Goshawk Aviation Ltd v Terra Aviation Network S.A.S.

Hearing date: 19 March 2021

Draft Judgement circulated to the parties: 15 April 2021

Approved Judgment

(A) INTRODUCTION

The Second Defendant (“ Lion”) and the Third Defendant (“ Thai Lion”) apply, by notice dated 6 January 2021, for an order setting aside service of the Claim Form on them. They were purportedly served by email sent to their solicitors, Stephenson Harwood (“ SH”), pursuant to an order of Moulder J dated 24 November 2020 (“ the Moulder Order”) permitting the Claimants to serve them by that alternative method. Lion and Thai Lion contend that the Claimants should not have been permitted to serve the Claim Form on them by an alternative method, and that the Claimants obtained the Moulder Order through material non-disclosure.

The Claimants seek an order varying the Moulder Order to include permission to serve out of the jurisdiction, for the reason indicated in § 32 below, and (if necessary) declaring the steps already taken pursuant to the Moulder Order to have constituted good service.

There is also before the court an issue about the costs of a previous application made by Lion and Thai Lion by notice dated 1 October 2020 (“ the First Application”), by which they applied for an order setting aside service of the Claim Form on them. The grounds of that application were that service was purportedly effected on them under CPR rule 6.11 when the conditions set out in that rule were not satisfied, because the Claim Form included claims that Lion and Thai Lion had not agreed (i) to subject to the jurisdiction of the English courts or (ii) could be served on them by service on an agent in England.

(B) FACTS

The First Claimant (“ Goshawk”) is an aircraft leasing and financing company.

The Second to Ninth Claimants are special purpose vehicles that each own an aircraft which is the subject of this claim.

The Claimants claim for sums said to be due in respect of aircraft which are the subject of leases between one of the Claimants and one of the Defendants, either under the leases themselves, under guarantees and indemnities and/or notices of assignment and acknowledgment, or under a Side Letter dated 14 November 2019 (“ the Side Letter”). The Claimants say the Defendants have had the use of their planes for more than a year without payment.

The first witness statement of the Claimants' solicitor, Mr Kavanagh, outlines the commercial connections between the parties and the claims as follows:

“5. The First Claimant (“Goshawk”) is an aircraft leasing and financing company and the remaining Claimants are special purpose aircraft owning companies which are either affiliated with Goshawk or managed by an affiliate of Goshawk. Each of the Second to Ninth Claimants owns an aircraft that is the subject of a lease.

6. The Second Defendant (“Lion”) is an airline incorporated in Indonesia and the Third Defendant (“Thai Lion”) is an airline incorporated in Thailand. Lion and Thai Lion form part of the ‘Lion’ group of companies. Thai Lion leases an aircraft from the Fourth Claimant. The First and Fifth Defendants (respectively, “TAN” and “Ciel”) are special purpose vehicles incorporated in France which lease aircraft from the Claimants and then sublease them to airlines in the Lion group. The Fourth Defendant (“LEO”) is a holding company in the Lion group which is incorporated in Indonesia. Lion and LEO provide security in respect of a number of the other Defendants' obligations under the relevant leases.

7. By a written agreement dated 14 November 2019 to which Goshawk, Lion, Thai Lion and LEO were parties (the “Side Letter”) …, it was agreed (among other things) that:

(a) The lessees under the various lease agreements between Goshawk group entities and Lion group entities would pay an additional deposit to the lessor under the relevant lease on or before 30 April 2020 such that the security deposit held by the lessor for each relevant aircraft should be equal to six months' Basic Rent (as defined in the relevant lease); and

(b) Lion would procure that such additional deposits were paid.”

Save for the Side Letter, all of the relevant contractual documents contain express provisions permitting service of claims on (variously) two process agents in England: Cogency Global (UK) Limited and SH Process Agents Limited.

On 26 June 2020 the Claimants obtained saisies conservatoires (“ saisies”) from the French court, freezing bank accounts belonging to the Fifth Defendant (“ Ciel”). It was a condition of the saisies that the Claimants must issue substantive proceedings within one month.

That condition was satisfied by the issue on 24 July 2020 of the Claim Form in the present proceedings and its service on Ciel in France on 28 July 2020.

On 5 August 2020, the saisies were set aside. In its judgment, the French court referred to the fact that the translations of the contract documents provided to the judge who issued the saisies had not made clear that Ciel had the benefit of parent guarantees from the Fourth Defendant (“ LEO”) (which was said to undermine the case that there was a risk of the debts going unpaid if the saisies were not granted), the relevant passages having been redacted from the translations.

On 19 August 2020, the Claimants purported to serve the Claim Form on the two nominated process agents in England. The letters to the two agents were in similar form. After setting out the action heading and the names of the relevant Claimants, each letter stated:

“We refer to the documents set out in Schedule 1 to this letter and your appointment as process agent in respect of claims under or in connection with those documents against the relevant parties identified in Schedule 1 (the “Relevant Parties”).

In accordance with your appointment as process agent as set out in Schedule 1, and pursuant to CPR r.6.11(1), on behalf of our above named clients please find enclosed, by way of service on the Relevant Parties, copies of the Claim Form in the above proceedings and accompanying Acknowledgement of Service form.

Kindly confirm safe receipt.”

Schedule 1 to each letter included a table listing contractual documents and, for each one, the name of the “Relevant Party for whom you are appointed as process agent”. The Schedule to the letter to Cogency Global (UK) Limited included (among other documents) two Notices of Assignment and Acknowledgment, and the Side Letter, in respect of which the process agent was said to have been appointed for Lion. The letter to SH Process Agents Limited was addressed ‘care of’ SH themselves. Its Schedule included two Deeds of Guarantee and Indemnity under which the process agent was said to have been appointed for Lion; and an Operating Lease Agreement, and the Side Letter, under which the process agent was said to have been appointed for Thai Lion.

On 20 August 2020 the Paris Commercial Court opened conciliation proceedings in respect of the First Defendant (“ TAN”) and Ciel.

On 4 September 2020, TAN, LEO and Ciel all acknowledged service, indicating an intention to defend. No claim is made against TAN, LEO or Ciel under the Side Letter. On the same date, Lion and Thai Lion acknowledged service, indicating an intention to contest the jurisdiction.

On 30 September 2020, the Claimants' solicitors Holman Fenwick Willan (“ HFW”) wrote to SH:

“We understand that you act for the following parties in the above proceedings:

(1) Terra Aviation Network S.A.S. (the First Defendant);

(2) PT Lion Mentari Tbk (the Second Defendant);

(3) Thai Lion Mentari Co. Ltd. (the Third Defendant);

(4) PT Langit Esa Oktagon (the Fourth Defendant); and

(5) Ciel Voyage S.A.S. (the Fifth Defendant).

We should be grateful for your confirmation that you are instructed by the above Defendants to accept service of the Claimants' Particulars of Claim and Initial Disclosure List.

Subject to the above, and in light of the current public health situation, we should be grateful if you would also confirm that you will accept service by way of email on this occasion.

Many thanks and we look forward to hearing from you by return.”

SH replied on 1 October 2020:

“We refer to your letter dated 30 September 2020.

We confirm that we are instructed to accept service of the Claimants' Particulars of Claim and Initial Disclosure List on behalf of the First to Fifth Defendants in the abovementioned proceedings without prejudice to the Second...