The following Banking & Finance guidance note Produced in partnership with Norton Rose Fulbright provides comprehensive and up to date legal information covering:
The most basic concerns for a lessee in an operating lease are that the aircraft it leases is in an airworthy condition and that it is able to use the aircraft without interference from the lessor. The lessor’s most basic concerns are that it gets paid for allowing the lessee to use the aircraft and does not suffer any losses as a result of the operation of the aircraft by the lessee.
This Practice Note explains the key provisions in operating leases which relate to delivery condition, quiet enjoyment, rent and deposits and operational indemnities.
For more information about other aspects of operating leases, see Practice Notes:
Aircraft operating leases—basic concepts
Aircraft operating leases—subleasing and events of default
Redelivery conditions in aircraft operating leases, and
Aircraft lease maintenance obligations
Specific considerations apply where an aircraft is the subject of a sale and leaseback or where an aircraft is a new aircraft. For more information on sale and leaseback arrangements, see Sale and leaseback arrangements. Where, however, the aircraft is being purchased as new from the manufacturer, the lease will typically contain very detailed delivery conditions based on the manufacturer’s specifications for the aircraft as set out in the aircraft purchase agreement between the manufacturer and the lessor. For more information, see Practice Note: Purchase agreements for new aircraft.
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