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Flight fares are set to rise as airlines look to recover costs on payouts to passengers for delays in the wake of the Thomson court ruling.

One senior industry figure suggested fares could rise by as much as £5, with charter prices likely to increase by more than scheduled services. 

Last week a passenger seeking compensation for a delay on a flight six years ago was celebrating after The Court of Appeal ruled in favour of a claim against Thomson Airways.

Rising costs: Air fares are set to increase as more passenger's claim money for delayed flights

James Dawson was awarded £975 by a county court but Thomson has appealed, arguing the Montreal Convention, which says there is a two-year limit on claims.

It was the second ruling on passenger rights and EC Regulation 261 this month. 

In a case against Jet2.com, The Court of Appeal had ruled that a technical fault that caused a delay could not be classed as an 'extraordinary circumstance'.

Now airlines say they are being forced to recover the costs of handling the claims by increasing fares.

Lawyer Joanna Kolatsis of Hill Dickinson told Travel Weekly: 'It is inevitable air fares will rise as the costs of handling these claims increase. 

'There is simply no other way for airlines to recover the costs. Ryanair implemented a Regulation 261 levy on tickets and, while unpopular at first, it has gathered growing sympathy among airlines.'

Delays of more than three hours affect almost 1 per cent of UK flights which falls within Regulation 261. 

A senior industry source said: 'Charter delays of more than three hours are more than double the rate of scheduled carriers' and a significant proportion are technical. If everybody made a claim it would add £5-plus per passenger.'

Time limit: Thomson believe passengers should only be able to claim within a two-year period

A CAA spokesman told MailOnline Travel: 'It's difficult to estimate what this might cost passengers. It's up to each airline.'

'As the UK's most on-time holiday airline, at Thomson Airways our focus continues to be ensuring that our customers reach their destination safely and promptly.

'We believe that it is reasonable to expect that those who perceive they have suffered a real loss as a result of an unfortunate delay should be able to make their claim within two years.

'We also continue to believe that the law stipulates this and we are therefore surprised by today's judgment.

'If unchallenged, this judgment could have a significant impact on the entire airline industry and specifically upon the price that all air travellers would need to pay for their flights.

'We therefore confirm that it is our intention to seek an appeal to the Supreme Court.'