Bitesize know how from the English Courts
Knowledge Counsel London
"…the contractual scheme recognised that, at any time until SpiceJet had satisfied all of its obligations, CIT could exercise the power in clause 13.14, ‘pull the rug’, and revert to its original entitlements…"
AVIATION
SpiceJet leased two aircraft from CIT but failed to make certain payments of rent. CIT sent notices of default and when SpiceJet failed to remedy the defaults the parties entered into agreements for the early termination of the lease agreements (“ETA”). The aircraft were redelivered to CIT and acceptance certificates issued by CIT. However, SpiceJet did not make all payments due and owing under the ETA and CIT sent notices exercising its rights to revert to the terms of the lease agreements. CIT issued proceedings and the Commercial Court awarded summary judgment on the claim. The court rejected SpiceJet’s argument that any sums were due under the ETA not the lease agreement; there was a clear provision in the ETA reserving CIT’s rights to revive the terms of the lease agreements. There was no Braganza duty of good faith on CIT in exercising its rights. Further, the redelivery certificates did not create an estoppel to preclude CIT from claiming the losses now claimed. The redelivery certificates served a narrow purpose in confirming that the ETA delivery condition was met. CIT was awarded payment of the undisputed sums and summary judgment on SpiceJet’s liability for the other losses claimed.
LANDLORD AND TENANT
The Ibis London Wembley hotel was found to be covered with external cladding panels that represented an intolerable risk of fire and needed to be removed. A dispute arose as to who was responsible for this removal. The tenant operator of the hotel alleged that the landlord was responsible for this as a result of various lease covenants and other legal obligations. The judge commented that the tenant’s obligations were novel as it was seeking to obtain in substance a building safety remediation order relying on the terms of a commercial lease, where the Building Safety Act 2022 does not apply to certain categories of buildings including hotels. The court held that the landlord was in breach of the good condition covenant where the cladding represented an intolerable fire risk, as well as the legal obligations covenant and obligations under the Regulatory Reform (Fire Safety) Order 2005. The tenant’s decision to close the hotel was reasonable in the circumstances. The court considered it appropriate to make an order against the landlord for specific performance of the obligation to remove the cladding and replace it with appropriate cladding.
LANDLORD AND TENANT
The Court of Appeal has confirmed that when considering whether a building was a “self-contained part of the building” as required by the Commonhold and Leasehold Reform Act 2002 for a right to manage claim, the appropriate test relates to the physical structure of the building, not ownership by law (such as shared foundations or basements). Further, it relates to the vertical, actual division of the building. The appeals in both claims were dismissed.
Courtyard RTM Co Ltd v Rockwell (FC103) Ltd [2026] EWCA Civ 712, 9 June 2026
JURISDICTION
The claimant insurance company issued a property insurance policy to the defendant company (incorporated in Texas) and its associated companies. The policy contained a provision requiring disputes to dealt with by arbitration in London. The defendant made a claim under the policy for losses resulting from the Covid-19 pandemic and brought proceedings in the Louisiana courts. Following the grant of an interim anti-suit injunction restraining any further steps in the Louisiana proceedings, the Commercial Court awarded a final injunction and damages for breach of the arbitration agreement. The policy was governed by New York law but the arbitration agreement was expressly governed by the law of England and Wales. The court rejected an argument that the arbitration agreement was invalid as a result of Louisiana law. The arbitration agreement was governed by English law; Louisiana law was therefore irrelevant and the clause was valid.
Key contacts
Knowledge Counsel London
Partner London
