The right to flat-rate compensation is not payable to a passenger with a confirmed reservation who, due to an imminent delay in arrival at the final destination, has booked an alternative flight oneself and in consequence, has arrived at the final destination with a delay of less than three hours compared to the originally scheduled time of arrival of the first flight—as stated by the Court of Justice of the European Union (hereinafter referred to as the “CJEU” or “the Court of Justice”) in the judgment of 25 January 2024, C-54/23, WY v. Laudamotion GmbH and Ryanair DAC.[1]

The facts

WY (hereinafter referred to as the “Passenger”) has booked a round-trip flight connecting Düsseldorf (Germany) with Palma de Mallorca (Spain) with Ryanair. The flight was delayed for six hours for reasons beyond our control. The passenger (because of fear of being late for a business meeting in Palma de Mallorca) decided to use an alternative flight. Owing to this decision, he arrived at the destination with a delay of less than three hours compared to the scheduled arrival time of the original flight.

The passenger requested compensation from Laudamotion (the operating air carrier) in the amount of 250 EUR (according to Article 5 (1) c) and Article 7 (1) of Regulation (EC) No 261/2004 of the European Parliament and of the Council of 11 February 2004 establishing common rules on compensation and assistance to passengers in the event of denied boarding and of cancellation or long delay of flights, and repealing Regulation (EEC) No 295/91 (hereinafter referred to as “Regulation (EC) No 261/2004” or “Regulation”)).

The Passenger’s demands against Laudamotion were not accepted both in the first instance and in the appealing proceedings. The appellate court found that although the original flight had a delay at its destination of more than three hours, Laudamotion was not obliged to pay the requested compensation because the Passenger did not take the flight and reached the destination with a delay of no more than three hours.

In the given situation, the Passenger lodged an appeal on a point of law to the Bundesgerichtshof (Federal Court of Justice), which is the referring court. The Bundesgerichtshof decided to suspend the proceedings and refer two questions to the CJEU for a preliminary ruling. By asking the question, the Bundesgerichtshof sought to establish whether in a situation where an announced flight is to be delayed by at least three hours beyond its originally scheduled arrival time, an air passenger who has failed to check in or has booked an alternative flight enabling him to reach destination with a delay of less than three hours is entitled to compensation as referred to in Article 5 (1) and Article 7 (1) Regulation (EC) No. 261/2004.

The Ruling of the CJEU

The Court of Justice ruled that Article 5 (1) and Article 7 (1) of Regulation (EC) No 261/2004 must be interpreted as meaning that “the right to compensation, within the meaning of those provisions, cannot be enjoyed by an air passenger who, on account of a risk of a long delay in arrival at the final destination of the flight on which he or she has a confirmed reservation, or even on account of sufficient evidence of such a delay, has himself or herself booked an alternative flight and has reached the final destination with a delay of less than three hours after the originally scheduled arrival time of the first flight.”

Justifying its decision, the CJEU stated that incurring the costs of substitute travel undoubtedly constitutes an inconvenience, but such an inconvenience (in itself) does not justify the inclusion of compensation claims (such inconvenience cannot be regarded as “serious”, within the meaning of recital 2 of Regulation (EC) No. 261/2004) if that passenger (by booking an alternative flight) has reached his or her final destination with a delay of fewer than three hours after the originally scheduled time of arrival. The Court of Justice has made it very clear that the possibility of pursuing compensation claims under Regulation (EC) No. 261/2004 only becomes effective when reaching the destination is delayed by at least three hours. According to the CJEU, the fact that the original flight was delayed by more than three hours does not mean that the passenger is entitled to any compensation since the passenger canceled the flight (despite having a confirmed reservation) and booked a replacement flight.

Practitioners’ position

Regulation (EC) No. 261/2004 has been causing numerous controversies among both passengers and air carriers for many years. Its provisions are so vague that they often lead to too much flexibility in their application or to over-interpretation.

According to Jabłoński Koźmiński Law Firm’s experts, the judgment discussed contains very valuable guidelines for national courts adjudicating on the compensation liability of an air carrier for a delayed flight. The CJEU’s interpretation of the provisions of Article 5 (1) and Article 7 (1) of the regulation in question, may significantly facilitate national courts in adjudicating on the validity of compensation claims made by passengers who decided to book a replacement flight (thus giving up waiting for a delayed flight). These kinds of situations occur very often in practice, but they are not regulated under Regulation (EC) No. 261/2004. The CJEU’s statement on the possibility of pursuing compensation claims in the event of such situations was therefore extremely necessary.

Lawyers from Jabłoński Koźmiński Law Firm have years of specialist expertise in conducting complex and often precedent-setting cases in the field of aviation law, including proceedings for awarding compensation for a delayed/canceled flight or failure to allow a passenger to board the plane. Shall you have any questions or doubts concerning this issue, please feel free to contact us.

[1] See: Judgment of the Court of Justice of January 25, 2024, C-54/23, WY v. LAUDAMOTION GMBH AND RYANAIR DAC, LEX no. 3657308