Jurisdiction(s):
Ireland

AerCap and others v insurers: England and Wales Commercial Court to decide war‑risk vs all‑risk liability for aircraft stranded in Russia; contingent liability policies; multi‑billion‑pound exposure

Published on: 05 February 2025

Published by a Law360 reporter

Legal News

Article summary

Gavin Kealey KC of 7 King's Bench Walk, acting for a consortium of all-risk insurers, contended at trial that those all-risk carriers bear no liability. The proceedings aim to determine which insurers must meet the losses suffered by lessors after their aircraft were marooned in Russia following the February 2022 invasion of Ukraine. Kealey maintained that the losses stemmed directly from the Russian state retaining the planes in retaliation for Western sanctions imposed when Moscow invaded Ukraine. Accordingly, he said, responsibility lies with the war risk market, which issued policies to lessors to address the war-risk carve-outs in the all-risk wordings. He invited the court to dismiss the war risk insurers' contention that there remained a real prospect of the aircraft being returned notwithstanding the invasion and sanctions. In his words, the Russian government would concede nothing to the West in the economic conflict it was waging. He further asked the court to reject the suggestion that lessors could simply have sought redelivery of the aircraft, noting the war-risk insurers allege many lessors did not in fact make such a request...

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