Salam Air SAOC v Latam Airlines Group SA

Salam Air SAOC v Latam Airlines Group SA

SalamAir failed to establish a strong case for frustration of the aircraft leases or entitlement to an injunction; the SBLCs are intended to be equivalent to cash and the contract allocated risk to SalamAir, including inability to operate due to regulatory changes.

Parties
Claimant: Salam Air SAOC; Defendant: Latam Airlines Group SA
Jurisdiction
England and Wales
Judgment Date
08 September 2020
Procedural Posture
Commercial Injunction Application / Judgment on Without Notice Application for Interim Injunction
Outcome
Application refused
Legal Topics
Injunctions, Letters of Credit, Frustration of Contract, Aircraft Leasing
Contract Law Commercial Law Injunctions Letters of Credit Frustration of Contract Aircraft Leasing

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Parties

Salam Air SAOC

Claimant

Latam Airlines Group SA

Defendant

Procedural Posture

Commercial Injunction Application / Judgment on Without Notice Application for Interim Injunction

Legal Issues

  1. 1 Whether the court should grant an injunction restraining Latam from making demand under standby letters of credit
  2. 2 Whether SalamAir has a sufficiently arguable case that the aircraft leases were frustrated by Covid-19 regulations

Ratio Decidendi

SalamAir failed to establish a strong case for frustration of the aircraft leases or entitlement to an injunction; the SBLCs are intended to be equivalent to cash and the contract allocated risk to SalamAir, including inability to operate due to regulatory changes.

Court Disposition

Application refused