Air Canada had to pay for its chatbot's bereavement advice

A chatbot on a company's website is the company speaking. The British Columbia Civil Resolution Tribunal treated it that way in a small claim, and the reasons are specific enough for a manager to use on a live assistant.

The decision is Moffatt v. Air Canada, 2024 BCCRT 149, issued on 14 February 2024 by tribunal member Christopher C. Rivers, file SC-2023-005609. Jake Moffatt was self-represented. Air Canada was represented by an employee. The question was whether Air Canada had negligently misrepresented the procedure for bereavement fares, and what the remedy was if it had. The member mostly allowed the claim.

On 11 November 2022 Mr. Moffatt's grandmother died in Ontario. The same day, Mr. Moffatt went to Air Canada's website to book Vancouver to Toronto on a bereavement fare. The decision records that the airline does offer reduced fares when a passenger travels because an immediate family member has died. Two places on the site then gave different accounts of how to claim one.

Mr. Moffatt used a support chatbot. Air Canada told the tribunal nothing about what the system was. The member describes a chatbot, in general, as an automated system that answers prompts from a person using the website. The parties agreed this was not a conversation with an employee. The screenshot quoted the bot in part. 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 you have already travelled and want the ticket submitted for a reduced rate, do so within 90 days of issue by completing the Ticket Refund Application form.

The words "bereavement fares" were a highlighted link to a page titled "Bereavement travel". Air Canada filed part of that page. It said the bereavement policy does not apply to requests made after travel has been completed. The bot invited a retroactive application inside 90 days. The linked page said the policy does not apply once travel is over.

Mr. Moffatt booked on the bot's account. On 11 November, Vancouver to Toronto, departing 12 November, for $794.98. On 16 November, Toronto to Vancouver, departing 18 November, for $845.38. On 11 November a phone agent put the bereavement fare at about $380 each way. Nothing in the evidence shows that the agent said whether a claim could be made after travel. The first written application went in on 17 November 2022, inside the 90 days. Correspondence then ran through December 2022 and February 2023. On 5 February Mr. Moffatt sent the screenshot, confirmed the refund form, and said a death certificate had been provided. On 8 February a representative admitted the chatbot had used "misleading words", pointed back at the bereavement page, and said the airline had noted the issue so the bot could be updated. The emails did not settle the refund. Mr. Moffatt claimed $880. Air Canada said the right procedure had not been followed, retroactive claims were not allowed, the airline was not liable for the chatbot, and the Domestic Tariff applied.

The member treated this as negligent misrepresentation: a seller that does not take reasonable care to keep its representations accurate and not misleading. Citing Queen v. Cognos Inc., he required a duty of care, a representation that was untrue, inaccurate, or misleading, negligence in making it, reasonable reliance, and damages. He found the duty in the commercial relationship between the airline and the customer, and he applied a standard of reasonable care.

Air Canada's liability argument is the paragraph to hand to whoever runs a customer-facing assistant. The airline said it could not be held liable for information from its agents, servants, or representatives, including a chatbot, and it did not explain why. The member wrote that this was, in effect, a claim that the chatbot is a separate legal entity responsible for its own actions. He called that a remarkable submission. A chatbot is interactive, he wrote, and it is still part of the website. Air Canada is responsible for all the information on that website. He added that it makes no difference whether the information comes from a static page or a chatbot.

He found the airline had not taken reasonable care to keep the bot accurate. Air Canada said the correct rule was available on another part of the site. The member said the airline had not explained why the "Bereavement travel" page was more trustworthy than the chatbot, or why a customer should have to cross-check one part of the website against another. He accepted that relying on the bot was reasonable. There was no reason for Mr. Moffatt to know that one section was right and another was wrong. He also accepted that Mr. Moffatt would not have flown at the last minute if the full fare had been the known price, which matched the effort spent chasing the refund the bot had described.

The tariff defence failed because the clause was not in the file. Air Canada described what the tariff allegedly said and did not file the relevant portion. The member said a sophisticated litigant should know that asserting a contract, without producing it, is not enough, and that the tribunal tells parties to file relevant evidence.

Damages were the position Mr. Moffatt would have been in had the misrepresentation not been made, measured as the gap between price paid and market value, following Ban v. Keleher. The phone figure was about $380 each way, $760 for both flights, against $1,630.36 paid. The claim form said $880. Submissions said $880.36. The member noted that $1,630.36 minus $760 is $870.36, and treated that as the ceiling before ticket charges. Air Canada denied the allegations in general terms and filed no other bereavement fare, though it was best placed to do so. He drew an adverse inference and accepted $380 as the fare. He did not treat it as the all-in price. Taxes, security charges, and airport improvement fees still applied, as they had on the original tickets. The tribunal's all-in bereavement totals were $474.23 outbound and $505.25 return, $979.48 together. Damages were $650.88.

A $200 goodwill coupon was not set off. Mr. Moffatt said it had not been accepted, and Air Canada filed nothing to show that it had. Interest under the Court Order Interest Act, from the 17 November 2022 refund request to the decision, was $36.14. CRT fees of $125 were added because the claim substantially succeeded. The order, due within 14 days, was $812.02. Remaining claims were dismissed. Once filed in the Provincial Court of British Columbia, a CRT order has the same force as an order of that court.

The decision names no model and no vendor. Air Canada never described the chatbot, and the member did not need the description. He had the screenshot, the contradictory page, the bookings, the call, the emails, and a tariff extract that was not there. A company putting a more fluent assistant on a booking page is in the same spot he described. The assistant is part of the website, and the customer may treat its words as the company's. The member reached that conclusion without any evidence of how the bot was built.

Four controls follow from the way the file failed.

1. Name an owner for the output. The member would not treat the chatbot as a separate legal entity. The person who owns the fare rule owns the answer an assistant gives about that rule. When a digital team runs the assistant and a policy team owns the rule, this file is what that split looks like: two answers, one website, and a customer who followed the interactive one. Put the owner's name on the assistant where you already put it on the page.

2. Check the assistant against the page it cites, before a customer can buy. Here the bot linked to "Bereavement travel" and contradicted it. That was still true on 11 November 2022, when the tickets were bought. The email that called the words misleading is dated 8 February 2023. On any topic where a wrong answer changes the price, compare the reply, the linked page, and the rule you will actually apply. Telling the customer to prefer the static page did not work in this case, because the airline never explained why that page should win. Do the comparison before the reply is served.

3. Put a person on the path who is allowed to correct the assistant, and use that path at the first human contact. Mr. Moffatt did reach an agent on 11 November. The call produced a $380 estimate and, on the evidence, no correction of the retroactive rule. The written admission came after both flights and after a formal application. Updating the assistant months later does not unwind the ticket. Decide which topics the assistant may carry through to payment, and which must stop with a person. A bereavement fare belonged on the second list. So does any rule your own linked page already denies.

4. Sign off the answer you will honour, and keep the document you would file. The damages followed the representation: the fare the customer was led to expect, plus the taxes and fixed charges a real ticket carries, because the airline produced no different number. The coupon failed for lack of proof it was accepted. The tariff failed because the clause was missing. The person who signs off the assistant is confirming that the answer matches a rule the company will price, and that the policy behind it can be produced in a dispute. The 8 February email noted the problem so the bot could be updated later, and the order still set the remedy.

A manager with an assistant already in front of customers can ask those four questions of one live flow this month, with the screenshot and the policy page in the same meeting. In this file those two documents showed the failure, and the contract that was described but not filed showed the defence that did not succeed.

An AI governance session is a place to run the questions on one customer-facing assistant, with the policy owner and the person who can change the assistant both in the room.