‘Ryanair v CAA’: CA judgment on ‘Extraordinary Circumstances’

Court of Appeal Rules That Strikes by an Airline’s Own Crew Are Not Extraordinary Circumstances

The Court of Appeal has today handed down judgment in Ryanair DAC v The CAA [2022] EWCA Civ 76, concerning the liability of air carriers to pay compensation under Regulation 261/2004 in cases where flights are cancelled due to industrial action by members of air and cabin crew employed by the carrier in question.  At first instance, HHJ Gerald, sitting as a Judge of the High Court, had ruled that such industrial action did not amount to extraordinary circumstances and the Appellant was required to pay compensation to passengers (The CAA v Ryanair DAC [2021] EWHC 1476 (Ch.)).

On appeal, Lewison, Newey, and Snowden LJJ agreed that the Appellant was liable and refused the appeal.  Giving the judgment of the Court, Newey LJ (with whom Lewison and Snowden LJJ agreed) held that Regulation 261/2004 was to be construed such as to provide a high level of protection for passengers and that the derogation in Art. 5(3) is to be strictly interpreted (at [31]).  In deciding whether an event amounts to extraordinary circumstances, regard should be given to whether it stemmed from an external source, but demands issued by a trade union acting on behalf of the carrier’s staff cannot be considered external (at [33]-[34]).  It is also not relevant whether the industrial action was prompted by something done by the carrier (at [34]).  Airlines may, as a matter of course, encounter disputes over pay and employment conditions, and the risks arising from that (including industrial action) must be regarded as inherent in their normal activity (at [36]).  The question of whether the union’s demands were unreasonable or not is also irrelevant to the question of whether the industrial action amounts to extraordinary circumstances.  An inquiry into that issue would be “disproportionate in the context of a claim for, at most €600 per passenger” (at [39]).  The Court therefore concluded that “The strikes from which the cancellations arose, relating as they did to employment conditions of employees of Ryanair, did not constitute ‘extraordinary circumstances’ whether or not the aims of the strikers were reasonable or achievable and notwithstanding the involvement of trade unions.” (at [43]).

Kevin de Haan QC and Michael Coley represented the Civil Aviation Authority at first instance and on appeal.

Judgment available here: CAA v Ryanair judgment