The TWA crash in mid-July underscores the uncertainty that still surrounds airline liability, despite progress made on Iata's voluntary agreement on unlimited liability.
The agreement was signed after the crash, so won't affect claims against TWA. But the carrier could still follow the example of American Airlines, which decided last year to waive liability limits on its crash in Colombia. American chose that course to avoid the expense and adverse publicity of any potential litigation - the reasoning behind Iata's accord. TWA reportedly has liability coverage of $500 million.
Iata has since sought US Department of Transportation approval for its accord, in the hope that the November implementation date can still be met. But a green light from Washington is no certainty. The US has always insisted that any pact allow the families of victims to sue in their home country regardless of origin and destination of the flight. This condition is not explicit in the intercarrier agreement, as many airlines are wary of US juries.
Aside from banning punitive damages, Iata will leave the question of what damages are recoverable up to the respective court. Even if the US had approved the intercarrier agreement and TWA had signed it before the crash of Flight 800, the carrier would still have faced uncertainty on this issue.
In January, the US Supreme Court ruled that US law did not cover claims for indirect damages for accidents on the high seas. A row is now brewing over where TWA's crash occurred. A 1920 US law measured 'the high seas' as three miles offshore, but the US has since extended its territorial limits to 12 miles. TWA 800 crashed 7 miles off New York's Long Island. No case has yet decided whether the extension of territorial limits also moved the boundary of the high seas. TWA's lead insurer claims it did not; Iata's chief counsel believes it did.
David Knibb
Source: Airline Business
