By virtue of its decision of 8 November 2021, the Civil Court (First Hall) presided over by Hon. Justice Robert G. Mangion 1, revoked a warrant of prohibitory injunction which was provisionally issued in September 2021. This warrant sought to prevent the defendants (Avmax Aircraft Leasing Inc. and the Bank of Utah) from exercising their rights under Irrevocable Deregistration Export Request Authorisations (IDERAs) registered in the national aircraft register, following an alleged default under a number of aircraft lease agreements. The Maltese Court concluded that the reasons put forward by the applicant company for the issuance of the warrant were unfounded and did not justify the issuance of the warrant.
The warrant was provisionally issued 2 to, inter alia, prohibit the Civil Aviation Directorate (within the Authority for Transport in Malta) from acting on any requests of the defendants, acting in their capacity as "certified designee" and "authorised party", respectively, for the deregistration of the aircraft indicated in the IDERAs. The IDERAs empowered the defendants to instruct the Civil Aviation Directorate to proceed with the deregistration of the said aircraft from the Maltese Aircraft Registry. In light of an alleged default by the applicant company (as sub-lessee) under the lease agreements, one of the defendants attempted to enforce its rights in accordance with the IDERAs and the provisions of the respective lease agreements.
Pursuant to the warrant of prohibitory injunction, the applicant company alleged that the actions taken, including the termination of the lease agreements, constituted a breach of the lease agreements and a Canadian Court order (in the form of an interim measure) which attempted to safeguard the applicant company's business. The applicant company argued that the implications of an enforcement under an IDERA and thus the deregistration of aircraft would cause irremediable harm to the applicant company as operator of the aircraft.
The Maltese Court revoked the warrant of prohibitory injunction for various reasons. With specific reference to the aviation sector, the Court made reference to the Cape Town Convention as well as the Practitioners' Guide to the Cape Town Convention and the Aircraft Protocol of the Legal Advisory Panel of the Aviation Working Group. 3 The Court concluded that following the registration of the IDERAs in the register of the aircraft, which was duly consented to by the applicant company, the latter company, on a prima facie basis, does not have the right to stop the Civil Aviation Directorate from registering, processing and, or executing a request for the deregistration of aircraft by any authorised party or certified designee indicated in the registered IDERA. The Court acknowledged that the deregistration of the aircraft can seriously prejudice the applicant company, however this is not a consideration which is relevant when determining whether the Civil Aviation Directorate should proceed with the deregistration of aircraft on the basis of a proper formal request to that effect. A contrary conclusion would be unfounded both in terms of national law and the Cape Town Convention and would potentially render useless one of the principal objectives of the Aircraft Registration Act (Chapter 503 of the laws of Malta) and Malta's ratification of the Cape Town Convention.
Footnotes
1 Air X Charter Limited et vs Kuraturi Deputati et, Civil Court (First Hall) 8 November [1437/2021/1].
2 [2] The warrant of prohibitory injunction was provisionally issued by virtue of a court decree dated 24 September 2021.
3 The Convention on International Interests in Mobile Equipment and Protocol on Matters Specific to Aircraft Equipment (the "Cape Town Convention"). Malta ratified the Cape Town Convention on 1 October which subsequently came into force on 1 February 2011.
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