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A HfP reader sues BA when it refuses downgrade compensation on a 241 voucher

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A question that often gets asked when the conversation moves to EC261 compensation (2019 No.278 now that we have left the EU) is what value the British Airways American Express companion voucher has in the case of downgraded or cancelled flights.

British Airways continues to insist that the companion voucher has no value, since it is simply a ‘plus one’ for an Avios booking.

Common sense suggests otherwise, and indeed we know that British Airways has lost numerous CEDR and MCOL arbitration cases with HfP readers over the years on this point.

For clarity, we do not know of ANY case where British Airways has actually won in court or arbitration on this issue. You may wonder why it continues to force readers to take this route to get the compensation they are legally due.

We were recently contacted by a reader who had just successfully won a dispute in Court. As the case had progressed to Court with BA unwilling to settle, there was no confidentiality undertaking signed. For once, we are free to discuss it.

Over to our reader:

“I was due to travel on a long-haul flight with my wife and infant. We had booked a reward flight in Club World using a Companion Voucher. We were downgraded without notice at the gate and had a second set of boarding passes issued with seats in World Traveller Plus. This was after a two hour delay waiting at the gate.

The BA staff tried to offer cash compensation of £200 each when we expressed our frustration. We rejected this and refused to travel on another day as we had another flight to catch at the destination. We were informed that BA would contact us within seven days of the flight to discuss the refund due, but no contact was made.

Over the next six months, 16 emails were exchanged between myself and British Airways’ customer relations team as I tried to seek the correct compensation.

I had calculated the correct compensation due under EC261 for downgrades. Based on my understanding that I was entitled to 75% of the price of the ticket and bearing in mind it was an Avios purchase, I was seeking:

Outbound leg was 90,000 avios (peak pricing)
75% of 90,000  = 67,500 Avios per adult
75% of 9,000  = 6,750 Avios per infant (infants pay 10%)
Total due:  141,750 Avios downgrade compensation

The total refund in Avios would be 141,750 for the three of us.

Unfortunately, British Airways rejected my calculation. As I wasn’t making progress, I decided I had no option but to take British Airways to court.

I wrote a detailed letter to BA before starting my action and subsequently issued a claim in the Small Claims Court using MCOL, the Money Claims Online Service. This was relatively straightforward and the online portal is quite user-friendly. You can do this yourself and do not need to appoint a lawyer.

BA 787

At this point, British Airways offered me compensation I was legally due of 67,500 Avios for my ticket and 6,750 for our child.

However, it disputed my wife’s refund since it was a Companion Voucher, i.e. the companion ticket holder ‘did not pay a fare,’ and therefore not entitled to compensation. They were essentially arguing that the voucher had no value.

We argued that under Article 10.2(c) of EU Regulation 261, we were both entitled to compensation of 75% of the price of our tickets for the downgrade.

Article 10 of the Regulation relates to upgrading and downgrading. It states:

2. If an operating air carrier places a passenger in a class lower than that for which the ticket was purchased, it shall within seven days, by the means provided for in Article 7(3), reimburse:

(a) 30% of the price of the ticket for all flights of 1500 kilometres or less, or

(b) 50% of the price of the ticket for all intra-Community flights of more than 1500 kilometres, except flights between the European territory of the Member States and the French overseas departments, and for all other flights between 1500 and 3500 kilometres, or

(c) 75% of the price of the ticket for all flights not falling under (a) or (b), including flights between the European territory of the Member States and the French overseas departments

We also referred specifically to Article 3.3 of the Regulation which sets out very clearly that:

‘This Regulation shall not apply to passengers travelling free of charge or at a reduced fare not available directly or indirectly to the public. However, it shall apply to passengers having tickets issued under a frequent flyer programme or other commercial programme by an air carrier or tour operator.’

Clearly, EU261 applied to companion vouchers. Given that you can only get a companion voucher after a £10,000 credit card spend and the associated £195 fee for the card itself, we were adamant that British Airways was wrong in giving it a nil value.

British Airways BA 777X 777 9X

It is worth noting that within BA’s court documents they referred to the “Steef Mennens v Emirates Direktion für Deutschland” case.

This was an attempt to demonstrate that a passenger who did not “pay a fare” was not entitled to any compensation. We asserted the facts of this case were completely different and could not be compared to our case, on the basis a Companion Voucher (with intrinsic value) was used to purchase a ticket. This view was accepted by the court.

We were successful at trial and were somewhat surprised that BA had not offered to settle prior to the hearing.

In addition to compensation for my wife’s downgraded ticket, we were also granted costs to cover the claim fee and hearing fee. The cash value of Avios was based on the cost of buying Avios directly from British Airways – so 1.6p per Avios.

We were therefore awarded £1,080 and 74,250 Avios, as well as our costs.

The judge agreed that it was acceptable for compensation on my ticket and my child’s ticket (but not my wife’s companion ticket) to be in Avios since this was the means of payment.

The £1,080 comes from multiplying 67,500 Avios x BA’s selling price of 1.6p per Avios.

[HfP edit: it is very rare for CEDR or MCOL to make a non-monetary award against British Airways. In every previous case we have seen, all of the compensation was paid in cash based on 1.6p per Avios]

It was crucial that we laid out the calculation to value the Companion Voucher, and therefore the compensation in monetary terms since we were using Money Claim Online.

My advice would be that you can most certainly pursue compensation for a downgrade on a companion voucher but it is imperative to set out your claim very clearly.

We put a lot of time and effort into researching the regulations, reading various terms and conditions and drafting the court documents. In the end it took 14 months from the date of the flight until the court hearing came around, but our perseverance and hard work paid off.”

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Category

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Comments (193)

This article is closed to new comments. Feel free to ask your question in the HfP forums.

  • Dwb1873 says:
    15 Feb15 February 07:00

    What about publishing some of the case references now there seems decent precedent?

    Would surely make it a lot more straight forward – especially if BA are trying (badly) the same in reverse?

    • Tom H says:
      15 Feb15 February 07:10

      +1 this has the potential to make it a very easy ‘slam dunk’ if a few more details are provided? Also we can now quote this case ‘x vs BA’ which would hopefully simplify things further?

      • Anna says:
        15 Feb15 February 07:26

        No – and BA often requires a NDA when settling these things.

        • meta says:
          15 Feb15 February 07:42

          There was no NDA in this case. It went all the way to hearing.

        • Anna says:
          15 Feb15 February 08:02

          @meta, yes – but as I recall TripRep and others were required to agree to one, therefore very difficult to get a clear picture of the scale of the problem.

          • meta says:
            15 Feb15 February 10:14

            They didn’t make me sign an NDA either even though we settled out of court. I think they might have sacked a lot of staff in the legal department during pandemic…

          • Chris Heyes says:
            15 Feb15 February 12:19

            Anna I’ve had two in all my flying with BA, both settled with NDA,
            So I’m amazed BA allowed it into court in the first place
            (largish settlements is all I’m supposed to be allowed to say)
            They are normally very good at tying down NDAs
            only think a slip up on their part

          • Lady London says:
            15 Feb15 February 13:39

            not required. offered as part of a settlement offer. claimant can always refuse if there is not sufficient extra in the settlement to keep stumm.

      • memesweeper says:
        15 Feb15 February 07:55

        I believe you can cite a similar case, in the absence of a precedent, if it is persuasive. That can be from a court at the same ‘level’ in the English system, or a foreign common law one I think. It’s not binding but can be helpful — I would imagine especially so if its the same respondent who keeps on loosing on the same facts.

    • Rob says:
      15 Feb15 February 08:11

      Do MCOL cases get published?

      • Jack says:
        15 Feb15 February 08:21

        No, they aren’t. Transcripts aren’t usually published for cases below the high court, and even in the high court you frequently need to pay a decent sum to get it typed up by the court.

        • Igloo says:
          15 Feb15 February 13:09

          I have occasionally gotten a court transcript of county court proceedings (which I think MCOL falls under), but as you say it costs a fair bit!

  • Mark says:
    15 Feb15 February 07:13

    What really annoys me about this is people typically save up avios and a companion ticket to make an aspirational redemption for a holiday, with the business or first class flight part of enjoying time away. Being downgraded at the gate having been looking forward to an enjoyable flying experience to start a holiday is such poor show by BA.

    • Annih says:
      15 Feb15 February 07:28

      The whole point is to have an outsized redemption plus the fact it takes a lot of effort for most to find a redemption seat. Additionally, you need to avoid the devaluations, etc. None of which is taken into account in these outcomes. IT really is unfair and that is why you should always keep your balance as close to zero and have alternative carriers to use. Easier said to done though.

    • BuildBackBetter says:
      15 Feb15 February 07:42

      Agreed. I think the reader should’ve asked for more penalties to deter BA from repeating this.

      • memesweeper says:
        15 Feb15 February 07:59

        what can you ask for though? there’s no punitive damages in UK civil law AFAIK

        • A says:
          15 Feb15 February 09:36

          Yep absolutely right – also let’s recall it’s not a breach of contract case – BA’s contract with you entitles them to effect this downgrade.

          You’re claiming compensation under a statutory right given to you by EC261 (as implemented in the UK under EUWA etc etc).

          So the only rights to compensation are those set out in EC261.

    • Lady London says:
      15 Feb15 February 09:02

      especially with an infant.

      sounds like a last minute equipment swap. I bet these passengers were not the only ones downgraded

      Imagine if you were taking someone on a
      romantic treat. An unseemly argument at the gate would be a really bad thing to be forced into in front of of someone you wanted to impress.

  • NC says:
    15 Feb15 February 07:28

    I have a dispute where BA cancelled a flight and the earliest rebooking was three days later. BA reimbursed me for the extra hotel room costs but are refusing to pay more than £25 per day for food/refreshments. I was stuck on Rangali in the Maldives (I know, not a huge hardship!) where £25pd barely buys a bottle of still water, let alone lunch, dinner and drinks. To be fair BA paid out for the room rate (which was rather high) without argument but their refusal to reimburse the full food etc costs seems arbitrary. Is there any reason to think a claim for full reimbursement won’t be a slam dunk before MCOL?

    • meta says:
      15 Feb15 February 07:53

      I’d submit copies of all menus where it clearly shows that there wasn’t a way to reduce food costs. Remember you can’t claim on alcohol.

      • NC says:
        15 Feb15 February 09:13

        That’s fine – I think my claim only included one alcoholic drink total. But out of interest where’s the legal basis for saying alcohol is excluded? EU261 refers to “refreshments” being covered by the duty of care.

        • meta says:
          15 Feb15 February 09:17

          I think it falls under reasonable and necessary costs and obviously alcholic drinks are not necessary or reasonable.

      • Lady London says:
        15 Feb15 February 09:14

        100% mcol it. Enclose a few price lists/menus if you can get more.

        Dont forget to claim transport costs to and from hotel and 2 phone calls or internet as well.

        BA needs to step up for the true costs of these according to where they stranded you 3 meals per day. Most flights seem to be being cancelled for BA’s profit so they have done tbeir sums abd know perfectly be well what their duty of care is..

        It would be negligent not to claim. Do an MCOL and include 8% pa statutory CV interest in your claim
        ..

      • Lady London says:
        15 Feb15 February 09:19

        not obliged to reduce food costs. BA is obliged to pay reasonable considering the general rates prevailing where they stranded you.

        If you are travelling Business Class to the Maldives then you are not eating in McDonalds

        • NC says:
          15 Feb15 February 10:56

          Indeed!

          Is EU261 compensation for the cancellation also out of the question? I know there’s a general stop on that because of covid, but it’s quite clear that BA cancelled the flights for operational/business reasons.

          • Lady London says:
            15 Feb15 February 13:42

            as a general rule you cant make compo stick during covid

          • Charlieface says:
            15 Feb15 February 13:50

            You would certainly have a good argument but not guaranteed. If you’re MCOL’ing anyway for expenses, you could just add it to the claim and avoid paying fees a second time.

      • NFH says:
        15 Feb15 February 11:29

        A drink with a meal, whether alcoholic or not, is covered by EU261. There is no exemption in EU261 for alcoholic drinks. Obviously an airline could reject a claim for spirits or excessive amounts of beer or wine above and beyond what a reasonable person would consume with a meal.

        • meta says:
          15 Feb15 February 12:51

          It says reasonable food and drink costs. What is reasonable in this case would be determined by the judge? You could order one glass of most expensive wine and that would not be reasonable. In any case @NC would certainly be entitled to more than £25 per day and should pursue his claim at MCOL. The very fact they paid for his accommodation means they admitted their liability and it is a slam dunk case for food and drink costs.

          • NFH says:
            15 Feb15 February 13:11

            Yes, you are right. If I have a pint of beer, or possibly two, pints, with my meal, then no judge is going to disallow that. But if I have wine whose price is evidently of a premium nature, then a judge is probably going to accept the airline’s arguments that it is not a reasonable cost.

  • Harper says:
    15 Feb15 February 07:41

    My parents experienced the same situation a while ago travelling back from CPT where my dad (75)was moved to WTP at the gate.

  • meta says:
    15 Feb15 February 07:49

    Well done to the reader!

    The only thing I would have done differently is not wait 6 months for BA’s customer service before sending them letter before claim. I’d give them a maximum of one month to respond plus 14 days after sending letter before claim (or 21 days if they never responded to initial correspondance) then issue MCOL claim. It would all have been settled within a maximum of 6 months incl. hearing.

  • Alan says:
    15 Feb15 February 08:05

    Well done that reader for pursuing this appalling treatment by BA. If the companion voucher really had no value then what are all those massive BA surcharges that they apply to the ticket? They can’t have it both ways!

  • Andrew says:
    15 Feb15 February 08:05

    The problem with these laws is that as they are civil laws the airlines can just say no we’re not paying and you have to take us to court to get it. I had this with a Qatar delay and despite it being covered by EU legislation and was a valid delay, they refused to pay out, leaving the only route a no-win no-fee law firm or me taking them to court. All the CCA can do is write to them to remind them of their obligations but they have no enforcement powers for this.

  • KBuffett says:
    15 Feb15 February 08:11

    What is the status of this EC regulation in relation to UK flyers post Brexit?

    • meta says:
      15 Feb15 February 08:35

      Transposed into UK law until MPs vote to repel it.

    • Rob says:
      15 Feb15 February 09:44

      All EU law was copied into UK law, see the first paragraph.

      What I need to check is if it applies to an EU airline flying to the UK.

      EU261 did not apply to non-EU airlines flying TO the EU. Does the new version non apply to non-UK airlines flying TO the UK? Not that it matters, since you have a claim under EU261 of course.

      • AJA says:
        15 Feb15 February 10:08

        Rob, It was implemented by the Air Passenger Rights and Air Travel Organisers’ Licensing (Amendment) (EU Exit) Regulations 2019, bringing into force what is effectively “UK261”.

        “UK261” applies to passengers departing from a UK airport; and

        to passengers departing from an airport located in a country other than the UK to an airport situated in:

        the UK if the operating air carrier of the flight concerned is either an EU/EEA carrier or a UK air carrier; or

        the EU/EEA if the operating air carrier of the flight concerned is a UK air carrier.

        Passengers therefore enjoy the same coverage between the UK and EU regimes as they had enjoyed under the previous unified regime.
        From now on, any claim brought in the UK arising out of a qualifying delay or cancellation must be brought under UK261 regardless of the date of the flight in question. EU261 claims can still be made against UK carriers, but only in EU Member States. On certain routes there will be overlapping coverage of both the UK and the EU regimes and passengers will be entitled to decide which they prefer to use.

        One other change is that now under “UK 261” the amounts are in GBP.

        Flights under 1500km you can claim GBP220,
        Between 1500 and 3500km you can claim GBP350,
        and flights over 3500km you can claim GBP520

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