Lufthansa ordered to pay Malta agencies €28k after strike strands 31 passengers

A court has ordered Lufthansa to pay over €28,000 to two travel agencies after 31 passengers were stranded at Hamburg airport when their flight was cancelled due to a strike by pilots.

Executive Holidays Limited and SMS Mondial Limited filed a case in the First Hall of the Civil Court against Deutsche Lufthansa AG on June 19, 2024.

In their application, the companies explained that a contract was drawn up between Executive Holidays Limited and Lufthansa Group on September 30, 2021. There was also a commercial agreement for sales agency between Executive Holidays Limited and SMS Mondial Ltd, through which the former passed on passengers to the latter.

An industrial action was held on September 2, 2022, affecting several Lufthansa flights, including one from Hamburg to Frankfurt in Germany.

The cancellation affected passengers travelling with Executive Holidays Limited, and both companies suffered financial loss.

Out of a group of 42 passengers, Lufthansa only organised alternative flights for 11 individuals, leaving the rest stranded. In the case of these 11 individuals, the airline did not provide for their accommodation while they waited for their flight, which was a day or two later.

Both companies sought to recoup the money spent on accommodation, food, and alternative flights for the passengers, but the airline did not reply to the requests.

The two companies then asked the court to declare the airline responsible for the financial losses to the tune of €28,454 and order it to pay up.

When the case was filed, Lufthansa did not file a request to contest the claims.

From the affidavits filed by different managers, it emerged that the companies bought seat allocations on board Lufthansa flights from Malta to Hamburg and Hamburg to Malta via Frankfurt.

According to the agreement, Executive Holidays Limited had to sell a minimum of 80 per cent of the seats bought.

The seats were included in travel packages sold by SMS Mondial Limited.

The managing director of both plaintiff companies told the court that he got to know about the strike a day earlier from the news, while another witness testified in their sworn statement that the son of a couple travelling with the agency informed them that his parents received an email in which they were informed that the flight had been cancelled due to industrial actions.

Martin Degiorgio provided a breakdown of the costs incurred because of the flight cancellation, including accommodation, food and alternative flight costs.

Another witness testified that she sought answers from Lufthansa on September 1, 2022, but it was only two hours and 19 minutes before the flight’s departure that the airline replied that it could not take the passengers and offered no solution.

The passengers had already been taken to the airport by then.

An SMS Mondial Limited manager explained that the company sold Costa Diadema packages which included a cruise, transport and flights.

She had been informed by one of her colleagues about the strike instead of receiving it directly from the airline.

Another witness explained that she and some of her colleagues had personally got in touch with the passengers by giving them new flight details.

The court considered that this was a case about compensation for the money incurred by the plaintiff company.

It considered that the airline had been contumacious, but this did not automatically mean that it accepted responsibility.

It quoted case law and said this was still regarded as a contestation of the claims.

Analysing the terms and conditions imposed by Lufthansa in the contract with Executive Holidays Limited, the court observed that there was no clause dealing with circumstances stemming from industrial actions or force majeure.

The travel agencies had obligations towards the travellers, which it honored.

The court also upheld the plaintiffs’ arguments that industrial action does not constitute extraordinary situations in air travel.

From the evidence, it emerged that the companies backed their claims on the expenses incurred.

It then analysed the Package Travel and Linked Travel Arrangements Regulations and the relevant subsidiary legislation, noting that while a travel agency had to honour its contract with its clients, they still had a right to action against service providers.

Analysing the relevant EU regulations, the court ruled that the airline had to provide alternative flights, refund and compensate the passengers, as well as provide alternative accommodation and food until they got on their new flight.

It held that the airline failed to do so, and the plaintiff companies had footed the bill as a travel agency.

It upheld the claim and ordered Lufthansa to pay €28,454 with legal interest, which started running from the day the airline was served with the judicial letter.

The judgment was handed down on January 22.

Madame Justice Doreen Clarke presided over the First Hall of the Civil Court.

Lawyers Michael Tanti Dougall and Rebecca Tanti Dougall assisted the plaintiffs.