The Supreme Court (Lords Lloyd-Jones, Sales, and Burrows and Ladies Rose and Simler JJSC) yesterday handed down judgment in BA Cityflyer Limited v Lipton and another [2024] UKSC 24.  The case arose from the cancellation of a flight, due to the captain falling ill, giving rise to a claim under Regulation (EC) 261/2004 (“EC261”).  The claim was resisted by the air carrier on the ground that the captain’s illness amounted to extraordinary circumstances.

The cause of action had accrued before IP Completion Day, but by the time the matter came before the Court of Appeal, the UK had left the EU and the version of the Regulation in force was the one which had been retained and amended by operation of the European Union (Withdrawal) Act 2018 (“UK261”).  The Court of Appeal held that the version to be applied was UK261 and that the captain’s illness did not amount to extraordinary circumstances (Lipton and anor v BA Cityflyer Limited [2021] EWCA Civ 454).

On appeal to the Supreme Court by the air carrier, Their Lordships held as follows:

  1. The Court held unanimously that the version of the Regulation to be applied was EC261, since that was the version of the Regulation in force at the time the cause of action accrued.  Accordingly, the Court of Appeal had erred in holding that UK261 applied.
  2. There were two competing analyses of the mechanism by which the Liptons’ cause of action was carried forward past IP Completion Day.  The “Complete Code Analysis” was that the 2018 Act dealt comprehensively with the application of EU law after IP Completion Day and brought forward any cause of action accrued before that date.  Alternatively, under the “Interpretation Act Analysis” such causes of action were saved not by the 2018 Act, but by s. 16 of the Interpretation Act 1987, which provides that a repeal of any enactment does not affect any right accrued under it.  By a majority decision (Lord Lloyd-Jones dissenting and Lord Burrows giving a separate judgment concurring with the judgment of the majority) the Court held that the Complete Code Analysis was correct.
  3. The Court held unanimously that the term “extraordinary circumstances” must be given its usual meaning.  As to the inherency limb of the test, staff illness is commonplace for any business. The attendance or non-attendance of a member of the crew is therefore an inherent part of the operating system of the air carrier.  The Court rejected the submission that a detailed investigation into the reason for the illness was required on the basis that that would be contrary to summary nature of compensation scheme.  Accordingly, the captain’s illness did not amount to extraordinary circumstances and the appeal would be dismissed.

The decision is an important authority in two respects: first, on how assimilated EU law is to be applied in cases where the cause of action accrued before IP Completion Day, but the matter is litigated after that date; and secondly, on the application and interpretation of Regulation 261/2004, and the test for extraordinary circumstances in particular.

Kevin de Haan KC and Michael Coley acted for the Civil Aviation Authority as intervener.

The judgment can be found here: