Nov. 20 (Bloomberg) -- Air Canada, the country's biggest airline, and other carriers can't charge disabled or obese people for an extra ticket when they need an additional seat or an attendant to accompany them.

The Supreme Court of Canada today refused to hear an appeal from the airline, upholding a Canadian Transportation Agency ruling ordering carriers to charge all passengers the same fare and not make people pay extra when they need an additional seat for medical reasons.

Air Canada, its Jazz unit, and WestJet Airlines Ltd., Canada's second-biggest carrier, failed to prove the policy would impose undue hardship on them, the transportation agency said in its ruling in January. The agency estimated the change would cost Air Canada, which reported C$10.6 billion in revenue last year, C$7.3 million ($5.7 million) annually.

``Now, many people who could not previously travel will be able to do so,'' Laurie Beachell, national coordinator at the Council of Canadians with Disabilities, said today in a telephone interview. ``We've leveled the playing field. People with disabilities aren't having to bear extra costs of travel.''

The ruling applies only to domestic flights and doesn't include the domestic portion of an international flight, Air Canada spokesman Peter Fitzpatrick said in an e-mail.

`Unprecedented' Ruling

``This is unprecedented in the airline industry,'' Richard Bartrem, WestJet's director of communications, said in a telephone interview. ``There's no other country, as far as we know, in the world that has implemented something like this.''

WestJet is developing procedures to implement the policy by Jan. 10, as the transportation agency ordered, Bartrem said.

Air Canada also started to put together procedures, including determining who would be eligible and training employees, Fitzpatrick said. He said Air Canada doesn't have a cost estimate for the program.

Air Canada, based in Montreal, fell 16 cents, or 7.4 percent, to C$1.99 at 4 p.m. in trading on the Toronto Stock Exchange. The shares had fallen 83 percent this year. WestJet, down 61 percent this year, fell 85 cents to C$8.76.

Air France-KLM Group, Europe's biggest airline, last year lost a case filed by a passenger who said he was humiliated when obliged to pay for a second seat on a flight from Delhi to Paris, Agence France-Presse reported in November 2007. A French court ordered the airline to pay 8,000 euros ($9,964) and repay the cost of a second seat, according to AFP.

Six-Year-Old Dispute

Canada's Supreme Court in March 2007 ordered Via Rail, the country's passenger train service, to modify 30 coaches to make them accessible to people in wheelchairs, overturning a lower court ruling that said the changes weren't necessary.

Airlines remained the only federally regulated companies to charge people with disabilities for a second seat, with rail, bus and marine companies all waiving the extra charge, Beachell said.

Today's decision ends a six-year-old legal dispute that began in August 2002 when the council sued on behalf of Joanne Neubauer of Victoria, British Columbia, who needed a wheelchair because of severe rheumatoid arthritis, and Eric Norman of Gander, Newfoundland, a paraplegic who died in 2006.

The case was on hold for 18 months in 2003 and 2004 as Air Canada restructured operations while in bankruptcy protection.

The Supreme Court ordered the airlines to pay the plaintiffs' legal fees. The amount hasn't been determined yet, David Baker, the council's lawyer.

``The costs never begin to cover the appeal costs to the client of litigation of this kind,'' Baker said. ``It's been a very difficult thing for the disabled community to litigate this issue.''

The case is Air Canada v. Canadian Transportation Agency. File No. 32729. Supreme Court of Canada (Ottawa).

To contact the reporters on this story: Joe Schneider in Toronto at jschneider5@bloomberg.net.

Last Updated: November 20, 2008 17:21 EST