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AI failures · Unauthorized commitment

Air Canada Chatbot Misstates Bereavement Refund Policy — Tribunal Holds Airline Liable

Verified Checked against its sources on 1 source quoted

Where it happened
Canada
Organization
Air Canada
Date
February 14, 2024 (decision issued)
Function
Customer Service
Where it happened
Customer support; refund policy
System
Air Canada website chatbot
Technology
Generative AI
Type of failure
Unauthorized commitment
Caught by
The person affected

Summary

In November 2022, after a death in the family, Jake Moffatt used the chatbot on Air Canada's website while booking flights. The chatbot said bereavement fares could be claimed retroactively, within 90 days of ticketing; Air Canada's policy did not allow retroactive claims. Air Canada argued it was not liable for what its chatbot said. The British Columbia Civil Resolution Tribunal (Moffatt v. Air Canada, 2024 BCCRT 149) found the airline had not taken reasonable care to ensure the chatbot was accurate, held it liable for negligent misrepresentation, and ordered it to pay $812.02, including $650.88 in damages.

Consequence

  • Air Canada ordered to pay $812.02: $650.88 damages, $36.14 pre-judgment interest and $125 tribunal fees.

Who caught it The person affectedFound outside the organization

Analysis

What could have been done

Limits on what the system may decide or commit to

The AI's authority to decide, commit or act is defined, bounded and approved by a person above set thresholds.

The website chatbot told a customer that bereavement fares could be claimed retroactively within 90 days of ticketing, a statement of refund policy made on the airline's behalf that its actual policy did not allow, and the airline was held liable for it.

Testing before use

The system is tested for accuracy, bias and failure modes on representative cases before use.

The tribunal found Air Canada had not taken reasonable care to ensure its chatbot was accurate.

What would likely have prevented it

  • Test the chatbot's answers on refund and fare-policy questions against the written policy before release and after every policy change.
  • Limit the chatbot on refund and eligibility questions to quoting or linking the governing policy text, and route anything it cannot answer that way to staff.
  • Give a named owner responsibility for the chatbot's policy content, on the basis that its statements bind the company as any other customer communication does.

What would likely have caught it earlier

  • Each month, compare a sample of chatbot answers on refund topics with the published policy, and review refund claims that cite the chatbot.

Related reading Your AI Agent Is an Unlisted SignerMost Documented AI Failures Were Found by Someone Else

Key dates

  1. February 14, 2024Event
  2. October 16, 2026Checked against sources
  3. October 18, 2026Checked against sources
  4. October 21, 2026Checked against sources

Developments are added when the record is reviewed. Next review: October 16, 2027.

Evidence

Each passage is quoted from its source. The quoted passages are re-checked against the live pages every month.

  1. The chatbot suggested Mr. Moffatt could apply for bereavement fares retroactively. Mr. Moffatt later learned from Air Canada employees that Air Canada did not permit retroactive applications.

    Supports: What the chatbot said and the actual policy

    I find Air Canada did not take reasonable care to ensure its chatbot was accurate.

    Supports: Liability finding

    I order Air Canada to pay Mr. Moffatt a total of $812.02, broken down as follows: a. $650.88 in damages, b. $36.14 in pre-judgment interest under the Court Order Interest Act , and c. $125 in CRT fees.

    Supports: Award

    Date Issued: February 14, 2024

    Supports: Decision date

    Moffatt v. Air Canada, 2024 BCCRT 149 British Columbia Civil Resolution Tribunal Primary source

Suggested citation. Eminence Scan, “Air Canada Chatbot Misstates Bereavement Refund Policy — Tribunal Holds Airline Liable”, Eminence Growth Solutions, last verified October 16, 2026, https://eminencegrowthsolutions.com/tools/eminence-scan/record/fail-015/.

Using our research: you may read and quote Eminence Scan with credit to “Eminence Scan, Eminence Growth Solutions” and a link; all other rights reserved. Terms: Using our research.

Spotted an error, or a development we have missed? Report a correction. How we check records: research methodology.