Theft of $20 million in gold bars at Pearson Airport: Air Canada will pay less than $19,000

The Federal Court ruled Monday in favor of Air Canada in the case of the spectacular theft of gold bars and bank notes that occurred at Toronto’s Pearson Airport in April 2023. Although the value of the stolen goods rose at more than $22 million, the airline will only have to pay about $19,000 to security firm Brink’s.

Air Canada’s liability for loss of stolen cargo is limited to [environ 41,33 $ CAD] per kilogram, i.e. [environ 16 553 $ CAD] for the cargo of gold and [environ 2211 $ CAD] for the cargo of banknotesfor a total of approximately $18,764, writes Judge Cecily Strickland in its decision rendered on January 20.

Air Canada immediately admitted its responsibility for the theft. Air Canada admitted to being strictly responsible for the damages sufferednotes the judge. However, this responsibility is governed by the Montreal Convention, which establishes international rules for air transport.

The theft detailed in the decision

The facts date back to April 17, 2023. According to the decision rendered on Monday, the Swiss bank Raiffeisen and the precious metals refining company Valcambi SA had entrusted Brink’s with the mandate to transport from Zurich to Toronto a cargo of 400.19 kilograms of ingots gold worth 13.6 million Swiss francs (approximately $21.5 million CAD) and a cargo of 53.18 kilograms of bank notes worth 1.9 million US dollars (approximately $2.7 million CAD).

Flight AC881 landed in Toronto around 3:56 p.m. The shipments were stolen shortly after arriving at their destination while at Air Canada Cargo facilities at the international airport Pearson from torontoreports the judge. The suspect(s) allegedly came into possession of the shipments after presenting fraudulent air waybills to Air Canada employees.

The regional police of Peelwhich is leading the investigation in Canada, has since identified and charged or issued arrest warrants for 10 individuals, who face more than 21 charges. Among the suspects is a former Air Canada employee who worked for the carrier at the time of the flight.

However, we read in the decision handed down on Monday, Brink’s has already reimbursed its customers: the security firm claims to have paid a sum of 1,734,835 Swiss francs to Raiffeisen and a sum of 14,988,920.58 US dollars to Valcambi in as compensation.

The Montreal Convention applies

The crux of the matter lies in Article 22 of the Montreal Convention, an international treaty that governs the liability of air carriers. According to this article, the liability of the carrier in the event of destruction, loss, damage or delay is limited to the sum of [environ 41,33 $ CAD] per kilogram, unless special declaration of interest in delivery made by the sender at the time of delivery of the package to the carrier.

For a special declaration of interest to have concrete effect, it must designate or include the monetary value of the goodsexplains the judge Strickland in his decision.

However, Brink’s had registered S.V.D. (without declared value) on the air waybill. And therefore, she concludes, the carrier’s liability is calculated using the weight of the package.

Ironically, the judge Strickland ordered Brink’s to reimburse Air Canada’s legal costs. Air Canada is entitled to costs for its response to the motion for summary judgment and for its cross motion for summary judgmenty lit-on.