A recent High Court decision highlights the duties of financiers in the context of aircraft repossessions and the associated power of sale in default scenarios, while also raising questions about the level of intention required on the part of a defendant in unlawful means torts. The case garnered significant mainstream media attention, principally because the claimants are controlled by Russian billionaire Alexander Lebedev.
Following the French Court of Cassation's Rothschild decision, the High Court has ruled that one-sided jurisdiction clauses will be upheld by the English courts. This decision confirms that English courts are unlikely to follow Rothschild and is of considerable importance to aircraft lessors, lenders and airlines.
The Court of Appeal recently issued a decision that is of considerable importance to aircraft lessors, lenders and airlines. The decision sends a clear message that aircraft leases and their related certificates of acceptance should be construed in accordance with their plain, unambiguous terms, and that the risk allocation set forth in those documents between lessee and lessor should be given effect.
The High Court recently upheld a tribunal award relating to reinsurance contracts covering losses arising out of the terrorist attack on the World Trade Centre of September 11 2001. The judge held that the unity of cause in the attacks was both hijacking and terrorism, and that a finding as to whether the attacks fell under the terrorism or hijacking perils was irrelevant as to the question of whether one event or two had occurred.
Financiers and operating lessors should ensure that the delivery condition of an aircraft (including the airworthiness requirement) is an objective condition precedent in favour of the lessee. In this way, no positive obligation need be imposed on the lessor to ensure the delivery of an aircraft in any particular condition.
Recent European airline bankruptcies have highlighted the need for care when devising aircraft repossession and recovery strategies. Stakeholders should be aware of the detention and sale regime in the United Kingdom, possible approaches to the risk of the Eurocontrol fleet-wide lien, and the protection available for owners and financiers in the context of EU Emissions Trading Scheme legislation.