Lessors sued for seizing Flair Airlines planes seek dismissal of claims

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The leasing companies that seized four Flair Airlines planes over missed payments a year ago are seeking to have Flair’s lawsuit against them declared “frivolous” and have asked a judge to strike out most of the claims.

Edmonton-based Flair sued Airborne Capital of Dublin and four other lessors for $50-million in March, days after the Boeing 737s were repossessed after the discount airline fell behind on rent payments.

Flair chief executive Stephen Jones said at the time the airline had missed payments worth US$1.3-million but was trying to catch up when Airborne representatives boarded the aircraft and took control as passengers were preparing to depart airports in Toronto, Edmonton and Waterloo, Ont.

Flair sued the lessors three days later, accusing them of acting “unlawfully” and without warning because they found another company willing to buy or lease the planes for more.

Airborne Capital said Flair had missed payments worth millions of dollars over five months and the seizures were a last resort.

Airborne and the other leasing companies, all based in Ireland, have asked an Ontario judge to strike out most of Flair’s claims, including breach of contract and wrongful seizure.

The lessors said they will defend the lawsuit but had not filed a statement of defence as of Feb. 12. They said in a court document Flair has failed to properly respond to their requests to provide more details on its allegations.

Flair counsel Kent Breedlove called the leasing companies’ filing a delay tactic. “Our claim will continue according to the court’s schedule and Flair remains current on all leases,” Mr. Breedlove said in an e-mail.

The leasing companies have asked the judge to dismiss much of Flair’s claims, alleging they amount to “bald and conclusory allegations… improperly lumped together.”

“The [Flair] statement of claim alleges that the lessors breached the terms of the respective leases but fails to particularize what term or terms of the leases each of the lessors allegedly breached,” the leasing companies said in a document filed at the Ontario Superior Court of Justice obtained by The Globe and Mail.

“In its current form, the [Flair lawsuit] may prejudice or delay the fair trial of this action, is scandalous, frivolous or vexatious, and/or is an abuse of process of the court,” the lessors said.

Privately owned Flair bills itself as a discount airline that flies to destinations in Canada, the United States and some tropical resorts. It is partly owned by 777 Partners of Miami.

The Globe reported on Jan. 27 that Flair owes the federal government more than $67-million in taxes related to the import of 20 Boeing 737s. A court granted the government a document in September that allows it to order the seizure and sale of Flair property worth the amount owed. Flair said it has a repayment plan in place. The order has not been enforced.

The aircraft seized last year were three almost new 737 Max planes and an older 737 model. After the aircraft were seized, they were posted as available on industry websites.

The four were deregistered by Transport Canada and stored for several months at an airport near Barrie, Ont.

One of the aircraft departed in January and is registered to Ethiopian Airlines, flying out of Addis Ababa daily, according to Canadian government registries and Flight Radar 24, a tracking website.

Another was exported to the U.S. on Jan. 30 and is registered to a Chicago aircraft leasing company, according a U.S. government database.

The Globe has also reported Airborne and another lessor, BOC Aviation, were offering a total of 11 of Flair’s 19 planes to other airlines. Flair said it paid up these leases and retains them.