Major insurers attempt to push billion pound litigation to a Russian court
Major insurance companies are at court today seeking to have a multi-billion pound aviation legal action moved from England to a Russian court.
The High Court is currently hearing arguments over a jurisdiction challenge on the multi-billion pound court battle over stranded planes in Russia.
After Russia’s invasion of Ukraine, a barrage of sanctions left aircraft leasing companies out of pocket as their planes were stuck on Russian territory. Following that, a swarm of litigation hit the English (another other) courts after the insurers of the leasing companies declined to pay out on the stranded planes.
Those claimants are some of the world’s largest aircraft lessors including AerCap, Aircastle, Avenue Capital, Carlyle Aviation Partners, FTAI Aviation and Merx Aviation. Their case is against some of the world’s largest insurers including AIG, AXA, Allianz, Liberty and Lloyds.
The court put a group of five claims together and this is set to be heard at the High Court on 2 October for 12 weeks.
However, starting today and running into next week, the court has to decide on a challenge as the insurers argue that the location of the reinsurance policies of the claims should be heard in a court in Russia.
The defendants, which include Lloyds, AIG and AXA, state that the Russian airlines took out policies with Russian insurance companies, which were reinsured by several London and international reinsurers.
They argue that the reinsurance policies contain exclusive jurisdiction agreements in favour of the courts of Russia, therefore, the English claims should be stayed.
Furthermore, the lawyers for the leasing companies (including Carlyle Aviation Partners and AerCap) informed the court that the prospect of a Russian court having a fair trial for Western lenders is unrealistic.
According to documents seen by Morning Wire, one of the claimants informed the court that “there is not the slightest prospect” they will get a fair trial in Russia because the evidence establishes the Russian courts’ susceptibility to the political inference of an authoritarian state almost to the point of being “a matter for judicial notice”.
The application hearing started today in front of Mr Justice Henshaw and is set to continue until next Tuesday.