6.3.1 What documents would the Owner as lessor need to present in order to obtain possession of the Aircraft, both before and subsequent to judgment? Can documents be copies?
The documents required by the Owner as lessor to obtain possession of the Aircraft through judicial proceedings will vary from case to case but will include documents evidencing ownership of the Aircraft, documents evidencing a right to repossess the Aircraft or a right to compensation and documents evidencing breach by the lessee of its obligations. This might include a copy of the mortgage, the loan agreement, the lease, documentation relating to the debt, evidence as to when payment was due and documents demonstrating non-payment, evidence of an event of default and/or evidence of service of a notice of default. (Documents which are not in English will need to be translated.)
It is often helpful if original documents are available, but the court in England & Wales will usually accept certified copy documents, where for example urgent action is required and original documents are overseas. Local lawyers can certify that the copy documents are true copies of the originals. Certified true copies can only be made by a person who has the original documents in his or her possession.
6.3.2 What is the approximate cost of issuing proceedings?
The cost of issuing proceedings will vary considerably depending on the nature of the dispute. Where there is a straightforward uncontested right to possession under a lease it is likely that a non-judicial route will be adopted, and so it is more likely that any proceedings in court will relate to complex, contested matters and so can be more costly. Examples might be the need to seek an injunction that the aircraft be returned to the Owner; this might be combined with an application for a freezing order where it is feared that the lessee may dispose of its assets to avoid any judgment. Alternatively, it might be necessary to seek an injunction detaining the aircraft in the jurisdiction while the dispute is determined. The Court has discretion whether to grant such injunctions and will need to be convinced that on balance ordering an injunction is the best course of action.
A dispute is usually resolved in the court by issuing a claim. Where there is an urgent matter to resolve, proceedings can be commenced for urgent interim injunctive relief; this can if necessary be done without notice to the lessee before issuing proceedings. If an interim injunction is granted it is necessary then to issue a claim to have the matter determined conclusively through a full court process.
To issue an application for an injunction the claimant must produce an application notice, a supporting affidavit or statement setting out the background to the case, supported by documents and a draft order and must liaise with court for a hearing, (including payment of a small court fee). Costs vary depending on the complexity of the issues and factual background, but the cost of issuing a straightforward injunction application might cost: £5-10,000. The costs of the steps that follow will vary depending on the process ordered by the court and the response of the opponent.
Issuing a claim in court requires a claimant to draft and issue a claim form, pay a court fee and then, in most cases, to provide greater detail by setting out a comprehensive document giving particulars of the claim. The claim will need to be served on the defendant. The cost of these steps will again vary depending on the complexity of the issues and factual background and the location of the defendant, but in straightforward proceedings issuing proceedings might cost: £10-15,000. In addition, Court fees to issue a claim vary, but even on high value disputes are currently under £2,000. Again the costs of the steps that follow will vary depending on the process ordered by the court and the response of the opponent.
Under English law if a party is unsuccessful in an action it is likely to have to bear the reasonable costs of its opponent, as well as its own legal costs. However, there will always be an element of unrecoverable costs and parties who are successful in action should not necessarily expect to recover 100% of their costs.
6.3.3 Would the Owner be required to provide a bond, guarantee or other security in order to issue proceedings?
If a claimant seeks an urgent injunction to prevent the defendant from taking steps in relation to the Aircraft or seeking repossession, the claimant will have to offer a cross-undertaking in damages. That is the claimant will be required to promise to reimburse the defendant for any losses incurred if it later becomes clear that the urgent order was not required. If the defendant is not confident that the promise has real value, for example because the claimant is located outside of the EU and so is difficult to enforce against, or because the claimant appears to be impecunious, then the defendant can apply to the court for the cross undertaking to be fortified by the provision of security for costs. The court can then order a party to produce financial security before continuing to hear the matter.
In a standard claim the Owner would not as a matter of course be required to provide a bond, guarantee or other security in order to issue proceedings. However, again if the defendant believes that the claimant would not be able to meet an order of costs, should the defendant eventually succeed in the proceedings, the defendant can apply to the court for an order for security for costs against the claimant. Again the court can order a party to produce security before continuing to hear the matter.
6.3.4 What is an estimate of the normal duration of possession proceedings from time at which all required documentation is made available – if uncontested?
Uncontested proceedings can be resolved quite promptly. If a defendant makes no response at all to a claim and 14 days expire after service of the particulars of claim, then the claimant can apply to the court for a judgment in default. This order will usually grant the claimant the remedy it seeks in full. Depending on the speed of the court in dealing with the application, it may be possible to achieve judgment within a week or two of making the application. The response of the court can, however, be slow at times. (Time limits vary if the claim form is served out of the jurisdiction and permission of the court may be required.)
6.3.5 What is an estimate of the normal duration of possession proceedings from time at which all required documentation is made available – if contested?
Proceedings are likely to be brought in the court if there is not a straightforward right of possession, for example if the right to repossess is contested, or if it is unclear whether an event of default has occurred. In normal circumstances it will take at least a year to progress a contested claim through the court and could take considerably longer; there may also be an appeal process.
If, however, it is clear that the defendant’s arguments have no prospect of success it may be possible to apply for summary judgment after the defence has been served and to have a court determination within a few months.
Without notice injunction processes can be swift: it can be possible to have an initial determination from the court within a few days, although this would then have to be followed by a fuller claim process. Contested injunction processes could take months to be resolved.
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