The final cases taken by aircraft lessors against insurers over jets seized by Russian airlines three years ago as a result of the Ukraine war have been all but settled, the High Court heard on Wednesday.
“While I have probably prepared the longest draft judgment I will never deliver, such an outcome is always to be preferred, particularly where, as here, the parties will likely continue to do business together for many years to come,” said Ms Justice Eileen Roberts, who began hearing the largest ever commercial court trial last June.
“I appreciate that the settlement of this litigation has not been straightforward or easy to achieve. The disputes involved multiple layers of parties, jurisdictions, policies and complex legal arguments and finding an agreeable compromise is a credit to the legal skills, the business acumen and the common sense of all involved.”
The terms of the settlements have not been disclosed.
Six aircraft lessors, including Avolon, Beijing-controlled BOC Aviation and Japanese-owned SMBC Aviation Capital, filed a total of more than €2.5 billion of claims with the High Court in Dublin in 2022.
The Irish lawsuits, also involving Nordic Aviation Capital, CDB Aviation and Hermes Aircraft A1264, echoed actions taken by lessors against insurers in other jurisdictions in recent years, including London.
The insurers and reinsurers, including names such as Lloyds, Chubb, AIG and Fidelis, were sued as providers of “all risks” policies, “war risks” policies, or as providers of both.
The global aircraft leasing sector, which counts Ireland as a major hub, is estimated to have racked up at least $8 billion of losses after more than 400 planes were stranded in Russia following western sanctions over Moscow’s war in Ukraine that forced the termination of their leases.
The Irish Times was the first to report, on February 7th, of settlements emerging from the mammoth case, involving Avolon and its insurers. It was subsequently established the same day that BOC and Nordic Aviation also resolved their cases, while SMBC had settled some.
The High Court was told last week that cases against the “war risks” defendants had been settled at that stage, leaving some “all risk” cases outstanding.
Lawyers for the final two lessors with cases remaining, SMBC and CDB, told the court on Wednesday that remaining issues with insurers had either been settled, had seen the terms of a settlement agreed in principle, or – as with CDB’s action against certain insurers behind all-risk policies, represented by law firm Dillon Eustace – are no longer being pursued.
The issue of costs relating to Dillon Eustace’s all-risk clients will be heard next Wednesday, the court heard. It will also convene on April 11th to make final orders in relation to SMBC and CDB cases against Chubb, which have been resolved in principle but not yet executed.
“I have made the directions then that are needed in relation to the outstanding issues, so I don’t need to repeat those there, but I would ask, in relation to that, that the parties continue their efforts to agree or narrow the issues to avoid yet further consequences,” Ms Justice Roberts said. “And with that, I bid adieu, as they say.”
