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Master thread Air Canada Refunds vs credits; Class action lawsuit filed

Old Dec 10, 20, 7:55 pm
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As of April 13, 2021 (in conjunction with the federal government bailout), AC is providing refunds for flights cancelled due to COVID, which applies to tickets with travel after February 1, 2020, and purchased before April 13, 2021. This includes flights cancelled by customers rather than AC.

Going forward (i.e. tickets purchased on or after April 13, 2021), cancelled flights will be refunded if AC does not offer a re-booking option with departure +/- 3 hours from the original time.

AC refund portal

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Master thread Air Canada Refunds vs credits; Class action lawsuit filed

Old Apr 1, 20, 4:33 pm
  #31  
 
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Chargeback is probably the only real option
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Old Apr 1, 20, 4:47 pm
  #32  
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Originally Posted by yyz_consulted
Interested to hear the forums thoughts!
As has been pointed out upthread, class actions take a long time, but Evolink is working purely on contingency, so there's little downside to any of AC's customers in them pursuing this.

Originally Posted by Transpacificflyer
Associated with this will be a claim of bad faith. The Airlines persisted in selling airline tickets right up until the Canadian government made its more explicit return to Canada request and moved to stop international flights. This isn't about the stupidity of people who continued to fly. Rather it is about a business decision to keep selling tickets that the airlines were aware that they would not be able to honour. They were gambling with customer funds. The airlines had a duty of care to warn customers as far back as mid February as the pandemic grew that there was a strong likelihood that flights would be cancelled. It was evident this would explode even then. Yes, there was a responsibility of the customers to act in a prudent manner, but the airline industry dropped the ball on this.
It may have been "evident" to you, but the exact extent and consequences were not "evident" to many. Nor are your comments at all relevant to those who purchased tickets before then who now can't get refunds. No one can blame AC for selling me a YYC-NAS ticket for Easter 2020 last August, or a bunch of YYC-YVR trips for Q2/Q3 in December.

Originally Posted by pitz
Additionally, there is still a decent chance that AC ultimately files for CCAA, in which case, the not refunded tickets would be unsecured claims
No, that's not how it works. If the customer has a right to get a refund from an intermediary, e.g. credit card issuer or travel agent, the consumer doesn't have a claim, the intermediary would have a claim, and that would be subject to the terms of whatever agreement exist between the intermediary (or any further intermediaries) and AC, which may or may not be unsecured.

Furthermore, any tickets/credits that are honoured don't become claims against AC in an insolvency, because AC has fulfilled (or will fulfill) its obligation.

No one can say for sure what would happen to travel credits in an insolvency. It would depend in part on the scope of the problem. If it's relatively small, compared to the other liabilities, they may simply be left untouched rather than having to go through the potentially significant hassle of appointing representation for the holders and dealing with their rights, as well as thorny questions such as whether a haircut should be imposed on amounts charged to cover true 3rd party charges - AIFs, GST, UK APD, etc. It may be less costly to the parties involved to simply leave the travel credits in place.

Originally Posted by Low Roller
The only people who win in class actions are the lawyers. The defendant takes a huge financial hit which hurts its business (and ultimately its customers). They are usually settled for a portion of the claimed amount and then the lawyers take a huge cut, leaving the plaintiffs in a case like this with very little, after years of waiting. They are usually portrayed as some great win for "the little guy", touting multi-million dollar wins, but this is far from the reality for most plaintiffs.
I generally agree with you. And with settlements like Red Bull and DRAM, sure. But the big difference here is that the harm is relatively identifiable and recent. The DRAM one, in contrast, took place over something like a decade, had an unclear impact on each individual consumer, and given the length of time, it was difficult to calculate what losses had been incurred by any given party. In this case, the amounts are generally much larger, and tickets are sold at most 12 months out (and typically much shorter), so most customers should have pretty good records. And the remedy is pretty clear - AC can simply refund us all our money.

Originally Posted by robsaw
Somewhat of a false narrative, the objective is to change behaviour more than it is to save all-encompassing net cash costs to consumers. Personally, I think the objectives of the lawsuit are overshadowed by the probability that any sniff of large success by the plaintiffs will lead to immediate bankruptcy protection for AC (and similarly for WestJet or any other Canadian airline subject to a similar suit); if they aren't already there by the time this gets to trial (if ever).
Conserving cash is important, but advance ticket sales aren't nearly as meaningful to AC's balance sheet as you think. At December 31, 2019, AC had $6 billion of cash and $2.94 billion of advance ticket sales. I've already done a more detailed analysis elsewhere.

Originally Posted by Low Roller
I'm not saying that there shouldn't be a penalty. I guess I would just prefer that it be in the form of government regulation and fines as opposed to a lengthy and unruly process that was designed for the benefit of lawyers (which I used to be BTW).
Write to your MP. Write to Garneau. Write to the CTA. That's what I've done, and have encouraged my non-FT friends to do when they've run in to this issue. The government isn't going to respond to us .....ing on FT, but if enough people start making a stink about this, they might do something. (Which would hopefully ensure that the CTA doesn't allow airlines to file tariffs that don't contain reasonable refund provisions).
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Old Apr 1, 20, 5:39 pm
  #33  
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Originally Posted by hoipolloi
It could also lead to provincial (consumer protection laws) and federal regulation that make it clear the customers are entitled to the refunds, which will override any airline's contract of carriage terms/rules.
Sorry, it turns out the Canadian Transportation Agency has already ruled that airlines do not need to provide cash refunds for flight cancellations, effective 25 March. https://onemileatatime.com/canada-re...ght-cancelled/
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Old Apr 1, 20, 6:09 pm
  #34  
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Originally Posted by mahasamatman
Sorry, it turns out the Canadian Transportation Agency has already ruled that airlines do not need to provide cash refunds for flight cancellations, effective 25 March. https://onemileatatime.com/canada-re...ght-cancelled/
But unlike in the US, where the DOT is the end of all issues, the CTA and its "statements" (I do not see the word "ruling" anywhere) are not legally binding. It just means you won't win in CTA arbitration. It doesn't mean you won't win in court.
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Old Apr 1, 20, 6:21 pm
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Please correct me if I'm mistaken, but I thought AC only received the money when the flight was actually flown. I read (somewhere, quite possible on this forum) that the CC company keeps the money until then.

Anyhow I echo others' comments (and my own) that a credit would be 'OK' if it could be used like a gift card. Today I ate the $600 non-refundable portion of a May flight to get most ($3600) of my money back exactly for this reason. I have no idea if I'll be flying within the next year on a flight that costs at least $4200 and didn't want to take that risk
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Old Apr 1, 20, 6:59 pm
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Originally Posted by mahasamatman
Sorry, it turns out the Canadian Transportation Agency has already ruled that airlines do not need to provide cash refunds for flight cancellations, effective 25 March. https://onemileatatime.com/canada-re...ght-cancelled/
That isn't exactly what they said. They implied it, but on a careful reading, they simply said that vouchers "could" be an acceptable option. They did not say explicitly that refunds were absolutely not required. It was very soft overall, and not at all a "ruling" binding anyone.
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Old Apr 1, 20, 7:27 pm
  #37  
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Originally Posted by canadiancow
But unlike in the US, where the DOT is the end of all issues, the CTA and its "statements" (I do not see the word "ruling" anywhere) are not legally binding. It just means you won't win in CTA arbitration. It doesn't mean you won't win in court.
Actually, CTA hasn't even been that definitive. They said they would examine things case-by-case, but indicated they might be predisposed to consider a 24-month credit to be appropriate.

Originally Posted by tomvancouver
Please correct me if I'm mistaken, but I thought AC only received the money when the flight was actually flown. I read (somewhere, quite possible on this forum) that the CC company keeps the money until then.
No. See this post for some explanation of that topic.
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Old Apr 1, 20, 10:29 pm
  #38  
 
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The proposition that AC should allow the credits to be used to rebook same origin and destination with no fare difference or ADCOL applicable won't work, because then everybody will want to rebook their flights during peak periods such as Christmas, spring break and summer.
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Old Apr 1, 20, 11:37 pm
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Originally Posted by tomvancouver
Anyhow I echo others' comments (and my own) that a credit would be 'OK' if it could be used like a gift card.
The problem with gift cards is that you're pretty much last-in-line if they go bankrupt. You're making an interest-free loan to a very risky business.
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Old Apr 2, 20, 12:58 am
  #40  
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Originally Posted by tecate55
The problem with gift cards is that you're pretty much last-in-line if they go bankrupt.
That's an oft-repeated fallacy around here. The situation is far more nuanced. See, for example, this post not very far up this thread, where I discussed some of the particulars of insolvency.
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Old Apr 2, 20, 8:06 am
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To me, the major issue if credits were consolidated to a gift card or some other similar payment form is the loss of credit card travel insurance. There is no easy or perfect solution to this situation folks, unless AC decides to unilaterally refund, which is something I don't see happening at this point.
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Last edited by jasdou; Apr 2, 20 at 8:35 am
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Old Apr 2, 20, 11:18 am
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Originally Posted by jasdou
To me, the major issue if credits were consolidated to a gift card or some other similar payment form is the loss of credit card travel insurance. There is no easy or perfect solution to this situation folks, unless AC decides to unilaterally refund, which is something I don't see happening at this point.
how expensive is it to buy standalone travel insurance or trip cancellation/interruption insurance ?

What are you trying to protect from ? If it's about the risk of having to cancel a trip , you just pay $100-$200 cancellation fee to the airline and the trip cost will be put back in a travel voucher or gift card.

emergency healthcare during a trip ? Most credit card emergency health policies don't require you to have paid with the same card be covered, just need to be a cardholder of a card that provides such coverage.
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Old Apr 2, 20, 11:29 am
  #43  
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Originally Posted by tracon
I got one of those e-mails too for domestic May travel.

Part of the e-mail included:
"If you have a non refundable fare, you can still cancel your trip and receive 100% of the unused value of your ticket as a future travel credit. This credit is valid for travel before April 30, 2021. "
So I received this email aa well. One day after I had opted for the 24 month voucher offered when my flight was cancelled by AC. The trip was booked for May, and I took the voucher because I want to take the same trip (was flying to connect with the Rocky Mountaineer train Vancouver to Banff) next May.
I kept my original cancellation confirmation with the 24 month validity which came immediately upon selecting the voucher option vs the partial refund. I am ignoring this one.
But what's up with this?
​​​​​​
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Old Apr 2, 20, 11:56 am
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Originally Posted by hoipolloi
how expensive is it to buy standalone travel insurance or trip cancellation/interruption insurance ?

What are you trying to protect from ? If it's about the risk of having to cancel a trip , you just pay $100-$200 cancellation fee to the airline and the trip cost will be put back in a travel voucher or gift card.

emergency healthcare during a trip ? Most credit card emergency health policies don't require you to have paid with the same card be covered, just need to be a cardholder of a card that provides such coverage.
Why should I have to buy a standalone insurance when I already paid for coverage through my credit card?

As for the protections, here's what you get from an Amex Platinum card (copied straight from amex.com, apologies for the poor formatting). You'll notice that most require that you charge travel arrangements to the card.

  • Out of Province/Country Emergency Medical Insurance
Can provide coverage of up to a maximum of $5,000,000 for eligible emergency medical expenses incurred by an insured person under age 65 while travelling outside your Canadian province or territory of residence for the first 15 consecutive days of a covered trip.
.
  • Trip Cancellation Insurance
You can be reimbursed for the non-refundable and non-transferable portion of your travel arrangements when charged to your Platinum Card before your departure date should you cancel your trip for a covered reason. You can be covered for up to $2,500 per insured person, per trip, up to a maximum of $5,000 for all insured persons combined.
.
  • Trip Interruption Insurance
When you charge your travel arrangements to your Platinum Card, this insurance can cover the non-refundable and non-transferable unused portion of your travel arrangements purchased before your departure date, should your trip be interrupted or delayed for a covered reason. You can be covered for up to $2,500 per insured person, per trip, up to a maximum of $6,000 for all insured persons combined.
.
  • $500,000 Travel Accident Insurance
You can be covered up to $500,000 of Accidental Death and Dismemberment Insurance when you fully charge your common carrier (plane, train, ship or bus) tickets to your Platinum Card.
.
  • Car Rental Theft and Damage Insurance
You can be covered for theft, loss and damage of your rental car with an MSRP of up to $85,000 for rentals of 48 days or less when you fully charge your rental to your Platinum Card. To take advantage of this protection, simply decline the Collision Damage Waiver (CDW), Loss Damage Waiver (LDW) or similar option offered by the car rental agency.
.
  • Flight Delay Insurance
You can receive up to $1,000 in coverage (aggregate maximum with Baggage Delay Insurance) for necessary and reasonable accommodations, restaurant expenses and sundry items purchased within 48 hours when delayed or denied boarding for 4 hours or more and no alternate transportation is made available when you fully charge your airline ticket to your Platinum Card.
.
  • Baggage Delay Insurance
You can receive up to $1,000 in coverage (aggregate maximum with Flight Delay Insurance), for reasonable and necessary emergency purchases for essential clothing and sundry items purchased within four days of arrival at your destination when your checked-in baggage on your outbound trip is delayed for 6 hours or more when you fully charge your airline ticket to your Platinum Card.
.
  • Lost or Stolen Baggage Insurance
You can be covered for loss or damage to your checked-in or carry-on baggage and personal effects while in transit for up to a maximum of $1,000 per trip for all insured person(s) combined when you fully charge your airline tickets to your Platinum Card.
.
  • Hotel/Motel Burglary Insurance
You can receive up to $1,000 in coverage against the loss of most personal items (excluding cash) if your accommodation is burglarized when you fully charge your accommodations to your Platinum Card.
I'm not exactly willing to give those up.
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Old Apr 2, 20, 12:08 pm
  #45  
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Here's my speculation, assuming AC survives.

They'll refund all these credits to the original form of payment after the crisis is over and there's no longer a liquidity crunch.

This class action will be a massive waste of money, since it won't see the inside of a courtroom by then.
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