2 days ago
- Business
- Irish Independent
UK court orders costs payment to unit of Irish leasing giant AerCap
The costs are linked to a $203m dispute over jets that were lost after Russia's invasion of Ukraine.
Volga-Dnepr has raised concerns that if it makes any payments, the company could be in breach of Western sanctions that were imposed on Russia after the 2022 invasion.
However, the court has refused to postpone the 14-day deadline for payment to Celestial Aviation Trading, rejecting a proposal that it be paid whenever Volga-Dnepr secures a licence from the UK's Office of Financial Sanctions Implementation, or when it is no longer subject to sanctions.
Last month, the UK High Court refused a request from the Dutch arm of Volga-Dnepr Logistics to vary an order that it make a $203m payment to the Irish bank account of AerCap's Ireland-based Celestial unit.
The court ruled that the court order did not breach sanctions imposed on Russia.
After the order was made, the Volga-Dnepr unit was deemed liable for Celestial's £245,000 costs in relation to the failed request to vary the $203m payment order.
Last month, Celestial agreed to accept a lower payment of £134,000. However, the sum was not paid within the stipulated 14 days.
Irish units of AerCap's Celestial Aviation, which were formerly owned by Gecas, sued Volga-Dnepr in May 2022 claiming that events of default or events of loss had occurred under the lease agreements for eight aircraft. The Dutch subsidiary had guaranteed the obligations under the leases.
Following a hearing last February, the Dutch arm of Volga-Dnepr was ordered by the UK court to make an interim payment of $202.8m to Celestial in respect of its liabilities under the guarantees it made in relation to the leasing of the eight jets.
The company was also ordered to pay £50,000 in costs to Celestial.
Both payments were to be made by February 25 into a bank account in Ireland, but had not been made by that time.
In relation to the costs associated with the failed effort to vary the order, High Court deputy judge Nigel Cooper said he was not persuaded that there were any good reasons why he should make any order other than one requiring Volga-Dnepr to pay the assessed costs within 14 days.
