Passenger rights when a xONEx segment is cancelled
 

I’m currently midway through a DONE3, issued on CX stock. In October, AA canceled a late-December segment on which I had a confirmed ticketed reservation. Alternative flights were unsatisfactory to me. Notably, AA’s cancellation was part of ad hoc holiday schedule adjustments – cutting unpopular flights during winter holidays. So this is a classic context of cancellation for the carrier’s convenience (profit!), not weather, mechanical, etc.

I’m trying to figure out what my rights are. Clearly I can reissue to a different routing. Probably I can convince CX to waive the usual reissue fee.

On an ordinary paid ticket, I’ve always been of the view that a schedule change with no reasonable alternative (e.g. no alternative within 2 hours) or flight cancellation entitles a passenger to a refund to the original form of payment. For an entirely unused ticket, the refund would be for the full purchase price. For a partially-used ticket, I believe I’ve always received pro-rated tickets (refund in proportion to the distance of segments flown). But it’s hard to find a source of authority that requires this outcome.

The xONEx rules don’t say anything on point. The xONEx rules include provisions for cancellations, but only speak to cancellations a customer requests.

The Cathay Conditions of Carriage say: “If, after you purchase your Ticket, we make a significant change to the scheduled flight time, which is not acceptable to you, and we are unable to book you on an alternate flight which is acceptable to you, you will be entitled to a refund in accordance with Article 11.” (section 10.1) That sounds promising. But then within the section on involuntary refunds, 11.2.2 says “if a portion of the Ticket has been used, the refund will be not less than the difference between the fare paid and the applicable fare for travel between the points for which the Ticket has been used.” I’ve flown roughly 2/3 of the DONE3, and there is no single “applicable fare” for the flights I’ve flown. Assemble an “applicable fare” out of point-to-point full fares and obviously the cost would be well more than the full amount charged for the entire DONE3. On the other hand, Cathay says the refund will be “not less than” that amount (zero), but it could be more, and indeed in my view it absolutely should be more.

Has anyone here faced such a question? Thoughts on passengers’ rights in this situation? I know it would be easiest to reissue to a different routing, but I’d like to explore my other options -- and if a cancellation with pro-rated refund is among my options, as provided by law and/or contract, that's something I'l want to think about. Of course I’ll shortly be inquiring with Cathay, but I’d like to be well prepared for that discussion.

I think that you've got a problem. First, from your quote from the Conditions of Carriage above, note the "we" used (highlighted in red). CX hasn't made any changes to the flight schedule. That might get them out of liability. Second, if they charge you regular fares for the flights you've flown, that could easily exceed the entire DONE3 fare, depending on routing, etc.

Not sure what to say, other than that you do seem to have an interesting problem.

I've had flights canceled midway through an XONEX and just got re-accommodated with a re-issue, and also received original routing mileage credit if the new mileage was less than previously.

I'd be surprised if CX would see this as grounds for any kind of refund, although you certainly should have any taxes and/or fuel fines previously paid refunded. And I'm not enough of an expert on various tariff conventions to know if any "rights" come into play; frankly I'd doubt it. I seem to recall that there were a lot of XONEX pax in a similar pickle a few years ago when CX scrubbed all their flights into CMB during the troubles in Sri Lanka. I don't remember anyone getting refunds in that case, but a wander through the FT archives might be productive.

My experience

I had CX-issued XONEX including MX's YYZ-MEX segment.
As you all know, that flight was canceled.
CX offered altnative AA's YYZ-DFW-MEX flights without change fee.
I don't know that altnative routing can be over 16 segments limit.

Yes it can

On our LONE4 in 2008/2009 we were booked on QF's BOM-SYD flight, and QF ceased flying it a few months before we due to fly it

QF booked us onto BOM-xSIN-SYD, which meant we had 17 segments on our RTW and 5 of those segments were now in Asia - all at no charge to us

My recent DONE4 had an AA flight reschedule (not cancellation) make a connection impossible. No refund but I was able to reroute at no cost. I was not permitted to exceed 16 segments though.

I had an LONE4 in 2008 issued by QF. One of the last flights was to be NRT-MEL. After ticket issue, but before departure, QF canned the NRT-MEL route. I was rerouted through SYD and had 17 sectors as a result. That changed the e-ticket to a paper ticket.

(and then during the trip, issues in BKK with riots and airport shutdowns caused another reroute and a second reissue back to an e-ticket).

You can't book more then 16 sectors or more then the permitted sectors per area but if the airline changes something, they can and do ignore any ticket rules in order to re-accommodate.

+1. I flew a DONE3 with 17 segments as a result of airline cancellation & re-route.

Thanks for all the experiences. I completely credit what you've described as typical carrier actions -- what a carrier or issuer will offer -- when there is a flight cancellation or significant schedule change. No doubt a reissue -- even with a 17th segment if needed -- is what they tend to encourage.

But is that truly a passenger's only option? The Cathay COC language I quoted does seem to provide for a refund in case of significant schedule change. AA offers a similar statement ("schedule change unacceptable to customer"). And I am certain that when AA has made unacceptable schedule changes on my prior tickets, partially used, I have received pro rata refunds. I'd still like to find some authority saying that Cathay must offer such a refund, if a passenger so requests.

Thanks for these thoughts, Dr. HFH. My initial views here:

"We" should include the ticketing airline's partners, vendors, and service partners. Cathay acted on their behalf when it sold me this ticket. As an alliance member and codeshare partner, AA has a particularly strong relationship with Cathay.

Point-to-point full fares are, in my view, an unreasonable basis for calculating a fare difference. For one, the ticket I booked had additional restrictions not present on full fares -- for example, lower booking inventory, restricting on routing, reissue fee, etc. Furthermore, using full fares is manifestly unjust: After my first long-haul segment, Cathay would be able to argue that the full fare for that single segment exceeded the amount I had paid -- such that, on the reasoning you proposed, Cathay and its partners could cancel all my further flights without my being entitled to any refund at all. In my view, this demonstrates why the proposed approach of calculating a fare difference using full fares is inappropriate and impermissible, in the case of a cancellation due to schedule change / carrier cancellation. (Clearly cancellations at a customer's request are quite a different matter, and not what we're discussing here.)

I certainly see your point. I think that this is actually an interesting problem. (I'm a litigator.) However, I doubt that a sales agent would be responsible for the actions of the party whom it represented. An analogous situation might be if you booked a hotel through a travel agency and the hotel overbooked. The hotel has responsibility, but I doubt that the agency does. On the other hand, I also see this as not so clear cut. Please let us know what action(s) you take, if any, and your progress.

Even if the issuing carriers CoC says something, you're still bound by the fare rules.

But this refers to the refund due if the passenger cancels the ticket after commencement of journey - it doesn't really clarify the OP's situation where the carrier cancels a confirmed segment. But equally I have no answer.

The airline has cancelled a sector and a rerouted journey has been offered

An actually cancellation of the ticket would have to be initiated by the passenger and , depending on how much of journey has been undertaken already , once a fare for the actual journey undertaken is calculated could find that there is not much of a refund due

What you have not disclosed is what the segment cancelled is and what AA offered you.
Did you suggest any re route that was acceptable to you ?
How long after October were you aware of the change ? [that's 3 months ago]

AA should be able to reissue. Only before the first flight do you need to deal with the ticket issuer only

.....

That's a roundabout way of saying that like me you have no answer to the specific question the OP has asked ie how that calculation is made and where he can find the rules for that calculation

That's saying that it won't be, as proposed by the OP that it wont be a refund of ratio of distance travelled over total proposed travel

(quote from OP : For a partially-used ticket, I believe I’ve always received pro-rated tickets (refund in proportion to the distance of segments flown).

What it will be is a calculation for a business class ticket for the journey undertaken, which unless it is very close to start of journey likely to be close to zero

Himeno writes: "Even if the issuing carriers CoC says something, you're still bound by the fare rules."

Are you sure? If I buy an ordinary restricted nonrefundable AA coach domestic round-trip, the fare rules will surely sane nonrefundable. But if AA cancels a segment, there is no doubt in my mind that AA will offer a full refund to my oringal form of payment (among other options). And I believe they are required to do so precisely because their COC so provides (section "Involuntary Refunds"). In some respects surely COC does modify rights otherwise set out in fare rules. The documents interact in interesting ways -- sometimes directly contradictory, yes, but then it is a question of judgment to properly interpret the contradictions and determine the proper lawful result.

I think we've hit the crux of the question, Dave: Whether the method of calculation for a refund, subsequent to a carrier cancelling a confirmed ticketed segment for its own business reasons, is the "sum of the full fares" as provided in fare rules (for voluntary cancellations), or whether some other method of calculation of the refund is required in this circumstance. I still don't feel I know the answer -- and I am not convinced that the fare rules for voluntary cancellations truly dictate procedures in case of involuntary cancellations. But in any event it sounds like it's time to write to CX, see what they say, and then proceed from there.

guidance from DOT
 

In further researching this question, I found the following statements from the US Department of Transportation:

“refunds should be provided upon request to passengers who wish to cancel their trip as a result of a flight cancellation or significant schedule change made by the carrier” -- letter of 2001

"The second problem we wish to bring to your attention concerns passengers holding nonrefundable tickets or tickets that require the payment of a penalty for a change of flight time or travel date. It is our understanding that at least one carrier has been applying its nonrefundability/penalty provisions in situations in which the change of flight time or travel date has been necessitated by carrier action or "an act of god", e.g., where the carrier cancels a flight for weather or mechanical reasons. Imposing monetary penalties on passengers in these kinds of situations is grossly unfair and it violates 49 U.S.C. 41712, as would any contract of carriage or tariff provision mandating such a result. We will aggressively pursue any cases of this type that come to our attention." -- letter of 1996

I credit that neither of these statements specifically discusses calculation of the amount of a refund when a ticket has been partially used. Still, the language of the second quote could hardly be stronger -- "grossly unfair ... aggressively pursue". Calculating a fare difference using full-fares on flown segments, even when a passenger actually flew on a restricted fare with lower inventory and numerous other restrictions, would seem to fly in the face of these instructions from DOT.

I have contacted Cathay -- politely, of course, and with a brief request grounded in Cathay's COC rather than DOT rules. Will report back with any notable developments. Meanwhile, perhaps the above quotes can be useful to anyone facing a similar problem.

If the ticket was bought in Hong Kong for example USA DOT will not apply
USA law is only for the USA: not for the world
We have not got all the information IMHO: the full route as ticketed

OP - Are you trying to force a cancellation here??? rather than taking whatever rerouting is offered (given you assumedly have other segments)

If so I suspect any refund will be low (as per single fare pricing) and probably paid by CX only - I can't imagine CX has an easy way of splitting any refund across the remaining segments and carriers.


---

My only experience with CX on a semi-similar is on an ex-TPE J Class Business Saver TPE-HKG-xSYD-xHKG-TPE. Cost was about US$1500. Stopped over at Sydney and was unable to get leave for return flight within six months. Ticket cancelled and refund was US$200 which was explained to me as difference between my fare and a one way fare at time of ticketing. Admittedly it took 3days for them to work this out and they just refunded with no paperwork or anything (at the time I was ok with it as I frankly was expecting to get nothing back)

At the risk of repeating myself the OP is not cancelling the ticket he purchased . He has a confirmed reservation that the airline cannot honour, nor can it give him an alternate flight that is acceptable to him as required by the COC.
The only similar situation I have had was when I had flown the outbound segment of a return fare and the airline cancelled my return flight and wanted to put me on a flight 12 hrs later which was unacceptable to me. The fare rules stated that my ticket was not refundable but this does not give the carrier the right to keep your money if they cannot comply with their contract with you.
If I had cancelled the ticket for no reason i would have expected and received no refund. I requested a refund because of the airline's inability to provide the service. The refund I received was not the fare I had paid less the one way fare for the journey that I had completed (which would have resulted in no refund) but half the fare that I had paid ie it was prorated as the OP raised in his initial post.
While every man and his dog has provided an answer to the question what happens if I cancel my ticket for my own reasons, no-one is responding to the question that the OP is asking.
Clearly, my case where a simple return that cost less than the airline's lowest one-way tariff resulted in a 50% refund of the total ticket cost, the answer to the OP's is not as simple as what has been given here so far.

OP Needs to Sit Back and Consider Options
 

1. What does OP want for a result? It may be that he should be caerful what he wishes for. (Alternatively, what doesn't make sense to others, may make perfect sense to OP because we don't know what he wants & he doesn't say).

2. The one thing we know for certain is that OP can't fly his ticketed route. Why the carrier cancelled is of no consequence and it's immaterial. In the end, of course there's a profit motive, it's a for-profit business !

3. So what does OP want? Does OP want to be rerouted or does OP want a refund? As a technical matter, the COC of all carriers make this the carrier's option, but the fact is that I've never heard of a carrier which doesn't give the pax the first chance to see if there are acceptable alternatives.

4. If OP wants a refund, he need only decline whatever alternatives are offered, if any. His problem will be, as others note, that the calculation of refunds on intl. complex routings is murky and often leads to minimal or zero actual refund. As a starting point, rather than playing cat & mouse, get on the phone with the carrier and ask what the refund will be if OP cancels. OP can then fight about it if he doesn't like what he hears, but he might find it reasonable and not have to fight.

5. If OP wants a reroute, he should do the leg work upfront and propose the rereoute he wants. Bearing in mind the segment caps and the like, the key is to be reasonable. This is a reroute occasioned by a cancellation so any rule is waiveable. But, if what took 1 segment before now takes 5, that won't likely work.

6. All of this speaks to getting on the phone, not email and speaking with real live people to achieve the result OP wants. Right now sounds like games playing which always ends badly for the pax. The one thing carriers do well is enforce their own rules once things get bounced to their regulatory people which is where OP is headed.

So, like any good strategist, how to turn lemons into lemonade? Figure out what you want and devise a path to get there rather than simply stumbling from step to step just because you can.

Mwenenzi, do you have any authority (law, regulation, staff policy statement, etc.) for the proposition that US law and regulation does not apply to a ticket bought elsewhere for travel to/from/via the US? I believe you're mistaken. I see no such statement anywhere in applicable DOT rules. Indeed, I see statements precisely the opposite.

Often1 and Moa999, thanks the thoughts. I agree that it's time to contact CX, which is why I did so yesterday. Often1, you're right that I haven't said much in this thread about what I want for a result, but I feel that's my prerogative. Clearly my discussions with CX will be different, as I need to tell them exactly what outcome I seek (and I have done exactly that). Meanwhile, anyone similarly situated, in case of future cancellation or significant schedule change, can look to this thread for insights into passengers' rights in this situation. What I ultimately choose to do is of lesser interest to others, I would think. But clearly I'm thinking about refund rights, not just reroute rights, and I'm thinking about that because it's a potentially-desirable outcome under these circumstances -- albeit of course more desirable if the refund is substantial and less so if the refund is zero or tiny; hence the need to try to figure out how the refund would be, and should be, calculated.

It's a CX-issued ticket for a flight on AA. AA cancelled. I don't see CX refunding anything until it finds out how much AA will reimburse it.

That is simply that the US cannot apply such laws extra territorially; the DOT has no legal authority to make laws in Hong Kong

I disagree. By all indications, the DOT has authority to regulate behavior occurring in the US. And customer service matters pertaining to travel in or via the US are well within the authority the DOT has long enforced.

The DOT has numerous rules that explicitly regulate the conduct of foreign air carriers when they serve the US. See e.g. the Notice of enforcement policy: oversale notice for foreign carriers. By its plain language, this rule covers "foreign air carriers", and nothing in the rule suggests that this rule benefits only passengers originating in the US.

Analagously, many folks here may be familiar with EU rules on air travel disruptions. Those rules benefit even non-EU citizens when flights arrive, depart, or connect in the EU.

Nothing of this offends my sense of extra-territorial application of law.

Bedelman, by his own statements, admits that he is simply toying with FT. As others point out, he's going to have a rude awakening when speaking with CX and would be far better off armed with some good suggestions (something with which FT can be very good) from others who have experienced roughly the same situation.

As to DOT, it's by no means an extraterritorial application of law (which, by the way, isn't unlawful). If the ticket was purchased in the USA, originates or terminates, DOT authority is clear. Beyond that, non-USA carriers which are theoretically beyond DOT's reach, agree to regulation as a condition of a license to conduct any commercial operations here.

But, in the end, it's AA which cancelled the flight and all comes back to AA and how OP interacts.

No way is it "toying with FT" to take the time to research one's rights and see whether others have insight into applicable law and regulation.

Depending on passenger rights in this situation (precisely the subject of the thread!) we could be talking about a refund of a sizable fraction of a ~$8000 ticket. (I say that realizing that some folks here think a refund would be much less, or zero, but there's surely at least a plausible argument to the contrary.) I would be crazy to call CX on a whim without doing appropriate research first. What if CX tells me my rights are only X, and I then accept X, when in fact by law I'm entitled to Y if I prefer, and would in fact have preferred Y? There's absolutely nothing wrong with learning what I'm entitled to so I can tailor my request accordingly.