LM-2025-000186 - [2025] EWHC 2098 (Comm)

The parties agree that if a sum is payable in respect of Block Hours Utilisation Compensation, the sum payable is €86,060.52. There is however a dispute as to whether it is payable at all. SLX EST contends that under the terms of the ASA there is a procedural notification requirement which required TUI BEL to notify SLX EST within a specified time, and that such notice (if given) would have to comply with a specified procedure. It is said that these provisions were not complied with, and as a result the claim by TUI BEL fails.

The particular terms relied on by SLX EST are Clause 8.2 and 21 of the ASA. These provide (so far as relevant) as follows:

In relation to Clause 8.2, any claim for Block Hour Utilization Compensation would only be possible once it is known what the relevant hours were for each relevant aircraft. It is likely that the Claimants kept their own records, and would be able to make their own assessment promptly at the end of each lease as to whether a claim would be likely to arise. But the agreement envisages that there would be a process of reconciliation in relation to the hours flown. Clause 2.2 of CTA Annex A in terms refers to a preliminary reconciliation within 15 days of the Redelivery Date, with final reconciliation one month after the end of each lease pursuant to Clause 8 of the ASA.

The process of reconciliation did indeed take place, albeit later than envisaged by the agreement, with the Defendants providing details of the relevant hours to TUI BEL on 25 November 2024, and TUI BEL notifying SLX EST within 3 days that it considered that compensation should apply. SLX EST did not consider that it was barred from seeking payment in respect of excess hours outside the period referred to in Clause 2.2. I do not consider that the time periods within Clause 8 of the agreement are to be construed as conditions to the underlying claims by either party, or bar those underlying claims should they not be met. The requirement in Clause 8.2 that the compensation should be effected within one month is directed to the intended timing of the payment of compensation, and does not bar any claim to compensation if not made within that period. In my view much clearer language would be necessary to produce that result.

In circumstances where the claim to compensation was not (in my view) barred by its timing, and where the figures have in fact been agreed as a result of a reconciliation between the parties, I do not consider that the related point that TUI BEL failed to give formal notice of its compensation claim in accordance with the provisions of Clause 21 of the ASA takes matters any further. TUI BEL in fact engaged with the individuals dealing with block hours issues at the Defendants (one of whom in any event appears to have been the individual identified as the point of contact for operational issues under Clause 4.2.1 of the ASLAs between TUI BEL and SLX EST), and there is no suggestion that SLX EST was not in fact aware of the claim.