A German pilot working for a Manx-registered company has been awarded $81,778.50 by Deemster John Needham.

The dispute, which arose because of the pandemic, was between pilot Pablo Mueller and PARC Aviation Services Limited, which has an office on Peel Road, Douglas.

When the pandemic broke out, Mr Mueller had a contract with PARC and as a result of the restrictions, he was unable to fly for Air Japan Co, the company he was for which he was contracted by PARC to fly. 

Mr Mueller accepted that when the pandemic struck in March 2020 he was in his native Germany and was instructed by the airline by email on March 19 2020 not to fly to Japan and he agreed to take leave for the rest of the month. 

He was paid for the whole of March and April 20202.

However, on April 10, 2020, the airline issued an instruction to contracted flight crews, which it termed an ‘involuntary leave order’, which said the staff would be paid 25% of their usual payment for the month of May, a figure totalling $3,126,25.

Further involuntary leave orders were issued for the months of June, July and August 2020. In June 2020 again $3,126.25, 25% of the basic payment, was paid to Mr Mueller, but no further payments were made for the following months.

Towards the end of August 2020, the airline gave 90 days’ notice to him, terminating his contract on November 30 2020.

Deemster Needham summarised his claim as: ‘The claimant seeks what he says is the unpaid debt arising from the defendant’s liability to make payments under the Contract in that only part payments were made for May and June 2020 and no payments were made for July to November 2020.

‘In the alternative, the claimant seeks damages for breach of contract to be assessed in the same sum. He also seeks interest on the debt/damages and costs.’

PARC filed a defence statement in December 2020, saying it denied there was any automatic entitlement to receive basic payments. It also denied that Mr Mueller was an employee and that the contract was one which ‘made clear that payment was “in consideration of [the claimant’s] services’.

In essence, the company said he was paid as a contractor to do a job and because of the pandemic he couldn’t do the job, so wasn’t entitled to be paid, as such, there was no breach.

Deemster Needham said: ‘There is no dispute that the contract was validly terminated by the defendant with effect from November 30, 2020. It is accepted that the claimant performed no flying duties and, save for the matter of the verbal component of a simulator assessment, no other duties for the Airline between April and November 2020. 

‘There is no dispute that the pandemic amounted to force majeure as envisaged within the contract. The defendant has not defended the case on the basis of frustration of the contract, rectification or subsequent variation of the contractual terms.’

Therefore, the issues explored were whether the contract allowed a pro-rata reduction in payments in accordance with the claimant’s performance in terms of monthly flying hours and the imposition of involuntary leave periods by the defendant on the claimant.

In his ruling, Deemster Needham said that the contract between Mr Mueller and PARC didn’t allow for the company or the airline to make the deductions it did. 

After subtracting the amounts paid to him in May and June, Deemster Needham ordered PARC to pay Mr Mueller a total of $81,778.50.