ࡱ> y{x5@$bjbj22 *XXP #(D dddx\\\8,$x52X^^^^> 4444444$6R94dh^^hh4dd^^J5###hd^d^4#h4##$3|ddC4^ 0~ϓ\"3o44`50539*#9$C4xxdddd9dC4,j&p#44xx \#xx\MONTREAL CONVENTION AND NATIONAL LEGISLATION Slobodan Kaatela, D. Sc., Ana Keglovi, LLB University of Zagreb Faculty of Transport and Traffic Engineering Vukelieva 4, HR-10 000 Zagreb, Croatia  HYPERLINK "mailto:ana@fpz.hr" ana@fpz.hr ABSTRACT Liability of air carriers in international traffic is still regulated by the Warsaw Convention from 1929. However, this situation will change soon, since the required number of states have ratified the Montreal Convention brought in 1999 which fully replaces the provisions of the Warsaw Convention including all its subsequent amendments. The most significant changes have occurred regarding the liability of air carriers in case of passenger's injury or death. Regarding the thoroughness of the changes introduced by the Montreal Convention into the system of air carrier liability, and the scope of its application, it is to be expected that the Republic of Croatia will soon join this new Convention. Consequently, this raises the question of harmonisation of the national legislation with the solutions of the Montreal Convention. INTRODUCTION On 5 September 2003, the United States of America, as the thirtieth state, deposited with the Depositary of the International Civil Aviation Organisation (ICAO) the instrument of ratification of the Convention for the Unification of Certain Rules relating to International Carriage by Air (Montreal Convention) [] . This ratification will make it possible for the Montreal Convention accepted in 1999 at the diplomatic conference in Montreal, to become effective on 4 November 2003. Its entry into force means that the old Warsaw Convention [] with all its subsequent modifications and amendments (Warsaw System) [] which was valid for seventy years, and which played a very important role in the development of international air transport will cease. The unique rules determining the liability of air carriers defined by the Warsaw Convention, regardless of certain weaknesses and frequent criticism especially due to relatively low amounts for compensation in case of injury or death of passengers during carriage by air made it the most widely accepted contract of international private law. [] Montreal Convention has been conceived as a unique document which fully replaces the Warsaw System provisions. The entry into force of the Montreal Convention opens up the problem of harmonising the Croatian national legislation, primarily the provisions of The Act on Obligatory and Property Right Relations in Air Transport, that is now harmonised with the instruments of the old Warsaw System. [] Montreal Convention Montreal Convention consists of a preamble and a total of 57 articles which are grouped into seven chapters. The Convention retains the structure of the Warsaw Convention and has the same scope of application as the original Convention from 1929. Although the new Convention represents a complete revision of the provisions of the Warsaw system, the most significant modifications have been made regarding the liability of air carriers in cases of injury or death of passenger on international flights. The bases of the Convention are the Warsaw Convention and the Hague Protocol. Besides, the Convention includes completely the Montreal Protocol No. 4, several elements of the Guatemala Protocol and the respective parts of the Additional Protocol No. 3. A special chapter (Chapter V) includes the provisions of the Guadalajara Convention. Two-tiered liability regime The Warsaw Convention limited the liability of carriers to personal damage up to the amount of about 10,000 or 20,000 US dollars, depending on whether the compensation is determined according to the original text of the Warsaw Convention or according to the text modified by the Hague Protocol. This liability, however, could be higher, but in that case the damaged party had to prove that the damage was occasioned by the carrier with evil intent or gross negligence, which was not easy to prove. Unlike the aforesaid, the Montreal Convention introduces a two-tiered liability regime in cases of death of or injury to the passenger, thus efficiently eliminating the limits contained in the Warsaw System. The claims of the victims not exceeding 100,000 SDR (approximately 135,000 US$) the first tier of liability which is a several times increase compared to the previous limits, the carrier is liable on the principle of objective liability. For claims exceeding this amount the second tier of liability the liability of the air carrier is based on presumption of fault and does not contain any limit of liability. Not entering into detail to explain the first tier of liability up to the amount of 100,000 SDR, it reminds of the previous practise, according to which the majority of the claims against the carrier performing carriage within the country and out of the country at low premiums (the majority of the countries in the world) did not exceed the amount of 100,000 SDR. Besides, this amount is substantially higher than the amounts defined by certain earlier international agreements which regulate the liability for death or injury of passengers in railway, road and sea carriage. Thus e.g. the Convention on Carriage of Passengers and their Baggage by Sea (Athens, 1974) stipulates the limitation of liability for passenger of up to 46,666 SDR (this amount was increased in 2002 to 250,000 Special Drawing Rights); the Convention on International Railway Transport (Bern, 1980) contains the limit of 70,000 SDR, and the Convention on Contracts for International Road Transport of Passengers and Baggage limits the liability to 250,000 Gold Francs. Both in case of the first and the second tier the claimant has to prove only the causative relation between the accident and the damage. Considering the implementation of the principle of objective liability in the first tier, the carrier can be wholly or partly exonerated from liability only if it proves that the damage resulted from negligence or other wrongful act or omission of the person claiming compensation (Article 20). On the contrary, the second tier of liability (Article 21, Item 2) applying the principle of presumed fault, the carrier is not liable for the damage if it is proved that the damage did not result from negligence or omission of the carrier, its servants or agents, i.e. if it proves that the damage resulted solely from negligence or omission of a third party. Naturally, the reasons for wholly or partly exonerating the carrier from the liability can be applied also in this case of liability from Article 20 of the Convention. Limits of liability due to delay and damage to baggage and cargo For the damage caused by delay in air carriage, the carrier is liable up to the amount of 4,150 SDR per passenger. The carrier is liable for the damage resulting from loss, destruction or damage of baggage, both checked and hand baggage, up to the amount of 1,000 SDR unless the passenger has declared a higher value at the time of check-in and has paid a supplementary sum. The amount of compensation for which the carrier is liable due to loss or damage of cargo cannot exceed 17 SDR per kilogram unless the consignor, when the package was handed over to the carrier, has made a special declaration about the higher value of cargo and has paid a supplementary sum (Article 22). In accordance with the solutions of the Montreal Protocol No. 4, the Montreal Convention stipulates objective liability of air carriers for the damage to checked baggage and cargo as well. The carrier can be exonerated from liability for the damage due to loss, destruction or damage of baggage if it proves that the damage was caused by bad quality or natural properties of the baggage. Similarly, the carrier can be exonerated from liability for the loss or damage of items only if it proves that the damage was caused by natural properties or inherent defects of the cargo, defective packing, due to war or armed conflicts i.e. act of public authority related to entry, exit or transit of cargo (Article 18). With the limited amounts of compensation that have been stipulated in Articles 21 and 22 of the Convention, the authorised court can also award additional payment for the court costs and interest. However, this provision will not be applied if the amount of damages awarded, excluding the court costs and other litigation expenses, does not exceed any written offer of settlement made within 6 months of the accident. The intent of this provision is to avoid unnecessary litigations and time-consuming and expensive court procedures, and it stimulates the carrier to offer to the victims at an early date a fair settlement for the damage, and the victims to accept such an offer. Modernised clause Apart from the two-tiered liability regime introduced by the Montreal Convention, the novelty is also the introduction of the so-called modernised clause, with the aim of maintaining the amount of compensation regarding inflation. The clause, namely, allows revision of the liability amount in five-year intervals, in accordance with the changed economic conditions. According to Article 24 of the Convention, the harmonisation needs to be carried out within five years, if the average accumulated inflation rate is based on the estimate of the average annual rate of increase or decrease of the Consumer Price Indices of the States whose currencies comprise the Special Drawing Rights, and if it exceeds ten percent of the previous review or the date of signing this Convention. The Depositary of the Convention (ICAO) shall notify States Parties of a revision of the limits of liability that will come into force within six months unless the majority of the member countries declare that they oppose such revision. The Montreal Convention took over the provisions of the Warsaw System according to which the carrier can contractually determine even higher limits of liability from those stipulated in the Convention, i.e. there are no limits of liability (Article 25). Similar to the provision from the European Council Regulation on Air Carrier Liability in the Event of Accidents which foresees the possibility of advance payment of a part of the compensation in case of passengers death, the Montreal Convention includes also the provisions of advance payment. []. Thus, in case of aircraft accident resulting in death or injury of passenger, the carrier is liable to make the payment in advance to compensate for the damage to the victims with the aim of assisting the entitled persons in meeting immediate economic needs. However, the carrier is not liable to make the advance payment if such liability has not been stipulated by the carriers national law. Besides, such advance payments shall not constitute recognition of liability (Article 28). Other significant provisions In carriage of passengers an individual or collective document of carriage shall be delivered containing: an indication of the places of departure and destination, if the places of departure and destination are within the territory of a single State Party, one or more agreed stopping places being within the territory of another state, an indication of at least one such stopping place (Article 3, Item 1). Regarding the possibility of electronic issuance of travelling tickets, the Convention foresees the usage of other means in order to keep record of the travelling documents. If other means are used, the carrier has to offer the passenger a written statement with the note contained in the travelling document and saved by the electronic medium. Such statement can be useful for presentation to the immigration authorities (Article 3, Item 2). The carrier has to provide the passenger with a baggage identification tag for every item of the checked baggage. Such document on the checked baggage is necessary for the passengers in order to claim the compensation for the damage, regardless of the fact whether a travelling ticket had been issued or there is only an electronic record (Article 3, Item 3). Furthermore, the carrier has to inform the passenger in a written form about the application of the carrier's limitation of liability (Article 3, Item 4). Adequate informing of passengers, (e.g. clear, short, understandable and timely provided information) on the possible limitation of carrier's liability represents the basic protection of the service user's rights. Besides, this information is necessary to the passenger also in order to make a timely decision whether s/he will use any other means of insuring life and health. Whereas the Warsaw Convention sanctioned the failure to issue or faulty issuance of travelling tickets i.e. baggage tags in that the carrier lost its right to call for the limitation of its liability, the Montreal Convention does not foresee any consequences for the mentioned failures. Harmonising national legislation with the provisions of the Montreal Convention As the signatory of the Warsaw Convention and its subsequent modifications and amendments, Croatia has regulated a part of her obligatory relations in air traffic relating to the carriage of passengers, baggage and cargo as well as the issue of carrier's liability in international air transport by the adopted Warsaw system. In the national legislation these relations are partly regulated by the Act on Obligatory Relations, and the provisions of The Act on Obligatory and Property Right Relations in Air Transport (further in the text Cro.abbr: ZOSOZP) fully regulate the issue of carrier's liability for the damage caused by death, health damage, or injury to passenger during transport as well as for the damage caused by delay, failure to perform or break of the journey or due to delay in transport by air. The provisions of ZOSOZP are applied to domestic, and also to international traffic if not otherwise determined by a contract. The same follows from the Constitution of the Republic of Croatia which defines that international contracts signed and verified in accordance with the Constitution, and which are effective and have been announced in public, form part of the internal rule of law of the Republic of Croatia and their legal power is above the law. In spite of the fact that it entered into force few months before signing the Montreal Convention, ZOSOZP follows in principle the Convention solutions. This compensates to some extent the fact that Croatia still has not ratified the new Montreal Convention and thus has joined the signatories that include the U.S.A. and the European Union countries primarily with the most developed civil aviation and the greatest influence on its development. The solutions of these two legal sources are not identical but they do correspond, which should help in faster harmonising the national legislation with the provisions of the new Montreal Convention and their implementation into the national legal system. The modifications and amendments to the ZOSOZP should result in compliance with the text of the Convention, so that the passengers in domestic traffic would have the same quality of protection as the passengers in international traffic. This refers especially to the regulation of the liability of carriers for the damage caused by death, health damage or bodily injury of the passenger, since in this segment ZOSOZP follows the concept of subjective liability, i.e. presumptive fault of the carrier adopted from the Warsaw Convention, whereas the Montreal Convention has introduced the new two-tiered system of objective-subjective liability of the air carrier. Based on Article 17, the ZOSOZP liability of the carrier is quantitatively limited to the amount of 100,000 SDR. The carrier may be exonerated from the liability for this kind of damage if it proves that he or the person working on his orders or for his account has undertaken all the necessary measures to avoid damage or if he proves that it was impossible to undertake any such measures. If he proves that the victim has contributed to the damage by his own action, the carrier's liability will be reduced to the extent of the passenger's own doing, i.e. completely exonerated if it is proved that the damage was caused due to reasons for which the exclusive responsibility is on the part of the damaged passenger (Article 15). If it is proved that the damage was done intentionally or due to extreme negligence, the carrier will not be allowed to claim the limitation of liability of 100,000 SDR, but rather according to the provisions of Article 19 of the ZOSOZP will be liable to an unlimited amount for the damage resulting from the death, health damage or injury to the passenger. Therefore, as with the Montreal Convention, the ZOSOZP in concreto foresees unlimited liability of the carrier on the principle of proved fault, and the Montreal Convention stipulates the criterion of presumptive fault. The carrier's liability for the damage caused by the delay of passenger or their baggage is regulated in the ZOSOZP in Articles 15 and 17 in the same way as the new Montreal Convention. Since regarding liability for damage on checked baggage, ZOSOZP uses the same formulation as for the damage resulting from death, health damage or injury to passenger during carriage, it is assumed that for such damage the carrier is liable according to the criterion of presumptive fault. The carrier's liability for the damage on the checked and hand baggage is limited by Article 27 of the ZOSOZP to the amount of 1,000 SDR per passenger. However, the carrier will not be allowed to invoke this limitation if it is proved that the damage has resulted from actions or negligence of the carrier i.e. person performing carriage on its order or for its account, and the actions or failures are result of intentional or extreme negligence. The same as in the Montreal Convention, the ZOSOZP allows the passenger at check-in to declare higher value of baggage than the amount of the carrier's liability for the baggage foreseen by ZOSOZP (Article 26). In that case the passenger has to pay additional charges, and the carrier is liable for the damage on the checked baggage up to the declared amount unless it is proved that the declared value is higher than the actual damage. Regarding hand baggage, ZOSOZP stipulates two criteria of liability, so that the carrier will be liable for the damage on the hand baggage caused by aircraft accident according to the criterion of presumptive fault, unless it is proved that the carrier or the persons performing carriage on its orders or for its account had undertaken all the necessary measures to avoid damage or if it is proved that it was impossible to undertake any such measures. In all the other cases of damage to the hand baggage, the carrier will be liable according to the criterion of proved fault. CONCLUSION The Montreal Convention has finally unified and simplified the system of international private air law and represents a radical modernisation of the Warsaw system. The Croatian ZOSZP from 1998 is based on the old Warsaw system and will need to be adapted in the future to the new provisions on the liability of air carriers in international traffic. The soon entry into force of the Montreal Convention and its integration into the national legislation will improve the protection of the customers' interests in international air transport and the needs for fair compensation based on the principle of restitution. This will enable further development of the international air traffic, faster and safer flow of passengers, baggage and cargo in compliance with the principles and objectives of the Chicago Convention. REFERENCES B. Cheng, The Warsaw System: the way forward. The Aviation Quarterly, Part 3, London, 1998. Convention for the Unification of Certain Rules for International Carriage by Air (Doc 57), ICAO, Montreal, 1999. Schwenk, W.: Handbuch des Luftverkehrsrechts. Carl Heymanns Verlag KG, Berlin, 1996. S. Steiner, Elementi sigurnosti zra nog prometa, Fakultet prometnih znanosti, Zagreb, 1998. S. Kaatela, Zra no prometno pravo, Fakultet prometnih znanosti, Zagreb, 2001. S. Kaatela, D. Kova evi, T. Tepea, "A Contribution to Recognising Carrier's Liability in International Carriage by Air and Sea" Promet-Traffic-Traffico, Vol. 15, No. 4, Portoro~-Trieste-Zagreb, 2003. M. Bareti, "Odgovornost zra nog prijevoznika za atetu koju pretrpi putnik u domaem i meunarodnom prometu", Pravo u gospodarstvu, 39(2000), 5, pp. 110-123 S. Debeljak Rukavina, "Odgovornost prijevoznika u domaem i meunarodnom prijevozu putnika i prtljage zrakom", Zbornik Pravnog fakulteta u Rijeci, 23(2000), Suppl.(2), pp. 325-369. [] Convention for the Unification of Certain Rules relating to International Carriage by Air, signed in Montreal on 28 May 1999. By 5 September 2003 inclusively, the Montreal Convention was ratified by 31 states: Bahrain, Barbados, Belize, Botswana, Cameron, Canada, Columbia, Cyprus, the Czech Republic, Estonia, Greece, Japan, Jordan, Kenya, Kuwait, Mexico, Namibia, New Zealand, Nigeria, Panama, Paraguay, Peru, Portugal, Romania, Slovakia, Slovenia, Syria, Macedonia, United Arab Emirates, Tanzania, the United States of America. []Convention relating to Unification of Certain Rules in International Carriage by Air, signed in Warsaw on 12 October 1929, and effective on 13 February 1933. []The Warsaw system consists of: a) Convention relating to Unification of Certain Rules in International Carriage by Air, signed in Warsaw on 12 October 1929, (the Warsaw Convention); b) Protocol on modification of the Convention relating to Unification of Certain Rules in International Carriage by Air, signed in Warsaw on 12 October 1929, signed in Hague on 28 September 1955. (the Hague Protocol) c) Convention on the amendment of the Warsaw Convention relating to Unification of Certain Rules in International Carriage by Air performed by a non-contractual carrier, signed in Guadalajara on 18 September 1961 (the Guadalajara Convention); d) Protocol for Modification of the Convention relating to Unification of Certain Rules in International Carriage by Air, signed in Warsaw on 12 October 1929, amended by the Hague Protocol on 28 September 1955, signed in Guatemala City on 8 March 1971. (the Guatemala Protocol); e) Additional protocols 1 to 3 and the Montreal Protocol No. 4 for the amendment of the Warsaw Convention, modified by the Hague Protocol or the Warsaw Convention modified both by the Hague Protocol and the Guatemala City Protocol, signed in Montreal on 25 September 1975 (the Montreal Protocols). [] The Warsaw Convention was accepted by 147 states. 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