AIRLINES

The legal battle between Air Canada and the Toronto Port Authority moves into high gear at the Federal Court of Canada this week.

The TPA, a federal agency, oversees Billy Bishop Toronto City Centre Airport, located on an island near the city's downtown core. Porter Airlines Inc., a regional carrier that started operations in 2006, currently enjoys a monopoly on commercial flights at the island airport. By contrast, Air Canada flies from suburban Toronto's Pearson International Airport.

Neil Finkelstein is the lead counsel from McCarthy Tétrault, representing Air Canada in the legal fight over daily slots, or takeoffs and landings, at the Billy Bishop airport. Mr. Justice Roger Hughes of Federal Court is expected to issue his decision within three to six months.

In the court case to be heard in Vancouver from Tuesday through Thursday, Air Canada will argue that the TPA has taken shortcuts that favour Toronto-based Porter. Montreal-based Air Canada argues that the federal agency has unilaterally designated the island airport as a Level 3 facility that effectively safeguards Porter.

With the Level 3 designation, the TPA has been able to appoint a slot co-ordinator under guidelines from the International Air Transport Association. But in Air Canada's view, the TPA overstepped its bounds because Billy Bishop should still be classified as a Level 1 airport - a designation that would effectively prevent Porter from receiving the lion's share of slots.

"The significance of the island airport's designation is critical," according to an affidavit filed in court by Marcel Forget, Air Canada's vice-president of network planning. Jazz Air LP, which flies regional routes on behalf of Air Canada, has already ordered Bombardier Q400 turboprops in anticipation of re-entering the island airport. In February, 2006, an air terminal company controlled by Porter chief executive officer Robert Deluce ousted Jazz from the airport.

Alain Boudreau, senior director of specialty products at Air Canada, said in an affidavit that the TPA has been seeking to prevent the emergence of a Porter rival that would "operate a commercially viable and competitive schedule to and from the island airport."

But the TPA defends its slot allocation procedures, saying an independent consulting firm has properly carried out its duties by recently determining that 30 new slots should go to Air Canada.