B.C. Judge Dismisses WestJet Class Action Over Travel Credits

Update:

• A proposed class action lawsuit over expiring WestJet credits was dismissed by the B.C. Court of Appeal.
• The court reversed a decision to certify the class action lawsuit over WestJet’s one-year expiry policy for “travel bank credits,” saying they’re not equivalent to gift cards and don’t fall under the same consumer protection laws, according to CBC.
• Appeal Court Justice Patrice Abrioux said the lower court judge erred in her approach.

(December 23, 2020)

The British Columbia Supreme Court has approved a class action lawsuit that challenges WestJet’s policy of issuing travel credits that expire after one year.

WestJet travel credits are issued through the airline’s travel bank program. According to the WestJet class action lawsuit, tens of thousands of travelers have either had their WestJet travel credits expire or have had to pay for an extension.

WestJet Travel Credits are Allegedly Gift Cards and Should Not Expire

Plaintiff Tiana Sharifi of Vancouver argues that the WestJet travel credits are legally gift cards, which are prohibited by law from expiring.

Sharifi says she booked two round-trip WestJet flights from Vancouver to Paris in January 2018. She cancelled the flights in May 2018 and received a $993.23 credit from WestJet, which imposed a one year expiry on the credit.

Sharifi used a portion of the WestJet credit on a trip to Calgary, but she lost about $400 in remaining travel credit when it expired.

According to the WestJet travel credit class action lawsuit, the airline’s travel bank program issues “hard” credit for flight changes or cancellations and “soft” credits for issues like lost luggage and customer dissatisfaction. Travelers can pay $20 to extend their hard credits for an extra year. Soft credits reportedly cannot be extended.

Consumer protection laws in many of Canada’s provinces prohibit companies from imposing expiry dates on prepaid purchase and gift cards, the WestJet class action lawsuit claims. Sharifi argues that WestJet’s travel credits should be legally treated as gift cards and therefore should not expire.

WestJet Maintains Travel Credits are Not Gift Cards

B.C. Supreme Court Justice Amy Francis noted in her ruling that no decision about the merits of the WestJet class action lawsuit had been made; she simply determined that the case could proceed as a class action lawsuit.

Gabor Lukacs, an air passenger rights advocate, told CBC News that he was glad the WestJet travel credit class action lawsuit had been approved.

“Airlines are unjustly enriching themselves by taking the money of passengers and after 12 months, just pocketing it without providing any services in return,” Lukacs said.

WestJet has opposed the certification of the travel credit class action lawsuit and argues that it is “plain and obvious” that its travel credits are not a gift card or a prepaid purchase card. According to WestJet, the policy is similar to a store credit for a retail purchase which can be time-limited.

Air Canada is facing a similar class action lawsuit over allegations the airline’s flight passes meet the definition of a prepaid card. In 2019, the Quebec Superior Court determined that the case was not suitable to move forward as a class action lawsuit because the provinces have different consumer protection laws.

However, Quebec’s Court of Appeal disagreed and will allow the Air Canada class action lawsuit to proceed.

Airlines Face Mounting Legal Issues During COVID Crisis

Numerous industries have taken an unprecedented financial hit due to the COVID-19 pandemic, and airlines are no exception. The COVID-19 crisis has caused widespread disruption to the airline industry, including flight cancellations. Many airlines have responded by issuing travel credits instead of refunds, which many customers believe is an inadequate remedy for an uncertain future.

On Nov. 8, the Minister of Transport announced that federal support for Canada’s airline industry would be contingent on the airlines issuing refunds to travelers whose flights were cancelled due to the COVID-19 pandemic.

A COVID-19 plane ticket refund class action lawsuit was launched against five Canadian airlines seeking refunds for flights that were cancelled due to COVID-19 travel restrictions imposed by the federal government.

WestJet Says It Will Issue Refunds for Some Flights Cancelled Due to COVID-19

In October, WestJet announced that it would issue refunds to some customers whose flights were cancelled due to the COVID-19 pandemic. The airline says it was not prompted by the government to issue the refunds.

WestJet president and CEO Ed Sims sent an open letter to MPs and senators earlier this month, stating that the airline “took this action without any prompting from the government because it remains the right thing to do and we did so at the very first opportunity.”

Have you had airline travel credits that expired? Do you believe the airline travel credits should be treated like gift cards that don’t expire? Let us know what you think in the comments section below.[/vc_column_text][/vc_column][/vc_row]