The Department of Transportation today published a Notice Providing Guidance on Reimbursement of Passenger Expenses Incurred as a Result of Lost, Damaged or Delayed Baggage to provide “guidance on air carrier contract terms and policies relating to reimbursement of passenger expenses incurred in connection with lost, damaged or delayed baggage.” The Notice was issued after the DOT discovered that some of the airlines have adopted policies that appear to limit reimbursement for such expenses in certain circumstances (e.g. denying any reimbursement “for necessities” where the baggage is “expected” to reach the passenger within 24 hours of filing a delayed baggage report, limiting reimbursement to actual expenses up to a fixed maximum amount per day after the first day or only reimbursing passengers for incidental expenses incurred after the outbound leg of a roundtrip).
As you may or may not know, DOT’s baggage liability rule, 14 CFR Part 254, does not contain the limitations the airlines are attempting to impose. As a result, DOT’s Office of Aviation Enforcement and Proceedings (Aviation Enforcement Office) considers “any such arbitrary limits on expense reimbursement incurred in cases involving lost, damaged or delayed baggage to violate part 254 and to constitute an unfair and deceptive practice and unfair method of competition in violation of 49 U.S.C. 41712.” In support of its position, DOT cites Section 254.4 which states that an air carrier “an air carrier shall not limit its liability for provable direct or consequential damages resulting from the disappearance of, damage to, or delay in delivery of a passenger’s personal property, including baggage, in its custody to an amount less than $3,300 for each passenger.”
In order to meet the regulatory requirements, the Notice states that airlines should reimburse passengers for “all reasonable, actual and verifiable expenses related to baggage loss, damage or delay up to the amount stated in part 254.” Accordingly, air carrier contracts of carriage etc. should not include terms setting arbitrary limits on reimbursement that are inconsistent with Part 254. If an air carrier has not removed such limitations within 90 days from the date of the Notice, the Aviation Enforcement Office “will pursue enforcement action in appropriate cases where unlawful reimbursement policies are not corrected.”
Although this should ultimately benefit airline passengers, it is important to note that neither the Notice nor Part 254 gives an airline passenger a private cause of action against an airline for violation of those regulations. Only DOT has the authority to pursue enforcement action against an airline for violation of Part 254. If you would like further information regarding the Notice or possible violations of Part 254 by an airline, you should contact Nicholas Lowry, Attorney, Office of Aviation Enforcement and Proceedings (C-70), 1200 New Jersey Ave., SE., Washington, DC 20590, (202) 366-9349.
