The High Court has ordered relief sought by Belair Holdings Ltd to discharge an entry made by Etole Holdings Limited on the International Register, holding that the entry could not be retained as a registrable non-consensual interest under the Cape Town Convention.
In a judgment delivered on 26 March 2015, Ms Justice O’Malley said the Convention’s conditions for applicability had not been met. Belair was incorporated in the Cayman Islands and had its registered office there, and the aeroplane was also registered there. The judge found no evidence that Belair had its centre of administration, a place of business or habitual residence in a Contracting State at the relevant time. The Cayman Islands could not ratify the Convention in its own right, and the United Kingdom had signed but not ratified it.
The court also considered the alternative argument that the registration might be supported by an Article 40 declaration allowing certain non-consensual interests to be registered. It found that no Contracting State with an arguable connection to the parties’ dealings had lodged such a declaration. Even assuming Etole had a binding agreement capable of creating an international interest, the judge said it could not be registered without Belair’s consent and did not justify describing it as a non-consensual interest.
Etole also relied on an Article 39 declaration lodged by the United States. The court held that such declarations concern priorities under national law for interests that are not registered, and did not justify retaining an entry that inaccurately stated it concerned an Article 40 interest. The judge said the registry’s inability to verify every entry did not mean a court should condone a misleading registration.
The judge rejected Etole’s objections to Belair’s demand for discharge. A 24-hour deadline was legally ineffective but did not invalidate the demand, and the request to remove the entry did not undermine the part seeking its discharge. Service on Etole’s agent at the address included with the registration was not rendered ineffective by an alleged breach of a professional code. The court also rejected criticism of Belair’s ex parte service application and alleged lack of candour, noting that US pleadings had been before the court.
The ruling addressed the validity of the registration only. It made no finding on the parties’ contractual dealings or on the High Court’s jurisdiction to decide issues arising from that dispute; those matters remained to be determined. The judgment concludes: “I therefore propose to make the order sought.”