Court rejects Air Canada’s ‘remarkable’ denial of liability regarding misinformation by its chatbot

By Anosha Khan ·

Law360 Canada (February 16, 2024, 4:38 PM EST) -- The British Columbia Civil Resolution Tribunal has found Air Canada liable for incorrect information provided by its chatbot to a customer who relied on the chatbot’s information to book flights for bereavement.

In Moffatt v. Air Canada, 2024 BCCRT 149, released Feb. 14, the applicant Jake Moffat booked a flight with Air Canada in November 2022 following their grandmother’s death. Moffat used a chatbot on respondent Air Canada’s website, which suggested that bereavement fares could be applied for retroactively. However, Moffat was later informed by Air Canada employees that the airline did not permit retroactive applications.

Moffat said the airline must provide a partial refund of the ticket price because of the chatbot’s advice, claiming $880 for the price difference between regular and alleged bereavement fares. Air Canada posited that Moffat did not follow the proper procedure to request bereavement fares.

“In effect, Air Canada suggests the chatbot is a separate legal entity that is responsible for its own actions. This is a remarkable submission,” said tribunal member Christopher Rivers.

“While a chatbot has an interactive component, it is still just a part of Air Canada’s website. It should be obvious to Air Canada that it is responsible for all the information on its website. It makes no difference whether the information comes from a static page or a chatbot.”

Moffat engaged with the chatbot to inquire about flying from Vancouver to Toronto. The chatbot issued the following response:

“Air Canada offers reduced bereavement fares if you need to travel because of an imminent death or a death in your immediate family. …

“If you need to travel immediately or have already travelled and would like to submit your ticket for a reduced bereavement rate, kindly do so within 90 days of the date your ticket was issued by completing our Ticket Refund Application form.”

The chatbot underlined bereavement fares, hyperlinking it to the Air Canada webpage regarding same. The webpage noted that “the bereavement policy does not apply to requests for bereavement consideration after travel has been completed.”

Moffat booked a departing and returning flight relying on the information given by the chatbot. While Moffat spoke to a representative about what the bereavement discount may be, there was no evidence of discussion of a retroactive application.

Moffat’s trip was from Nov. 12 to 18, 2022, and he filed a first application on Nov. 17. Air Canada notified Moffat that the chatbot had provided “misleading words” and that Air Canada noted this issue to update the chatbot accordingly.

Rivers said that while Moffat did not use the words specifically, negligent misrepresentation was what was being alleged. He found Air Canada owed Moffat a duty of care as service provider and consumer.

The tribunal noted that Air Canada did not explain why its bereavement travel webpage was more trustworthy than its chatbot. Reasonable care was not taken to ensure accuracy of the chatbot, nor was it explained why customers should have to double-check information.

Air Canada further relied on certain contractual terms from its Domestic Tariff but did not provide the actual contract in its submissions so the terms could not be considered. Rivers said that Air Canada was “best positioned to provide evidence about what the bereavement fare would have been.” Since it did not do so, adverse inference had to be drawn.

“Mr. Moffatt says, and I accept, that they relied upon the chatbot to provide accurate information. I find that was reasonable in the circumstances. There is no reason why Mr. Moffatt should know that one section of Air Canada’s webpage is accurate, and another is not,” said Rivers.

“Mr. Moffatt says, and I accept, that they would not have flown last-minute if they knew they would have to pay the full fare. I find this is consistent with Mr. Moffatt’s actions, which included investigating the options for bereavement fares and diligently following up for a partial refund in line with the chatbot’s information.”

After calculation, Moffat was entitled to damages of $650.88 with pre- and post-judgment interest, along with reimbursement of tribunal fees. The applicant was awarded $812.02

Air Canada said it was in receipt of the ruling and will comply with it, saying it had no additional information as it considered the matter closed.

The applicant was self-represented.

Air Canada was represented by an employee.

If you have information, story ideas or news tips for Law360 Canada on business-related law and litigation, including class actions, please contact Anosha Khan at anosha.khan@lexisnexis.ca or 905-415-5838.