(1) UniCredit Bank GmbH, London Branch (appellant) v Celestial Aviation Services Ltd (respondent)

Tuesday 14 - Wednesday 15 May 2024
(1) UniCredit Bank GmbH, London Branch (appellant) v Celestial Aviation Services Ltd (respondent)
(2) UniCredit Bank GmbH, London Branch (appellant) v Constitution Aircraft Leasing (Ireland) 3 Ltd (respondent)
Before Lord Justice Males
Lord Justice Snowden
Lady Justice Falk
By Appellant’s Notice filed on the 26 May 2023, this is an appeal against the decision of Mr Christopher Hancock KC, sitting as a High Court Judge, dated 26 May 2023, sitting in the Commercial Court.
The appeal raises issues of law concerning the construction of UK and US sanctions regulations and their application to obligations under letters of credit (“LCs”).
In each case, the LCs were issued in favour of the Respondents by a now sanctioned Russian Bank. The LCs were confirmed by the Applicant Bank (“UniCredit”). The purpose of the LCs was to secure obligations of a Russian airline under aircraft leases.
Following receipt of valid demands by the Respondents under the LCs, UniCredit refused to pay under the LCs, claiming that it was prohibited from doing so by reason of the operation of sanctions imposed by the UK, EU and US.
The Applicant’s issued separate Part 8 Claim forms seeking declarations that UniCredit’s obligations under the LCs were not relieved by the sanctions regimes and payment of the sums due.
By his Orders of 23 and 26 May, the Judge made the declarations.