The High Court will rule before Christmas on an application by the joint liquidators of two Irish-based Russian state-owned leasing firms to prevent the entities’ parent from “seizing ownership” of dozens of highly valuable aircraft.
Damien Murran and Julian Moroney, who are the joint liquidators to Dublin-registered GTLK Europe DAC, and GTLK Europe Capital DAC, are seeking orders from the High Court aimed at preventing Joint Stock Company State Transport Leasing Company from acquiring some 37 aircraft.
The liquidators say that the aircraft are the property of the firms in liquidation, and the parent has no legal entitlement to the assets.
Represented by James Doherty SC, appearing with Stephen Byrne, the liquidators have asked the court for orders including one setting aside so called “pledge agreements” which the parent claims entitle it to take ownership of the aircraft.
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The liquidators also seek a declaration that said agreements are void and unenforceable as a matter of Irish law and that the liquidators retain title to the aircraft.
The parent company did not participate in the proceedings brought against it.
The court was previously told that its lawyers had said in correspondence that it would not get a fair hearing in this jurisdiction, and they have also claimed that the dispute should be before the Russian courts.
Those claims are rejected by the liquidators.
The application came before Mr Justice Rory Mulcahy, who following the conclusion of Mr Doherty’s submissions, reserved his decision.
The judge said that he would give his ruling on the matter early next week.
The liquidators claim that the parent company is attempting to register itself as the legal owner of the aircraft, which are based in Russia.
GTLK’s parent, which is owned by the Russian Federation, says it is entitled to be registered as the legal owner under “pledge agreements” that are governed by Russian law, allegedly entered into between it, GTLK Europe, and nine other GTLK Europe group companies.
The “pledge agreements” were allegedly entered into in March 2022, two weeks before the parent became the subject of EU sanctions imposed following Russia’s invasion of Ukraine, it is claimed.
The parent claims that the pledge agreements were made to secure the repayment of loans from the parent to GTLK Europe between 2017 and 2022.
The liquidators claim the parent will use the pledge agreements to wrongfully “seize the title over the aircraft”, “secure payment under the loan agreements” and “declare itself the owner of the aircraft under an out of court enforcement of the pledges in the Russian Federation”.
Several subsidiaries of the GTLK group are notice parties to the action.
The firms, which are part of the wider GTLK group, were wound up earlier this year following an application by four creditors who claimed they were owed more than $178 million (€162.5 million) by the firms.
The companies’ financial difficulties arose from the economic sanctions imposed on Russian entities following last year’s invasion of Ukraine.
GTLK is Russia’s largest leasing business in the transport sector, and had leased ships and aircraft to customers all over the world.
GTLK’s Europe Group’s international leasing business is headquartered in Dublin.
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