The impact of the COVID-19 pandemic on the air transport industry: what should lessors and financiers do next?
— Donal Hanley, Professor of Law, McGill University ― Faculty of Law
Nearly half of the world's civil aircraft fleet is leased, and about 50 percent of the remaining half is subject to some form of of financing by the airlines. Now that traffic has dropped dramatically, the financial impact is huge. Airlines may want to renegotiate or cancel certain agreements with banks and leasing companies, as well as purchase contracts with manufacturers, but how can they do this? What is the legal situation and what practical solutions can there be? There is no concept of force majeure in the Common Law governing most leases, but there is a similar concept that can be used even more effectively. There is an interesting old precedent in English Law where the purpose of the contract was frustrated and therefore it was canceled. Watch a master class by Donal Hanley, Professor of Law and former Managing Director of a large leasing company, and learn how airlines can save on lease payments. And what should lessors and financiers do next?