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Friday, March 28, 2014

China airlines also liable for MH370


With angry pictures of Chinese families accusing Malaysia and Malaysia Airlines of neglect and murder filtering in from Beijing, many in Malaysia are now asking why China Southern is not bearing part responsibility.

This is because MH370 was also marketed as China Southern Airlines Flight 748 (CZ748), with many of the 152 Chinese nationals on board holding China Southern tickets.

The Montreal Convention, which governs civil aviation, states that both the contracting carrier and the actual carrier can be held liable for injury, death and losses on board.

In this case, MAS is the actual carrier while China Southern is the contracting carrier, and passengers next-of-kin can seek damages from either airline.

The Montreal Convention - formally known as the Convention for the Unification of Certain Rules for International Carriage by Air - has been ratified by both China and Malaysia.

Legal precedent in the United States also states that both airlines in a code share agreement can be held liable.

In one case, a passenger purchased a ticket from American Eagle Airline but boarded a flight operated by Executive Airlines due to a codeshare arrangement.

He fell out of the airplane as he was trying to get the attention of baggage handlers, in order to check in his carry-on baggage which was found to be too large to fit the overhead cabin.

The court found that in this case, both airlines were liable with the contracting airline liable for the whole carriage and the actual carrier for the portion it performs.

In the case of MH370, there has been scant or no news of how China Southern has responded to families of passengers who had purchased the tickets through the airline.

Differing results in US and China

Terry Rolfe, an aviation practice experts from Integro Insurance Brokers told CNBC that any MH370 claim brought in the US court system could lead to a pay out of at least US$8 million (RM 26.2 million) per passenger.

The figure is estimated to be significantly lower, at less than US$ 1 million (RM3.28 million) per passenger, in the Chinese courts.

To date, no lawsuits have been filed against any airline following the disappearance of MH370 on March 8.

A party purportedly related to Indonesian passenger Firman Chandra Siregar, via a Chicago law firm has, however, submitted a petition to obtain information from MAS and aircraft manufacturer Boeing in a prelude to legal action.

However, Firman's brother-in-law Clemens Triaji Bektikusuma, on behalf of Firman's family, however, denied that the family has hired the American law firm or made any petition.

He added that Januari Siregar, named in the petition, has no authority from the 24-year-old engineer's family.

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