On 1 August 2019, Matthew Brooks and Simon Liddy wrote about the Australian Government’s proposal to increase the liability limits under the Civil Aviation (Carrier’s Liability) Act 1959 (CACL Act) via regulations – that article can be viewed here.
That has now occurred, and the increase to the liability limits came into force on 1 October 2019, with the introduction of the Civil Aviation (Carriers’ Liability) Regulations 2019 (Regulations).
Additionally, updates to the Montreal Convention liability limits have been proposed by the International Civil Aviation Organisation (ICAO). If the increased limits are approved by a majority of the States party to the Convention, they will also come into effect on 28 December 2019.
New limits for Australian Domestic Carriage now in force from 1 October 2019
The Regulations come into force on 1 October 2019 increasing the Australian domestic carriage liability limits for passengers, baggage and mandatory insurance as follows:
- For the purposes of subsection 31(1) of the Act, the liability limit for claims in respect of passenger personal injury and death for Australian domestic air carriage is AUD$925,000.
- For the purposes of subsection 31(2) of the Act, the liability limit for claims in respect of destruction or loss of checked baggage, for Australian domestic air carriage, is AUD$3,000; and
- For the purposes of subsections 31(3) of the Act, the liability limit for claims in respect of destruction or loss of unchecked baggage, for Australian domestic air carriage, is AUD$300.
- For the purposes of subsection 41C(3)(aa) of the Act, the amount of personal injury indemnity insurance that an Australian air carrier must have in respect of each passenger, is 480,000 SDRs (approx. AUD$965,500).
New limits under the Montreal Convention expected to be in force on 28 December 2019
It is proposed the Montreal Convention Limits are to be increased by 13.9% and is based on the accumulated rate of inflation since the last revision in 2008. Subject to approval by the majority of member States, the Montreal Convention Limits are to increase on 28 December 2019, as follows:
- Injury/death: The Article 21 strict liability limit is increasing from 113,100 SDRs (approx. AUD$227,400) to 128,821 SDRs (approx. AUD$259,000);
- Delay: The limit is increasing from 4,694 SDRs (approx. AUD$9,450) to 5,346 SDRs (approx. AUD$10,750);
- Baggage: The limit is increasing from 1,131 SDRs (approx. AUD$2,275) to 1,288 SDRs (approx. AUD$2,590); and
- Cargo: The limit is increasing from 19 SDRs per kg (approx. AUD$38.23 per kg) to 22 SDRs per kg (approx. AUD$44.27).
In light of the increased limits for Australian domestic carriage to which the CACL Act applies, and international carriage to which the Montreal Convention applies, it will be prudent for air carriers to review their current liability and insurance arrangements.
This article was written by Matthew Brooks, Partner, Simon Liddy, Partner and Lisa Gooneratne , Special Counsel.