Not a lawyer, but as far as I know there is no requirement to prove negligence under the Montreal convention. All you (or your family) have to prove is you were a passenger and suffered a loss. The convention serves as a global safety net to cover people who may not be able to access legal representation. There are a number of trade offs in return for this waiver from the usual requirement to demonstrate negligence - the cap, and a 2 year statute of limitations.
It is only for claims in excess of this cap (USD $170000 approx) that negligence has to be established.
Not sure about the details of the earlier Warsaw convention.
Presumably AA have cover to meet Montreal convention payments, and presumably also cover for negligence claims in excess of this.
However I wonder if authorities may be concerned there may be sufficient grounds for Allianz to deny (or at least seek to deny) cover. This could explain the finger pointing which otherwise seems unusual. The comment about wanting people to sue AA seems particularly odd.
Last edited by slats11; 5th Jan 2015 at 10:31.