The Supreme Court has handed down judgment in Lipton v BA Cityflyer Ltd [2024] UKSC 24. The appeal concerned whether the illness of a crew member is an “extraordinary circumstance” for the purposes of the air passenger flight compensation regulation, Regulation (EC) No 261/2004, and the effect of Brexit on causes of action which accrued prior to 31 December 2020 (“IP completion day”).

Regulation 261 provides passengers with a right to compensation from airlines for flight cancellations and long delays but subject to a defence where the cancellation or delay is caused by extraordinary circumstances. In its first judgment on the extraordinary circumstances defence, the Supreme Court has held that the sudden illness of a crew member is not an extraordinary circumstance. In so doing, it considered and adopted the analysis of the concept of ‘extraordinary circumstances’ from CJEU decisions made prior to IP completion day. The decision will be important for all future cases concerning the defence.

The court also considered an issue of much broader significance concerning how the courts are to decide cases involving causes of action that accrued under EU law prior to IP completion day. On that day, under the European Union (Withdrawal) Act 2018, EU regulations such as Regulation 261 were incorporated into UK law as ‘retained law’ and many regulations, including Regulation 261, were amended at the same time. In the Court of Appeal, Green LJ held that courts should apply the UK regulation as amended to events occurring prior to IP completion day. On appeal on this point, the Supreme Court unanimously held that this was wrong. By a majority of 4:1, it was held that the EU Withdrawal Act retained in UK law both Regulation 261 and any causes of action which had accrued under it and that the courts should apply the ‘retained’ law but without reference to any amendments made on IP completion day. In his dissenting judgment, Lord Lloyd-Jones held that the courts should instead apply the EU law itself as it was in force at the time of the relevant events.

This aspect of the decision is important for all claims brought for causes of action under EU law that accrued prior to IP completion day and provides important guidance for how retained EU law, and the EU Withdrawal Act itself, is to be interpreted.

The press summary is available here and the judgment is available here.

Akhil Shah KC and Nicolas Damnjanovic acted for the Appellant, BA City Flyer, instructed by Robin Springthorpe of Norton Rose Fulbright LLP.