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ARTICLE · 14 JULY 2011

When is loss indemnifiable?

Discusses indemnifiable loss in leasing aircraft, both commercial and private.

AustraliaTransport

With the ever-increasing practice of leasing aircraft for operation across Africa, owners and financiers would be well-advised to familiarise themselves with their insurance policies, and to look beyond their policies for additional security in the form of registering rights and mortgages. In addition, the conduct of owners and lessors in their business practices could become the subject of some scrutiny in determining whether a claim is indeed an indemnifiable one.

Air service operations in Africa differ vastly from country to country. Within this competitive and tricky market, many commercial transactions have resulted in disputes, some even resulting in a complete breakdown of the relationship and the retention of aircraft by lessees. Matters are complicated further as the enforcement of written lease agreements is problematic in the foreign legal jurisdiction, and owners can find themselves in a difficult position minus one expensive asset. So what are

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