BOC Aviation, a leading global aircraft leasing company, has been awarded damages by a UK court in a case against a Russian airline over the operation of two freighter aircraft.
The case centered on the leasing of two Boeing 747-8F aircraft by BOC Aviation to AirBridgeCargo Airlines (ABC), a Russian-based air cargo carrier. BOC claimed that ABC had breached the terms of the lease agreement by failing to properly maintain the aircraft and failing to pay certain lease payments.
BOC Aviation argued that ABC had not performed the necessary maintenance on the aircraft, which had resulted in significant damage to the planes. The lessor also claimed that ABC had failed to pay lease payments for several months, despite repeated requests for payment.
The court found in favor of BOC Aviation, awarding the lessor $24.8 million in damages. The judge noted that ABC had breached the terms of the lease agreement and had not taken sufficient care of the aircraft.
The ruling is significant for aircraft leasing companies, as it highlights the importance of proper maintenance and payment in lease agreements. Lessor’s rely on the payments from their lessees to fund the aircraft’s own maintenance, upgrades, and repayment of loans used to purchase the asset. Failure to maintain or pay for the aircraft’s lease can lead to significant financial losses for the lessor.
In a statement, BOC Aviation welcomed the court’s decision and emphasized the importance of proper maintenance and payment in lease agreements. “We are pleased with the court’s ruling, which highlights the importance of upholding lease agreements and ensuring that lessees take proper care of leased aircraft,” said Robert Martin, Managing Director and Chief Executive Officer of BOC Aviation.
The case also demonstrates the challenges of leasing aircraft to foreign carriers. Lease agreements with international airlines can be complex and challenging, as there are often differences in laws and regulations across jurisdictions. Lessors must be diligent in vetting potential lessees and ensuring that they have the resources and expertise to properly maintain and operate the aircraft.
Overall, the ruling serves as a reminder to airlines that lease aircraft that they must comply with the terms of the lease agreement, including paying rent and properly maintaining the aircraft.