Austrian court rules against expiration of miles

Old Oct 27, 16, 6:22 pm
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Originally Posted by Goldorak View Post
Is there any English translation of this statement available ?
As they would say at KLM: helaas, niet mogelijk meneer.
NickB is offline  
Old Oct 28, 16, 1:47 am
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Originally Posted by KLouis View Post
Nobody is forced to become an FB member. As a matter of fact, there is a big choice of FF programs and the T&C of each one is clearly accessible for reading before one decides to join such a programmme. I also hated it when I had to take a no-real-purpose flight a month ago in order keep my miles, but I joined FB (or, to be precise, FD) knowing that they had certain rules. Heck, I earned more than one million miles in the years before I switched alliances and I was glad to see that my "new" *A miles did not expire. But going to court and sueing FB because I don't like their rules, well, I find it strange and I find the court's decision even stranger.
Originally Posted by KLouis View Post
I fully see your points but there are two items that make this contract different from a classical contract between a consumer/customer and a goods/services provider: 1) This is free! (forgetting the payment of so-called taxes like fuel surcharges, which no court anywhere in Europe, so far, has found to be illegal )
I'm not at all picking on your post but I answer it because I think that it is symptomatic of one of the "crux" of the discussion on FFP rules across pretty much all of the FT airlines fora that I follow more or less regularly.

The dominant notion is that airlines can pretty much dictate the rules that they want and effectively, if you are not happy, just don't join that FFP and if you do, accept the rules. I think that notion is mistaken.

It is typically defended through two types of objections:

1) an explicit one: "it's a contract", so as long as you've signed it, you accept it. Don't come whining or suing now;

2) an implicit one: I think that there is often an implicit argument - which is in fact more explicit in your second post here, that in fact, FFPs are really like a "gift" or if not a gift at least a "bonus" by the airline, you sort of get something for nothing so don't look a horse's gift in the mouth.

I think that there are issues with both arguments as pointed out by NickB (I don't think that I am adding much to what he says, but just generalising because I have seen variations of those arguments so often).

On 1) as NickB clearly explained, a contract is still subject to regulations. You can't just put anything in a contract and expect it to be valid because both people sign. In particular, one should remember that transactionally (economically if you prefer), the theory is that a contract would always be the result of two parties negotiating terms that they agree. That's how a contract works as the "price" of a transaction if you will. In practice, when contracts are made between two unequal parties (say, a large company and an individual customer) this is never the case. One party imposes the terms of the contract, and the other just accepts or refuses them. This is a founding inequality which, economically, would be considered grossly sub-optimal, and legally is immediately flagged as imbalanced in nature (the two parties do not have similar roles). As a result, courts would be particularly careful to ensure that the terms phrased by a single party comply with existing rules on fair terms.

So as a nutshell summary of the answer to argument 1), a contract cannot make just any term legal, moreover 2) a theoretically balanced contract would stem from a negotiations between the two parties, and if it is not the case because the contract is solely drafted by one of the parties unilaterally, their obligation is to ensure that the terms are fair and that can be enforced strictly.

2) The second argument is equally invalid in my view. I think people look at it - quite understandably - as a "I need to fly anyway so the airline is just giving me a thank you for choosing them". In fact, I typically see it that way too in my travel. However, courts which are more pragmatic (sometimes!) than the rest of us see it differently. That's not a freebie, but just part of the product that you are buying and therefore part of what makes you decide to fly, just like when you buy a car, the terms of how the car dealer may buy your old car or their "offering" you free insurance and/or gas for 5 years may obviously influence your decision to buy it.

I think that is an eminently sensible way to see it. It is irrelevant that you might have bought the car anyway without the free gas, ultimately, it was part of your purchase decision and as such is scrutinised not as a "gift" but as something that will have affected some commercial decisions and has therefore led both parties to commit to some obligations to get something in return.

I think it is important not to present passengers as sorts of freeloaders within the context of FFPs. They aren't. They are buying something, paying a price for it, may indeed decide to pay a higher price for a flight because of the FFP benefits, and it is therefore crucial that what they get in return be fair and good and important that courts can assess whether this is the case.
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Old Oct 29, 16, 7:27 pm
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Quote: "The decision is legally binding. You can read the full text of the verdict here (in German language)."

This is not correct!
from the newspaper "Die Presse":

"Das Urteil ist nicht rechtskräftig. Das OLG hat eine ordentliche Revision an den Obersten Gerichtshof (OGH) zugelassen"

Translation: "the decision is NOT legally binding. The OLG (court of a state) has permitted a revision by the OGH (supreme court) "
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Old Oct 30, 16, 8:34 pm
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So now does this mean other frequent flyer programmes will have to change their rules too (such as Miles&More with its 3 years regardless of activity unless you are elite or have cobranded credit card)?
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Old Oct 31, 16, 4:22 am
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M&M is based on German law/convention that says credits/bonuses have to valid for at least 3 years. In the judgement cited above, 3 years is mentioned as being a reasonable time frame. So this precedent (if there is such a thing in Austrian law, methinks not) has no implication on M&M.
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Old Oct 31, 16, 4:54 am
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Many thanks for this, KL803. As an Austrian-based FB member, I will be following this closely.
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Old Nov 15, 16, 10:00 am
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Austrian court ruling on lifetime of frequent-flyer miles

Without considering the minutiae of the legal ramifications, I can see a practical reason for putting a lifetime on miles. (For most US airlines, it is 18 months since the last 'activity'.) This allows the airlines to do some housework in cleaning out dormant accounts which inevitably result for various reasons, the most common one probably being the death of the frequent flyer. Even if the customer ceases flying, it is quite easy to obtain a free credit card associated with the airlines which will continue to generate non-flying miles to verify that the passenger is still alive and may, at some point in the future, wish to use the miles in his/her account. The arbitrary nature of 18 months may, in fact, be unreasonably short, but some kind of period is needed for accounting purposes so that the liability associated with accrued miles can be taken off the books when the passenger dies. Frequent-flyer miles seem to be one of the rare things that cannot be passed along in inheritance (unless, of course, a family member of the passenger continues to keep the account alive in some way, such as that described above).
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Old Nov 15, 16, 10:52 am
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There are no "free" Flying Blue credit cards available anywhere. The existing FB credit cards are only available in a handful of countries, not including Austria.

Keeping a deceased member's FB account active is against the T&Cs.
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