INTRODUCTION:-
On 3rd March 2019, Sunday, the Ethiopian Airline’s Addis to Nairobi Flight’s Boeing 737 MAX 8 crashed after a few minutes of takeoff killing 157 people aboard.
The Black Boxes of this Aircraft were found on 13th march 2019 – ten days after the crash. The Ethiopian Airlines does not have technical capability to analyse information from the Black Boxes. These are being analyzed by the French Experts.
This incidence involving the same model happened first by Aircraft Crash of the Lion Air Line of Indonesia killing 189 people aboard on October 2018.
These events of Aircraft crash of Boeing 737 Max 8 have resulted into airline of most of countries suspending the use of Boeing 737 Max 8 Aircrafts in their fleet.
China, India Brazil, Mexico, Panama, USA and Europe all with safety of flying passengers as priority took policy decision to ground Boeing 737 Max 8 from their fleet as pre-emptive step.
The U.S. Federal Aviation Administration (FAA) cited satellite data with evidence from the scene of Sunday Air crash near Addis.
The Aircraft Manufactures Boeing have lost market value of their stocks by US$ 26 MLNS as on date and may suffer further declines. Last week the Boeing were to launch 777X Aircraft which can carry 425 passengers and were scheduled to make its debut to the world on 13th March 2019. This debut is cancelled. The Boeing 737 Max deliveries are held back.
Now there may be interesting developments of Claims Management arising out of the Aircrafts air crash killing hundreds of passengers including Crew Members. Air Liner’s Liability is fixed as per Montreal Convention of 1999 or Warsaw Convention of 1929.
CLAIMS MANAGEMENT ACCORDING TO INTERNATIONAL CONVENTION:-
On 12th October 1929 a number of countries decided to have a regulations an aircraft operators Legal Liability to Passengers, their baggage and air cargo. On 12th October 1929 in the capital of Poland Warsaw a convention was signed initially by 23 countries followed by over hundred countries.
The Convention for the Unification of Certain Rules relating to International Carriage by Air – the so called WARSAW CONVENTION become the basis for claims management after an air crash causing serious injuries’ to passengers of various nationalities.
The compensations limits of US$ 10,000 per person was increased to US$ 20,000 per person by 1955. Americans required a higher limits of US$ 75,000 per person.
Further developments on the provision of the Warsaw Convention were updated and replaced by the Hague Protocol in 1995. The Guadalajara Supplementary Convention in 1961, and the Guatemala Convention of 1971.
Finally in 1999 the MV99 – The Montreal Convention Treaty was signed by member states of ICAO – The International Civil Aviation Organization.
The Montreal Convention Treaty signatory’s countries recognized the necessities for codification, Consolidation, Modernization and Harmonious agreements for the protection of the interests of Air Passengers to fix Air Lines Legal Liability to Air Passengers with realistic and reasonable levels of Financial Compensation. The Crew Members are covered not by the Montreal Convention but by Worker’s Compensation Agreements between Crew Members and their employers – Air Line Operators.
Thus Legal Liability Base for Air Passengers is the limits fixed by the Montreal Convention. Again International Passengers from USA – Canada – Europe – Japan – China – Australia – New Zealand, India and all Afro Asian Latin American countries may book their Air Tickets from Air Lines booking offices in various cities of various countries. The International air Passengers Nationality enables them to claim levels of compensation Limits as per their jurisdictions.
The Montreal Convention Treaty was signed on 28th May 1999 by 132 Countries + European Union. The Treaty becomes effective from 4th November 2003.
The Countries like Indonesia, Iran, and others have NUL rectified their Montreal Convention Treaty. They follow the Provision of the Warsaw Convention.
LIABILITY OF AIR LINES:-
According to Article 17 of the Montreal Convention Compensation can be claimed for death or bodily injuries if the accident took place on board the Aircraft or in course of operations of embankment and dismemberment or in event of Air Crash.
The per person limit of Legal liability of Airlines to Air Passengers are as per SDR – Special Drawing Rights according to Article 17.
SDR is converted into Foreign Exchange Rates of currencies of their four countries viz. Euro – YEN – U. K Fstg and US$. The rates of exchange are as prevailing on the date of payment according to the applicable imfis Rates of Exchange on the date of Payment.
SDR 113,100 was equal to Malaysian Ringet 572,000 when Malaysian Air Lines MH 370 flight from Kuala Lumpur to Beijing went missing.
An Air Line has to make Advance Interim Payment of Claim soonest possible and then adjust the Sums with Final Amounts of Compensations.
The Air Passengers Families can claim the Compensation WITHIN 24 MONTHS from the date of accidents
The jurisdiction applicable for Legal suits can be…..
– The Country of Domicile of the Air Line Or – The Head Office of Air Lines Business.
Or – Location of Foreign Branch Offices of the Air Line from where Air Tickets are booked. Or – The place of permanent residence of Air Passengers at the Time of the Accident.
Lawyers can try to get maximum compensations for Passengers through long litigations for all practical purpose Air Line can take Loss Minimization Measures through co-operations with all channels of communications.
CODE SHARING AIR LINES’ LIABILITY:-
When Malaysian Air Lines Flight MH 370 went missing there was the issue of the involvement of Code sharing Air Line. China’s southern Air Line was Code Sharing Air Lines of Malaysian Air Line.
There may be many passengers of MH 370 who have booked air tickets from Air Lines flight number CZ 748 which is same MH 370. The China south Air Line is not using its own aircraft but books passengers in its own code number for MH 370.
In such cases China Southern Air Line would be equally responsible and liable to pay compensation to air passengers of MH 370 booked through their Flight Code CZ 748.
However Passengers cannot claims compensation from both Air Lines.
AIRCRAFT MANUFACTURER’S LIABILITY:-
Families of the deceased passengers may consider legal action against Aircraft Manufacturer, the Engine manufacturer and also the Air Craft Maintenance Company of the Air Line etc. face claims made by families of dead passengers.
However advices of Legal experts are needed before taking legal actions.
CREW MEMBERS LIABILITY:-
Crew Members Liability is met from Workers Compensation Agreement reached by Air Lines and WCA Act liabilities apply.
It is important to note that Crew Members liability is not covered by the Warsaw Convention or by the Montreal Convention.
WHEN PASSENGERS ARE MULTINATIONALS:-
The Ethiopian Air Lines Flight Passengers were mostly Foreigners – diplomats who were enroute to Nairobi to attend and International Conference. India’s Foreign representative died along with other members.
Thus the compensation limits will be different according to country of domicile of passengers at the time of accident, location of Tickets booking office of the Air Line and applicable levels of legal Liability Limits.
Besides these Legal Liabilities according to Montreal Convention there may be additional Insurance Protection purchased by flying passengers. Passengers families can claim from Insurance companies who are liable to insured passengers according terms and conditions of insurance policies purchased by the passengers.
QUANTUM OF ETHIOPIAN AIRLINES AIR CRASH-
It is too early to arrive any amount of possible Loss but it will be huge with accumulations of all passengers Liabilities as well as High Volumes of Aviation Hull of Boeing 737 MAX 8. It may be little less than a billion US$!
Insurers and Reinsurers cover Agreed Values of Aircrafts and because of this there cannot be underinsurance of the Air Crafts Values.
The overall Liabilities of Passengers killed in the crash and the Aviation Hull Values always accumulate in the final amount of less.
As compensation Claims can be within 24 months from the Date of Loss, it involves unknown elements of inflating Final Claim amount.
GROUNDING OF AIRCRAFTS AND AIR CRAFTS MANUFACTURERS LIABILITY:-
Boeing the manufacturers of 737 MAX 8 have to pay compensation as per their liability to various countries airlines who have suspended flights using Boeing 737 MAX 8 as pre-emptive measures.
Grounding of Aircrafts 737 MAX 8 involve all 371 Aircrafts.
- The biggest setback is the bestselling 737 MAX 8 type 7600 places of around $ 550 BLNS may be cancelled.
- Boeing will have to replace existing Auto Pilot Systems by a new improved computer software and incur additional costs to train Pilots.
- Battery fix cost in jets is US$ 465,000 per Their plane will be more than billion US$.
- Airlines have started demanding compensation for technical defaults in 350 Boeing 737 Max 8 already in the fleets of various airlines world over.
- Families of passengers may also file legal suits against Boeing – the Aircraft
Grounding of Aircrafts by Airlines are normally not covered by Insurance and reinsurance covering Air lines world over.
CONCLUSION:-
Boeing 737 MAX 8 has a complicated Autopilot System which confuses pilots who find problems to handle control systems.
Natural tendencies among Pilots is to depend more on Autopilots Systems and Computer software used by manufacturers.
Perhaps proper training of pilots to skilfully handle Autopilot system of Boeing 737 MAX 7 is the cause of weak manual controls of pilots flying these sophisticated Aircrafts of latest generation.
The main lesson to be learnt is to carry out Training of pilots in exercising Manual Controls Rather than over dependence on Autopilot Systems.
