By Staff Reporter
The Patriot has it on good record that the European aviation authority is considering revoking Air Namibia’s operating licence for not honouring an almost N$400 million judgment debt. A source speaking on condition of anonymity told The Patriot that anyone who does not honour a judgement by a European court, should not be allowed to do business in Europe.
These new threats are in addition to the national airliner facing a freeze on their bank accounts held in Germany.
The national airliner fell into debt after a Belgium-based liquidated aviation company, Challenge Air SA dragged them successfully to court over a lease agreement.
Challenge Air recently told Air Namibia that they will continue with freezing the national airlines accounts if their agent in Namibia does not receive a “substantive settlement proposal”.
A communication seen by The Patriot showed Challenge Air’s lawyers last year warning Air Namibia that all money paid for tickets through Europe will be blocked from 16 November 2018 until they reach 25 million Euros (N$391 million). On 4th January 2019, CommerzBank attached approximately N$ 10 million as part of the repayment.
It is widely expected that they will proceed to the next step which will attempt to ground Air Namibia aircraft, albeit leased.
Air Namibia recently wrote to Challenge Air that because they do not own any of the aircraft operated on its international routes, though they have advised their lessors of the latest developments regarding the threats of attachment “… to enable the lessor to protect its interests in relation to such aircraft in the event of attachment,” the letter reads.
The Patriot in the past reported that according to a legal opinion, Air Namibia aircraft cannot be attached by Challenge Air, however it is possible to attach the Kerosene (fuel) contained in the aircraft, because under German law, kerosene (fuel) is a movable physical object.
Challenge Air – which was liquidated 20 years ago – wrote that to Air Namibia on 13 December 2018 in response to a 7 December 2018 letter from Air Namibia.
The letters form part of a series of communication over a 2015 judgment made by the Munich Regional Appeal Court.
The judgement arose from a transaction between the two parties involving a 1998 agreement with Air Namibia intending on leasing a 351-passenger plane – a Boeing 767-300 – from Challenge Air. The lease agreement was cancelled a few months after, following the discovery of defects that Challenge Air was unable to rectify.
The Patriot last year in November reported that Challenge Air instructed its legal team in Europe to proceed with the freezing of Air Namibia accounts and that the airline’s assets in Germany were at risk of being attached.
Air Namibia in their 7 December letter proposed to have a meeting with the liquidator of the Belgian company in Brussels or Germany during the first week of February 2019, in order for the parties to gain insight on proposals if any, regarding the proposed settlement.
Writing to the foreign company through the lawyers Shikongo Law Chambers, the airline requested that all further execution steps be temporarily suspended, if Challenge Air agrees with the proposed meeting.
The national airline also said that they intend to propose that the “amount of settlement in a United States litigation paid to Challenge Air in relation to the failed engines” that Air Namibia had been leasing from Challenge Air, be “disclosed without prejudice” and also that they discuss two unpaid bills of cost in favour of the national airline as referred to by proceedings in the High Court.
Challenge Air through their lawyers Fellows Advocates and Clerens Legal Partner responded to Air Namibia’s legal team saying it is premature to “convene a meeting in Brussels” as they have appointed agents, with full mandate to handle the matter in Namibia and that no concrete proposal regarding the amount of payment was made to the agents.
“Any settlement proposals must be done via Wilhelm Shali c/o [in care of] Sisa Namandje & Co and similarly all correspondences regarding settlement proposals must be sent to Sisa Namandje & Co” the letter read.
They also told the national airline’s lawyers that the assertion that Air Namibia does not have assets in Europe, “does not absolve Air Namibia from its legal obligation” arising from a German court judgement.
They further stated that they are aware that the judgement execution process that is currently underway may affect Air Namibia passengers destined for Europe and that it will cause an embarrassment to the country.
“We take the considered view that this situation is avoidable if there is a real intention to respect the Munich Regional Court of Appeal judgement on the part of the respondents and or the respondent’s (sic) shareholder” the letter read.
They further warned Air Namibia that “any consequential damages will only be the result of your refusal to make payment” and will be fully at Air Namibia’s risk and expenses.
Challenge Air’s lawyers told Air Namibia’s legal team that they take the national airline considering various options in mitigating against liquidation as their concession that the airline is unable to meet the obligations arising from the German court’s judgement.
“If this is correct we will seek further legal remedies in this regard,” Challenge Air warned.
While Mutorwa in the past said that government will defend the almost N$400 million dollar case, he told The Patriot yesterday that he will not comment on the latest developments as the matter is before the court.
“Speak to the Air Namibia management,” the minister said.
Air Namibia spokesperson Paul Nakawa said that their legal department was not available to address the questions sent to them and that they can only respond at a later stage.