Aviation transactions are specialized contractual relationships between equipment owners, lessors, and lessees. These parties play crucial roles throughout the entire cycle of ownership, operation, and service provision in the aviation industry. A central theme in typical aviation transactions is the assurance of trust among all stakeholders in this industry. Equipment owners seek guarantees that their assets will remain secure and be returned at the end of the contract period. Lessors require certainty in the remittance of agreed rental payments from Lessees as well as the ability to repossess the equipment ("aircraft") if necessary. Simultaneously, service providers, often operating on the aircraft which is likely to be removed from the jurisdiction need assurance that they will be compensated for any services rendered to either the Lessee or the aircraft. This intricate web of transaction dynamics underscores the legal complexities that often raise concerns for the parties within the transaction seeking security against outstanding obligations from aviation transactions.
Therefore, the significance of aircraft liens in aviation transactions cannot be overemphasized as it empowers non-owners (the "lienholder" or "lienee,") to retain possession of the aircraft until the owner's ("Lienor") outstanding debt is settled. Aviation liens encompass a wide spectrum of financial interests ranging from possessory liens to statutory detention liens, fuel expenses and even sellers' liens post-ownership transfer in aircraft. Hence, understanding the complexities of aircraft liens is essential for all stakeholders in the aviation sector is key to compliance with legal requirements, risk management, financial security, increased lender confidence and the successful execution of aircraft leasing and financing transactions.
To enrich the knowledge of legal practitioners, aviation industry participants, and all stakeholders involved in the complexities of aircraft leasing, financing, and operations in Nigeria, we have authored the *2023 Nigerian Chapter on Aircraft Liens recently published by Thomson Reuters/Sweet & Maxwell. This chapter offers a comprehensive exploration of the various types of aircraft liens, their legal implications, and effective enforcement strategies of this complex yet indispensable aspect of aviation transactions. (*Original chapter written by H. Odein Ajumogobia (SAN) LLB, LLM (Harvard),FCIArb).
Reproduced with permission from Sweet & Maxwell, a Thomson Reuters business. Aircraft Liens and Detention Rights (The Nigerian Chapter), (published in July 2023)
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
