DLA Piper advises China Southern Airlines on English High Court win

DLA Piper has acted for its client China Southern Airlines ("CSA") in a litigation case in the English High Court where CSA was ultimately awarded US$28 million in damages and interest.

The case related to a claim against CSA by Tigris International N.V. for US$46 million in damages for breach of contract, inducement of breach of contract and conspiracy to injure. The claims arose in connection with an aircraft sale agreement between CSA and Tigris International N.V. (a company incorporated in Curaçao, formerly part of the Netherlands Antilles), for the purchase of six redundant Airbus A300 aircraft and five spare Pratt & Whitney engines for a total consideration of US$124 million. Due to an internal shareholder dispute of the claimant, CSA was only able to deliver one of the six aircraft to Tigris International N.V. In order to mitigate its loss, CSA subsequently sold the remaining five aircraft to other purchasers, including a South African company owned by the financier of the claimant.

CSA counterclaimed for its losses of about US$37 million arising from the claimant's failure to pay for and take delivery of the undelivered aircrafts and engines as well as other associated expenses such as parking and maintenance charges.

After a 10-day trial in the Commercial Court in London in June 2013, the court dismissed the claims against CSA in their entirety. The court awarded US$28 million in damages and interest to CSA on its counterclaim, and also declared that CSA was entitled to forfeit the deposit paid by the claimant in the amount of US$10.5 million.

Kevin Chan, partner at DLA Piper said: "This case is a significant victory for CSA and we are pleased with the result we achieved for our client. The case involved close collaboration of our colleagues from various countries around the world, including Hong Kong, China, the United Kingdom, the Netherlands, the US, as well as DLA Cliffe Dekker Hofmeyr in South Africa."

The team was led by Kevin Chan partner in Hong Kong and supported by Adrian Elms (Senior Associate, Hong Kong), Paulina Ho (Associate, Hong Kong), Priscilla Chan (Legal Assistant, Hong Kong) and Ann Cheung (Trainee, Hong Kong); and Mark Franklin (Partner, London), Chloe Challinor (Senior Associate, London), Shereena Rai (Associate, London) and Chris Elliott (Trainee, London).