• Leasing firm, airline strike out-of-court settlement on dues
• Passenger flight from Kuala Lumpur to resume tomorrow

KUALA LUMPUR: A Malaysian court has ordered immediate release of a Pakistan International Airlines (PIA) plane that had been seized nearly two weeks ago by the authorities over a London court case about the jet’s lease after the applicant, Peregrine Aviation Charlie Ltd, agreed to withdraw its suit against PIA Corporation.

The Boeing 777 aircraft was seized on Jan 15 soon after landing at Kuala Lumpur International Airport on the orders of a local court that allowed an application by lessor Peregrine Aviation Charlie Limited to keep it grounded until the result of a $14 million lease dispute with PIA in Britain.

On Wednesday, the Kuala Lumpur High Court ordered the release after both sides apprised it they had reached an amicable settlement of the dispute, involving two planes leased to PIA, a lawyer for the airline said.

“Peregrine has agreed to withdraw its suit against Pakistan International Airlines Corp (PIAC) and for the injunction orders to be set aside,” said its lawyer, Kwan Will Sen.

“With this, the two Boeing aircraft operated by PIAC would be released with immediate effect.”

According to the interim injunction, PIA was restrained from moving the two aircraft in its fleet — Boeing 777-200ER with serial number 32716 and Boeing 777-200ER with serial number 32717 — once they have landed or parked at Kuala Lumpur International Airport until a further hearing on the matter.

Tracking data from Flightradar24 showed only one of the two Boeing 777s covered by the court order is currently in Kuala Lumpur. The other was last recorded in Karachi last month.

The two jets, leased in 2015 by Dublin-based AerCap, the world’s largest aircraft lessor, are part of a fleet it sold to Peregrine Aviation Co Ltd, an investment unit of NCB Capital, the brokerage arm of National Commercial Bank SJSC, in 2018.

AerCap, which continued as part of the agreement to provide lease management services to Peregrine, has declined to make any comment. Lawyers for Peregrine did not immediately respond to a request for comment.

Flight back home

Pakistan’s national carrier is now readying a crew for the plane to resume a passenger flight home by Friday, its spokesman, Abdullah Hafeez Khan, said.

Earlier on January 15, the airline tweeted: “A PIA aircraft has been held back by a local court in Malaysia taking a one-sided decision pertaining to a legal dispute between PIA and another party pending in a UK court. The passengers are being looked after and alternate arrangements for their travel have been finalised.

“It is an unacceptable situation and PIA has engaged support from the government of Pakistan to take up this matter using diplomatic channels.”

The PIA spokesperson while commenting on the legal dispute told Dawn.com that it was a “payment dispute between us and the party Peregrine” that had been filed in the UK courts about six months ago. He refused to give further details on the dispute, adding that the Malaysian court took an “ex-parte decision causing inconvenience to the passengers who had already boarded the plane”.

Federal Minister for Aviation Ghulam Sarwar Khan told a presser on Sunday that the PIA and the Peregrine Aviation Charlie Limited leasing firm had agreed on an out-of-court settlement for the PIA plane seized at the Kuala Lumpur Airport.

He said after paying the default money, it was expected that the Boeing 777 would be flown back to Pakistan.

The minister blamed the previous Pakistan Muslim League-Nawaz (PML-N) government for acquiring the two planes in 2015 on an ‘expensive’ lease that the national carrier failed to pay on time due to Covid-19 pandemic.

He said the Malaysian court issued an order without listening to arguments of PIA.

About financial problems, the minister said PIA was facing issues due to poor policies of previous governments as they made unnecessary political appointments even on fake degrees that ruined the organisation.

With more than $4 billion in accumulated losses, PIA had already been struggling financially when flights were grounded last year due to the Covid-19 pandemic. After it resumed operations in May 2019, a domestic PIA flight crash in Karachi killed 97 of the 99 people on board. Pakistan’s aviation industry was then hit by a scandal in which pilots were found to hold dubious licences prompting a number of countries to ban PIA from operating flights in their jurisdictions. The airline was banned from flying to the European Union for six months over safety compliance concerns under a ban still in place.

Published in Dawn, January 28th, 2021