20
Apr
20
Articles
The Weekly Roundup: the Continuing Impact of Covid-19 on the Travel Industry

This week the team at 1 Chancery Lane provide an update on the conduct of  hearings during lockdown, and discuss the continuing issues arising out of the vexed question of cancellation refunds.

Remote hearings

In the last few weeks, we’ve all had to adapt to new ways of working in the midst of the COVID-19 pandemic. For us lawyers, many of us have had to juggle hearings and litigation around small children, pets, and crowded homes, with limited access to documents that remain in the offices we can no longer enter.

The pandemic has similarly impacted the courts. One consequence of the pandemic on the justice system is that the already overburdened courts are ever more burdened. Many hearings have been vacated or adjourned as they do not fall within the priority listing categories set out by HMCTS, with much uncertainty remaining as to when they will finally be listed. It is likely that HMCTS will review the cases which fall within the priority listings at some point in the coming weeks. The reason for that will be twofold: the backlog of cases is only going to increase, placing insurmountable pressure on the justice system, and the fact that the courts will have had time to grapple with and familiarise themselves with the technology available, which could allow more hearings to go ahead.

I have had a number of remote hearings in the last few weeks. Some were successful, yet others far less so. As we attempt to navigate through this new way of working, I thought it may be useful to share some of my recent experiences and practical points for such hearings, which I hope you find helpful.

 

Practical points to consider for remote hearings

  1. Is your hearing suitable for a remote hearing?

Many hearings will be suitable to take place remotely. There will be a number, however, where it simply isn’t possible. Whilst we all have read of some success in the Commercial Courts of trials being conducted via Skype for Business, it is unlikely that the likes of Slough County Court will be set up to allow trials to proceed with the same success.

The matter becomes more complicated when you have multiple claimants or defendants, allegations of fundamental dishonesty, or litigants in person, particularly if a trial is to take place by telephone. Similarly, if you have experts in foreign jurisdictions that are to give oral evidence, they may not have the set up at home to be able to deliver it.

  1. Ensure you and your client are familiar with the technology to be used prior to hearing.

County Courts are largely using Skype for Business or telephones when conducting a remote hearing. It seems unlikely at this stage that Zoom is going to be utilised, due to a number of security concerns. However, HMCTS are due to roll out their bespoke video hearing facility in due course, which will likely replace Skype for Business.

Make sure you are familiar with how the technology works prior to the hearing, as well as your client. What you want to avoid is turning up virtually for the hearing, with the matter later being adjourned because your client couldn’t figure out how to unmute his/her microphone.

It is also important to check that your clients actually have the technology to participate in the proceedings. For those elderly witnesses, for example, they may not be able to set up and download Skype. In addition, they may simply not have the technology at home.

  1. Does the Judge have the documents you have filed?

I have had a number of hearings recently where it has become quickly apparent that the Judge does not have key documents either party is referring to, despite those documents being sent in to the court office some time before the hearing.

What I have found works well is to ask the Judge if they would like the relevant documents emailed to them in the course of the hearing, which can save the hearing being potentially lost. If there are a number of documents that a Judge doesn’t have and the hearing is only listed for a short time, it will likely be adjourned. However, I would recommend that you have individual copies of each document ready to send to the Judge if the worst happens.

  1. If you have a telephone hearing coming up, check if the court will be phoning you, or vice-versa.

I recently had a panicked phone call from one of my clerks about an upcoming remote hearing. After waiting for an hour and a half to get through to the court office, they were told that I would have to telephone the court to get through to the Judge at the time of the hearing the following day. This was not the same information given to my solicitor, who had arranged a telephone conference via Legal Connect. To make matters worse, my clerk was told by the court office that the matter was being transferred to a totally different court, leaving us unsure as to which court I would have to phone!

As it turns out, the hearing (thankfully) went ahead successfully via Legal Connect.

Although there are clearly some issues in respect of the information being given by the court office, it seems that most telephone hearings are taking place either through the means of Legal Connect or BT Meet Me. The difference between the two is that a Judge will use BT Meet Me to phone you. If the court has asked for your telephone details, or of those of your representative, it’s likely they will be phoning you.

  1. Is a stay necessary?

I have noticed that a number of defendants are requesting stays in CMC/CCMC remote hearings in response to the pandemic. In particular, for those solicitors representing defendants who are package holiday suppliers or foreign insurers, it is inevitable that instructions and disclosure are going to be hard to come by. In recent hearings, I found that Judges are essentially granting stays in all but name. Whilst they are rejecting stays on the basis that the wheels of justice have not, and indeed should not, grind to a halt, they are implementing dates in directions which are significantly in the future. That, coupled with the increased agreed extension of time to 56 days between the parties without the need for permission from the court (as per Practice Direction 51ZA), seems to be sufficient at this stage to avoid the need for a stay to be implemented.

 

Are remote hearings the way of the future?

Following the pandemic, I suspect HMCTS will consider that remote hearings have been a great success and should be more frequently adopted. I don’t, however, consider that the same will be said by lawyers or the judiciary.

The Lord Chief Justice, Master of the Rolls, and President of the Family Division recently issued a message to civil and family judges that is publicly available. It is interesting to note that a criticism received concerning remote hearings was that they were unusually tiring and that the behaviour of some participants, such as litigants in person, has been more challenging to deal with.

In this author’s view, remote hearings work well for applications or case management hearings, yet the same cannot be currently said in respect of trials. However, until the pandemic subsides, remote hearings are our new reality, for now.

About the author

Dominique Smith was called in 2016 and undertook pupillage in chambers under Jack Harding, Andrew Spencer and Sophie Mortimer. Her experience as a pupil in the field of travel law translated into a busy practice, and she is now a highly regarded practitioner within the area in her own right. She undertakes work for both Claimants and Defendants and has a particular interest and expertise in Coroners’ Inquests.

 

Group trips and the Package Travel Regulations 2018

 

As a result of travel restrictions and lockdowns around the world, many group trips around this time will be, or have been, cancelled. This raises interesting questions about who has rights and obligations under the new Package Travel Regulations.

 

The 2018 Regulations give rights to ‘travellers’ (as opposed to ‘consumers’ in the 1992 Regulations). Regulation 2(1) defines ‘travellers’ as “any individual who is seeking to conclude a contract, or is entitled to travel on the basis of a contract concluded, within the scope of these Regulations”. The individual people due to travel as part of a group should therefore be ‘travellers’ whether or not they have contracts with the tour operator. The party booking on behalf of the group – assuming it is not an individual – is unlikely to be.

 

And what of the other party to the contract? Under the 2018 Regulations it is the ‘organiser’ who is liable for the proper performance of the package (Regulation 15(2)) and who is responsible for providing a refund where applicable (Regulation 14). The ‘organiser’ is the person putting together and/or selling the package, providing they are acting for purposes relating to their trade, business, craft or profession.  There is an important exclusion which means that some group trips will not be covered by the Regulations. Packages offered (and linked travel arrangements facilitated) “occasionally on a not-for-profit basis for a limited group of travellers” are not covered by the Regulations. So if – for example – a school acted as ‘organiser’ and put together a package for its school pupils, making no money in the process, the resulting package would not be regulated.

 

Where group trips are cancelled a key issue will be the entitlement to refunds. If there are “unavoidable and extraordinary circumstances occurring at the place of destination or its immediate vicinity and which significantly affect (a) the performance of the package, or (b) the carriage of passengers to the destination” then the traveller/s can terminate the contract before departure and will be entitled to a full refund “of any payments made for the package” (Regulations 12(7) and (8)). “Unavoidable and extraordinary circumstances” means a situation beyond the control of the party who seeking to rely on them, and the consequences of which could not have been avoided even if all reasonable measures had been taken. Recital 31 of the underlying Directive provides some useful further guidance, stating “travellers … should also have the right to terminate the package travel contract without paying any termination fee where unavoidable and extraordinary circumstances will significantly affect the performance of the package. This may cover for example… significant risks to human health such as the outbreak of a serious disease at the travel destination…”.  It remains to be seen how consumer-friendly judges are willing to be when interpreting these provisions in the current circumstances, but if the caselaw arising out of the SARS epidemic is anything to go by, a traveller is entitled to cancellation and a full refund where the Foreign and Commonwealth Office advises against non-essential travel.

 

About the author

Andrew Spencer was called to the Bar in 2004, and is listed in the Legal 500 as a Band 1 practitioner in travel law. He acted for the Claimant in the seminal case of Japp v Virgin Holidays Limited [2013] 11 WLUK 131, in which the Court of Appeal considered the time at which applicable local standards should be determined for the purposes of liability under Regulation 15(2) of the Package Travel Regulations; but he is equally comfortable acting for Claimants and Defendants in all travel related claims.

 

Flight refunds: the saga continues…

Regular readers will recall that this briefing has been keeping a weather eye on airlines providing refunds under the terms of the Denied Boarding Regulations (EU Regulation 261/2004). Pursuant to Regulation 8 of the Regulations a full refund is due to passengers whose flights have been cancelled due to the pandemic; and most airlines are providing refunds in compliance with this Article. More latterly, however, with their entire fleets grounded, in many cases, and with no income or any expectation of any income for some months to come, airlines have been feeling the strain.

As at time of writing, some 14 European governments, including Germany, France, Italy, Belgium and the Netherlands, have come out in favour of allowing airlines to offer vouchers instead of refunds in satisfaction of the terms of the Regulations. The Dutch government has gone so far as to instruct its air travel regulator not to enforce the Regulations whilst the crisis in the industry is ongoing and has allowed airlines to offer vouchers redeemable within one year of issue; after which a refund is payable.

However, this approach is not compatible with the Netherlands’ obligations as a member state of the EU unless and until a temporary derogation is granted by the European Parliament. On 18th March the European Commission issued a statement to the effect that although passengers were not entitled to compensation under the Regulations, they should be offered a refund. Last week the Commission reiterated that the provision of vouchers is only acceptable where the consumer chooses to agree to it; if the traveller insists on a refund, he or she is entitled to one. The chair of the Transport Committee, a member of the Green Party, is no friend of the airlines, and is insisting that full refunds are the only acceptable course.

Perhaps she would not be sorry to see some more airline failures. But if so, she might consider quite how, where an airline has collapsed, any of its customers would receive any compensation at all.

There is, as so often, a Third Way. The Danes have introduced a voucher scheme underwritten by the Danish government; the airline may provide its customers with vouchers, but if it subsequently cannot honour them, the government will reimburse the customer. This allows passengers to accept vouchers rather than refunds, safe in the knowledge that those vouchers will always be honoured.

The European Passengers’ Federation favours this compromise because it strikes a balance between consumer rights and assisting the ailing airlines in their darkest hour. But environmental groups insist that airlines should not receive public money unless they sign up to higher environmental taxes and lower emissions when there is a return to some kind of normality.

All the same, in a sign that although the airlines face their biggest challenge since the industry began, they will benefit from some state assistance, on 11th April the European Commission approved the Swedish government’s €455 million airline support scheme, a package of loan guarantees available to any airline licensed to operate in Swedish airspace as of 1st January. France, Italy and Belgium have already acted to assist their airlines with immediate liquidity. The UK government looks increasingly out of step in its insistence that airlines will not receive bailouts and that it will not act to ameliorate the obligations placed on them under the Regulations. But a week is a long time in politics. Who knows what news next week’s Briefing may bring?

 

About the author

Called to the Bar in 1997, Sarah Prager has been listed in the legal directories as a Band 1 practitioner in travel law for many years. Together with her colleagues at 1 Chancery Lane, Matthew Chapman QC and Jack Harding, she co-writes the leading legal textbook in the area, and has been involved in most of the leading cases in the field in the last decade.

Written by or involving: Sarah Prager, Andrew Spencer, Dominique Smith

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