the family of an airline passenger killed due to an international aviation accident can receive up to US$ 16,600 in compensation. Once Sri Lanka accedes to the Montreal Convention, however, passengers will receive protection via a two-tier liability system where the amount of compensation due to all passengers will increase up to 100,000 Special Drawing Rights (SDR), a mix of currency values established by the International Monetary Fund (IMF), equivalent to more than US$ 100, 000. Under the Convention, air carriers will be strictly liable for proven damages up to this amount.

If victims however, can prove in a court of law that the accident was caused due to the negligence of the carrier, the two-tier system allows for unlimited liability, meaning that the carrier is liable to pay any amount of compensation demanded by the plaintiff.

The new law also increases compensation for damage, loss or delay of baggage by the carrier.

Under the Warsaw Convention, to seek damages, a plaintiff can file a case in the country of the carrier's principal place of business, the domicile of the carrier, the carrier's place of business through which the contract was made or at the place of the destination. The Montreal Convention amended these jurisdictional provisions to allow the victim or his family members to also sue foreign carriers from the territory of the State in which a passenger has his or her principal residence at the time of the accident. As such, a family of a victim whose principal residence is Sri Lanka, but who is killed in an aviation accident on board a foreign carrier would be able to seek damages by filing a case in a

Sri Lankan Court.