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Lufthansa could face 'unlimited' compensation claims for Germanwings crash

Lufthansa could face "unlimited" compensation claims for this week's deadly crash in the French alps, and it would be difficult, even counterproductive, for the German carrier to try to avoid liability, experts said after news emerged that the co-pilot is believed to have deliberately downed the plane.

How much the airline pays to families of victims depends on where claims are filed

Lufthansa could face "unlimited" compensation claims for the crash that killed 150 people in the French alps and it would be difficult, even counterproductive, for the German carrier to try to avoid liability, experts said Friday.

Under a treaty governing deaths and injuries aboard international flights, airlines are required to compensate relatives of victims for proven damages of up to a limit currently set at about $157,000 — regardless of what caused the crash.

But higher compensation is possible if a carrier is held liable.

"So more or less you will have unlimited financial damage," said Marco Abate, a German aviation lawyer.

To avoid liability, a carrier has to prove that the crash wasn't due to "negligence or other wrongful act" by its employees, according to Article 21 of the 1999 Montreal Convention.

That would be a difficult argument to make when a pilot intentionally crashes a plane into a mountain, and one that Lufthansa would likely avoid as it could further damage the brand, Abate said.

Investigators say the co-pilot of Germanwings Flight 9525 locked himself into the cockpit and slammed the Airbus A320 into the Alps. Germanwings is a subsidiary of Lufthansa.

Lufthansa CEO Carsten Spohr on Thursday said the airline would honour "international arrangements regulating liability" and noted that it already has offered immediate financial aid to anyone requiring it. He didn't mention any figures.

ATTENTION EDITORS - VISUAL COVERAGE OF SCENES OF INJURY OR DEATH French gendarmes and investigators make their way through the debris of the Airbus A320 at the site of the crash near Seyne-les-Alpes, French Alps March 26, 2015. A young German co-pilot locked himself alone in the cockpit of Germanwings flight 9525 and set it on course to crash into an Alpine mountain, killing all 150 people on board including himself, prosecutors said on Thursday. French prosecutors offered no motive for why 27-year-old Andreas Lubitz apparently took the controls of the Airbus A320, locked the captain out of the cockpit and deliberately set it veering down from cruising altitude at 3,000 feet per minute. REUTERS/Emmanuel Foudrot - RTR4V19A (Emmanuel Foudrot/Reuters)

How much the airline ends up paying in compensation will depend on where claims are filed. The options in this case, a German flight en route from Barcelona to Duesseldorf, are many, said Dutch lawyer Sander de Lang.

"For example, French law because that is where it ... crashed, German law because in most cases the passengers had return tickets to and from Germany. But some people may have bought tickets in Spain, then Spanish law could be appropriate," he said.

In some countries including the Netherlands, there's no compensation for emotional suffering, he said.

Families of American victims could sue in U.S.

Damages are typically much lower in Europe than in the U.S., where in domestic air crashes, juries have awarded plaintiffs sometimes millions of dollars per passenger.

The families of the three American victims could sue the airline in U.S. courts. Article 33 of the Montreal Convention states that a passenger's "principal and permanent residence" is used to determine jurisdiction for lawsuits regarding passenger deaths or injuries.

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Abate said that in German courts, damages for pain and suffering typically don't exceed €10,000 euros ($13,730 Cdn). However, Lufthansa could face much bigger claims for loss of financial support. If the breadwinner of a family was killed in a plane crash, the survivors can sue for years of lost income, Abate said.

Several analysts said Lufthansa will probably reach settlements with relatives of victims to avoid going to court.

Once the shock and grief subsides, the compensation issues should be resolved quickly, said Wouter Munten, a Dutch lawyer representing relatives of victims of last year's downing of Malaysian Airlines Flight 17 in Ukraine.

"People always say take your time for grief," he said. "But not everyone has the luxury to wait. Children have to be fed and go to school."

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