London insurers failed to move aviation mega-lawsuit out of UK court to Russia
London’s major insurance companies failed to have a multi-billion-pound aviation lawsuit withdrawn from England and flown to a Russian court.
Following Russia’s invasion of Ukraine, the country was hit with sanctions that left aircraft leasing companies out of pocket as their planes were stuck on Russian territory.
This is why a swarm of litigation hit the English – and other – courts, as the insurers and reinsurers of the leasing companies declined to pay out on the stranded planes.
- To understand the Russian aviation lawsuits in more detail, read CityAM,’s explainer on it here.
Elsewhere, back in February, some of the world’s largest insurers including AIG, AXA, Allianz, Liberty and Lloyd’s of London, tried their luck at the High Court.
The court held a hearing where it heard arguments over jurisdiction challenge, as the insurers argued that the reinsurance policies contain exclusive jurisdiction agreements in favour of the courts of Russia. Due to this agreement, the insurers asked the court to stay these proceedings.
The claimants in this case are some of the world’s largest aircraft lessors, including AerCap, Aircastle, Avenue Capital, Carlyle Aviation Partners, FTAI Aviation and Merx Aviation.
Those 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”.
Last week, Mr Justice Henshaw handed down his decision last week, siding with the aircraft lessors.
In a slapdown to the insurers, the judge said the “claimants have shown strong reasons why the court should decline to stay these proceedings.”
He noted that the “claimants are very unlikely to obtain a fair trial in Russia,” to which he added, “itself is a strong reason to decline a stay.”
Commenting on the decision, a spokesperson from Carlyle Aviation Partners said: “We welcome today’s ruling, which exposes the tactics of a faction of international insurers who are in breach of their contractual obligations. Without further delay, we intend to vigorously pursue our claims against all insurers who have failed to provide coverage for losses in the courts of London, as is the right and proper jurisdiction.”
A similar hearing on jurisdiction was held last month, only in this case the insurers wanted the aviation case moved to war-torn Ukraine. However, unlike the other well-known cases, this case is over a non-Russian operator policy, as it includes a Ukrainian airline, Windrose Airlines.
The same judge, Mr Justice Henshaw, heard this case, with a decision on the application still pending.