Boyar v. Korean Air Lines

• Decision Date: 27 February 1987
• Docket Number: 84-2629 and 84-2627.,Civ. A. No. 85-3444
• Citation: 664 F. Supp. 1481
• Parties: Robert M. BOYAR, et al., Plaintiffs, v. KOREAN AIR LINES, Defendant. Evelyn A. CHAUNCEY, as Ancillary Administrator c.t.a. of the Estate of Carol A. Grenfell, Plaintiff, v. KOREAN AIR LINES, Defendant. Evelyn A. CHAUNCEY, as Ancillary Administrator c.t.a. of the Estate of Neil John Grenfell, Plaintiff, v. KOREAN AIR LINES, Defendant.
• Court: U.S. District Court — District of Columbia

664 F. Supp. 1481

Robert M. BOYAR, et al., Plaintiffs, v. KOREAN AIR LINES, Defendant.

Evelyn A. CHAUNCEY, as Ancillary Administrator c.t.a. of the Estate of Carol A. Grenfell, Plaintiff, v. KOREAN AIR LINES, Defendant.

Evelyn A. CHAUNCEY, as Ancillary Administrator c.t.a. of the Estate of Neil John Grenfell, Plaintiff, v. KOREAN AIR LINES, Defendant.

Civ. A. Nos. 85-3444, 84-2629 and 84-2627.

United States District Court, District of Columbia.

February 27, 1987.

COPYRIGHT MATERIAL OMITTED

Juanita M. Madole, Speiser, Krause & Madole, Washington, D.C., for plaintiff in Civ. A. No. 85-3444.

Desmond T. Barry, Jr., George N. Tompkins, Jr., Condon & Forsyth, Washington, D.C., for defendant.

Harold A. Kurland, Kathleen A. Frensky, Nixon, Hargrave, Devans & Doyle, Washington, D.C., for plaintiff in Civ. A. Nos. 84-2629, 84-2627.

MEMORANDUM OPINION

AUBREY E. ROBINSON, Jr., Chief Judge.

This matter comes before the Court on Defendant KAL's Supplements to its Motion for Entry of Orders of Dismissal. The above-captioned cases are pending in this Court as a result of the shootdown by the Soviets of KAL Flight 007 in 1983. Defendant's supplements once again call into question the scope of the jurisdictional provisions of the Warsaw Convention.¹

Article 28(1) of the Warsaw Convention provides that:

An action for damages must be brought, at the option of the Plaintiff, in the territory of one of the High Contracting Parties, either before the court of the domicile of the carrier or his principal place of business, or where he has a place of business through which the contract has been made, or before the court at the place of destination.

Involved in these actions is a determination of the "place of business through which the contract has been made." Whether the United States is an appropriate forum for each case will, of course, turn on its individual facts. Underlying this determination, however, must be the recognition that Article 28 was intended to limit rather than broaden the jurisdiction of the nations adhering to the Warsaw Convention. The facts in all the cases appear to be undisputed.

Facts

The Lee Action

Jeong Bong Lee purchased a ticket in Seoul, South Korea from Northwest Orient Airlines. His trip was to begin and end in Seoul with one intermediate stop in Tokyo and six in the United States. The first two legs of the flight, Seoul-to-Tokyo and Tokyo-to-Los Angeles, were booked on Northwest Orient Airlines. The other segments of the ticket were left open as to date, carrier and flight. Mr. Lee paid the fare for the entire journey in Seoul at the time the ticket was issued.

On August 30, 1983, the New York office of KAL received a telephone call from a travel agent on behalf of Mr. Lee seeking to book space on that day's flight from New York to Seoul. The reservations agent reserved space for Mr. Lee on Flight 007. KAL did not issue a new ticket at this time because New York-to-Seoul was already listed as the final leg on Mr. Lee's original ticket. For the same reason, no new fare was paid.

In September, 1983, KAL billed Northwest Orient for Mr. Lee's fare, requesting payment in U.S. dollars. Northwest Orient is incorporated in the United States and has its principal place of business here.

The Grenfell Actions

Neil John Grenfell and Carol A. Grenfell, husband and wife, planned to travel from New York to Seoul on August 14, 1983. KAL issued tickets to them in April, 1983 which listed the August 14 date. These tickets were issued in Hong Kong.

The Grenfells did not take the August 14 flight. Instead, Mr. Grenfell, who was employed by the Eastman Kodak Company, asked Kodak's International Reservations Agent in Rochester, New York, to change the flight to August 31, 1983. The Kodak travel agent arranged with an independent travel agency in Rochester to book the Grenfells on KAL Flight 007. This travel agent made the reservations by calling a KAL reservations agent in New York City. Once this process was completed, the Kodak travel agent applied stickers to the tickets the Grenfells has been issued in Hong Kong indicating the new dates and flight numbers. No new tickets were issued and the Grenfells were not required to pay any additional fare.

The Park Action

Heung Sul Park travelled to the United States from Seoul, South Korea on a round-trip ticket paid for by his sister-in-law, Mrs. Seung Za Rhee. Mrs. Rhee, a resident of Broomfield Hill, Michigan, arranged for Mr. Park's transportation by visiting Detroit Travel Service, an authorized agent of KAL, located in Highland Park, Michigan. She gave the travel agent a check in the amount of $3,000.00 to pay for two round-trip flights with the following itinerary: Seoul-to-New York-to-Detroit-to-New York-to-Seoul.²

Mrs. Rhee's check was endorsed by the Detroit Travel Service and negotiated at a bank in Detroit. Although the travel agent could have issued the two tickets on KAL ticket stock and given them to Mrs. Rhee at the time of payment, Mrs. Rhee decided instead to use a KAL procedure called the prepaid ticket system which would enable the Parks to pick up their tickets at the airport in Seoul. Use of this system cost Mrs. Rhee $5.00. The Detroit Travel Service notified KAL's Chicago office that it wished to arrange for the two tickets and sent to the office a check for the amount of the two fares. This check was deposited in KAL's revenue account in Chicago.

In order to initiate the prepaid ticket system, KAL's Chicago office prepared a miscellaneous charges order (MCO) for the Parks. The primary purpose of this form is to notify KAL's headquarters office in Seoul that a fare had been paid in the United States for prepaid tickets. After the MCO was prepared and validated by the appropriate KAL stamp in Chicago, the Chicago office sent a telex (called a prepaid ticket advice (PTA)) to KAL's prepaid ticket desk in Seoul giving the information necessary to issue the appropriate tickets to the Parks. KAL's Seoul office issued the tickets and notified the Parks, who picked up the tickets at the airport. They were not required to pay any additional fare. The Parks then travelled to the United States.

The tickets prepared for the Parks did not contain any return date or flight number information. On August 15, 1983, an agent at Detroit Travel Service called KAL's New York reservations office to book space for the Parks' return flight. They were booked on KAL Flight 007 from New York to Seoul.

Issue Presented

Although the cases involved in the Motion before the Court involve different factual situations, all of them require an answer to the question "when is a contract for air carriage formed?." Frequently, this question is easy to answer, for example, when a passenger buys a ticket for a particular flight at his or her point of departure from the carrier who then provides the service described on the ticket. Obviously, none of the scenarios presently before the Court are so clear-cut.

Defendant seems to argue that in no circumstance can there be a contract between an airline and a passenger before the issuance of a passenger ticket. In short, KAL argues that the passenger ticket is the contract of which Article 28(1) speaks. Furthermore, KAL's position is that the location where a ticket is issued controls the jurisdictional question of Article 28(1) regardless of whether the passenger takes a different flight from the one set forth on the ticket, purchases a ticket which is open as to flight or carrier, or pays for the ticket and gives all of the necessary information for its issuance in another jurisdiction.

Plaintiffs on the other hand, argue that a ticket is merely evidence of the contract into which the airline and the passenger have entered. They appear to further suggest that the contract itself cannot be formed until the passenger selects and the airlines books the particular flight on which the passenger will actually travel.

Analysis

The parties have presented no cases, and the Court has found none, which factually parallel the actions sub judice. Dicta from other Warsaw Convention cases, however, provide guidance in the determination of this issue.

The Court is of the opinion that a passenger ticket is not itself the contract to which the jurisdictional provision of the Warsaw Convention refers. The Court in Block v. Compagnie Nationale Air France, 386 F.2d 323 (5th Cir.1967) aptly described the contractual relationship upon which "the applicability of the Convention undeniably is premised:

It is based on a contract of carriage that arises from the relationship between a `carrier' and the passengers. This contractual relationship requires only that the carrier consent to undertake the international transportation of the passenger from one designated spot to another, and that the passenger in turn consent to the undertaking."

Id. at 330-331. The Court went on to say of the passenger ticket that it "was not the contract but its issuance evidenced the contractual relationship between (the parties)." Id. at 336. This position is supported by Article 3(2), of the Warsaw Convention which states that "the absence, irregularity, or loss of the passenger ticket shall not affect the existence or the validity of the contract of transportation." Although KAL has cited other cases which use the words "contract" and "ticket" interchangeably, none of these cases faced the necessity presented here of determining the definition of "contract" that was contemplated by those who drafted the Convention. As previously stated, in most situations, the place that the ticket is issued is also the place where the mutual consent of the parties or the "sale and purchase of transportation" occurs. Id. at 331, 334. But the Court believes that this is a factual determination to be made on a case-by-case basis.

The second question before the Court, which is presented by the Lee and Grenfell actions, regards the circumstances which terminate, as opposed to...