Jetsgo must refund taxes and service charges in "non-refundable" ticket
GLOBEANDMAIL.COM
Jetsgo told to refund surcharges, taxes on non-refundable tickets
Canadian Transportation Agency ruling could have far-reaching implications
By PAUL WALDIE
UPDATED AT 2:21 PM EDT Monday, Jul 12, 2004
Airline tickets are not as "non-refundable" as they used to be, thanks to a ruling by the Canadian Transportation Agency.
In a recent decision, the federal tribunal ordered Montreal-based Jetsgo Corp. to refund all the taxes and extra service charges the airline included in a non-refundable ticket it sold to an Ottawa customer. The ruling could have far-reaching implications because most other airlines, including Air Canada and WestJet Airlines Ltd., offer non-refundable tickets.
The case involved Graeme Doré, who bought a ticket between Ottawa and Toronto last August from Jetsgo. The ticket cost $167.02, of which $38 was the base fare, with the remainder allotted to the airport improvement fee, the air travellers security charge, a NavCanada charge, a fuel surcharge and sales tax.
Mr. Doré cancelled the ticket and asked for a refund. Jetsgo refused but said he could apply the cancelled ticket as a credit on future travel for up to one year.
Mr. Doré complained to the CTA, arguing that Jetsgo had the right to withhold only the base fare, not the taxes and surcharges. Jetsgo argued that its rules and policies clearly state all tickets are non-refundable.
The airline added that "the air transportation industry is no different than any other commercial sector in respect of a non-refundable policy, and that, in many cases, a customer does not have the option of a credit," according to documents filed with the tribunal.
The agency sided with Mr. Doré and said Jetsgo's refund policies related only to the base fare. It noted that Jetsgo's "own domestic tariff does not consider a 'fare' to be inclusive of the total amount paid for the purchase of a ticket." The agency also pointed out that the airline's regulations state that it adds surcharges to "each fare-paying passenger."
The agency ordered Jetsgo to refund all taxes and surcharges. Since Mr. Doré received a refund of $13.16 from the federal government for the security charge, the agency ruled Jetsgo owed him $115.86.
Brad Cicero, a Jetsgo spokesman, said the airline has refunded that amount to Mr. Doré. "As far as policy going forward, for anybody who finds themselves in that situation, we will, on request, issue cheques in the amount of the taxes," he said.
Mr. Cicero added that passengers will still be able to credit any unused tickets toward future travel on Jetsgo for up to a year. "If they find they get to the stage a year down the road and they haven't had an opportunity to book another flight, then they will have that option of getting the taxes refunded," he said.