Court Enforces Cape Town Convention, Allows Repossession Of Arik Air Jet

The court’s decision follows the issuance of Nigeria’s Federal High Court (Cape Town Convention and Aircraft Protocol) Practice Direction on September 12, 2024. This new practice direction establishes legally binding rules that reinforce Nigeria’s commitment to the Cape Town Convention, instructing courts to apply its provisions in relevant cases without interference from other legal provisions.

The case centered around a 2013-built Bombardier CRJ1000 regional jet that was leased to Arik Air in 2014 by JEM Leasing Limited, with EDC helping finance the aircraft’s acquisition and holding a mortgage over it. Arik Air, which had been struggling financially and entered receivership under Nigeria’s Asset Management Corporation (AMCON) in 2017, stopped operating the aircraft in 2019.

In December 2022, after Arik Air defaulted on the lease, JEM Leasing moved to deregister and repossess the aircraft. However, efforts to repossess it were blocked by Nigeria’s Economic and Financial Crimes Commission (EFCC), citing concerns about the legality of the sale.

The applicants in the case, Captain Samuel Caulcrick, the local repossession agent, and Captain Isiaka Oyeshina Akinfenwa, CEO of part-out firm Merchant Express Cargo, criticized the tactics of the EFCC and Arik shareholder and founder, Johnson Arumemi-Ikhide. Justice Owoeye’s ruling revealed that EFCC officials had harassed, threatened, and intimidated the applicants during their attempts to repossess the aircraft.

The court granted EDC the right to reclaim and dismantle the CRJ1000 aircraft, which remains in storage at Lagos airport. It also issued an order preventing EFCC officials from interfering with the repossession process.

Minister of Aviation and Aerospace Development, Festus Keyamo, endorsed the court’s decision on his official X (formerly Twitter) account, calling it the “first victory in court in Nigeria courtesy of the Cape Town Convention.”