It looks as though the Germanwings first officer intentionally crashed the aircraft, killing all aboard. Reporters are asking about the airline's obligation to provide the passengers' families monetary compensation. Here are some answers:
The airline must compensate the families for any "accident." Because Flight 9525 was an international flight, all the families' claims are governed by a treaty called the Montreal Convention. The treaty makes the airline automatically liable to the families for any "accident." It doesn't matter whether the airline was negligent or did anything wrong.
The crash was the result of an "accident." Even if, as it appears, the first officer intentionally crashed the plane, it was still an "accident." Most courts define "accident" for the purposes of the Montreal Convention to be any "unexpected or unusual event or happening that was external to the passenger." The pilot's decision to crash the plane would certainly qualify.
The Montreal Convention's limits of liability will not apply. An airline can avoid paying to the families of those lost in an accident any amount over 113,100 Special Drawing Rights (a sum equal to about US$160,000) if it can prove that it was in no way at fault for the crash. Generally, it's very difficult for an airline to make that showing. It's the problem of proving a negative. In this case, of course, it will be impossible for the airline to prove it was completely free of fault. So the Convention will impose no limit on the airline's obligation to compensate the families for their loss.
The Airline is off the hook for punitive damages. Though the airline will have to compensate the families for their losses, even if it turns out that the airline knew or should have known that the first officer presented a danger, the Montreal Convention prohibits a court from awarding punitive damages, or money designed to punish the airline rather than compensate the families.
The amounts that the families will receive depends upon where they sue. The Montreal Convention leaves it to the courts of the country in which the passenger sues to decide how much money is appropriate compensation for the loss of a loved one. Every country is different. In the United States, certain families of those lost could expect payouts to exceed $10 million, depending on the circumstances. In France and Germany, the payouts would be much, much lower.
Few passengers, if any, will be able to sue in the US. The Montreal Convention allows families to sue in the United States only in certain limited circumstances. For example, a family might be able to sue in the US if the passenger happened to purchase his tickets in the US, or if he was planning to continue on after landing to a destination in the United States, or perhaps if the passenger was US resident.