Flair Sues Airborne Capital over Seized Aircraft

Flair Sues Airborne Capital over Seized Aircraft

DALLAS — Flair Airlines (F8) has filed a lawsuit in the Ontario Superior Court against aircraft leasing company Airborne Capital.

Early Saturday morning four of the ultra-low-cost carrier aircraft were seized by the Irish company over a technical breach of lease argument. On Wednesday the airline announced it would be suing the company for US$50m for an alleged breach of contract and “negligent and/or fraudulent misrepresentation”. 

During a Tuesday press conference, Flair Airlines CEO Stephen Jones commented to the media on the seizure noting that the airline was in constant communication with the leasing company regarding the late payment and that F8 had assured Airborne the payment would be received. To the company’s surprise, the aircraft were seized in the early hours of the morning with no warning.

In a statement on Tuesday, Airborne Capital noted, “The leasing of the four Airborne-managed aircraft was terminated following a five-month long period, during which Flair was regularly in default of its leases by failing to meet its payments when due, with payment arrears reaching millions of dollars.”

In the lawsuit filing, Flair noted, “It is very common for airlines to be in minor, and, in many cases, major arrears, in respect of the various payments due under aircraft leases, without lessors taking enforcement action.”

Flair’s comment within the suit continues by stating, “The seizures were orchestrated in a bad faith and malicious manner that inflicted the maximum possible harm on Flair, including by interfering with its passenger relationships and trust.”

Flair Airlines Boeing 737-8. Photo: Brandon Siska/Airways

Comments from Flair Airlines CEO

When asked by Airways regarding the impact of the loss of four aircraft to the expanding fleet, CEO Stephen Jones noted that the initial impact has been rectified by the activation of three standby aircraft delivered to F8 earlier in the year. These aircraft were initially slated to be activated during the summer season to line up with the airline’s expansion plans. However due to the loss of aircraft, the summer season could significantly be impacted by the shortage, 

When asked about the track of the airline to their F50 goal of having 50 aircraft active in the fleet by 2025, Jones noted that he expects the airline to still be on track to reach this goal as a fleet size of 60-100 aircraft is perfect for the long-term ULCC market in Canada. The loss of these aircraft is expected to be only a speed bump along this airline’s expansion path. 

The Canadian certificate of registration for the four aircraft seized by Airborne has been rescinded and it is expected the aircraft will be transferred to a new airline home once a transition process has been completed. Jones also noted during his Tuesday press conference that he believes the young airline still has a target on its back from some of the major carriers within the country.

Although he did not cite any specific evidence to support this claim he expects that some of his reasoning would become clear in the coming weeks to months. For now, the four seized aircraft are on the ground in Edmonton, Kitchener-Waterloo, and Toronto waiting for further action from the leasing company.

This is a developing story.

Featured image: Siezed Flair aircraft. Photo: Liam Funnell/Airways

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