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Tuesday 18 June 2019
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Air Namibia’s N$60 million legal bill

Air Namibia has spent more than N$60 million to fight off a court challenge from a Belgian aviation firm that was liquidated 20 years ago. Challenge Air SA wants the national airline Air Namibia to pay over N$400 million after the airline allegedly amassed outstanding debts for services such as maintenance, rent and insurance premiums.
Confidential documents seen by The Patriot indicate that Air Namibia incurred a legal bill of  N$62 million (3,734,969 Euros) compared to the N$31 million (1.906,653 Euros) legal bill racked up by the applicants.
The airline was represented by Shikongo Law Chambers, who subsequently instructed a host of European and South African based lawyers to battle the case from that side.
Although Air Namibia wanted the court not to award the costs or to rather reduce it, such requests were not considered.
In 2015 court documents, Challenge Air SA claim that the award made in France on 4 August 2011 and the Munich appeal court ruling of 12 January 2015 is yet to be honoured by Air Namibia and TransNamib.
The Munich court at the time ordered the airline to honor the court order because “the claimant has clearly won completely at the liability stage and substantially at this quantum stage(recovering all outstanding maintenance, rent and insurance premia amounts plus interest).”
“It is irrelevant whether a cost order against respondents could result in the first respondent being unable to continue operating as the national carrier of Namibia.
This is not a justifiable reason why the Claimant (and ultimately its creditors) should suffer non-recovery of costs incurred to recover its contractual rights breached by the respondents. I do not consider it relevant whether the claimant’s claim is being supported financially by another person,” reads one of the court documents perused by this paper.
The court further indicated that: “[Respondents] have substantially lost this arbitration. In the partial award I noted that this arbitration had been complicated and that respondents had raised a myriad of alternative defences and special please several of which were without any merit, and would have made little difference to the substantive amounts in issue and which complicated  this arbitration and to the added costs.”
Challenge Air SA has obtained a court order that compels Air Namibia to settle the debt within 10 days or risk having its Europe-bound aircrafts being impounded. Yesterday on the 25th October, that agreement lapsed and this means that Air Namibia Aircraft may be attached in settlement of this bill. All legal fees have been paid after ticket sales in Germany were attached in settlement of the fees.
Local business mogul Wilhelm Shali and Anicet Baum who are Challenge Air’s representatives are represented by prominent local lawyer Sisa Namandje.
The Patriot understands that Air Namibia, before the High Court on 3 December 2018, intends to cross examine Challenge Air’s witnesses on certain issues such as whether Challenge Air, from a comity of nations perspective should be recognized.
There are also talks that Challenge Air have approached German courts to exhaust ways to get funds due to it.
Air Namibia has a Ticket Sales Agent (Aviareps) as well as a bank account in respect of which an attachment may be effected, Challenge Air said, adding that the airline further operates its aircraft to Frankfurt.
Air Namibia, which owns no aircraft, is of the view that since their aircraft are operated under lease agreements, it cannot be attached. The fear in this respect, however, relates to the fuel contained in the Aircraft. The legal opinion provided in this regards indicates that, though Air Namibia aircraft cannot be attached by Challenge Air, it is indeed possible to attach the Kerosene (fuel) contained in the aircraft. The latter is due to the fact that, under German law, kerosene (fuel) is a movable physical object. The attachment of a movable physical object in the custody and control of the debtor is effected by the court appointed enforcement officer taking possession of it,” reads a document seen by this publication.
It further reads that: “Under German law therefore the enforcement officer does not have to examine whether the debtor is the owner of the physical object, or indeed entitled thereto.
In this particular case the German law works on the general assumption that someone who has possession over a moveable object most likely is also the owner thereof.
Otherwise the enforcement process would be complicated. It is believed that no court will be in a position to stop the enforcement of the January 2015 ruling attained in Munich. Challenge Air SA has appointed Baum as its liquidator.




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