The world is yet to recover from the shock of Malaysia Airlines Flight MH17. It was a very sad day for aviation and I sincerely hope the culprits shall be brought to book.

I have taken time to read the Montreal Convention (The Convention) and liability of carriers in such situations. Malaysia is one of the 107 states that are parties to the Convention.

The carrier is liable under Article 17 of the convention for the death of passengers if the accident that caused the death took place on board the aircraft, or in the course of any of the operations of embarking or disembarking. Contributory negligence or any wrongful act or omission on part of a passenger exonerates the carrier from any liability.

In the event that liability is established, it is limited to 113,000 Special Drawing Rights (SDR), approximately USD 175,000 (for each passenger), and the carrier is not entitled to limit its liability for any compensation not exceeding 113,000 SDR.

The carrier is not entitled to pay any amounts in excess of 113,000 SDR if it proves;

a) Such damage was not due to the negligence or other wrongful act of the carrier or its servants or agents; or
b)
b) Such damage was solely due to the negligence or other wrongful act or omission of a third party.

Further, the carrier may have to make an advance payment to persons entitled to make claims to meet their immediate economic needs. This however, is subject to local legislation enactments.

Despite having been shot down, Malaysian Airlines has an obligation to compensate families of the victims up to 113,000 SDR as discussed above, a clearly very tough time for the carrier. The Convention makes compensation mandatory to ensure that payment is guaranteed, certain and predictable.

In the future, airlines may have to re consider flying over war zones or conflict areas. Although it is mandatory under the convention for carriers to have adequate insurance to cover their liability, insurance companies may in the future, restrict airlines to routes and flight paths that do not lead them into or over war zones/conflict areas. It is foreseeable in the wake of the MH17 tragedy that we might see such an amendment to the convention.