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ARTICLE · 10 AUGUST 2006

Liability for Air Navigation and Airport Service Charges

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Aircraft lessors and financiers may be held liable for Canadian air navigation and airport service charges incurred by airlines operating the aircraft as a result of a recent decision by the Supreme Court of Canada.

CanadaTransport
McMillan LLP
McMillan LLP
Stephen Rigby
Stephen Rigby
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Aircraft lessors and financiers may be held liable for Canadian air navigation and airport service charges incurred by airlines operating the aircraft as a result of a recent decision by the Supreme Court of Canada.

The Court recently released its decision in two controversial cases regarding the extent of the rights of NAV Canada (the privatized Canadian civil air navigation service provider) and various Canadian airports to seize and detain aircraft for the non-payment of air navigation and airport service charges incurred by an airline operating the aircraft.

The cases involved the 1999 collapse of Inter-Canadien Airlines, a Quebec regional airline and the 2001 collapse of Canada 3000, then Canada’s second largest airline. In each case, Nav Canada and certain airports obtained courtordered seizures of aircraft operated by the insolvent airline pursuant to certain statutory rights created by the Civil Air Navigation Services Commercialization Act ("CANSCA") and the Airport

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