I’m Suing British Airways for Cancelling a “Mistake Fare”

As many readers know, I have a law degree and am currently pursuing a graduate degree in law. I recently moved to Montreal, which follows the Civil Code instead of the common law system.

The common law allows airlines to void a contract for unilateral mistake. To rely on that defence, the airline must prove on a balance of probabilities that:

  • The carrier mistakenly sold a ticket with a mistaken price, and;
  • The purchaser knew, or ought to have reasonably known, that the price was a mistake.

In many recent mistake fare cases, airlines have relied on the defence of unilateral mistake and cancelled tickets without consequence. However, having moved to Quebec, I am no longer subject to the common law rule of unilateral mistake. I am subject to the contract law of the Civil Code of Quebec.

Last week I purchased a well-published round-trip fare from London, Heathrow to Guayaquil, Ecuador on British Airways First Class and American Airlines Business Class. The ticket was $USD 1069.09 per person (I bought a ticket for myself and a companion).

I had to make plans to get to and from London, book flights to the Galapagos, etc. I called and emailed British Airways (after the fare was no longer offered, of course). I recorded the telephone call. On the telephone call, I pointed out the fare paid and the class of service. I asked a number of times whether British Airways was honouring the ticket. The agent answered in the affirmative. They also replied to my email, confirming the ticketed status of the reservation (and they sent me an updated confirmation).

Three days after booking the ticket, I received an email from British Airways stating they were not honouring my ticket:

BA always takes great care to ensure that all published fares are correct. However, on rare occasions mistakes are made which cause the display of incorrect fares. Unfortunately, this has happened in relation to the recent booking you made, and the fare you paid was incorrect.

In circumstances where a booking has been concluded on the basis of a manifestly incorrect fare, as is the case here, we cancel that booking.

If you wish to retain the booking, you must pay the difference between the incorrectly advertised price and correct price for this journey. Should you wish to do this, and retain the ticket, please contact your local BA contact centre by Monday 9 October 2017 at 5.00pm UK time or two days before your travel date, whichever is earlier.

If we do not hear from you by this time, your ticket will be cancelled and you will receive a full refund. We are sorry for any inconvenience caused.

Alternatively, BA can offer you the option of applying the value of the ticket you have purchased toward a flight to the same destination in economy class. This will be a new booking, but you will travel on the same flights, and no additional fare or fee will be payable. Please contact your local BA contact centre by Monday 9 October 2017 at 5.00pm UK time or two days before your travel date, whichever is earlier if you wish to do this. BA’s Conditions of Carriage will apply to this new contract for carriage. Any appropriate tax refunds will be applied by the BA contact centre.

Given that the fare was manifestly incorrect, BA cannot accept any responsibility for any costs or losses incurred as a result of the booking made.

Today, as promised, I can no longer see my reservation on the British Airways website, and the reservation on the American Airlines website no longer shows the British Airways segments. My ticket is cancelled and not being honoured.

If I were in a common law jurisdiction, British Airways may be entitled to their behaviour (though I’d argue that they were estopped from relying on unilateral mistake, and argue that a buyer did not know nor ought to have known the ticket was a mistake). However, living in Quebec, the jurisdiction where I entered into the contract and where British Airways operates, I believe the contract is subject to Quebec law. Gowling WLG, a prominent law firm, writes about the Quebec Consumer Protection Act: 

As for the existence of a contract under the Québec Consumer Protection Act (the “C.P.A.), the Court noted that unlike the Civil Code of Québec’s definition of an “offer”, a retailer is deemed to have made an offer if the retailer’s proposal contains all of the essential elements of the intended contract, regardless of whether there is an indication of the retailer’s willingness to be bound in the event the proposal is accepted, and even if there is an indication to the contrary!

That is, British Airways cannot rely on the defence of unilateral mistake for breach of contract. There are cases in Quebec where the Court has not enforced contracts that were entered into by mistake (ex. Faucher v. Costco Wholesale Canada Ltd. (2015 QCCQ 3366)). However, the case law in Quebec that allowed voiding the contract for mistake has shown to require that the price be obviously a mistake, and there must be a term in the contract that allows the seller to void the contract for mistake.

First, the ticket was over $USD $1,000. This isn’t a clear and obvious mistake. While this is substantially cheaper than the full cost of a First Class ticket, it’s not a dramatic and unrealistic price – this price could very well be a sale. Second, I could not find in the British Airways Contract of Carriage a provision that allows the voiding of tickets for mistaken prices. And finally, I contacted the carrier twice asking if the ticket would be honoured, and in both instances, my question was answered in the affirmative.

British Airways took three days to inform passengers that they did not intend to honour the ticket. A passenger is usually only afforded 24 hours to do the same. The price of the ticket, while low, is not obviously mistaken. Further, I cannot find a provision in the contract of carriage that would allow British Airways to cancel the ticket for allegedly mistaken price. Finally, British Airways confirmed that the tickets were valid. If this isn’t a clear breach of contract, I don’t know what is.

I filed a claim for $CAD 15,000 in Small Claims Court, the Court’s maximum. I am suing for the difference between what I paid and the price of the same flights now. Let’s see how this plays out!

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Comments

  1. Interesting, since you said you have a law degree. Let’s see the case’s outline. You, a quebec residence order a service from a british entity over the internet for a transport from UK to ecuador. There’s a dispute which the said british entity refuse to honour the service and you filed a claim assuming such dispute fails in your local court jurisdiction.

    I wonder what was written on condition of carriage regarding dispute settlement? Was it specify certain jurisdiction?

    Assuming you won a verdict, how are you going to financially benefit from it?

    • I’ll quote this article: http://www.consumerretailadvisor.com/2013/09/distance-contracts-what-you-should-know-about-sales-over-the-internet-in-quebec/

      Québec’s Consumer Protection Act deems sales made over the Internet with residents of the province to be subject to Québec law. Such sales are termed “distance contracts” and are subject to the formal and substantive provisions of the Act.

      The Consumer Protection Act states:

      54.2. A distance contract is deemed to be entered into at the address of the consumer.

      I do not see a choice of law or choice of venue provision in the BA Contract of Carriage.

      • BA’s jurisdiction clause is contained in its conditions of website use located here: https://www.britishairways.com/en-gb/information/legal/website-terms-conditions.

        “Your use of this website, any Material accessed or downloaded from it and the operation of these Terms and Conditions and any dispute or claim arising out of or in connection with such matters, their subject matter or formation (including but not limited to non-contractual disputes or claims) shall be governed by, construed and interpreted in accordance with the laws of England and Wales and You agree to submit to the non-exclusive jurisdiction of the English Courts.

        Where these Terms and Conditions are translated into languages other than English in the event of any conflict or inconsistency the English language Terms and Conditions shall prevail.

        We reserve the right to bring proceedings in:

        the Courts of the country of Your residence
        the Courts of the location of Your access, use or storage of any Materials obtained from the website
        the Courts of the location of any breach by You of these Terms and Conditions; and/or
        the Courts of the location of your authorisation of any of the above acts.
        You acknowledge and agrees that damages alone would not be an adequate remedy for any breach of the terms of these Terms and Conditions. Accordingly, We shall be entitled to the remedies of injunction, specific performance or other equitable relief for any threatened or actual breach of the terms of these Terms and Conditions.”

        Everyone is required to accept these terms on the first occasion they visit the BA website. There seems no way to contact you through this page – http://boardingarea.com/our-bloggers/. If there was I would be in touch with details of how I brought legal action against BA for cancelling a ticket they said was an error. I won.

        • I didn’t book through the BA website, therefore that term doesn’t apply to me. The agent with whom I booked the flight doesn’t have a choice or law or venue as well, and expresses total liability on carrier through agent – carrier liability.

          Would love to hear your story! Send a message to info@dcta.ca

  2. Good luck. I would bet that BA will settle rather then end up in court. They are a despicable company. Here in the UK they are routinely taken to the small claims court (which can be done very easily, without a lawyer, for moderate (like £30) court fees all online) over failing to pay delay compensation and so long as the passenger has a half decent case they always pay up. I got £100 out of them recently for unilaterally removing food and drink from the fares I had already booked, at the small claims court.

  3. Interesting. I’m no lawyer but it seems to me that this same argument could be made for overbooking and then not allowed to board a flight. A product was sold for a price and then the airline would not honor the ticket.
    You are asking for damage in the difference in the ticket but I would assume that alternatively you would be damaged by the unusable tickets to LHR and to Galapagos if not refundable.

    Keep us posted of course.

    • Overbooking is covered by the Contract of Carriage, alleged mistake fares are not. The standard legal calculation for damages in a breach of contract case is: ∆ between Price Paid and Price to Pay To Enter Into Same Agreement.

  4. I fully support your action. It is hard to see why the law should be stacked in favour of the seller. BA left themselves three days to correct their own error while allowing their own customers 24 hours before throwing their rule book at them. I would like to see lawmakers take a long hard look at the airline industry and their conditions of carriage (overbooking, loss of luggage for example) and re-shuffle the deck a bit

  5. So you are suing for 15x the times you paid? Out of curiosity, could I use the same legal method for a ticket even if I live abroad but purchased through a Canadian address? What decides your legal address for ticketing status? You, as a fellow Canadian buying in Canada but flying from UK, or a British person buying from Canada and starting in Canada?

    • The law of electronic commerce in English law is clear that a contract is entered into in the place in which it acceptance is received. So wherever you, the passenger, are in the world when you receive the email with your confirmed flights is the place at which the contract begins.

  6. Thanks for doing this. While I didn’t book the ticket, I also agree that BA handled it really badly and I feel sorry for those who booked. But you might help them. It really shows what kind of company BA is.

    For your information, a part of your ticket was in business, so I didn’t think it was a mistake given the current low prices in premium cabins from EU.

    My only worry is that airlines would start adding very protective statements into their CoC but my understanding is that there is no regulation so far on what to write in their CoC. Is there any way to sue the airline for unfair CoC?

  7. I’m sure that by filing a suit you have certain legal basis. Will that basis acknowledged by the court OR the defendant (BA) have another say, is what matters.

    The article you quoted basicly saying whatever and wherever legal entity conduct its bussines, as long as the customer is residence of quebec, all transaction falls under quebec’s law. I’m sure many would object to that.

    Curious about the outcome of your suit. Keep posting it please.

  8. This is interesting, I bought 1 direct with BA and got the letter 3 days later. I bought a 2nd ticket with Expedia and I haven’t heard boo out of them yet, it still shows as a confirmed ticket and I have a ticket number, what to do?

  9. I strongly suspect that the correct venue for this complaint is the CTA, not the Court of Québec, Small Claims Division.

    Economic activity undertaken by the aviation industry in Canada is under the jurisdiction of the Federal government; specifically, it is regulated by the ATRs which are given authority by the Canada Transportation Act.

    Before the CTA, this complaint would lose for either being non-justiciable in the selected venue, as the itinerary in question does not touch Canadian soil, or it would lose as it was cancelled within 72 hours of initial sale and a full refund was offered, cf. CTA Decision No. 202-C-A-2014

    • While the CTA could assert jurisdiction, it does not have sole jurisdiction nor preempt private civil action. Your choice of venue calculation in flawed. The ATRs have nothing to do with consumer breach of contract claims.

  10. The fact you called and recorded them might work against you…. you are essentially confirming that you knew the manifest was a mistake. Would you have called and emailed under normal circumstances? Probably not….

    • And you’re claiming that the current true value of the ticket is 15x. BA can easily illustrate that they rarely or never offer a >93% off sale in international first class. Some may say you’re being unreasonable.

  11. Please define “mistake”. I hope your friends/coworkers/neighbors etc sue your a** off next time you make a mistake.
    What a freaking greedy world!!!! ME!!! ME!!! ME!!! A bunch of whiny!

    • When you sell your friend something using a contract and mistakenly give the wrong price why shouldn’t that friend sue you.

      However, to say any mistake like giving bad directions, deserves legal action is frivolous. You know better. There would be no contract in such a case nor a legal dispute to make claim on. Don’t be childish.

      This coming from a buyer of the fare who has let go the agony and moved on – but others totally have this right.

  12. Why would there be even any Jurisdiction in Canada for this fare?
    The flight was ex London to Ecuador, not starting nor ending nor via Canada. Since you paid in USD the point of sale (POS) must have been in the U.S. / the issueing airline / travel agency in the U.S. –> therefore, no Canadian law should apply.
    Otherwise no business would be safe. Imagine there is a crazy law somewhere remote, let’s say on Fiji, that states a product ordered online (no matter if its a physical or digital product) needs to be allowed to be returned for full 5 years and full refund must be given.
    Anyone would always buy everything with their billing address on Fiji just to be eligible for that Fiji refund law policy.

    No matter your nationality or residency, even if you live in Canada, Canadian law should not apply since no airfare or surface sector actually involved Canada.
    I mean, please correct me if I’m wrong! If so, I would start buying all my error fares on Canadian OTAs or with a Canadian billing address then!

    Another scenario:
    As most of you know, when you book a multi segment flight, as soon as you do a noshow for one of those flights, the reaming flights / segments will be automatically cancelled. So you can’t just buy a ticket NYC-LON-NYC, miss the NYC-LON portion but use the London–> NYC portion of the flight.
    Airlines also call this to fly all coupons in sequence.
    Now the law in Austria is different:
    Airlines in Austria are not allowed to sell flight tickets where you must fly all coupons (=segments) in order!
    So as an Austrian resident you can buy VIE-FRA-VIE and only use the FRA–>FRA portion! You find this in many fare rules for flights ex Austria.
    But this does only apply for flights to/from Austria!!!
    Otherwise everyone would buy tickets with a POS in Austria or with an Austrian billing address and skip the first segments on cheap fares where its so cheap because of the origin airport (CAI, CMB,…)

    • The Quebec Consumer Protection Act asserts jurisdiction for all remote contracts (Internet contracts) where the purchaser is resident in the province. Oh, also the rule of Lex loci contractus if were in the other provinces.

      Trust me, I know the law here 🙂

      • Here’s to hoping you lose and get hit with serious court fees for filing what you know is a frivolous lawsuit with a ridiculous damage claim. By recording the call, you knew it was a mistake fare. Being that you’re governed by crazy Quebec laws, I would guess there is no repercussion for filing frivolous lawsuits.

  13. Good luck! I just got an email from BA this morning a full 251 hours after I booked to let me know they are canceling our tickets. I live in the US and find it unlikely I’ll have any recourse.

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