The UK’s High Court has dismissed an application from a solicitors’ firm that wanted to be indemnified for fees they failed to collect from customers who were paid compensation directly by Ryanair for delayed or cancelled flights.
Bott & Co Solicitors, which handles personal injury claims, holiday claims and flight delay compensation claims, had alleged Ryanair damaged the firm’s “business model, goodwill and revenues” when it started directly dealing with customers’ claims that had been initiated by Bott on their behalf.
The court ruling states that Bott began handling flight delay compensation claims in February 2013, since then it has acted on some 125,000 claims, and its business model is “based on the processing of a high volume of low value claims”.
The average gross compensation received by a customer of Bott is about €327, while the average fee paid to Bott per claim is about €109.
While the firm used to deal with Ryanair, in February 2016 Ryanair instituted a policy of dealing directly with customers.
“Bott no longer knew whether Ryanair was disputing or had paid a claim. In relation to claims that had been paid, Bott no longer knew whether the claim had been paid in the correct amount,” the ruling stated.
This then left Bott in a situation where it had to follow up on claims with its clients, and it found that of the customers who had made a successful claim against Ryanair, only about 70% paid Bott for its work.
Given the small fees involved, Bott said it was not “administratively or financially feasible” to pursue enforcement proceedings against non-paying clients.
However, Judge Edward Murray ruled that “Ryanair has established a straightforward and easy-to-use process for its passengers to make their flight delay compensation claims, either on-line or by correspondence, without the assistance of a third party”.
“Ryanair is not obliged to pay compensation directly to Bott in relation to claims submitted by Bott on behalf of its clients to Ryanair,” said Judge Murray.
Ryanair’s Kenny Jacobs said. “This will help prevent ‘claims chaser’ firms deliberately and needlessly dragging consumers through the courts so they can grab more than 40% of customers’ compensation, for providing no useful service.”
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