Finnair Fiasco from 2016

[Brissy1]

This sounds like a shakedown to me.

You don't (I assume) have any direct contractual relationship with KPF, therefore they have no contract to enforce with you. KPF would be an unsecured creditor of IfDelayed and have to line up with all other creditors. That would be the end of the line if IfDelayed have no funds to distribute.

If every bankruptcy worked like this (i.e. unsecured creditors of a bankrupt company going after the customers of the bankrupt company for payment plus costs plus interest) then the whole world would be in a complete mess of bankruptcies and debt chasing.

However, Finnish law might be different and allow some sort of pass through of liability. Getting some free/cheap advice on Finnish law may help.

In the meantime, do not reply to the emails, do not engage with them, do not admit to anything, and do not pay them a single Euro.

I'm not so sure that it is any different under au law, the plaintiff owes debt (costs)to the defendant. The plaintiff has a contract with a 3rd party (now bankrupt) to cover/recover those costs, and so is it not the plaintiff who is an unsecured creditor to the 3rd party if he wishes to recover those costs as contracted, but nevertheless responsible for the debt? A situation I never would have anticipated.

 

[SandyS]

I'm not so sure that it is any different under au law, the plaintiff owes debt (costs)to the defendant. The plaintiff has a contract with a 3rd party (now bankrupt) to cover/recover those costs, and so is it not the plaintiff who is an unsecured creditor to the 3rd party if he wishes to recover those costs as contracted, but nevertheless responsible for the debt? A situation I never would have anticipated.

The more I re read the email, it would seem that I gave my PoA to IFDelayed (as all do when deciding to go with a no win no fee company). So it would seem I am liable. Then the question is, will Finnair enforce the judgement and then pursue me.

Ignoring the fact I may need to stump up 6000 euros plus interest, its a very interesting case and I thought it was worth sharing. I never would have anticipated that this could happen.

 

[Mattg]

Ignoring the fact I may need to stump up 6000 euros plus interest, its a very interesting case and I thought it was worth sharing. I never would have anticipated that this could happen.

It'll certainly make me think twice about using a start-up to pursue compensation for an EU flight delay!

Please do let us know of the outcome.

 

[SandyS]

It'll certainly make me think twice about using a start-up to pursue compensation for an EU flight delay!

Please do let us know of the outcome.

IFDelayed are still operating under that name (but now bought over by someone else). So they are still available and trading, for people to use to claim their compensation. They are a Swedish company, not Finnish.

 

[nicnet]

I am in exactly the same situation as Sandy (same lawyers, same communications, same judgement result), and am delighted to find someone else that I can discuss this with - Sandy, you must contact me privately.

What I am concerned with is that we gave the collection agency (Ifdelayed) the following agreement: "you agree that an agent appointed by Ifdelayed AB may represent you against the airline. Under no circumstances will you be liable to pay any costs or other penalties if we do not win your case. If we win your case, our agent may charge the airline for the costs accepted by the District Court".
This agreement states "represent", which implies that the agent must do those normal actions related to communications and client protection that are normal and expected. This has not happened.
Also it's interesting to note that this "agent" has an upside - "may charge the airline for costs". Acceptance of an upside, implies acceptance of a downside - "under no circumstances etc".

Ifdelayed's brand has been bought by Swedish firm "Insurello". They did not take the liabilities (apparently the "agent" has asked them to". I also communicated directly with Insurello, but got no-where).
However, their web site (ifdelayed.com) still relies heavily on their "long term trusted reputation" (my phrase). I believe that some more pressure applied to Insurello might yield results.

Sandy, let's talk. The "agent" informed me that there are 6 or 7 other clients in this position currently.

 

[MEL_Traveller]

I am in exactly the same situation as Sandy (same lawyers, same communications, same judgement result), and am delighted to find someone else that I can discuss this with - Sandy, you must contact me privately.

What I am concerned with is that we gave the collection agency (Ifdelayed) the following agreement: "you agree that an agent appointed by Ifdelayed AB may represent you against the airline. Under no circumstances will you be liable to pay any costs or other penalties if we do not win your case. If we win your case, our agent may charge the airline for the costs accepted by the District Court".
This agreement states "represent", which implies that the agent must do those normal actions related to communications and client protection that are normal and expected. This has not happened.
Also it's interesting to note that this "agent" has an upside - "may charge the airline for costs". Acceptance of an upside, implies acceptance of a downside - "under no circumstances etc".

Ifdelayed's brand has been bought by Swedish firm "Insurello". They did not take the liabilities (apparently the "agent" has asked them to". I also communicated directly with Insurello, but got no-where).
However, their web site (ifdelayed.com) still relies heavily on their "long term trusted reputation" (my phrase). I believe that some more pressure applied to Insurello might yield results.

Sandy, let's talk. The "agent" informed me that there are 6 or 7 other clients in this position currently.

Hi nicnet and welcome to AFF!

Interesting to hear a number of cases brought against Finnair by ifDelayed... what was the nature of your case? I'm guessing it was not the same fuel pump issue?

The complicating factor here is ifDelayed's bankruptcy. Finnair is entitled to come after the money in the judgement. It's not really their concern that the company someone goes through becomes bankrupt.

There isn't really an 'upside'... if ifDelayed was successful and charged the airline for costs, that would be actual (compensatory) costs. It's not a profit making exercise.

 

[nicnet]

what was the nature of your case? I'm guessing it was not the same fuel pump issue?

No - it was different issue, but similar I suppose. Design fault on a brand new type of plane.

The complicating factor here is ifDelayed's bankruptcy. Finnair is entitled to come after the money in the judgement. It's not really their concern that the company someone goes through becomes bankrupt.

I agree with that.

 

[SandyS]

Here is what the new ifDelayed wrote

Thank you for your email. This is an extremely precarious situation, and I have had long discussions with the firm KPF that you have received the email from. Ifdelayed’s lawyer for the Finnish market left the company in February, but this is what has happened before and since.



The Finnish lawyer sent your cases to the KPF group, which is a law firm in Finland. It had a contract with Ifdelayed, whereby it would bringcases like yours before the relevant Court in Finland.



In January the KPF group lost your case, and the Court ordered the losing party to pay the legal fees of the winning party, i.e. the airline. The Court stated that since Ifdelayed has a contract with its customers in which customers incur no costs, there was no actual difference between Ifdelayed or the specific passenger when it comes to the obligation to pay the legal fees of the winning party. This verdict was however appealed by KPF group, and the case is still in the Court of Appeals.



What happened next is the most unfortunate situation. The drop in passenger air traffic and subsequent crisis in the airline industry caused Ifdelayed AB to file for bankruptcy on May 5th 2020. The company with whom your contract was agreed was thus insolvent. This should be grounds in and of itself to appeal the original verdict, as far as the obligation to pay the legal fees is concerned, as it is no longer true that Ifdelayed can cover these costs. It should be easy to make such a claim to the Court of Appeals. In other words, because Ifdelayed AB no longer is a going concern, the company cannot honour its contractual obligation to you. In light of that, the Court should relieve you from the obligation to pay the airline’s legal fees.



Initially the KPF group stated that it did not want to continue working on your case unless it got paid by Ifdelayed AB, which is not possible as that company no longer exists. Fortunately, I managed to convince KPF group to pursue your case with the Court of Appeals, to get a new verdict specifically on the legal fees that would mean that you do not have to pay anything. I find that the KPF group has a moral obligation to fight on your behalf, as it was aware of the risks with pursuing your case from the very outset. The KPF group has agreed that itwill continue working on your case to get the previous verdict overturned, at no cost for you.



The fact that your case has been affected by the bankruptcy of Ifdelayed AB like this is so incredibly unfortunate, and this should never have had to happen. I am however glad that the KPF group is continuing to work on your case so that this situation can be explained to theCourt.



Sorry for the long reply, but I feel you deserve to know all of what has happened, and why.



Please let me know if you have any other questions.

Post automatically merged: Oct 26, 2020

Here is what KPflaki said
We would say that enforcing the judgement would not be cost effective for Finnair. If Finnair decides to do that, they probably would do it as a matter of principle. After I have gotten replies from all flight customers, I have thought about contacting Finnair and asking them if they would be ready to moderate the litigation costs because of the bankruptcy which has caused an undue situation for the flight customers. This would be outside of the court, so it should be faster and cheaper than waiting for the possible moderation sentenced by the court of appeals.

Post automatically merged: Oct 26, 2020

 

[MEL_Traveller]

That sounds promising!

Have to admit I have no idea what this means:

In January the KPF group lost your case, and the Court ordered the losing party to pay the legal fees of the winning party, i.e. the airline. The Court stated that since Ifdelayed has a contract with its customers in which customers incur no costs, there was no actual difference between Ifdelayed or the specific passenger when it comes to the obligation to pay the legal fees of the winning party. This verdict was however appealed by KPF group, and the case is still in the Court of Appeals.​

 

[nicnet]

That sounds promising!

Have to admit I have no idea what this means:

In January the KPF group lost your case, and the Court ordered the losing party to pay the legal fees of the winning party, i.e. the airline. The Court stated that since Ifdelayed has a contract with its customers in which customers incur no costs, there was no actual difference between Ifdelayed or the specific passenger when it comes to the obligation to pay the legal fees of the winning party. This verdict was however appealed by KPF group, and the case is still in the Court of Appeals.​

The appeal is not filed. Just the permission is given to appeal.
The sections means that the court treated the plaintiffs (us) as a company. So the costs were not reduced, as they might have been if just individuals were up.
Under Finnish law, the costs can be reduced if the 2 parties have disparate size. Unfortunately, in this case it did not apply, as it was effectively Ifdelayed against Finnair. Now that Ifdelayed has ceased to exist, and it's just little old "us", this may be ground for a successful appeal.

 

[MEL_Traveller]

The appeal is not filed. Just the permission is given to appeal.
The sections means that the court treated the plaintiffs (us) as a company. So the costs were not reduced, as they might have been if just individuals were up.
Under Finnish law, the costs can be reduced if the 2 parties have disparate size. Unfortunately, in this case it did not apply, as it was effectively Ifdelayed against Finnair. Now that Ifdelayed has ceased to exist, and it's just little old "us", this may be ground for a successful appeal.

Ah! That makes sense now!

 

[SandyS]

First update I have received for a long time.


Finnair has proposed the following for cases in the court of appeals:

- The plaintiffs pay Finnair 4.000 euros/case and drop the case (take it from the court which means it is not possible to take it to the court again) OR drop the case and the judgement from the district court stays. The sentences from the district court are, depending on the case, 5.600-6.200 euros + penalty interest a couple of hundred euros.



- All cases between Finnair and KPF must be agreed on the abovementioned way. There are a few cases in the court of appeals and a few in the district court. This means that if some of the plaintiffs do not want to take this offer of Finnair, no one will get it. So, if some plaintiffs want to wait for the judgement of the court of appeals, the offer from Finnair is off the table.



- If everyone takes the deal, this is what would happen: KPF gets agreements from all passengers if they accept the offer or not. If all accept, the plaintiffs shall transfer 4.000 euros to KPF client bank account, and they will sign a contract with Finnair. There would be a clause in the contract that the contract would bind Finnair after the money is transferred to Finnair’s bank account. Finnair would sign the contract after this.



Finnair reserves the right to take back this offer. Because of this, if you consider taking this deal, it would be best to inform me about your decision as soon as possible.

 

[MEL_Traveller]

Oh dear, poor SandyS

Just to clarify... will it be €4000 per set of plaintiffs? Or is it that all plaintiffs across various cases will collectively raise €4000 between them?

Some legal advice might be warranted on your options.

 

[Brissy1]

For a bit of light reading Sandy on enforcement of foreign civil judgements; note para 2.2 and the *4 list of countries. This summary may be out of date, I'm not a lawyer, this is not advice.

 

[SandyS]

Oh dear, poor SandyS

Just to clarify... will it be €4000 per set of plaintiffs? Or is it that all plaintiffs across various cases will collectively raise €4000 between them?

Some legal advice might be warranted on your options.

4000 euros per set of plaintiffs

Post automatically merged: Dec 13, 2020

For a bit of light reading Sandy on enforcement of foreign civil judgements; note para 2.2 and the *4 list of countries. This summary may be out of date, I'm not a lawyer, this is not advice.

Thank you for that info however KPF have said that they can pursue us through the Australian Courts

 

[MEL_Traveller]

I think it might be worthwhile to seek some independent legal advice here. KPF may be great, but perhaps worth confirming the information they have given you, and also what other options you might have, if any.

 

[MEL_Traveller]

I've just read through the last few posts again... it looks like Finnair is trying to do a 'deal' prior to the case going to the Court of Appeal over costs.

Post 28 from IfDelayed seems to indicate that because of the bankruptcy, an appeal is likely to be successful to remove costs. IfDelyaed also suggests they have negotiated with KPF to continue working for free to handle the appeal.

The appeal has not yet been heard by the sounds of it, and Finnair is trying to get in early with a reduced amount. Otherwise they stand to lose a lot of money (ie all their costs).

if the appeal case goes forward and is successful, no one would need to pay anything. If not successful, everyone would be up for the full amount.

I think this is where some independent legal advice would be handy... to confirm iFDelayed's view that the costs would have a really good chance of being waived due to bankruptcy.

 

[HappyFlyerFamily]

I've just read through the last few posts again... it looks like Finnair is trying to do a 'deal' prior to the case going to the Court of Appeal over costs.

Post 28 from IfDelayed seems to indicate that because of the bankruptcy, an appeal is likely to be successful to remove costs. IfDelyaed also suggests they have negotiated with KPF to continue working for free to handle the appeal.

The appeal has not yet been heard by the sounds of it, and Finnair is trying to get in early with a reduced amount. Otherwise they stand to lose a lot of money (ie all their costs).

if the appeal case goes forward and is successful, no one would need to pay anything. If not successful, everyone would be up for the full amount.

I think this is where some independent legal advice would be handy... to confirm iFDelayed's view that the costs would have a really good chance of being waived due to bankruptcy.

Just a small point, if not successful, is it possible appeal legal costs of Finnair could be added?

 

[MEL_Traveller]

Just a small point, if not successful, is it possible appeal legal costs of Finnair could be added?

I think that's right.

So Finnair is hoping people will pay €4000 now rather than proceeding with the appeal.

So far IfDelayed seems to think the appeal will be successful. KPF seems non-committal, but understandable if they are working for no fee.

Independent advice would be able to confirm which way the OP should go.

 

[”TheFinnishLawyer”]

4000 euros per set of plaintiffs

Post automatically merged: Dec 13, 2020

Thank you for that info however KPF have said that they can pursue us through the Australian Courts

It’s really sad you ended up as a hostage in this situation. It’s not a scam. Unfortunately the Finnish law is quite clear. In case of multiple plaintiffs, they are multilaterally each responsible for all the legal costs if the case is lost. Since IfDelayed Ab doesn’t exist anymore the pointer of doom ended up on you. You were plaintiffs alongside IfDelayed Ab.

Even though IfDelayed Ab had a contract stating that you won’t have to pay anything if the case is lost, no contract can override the mandatory rule of law. This principle is globally very common.

Rights to IfDelayed’s brand was bought by another company. This sale was made by the bankruptcy lawyer in order to cover the known debts atleast partially. Subsequently IfDelayed Ab seized to exist.

I’m willing to help you Pro Bono by PM. I can give you my personal assessment as a private person. Not a professional legal advice.