Lloyd's Maritime and Commercial Law Quarterly
LEX SITUS AND AIRCRAFT
Air Foyle
v. Center Capital
Kuwait Airways
v. Iraqi Airways (Nos. 4 and 5)
Background
There has long been debate about whether the English conflict of laws rule that the validity of the creation or transfer of a proprietary interest in a chattel, including a security interest, is determined by the lex situs
does, or should, apply to aircraft. A subsidiary question is whether, in this context, aircraft have a deemed or artificial situs
in their country of registration.1
There was until recently little specific English judicial authority on the position in relation to aircraft. Dicey & Morris
2
treats aircraft similarly to ships. Exception 2 to r 112 states: “A civil aircraft may at some time be deemed to be situate in its country of registration.” Rules 116 and 117, in relation to transfer of tangible movables, make no special case for aircraft. Unlike ships, there is no authority for treating aircraft differently from general chattels3
by giving significance to the law of the register. Aircraft were treated by English domestic law no differently from general chattels in relation to their mortgaging until the Mortgaging of Aircraft Order 1972.4
Movement across national
1. See esp.: P. A. Lalive, The Transfer of Chattels in the Conflict of Laws
(Oxford, 1955) (hereafter, “Lalive
”); G.A. Zaphiriou, Transfer of Chattels in Private International Law
(Oxford, 1955) (hereafter, “Zaphiriou
”); Graham McBain (ed) et al.
, Aircraft Finance: Registration, Security and Enforcement: Anglo-American Conflict of Laws Rules relating to the Conveyance of Aircraft
(Sweet & Maxwell, London, 1989; loose-leaf, last updated January 2004) (hereafter, “McBain
”). The first two are now somewhat old and concentrate on general chattels, although Lalive does have a little to say on aircraft (and Zaphiriou has some interesting observations on ships). McBain, as the title suggests, gives a full review of the English and US position relating to aircraft. He makes a strong plea for the law chosen by the parties to be determinative, rather than the law of the physical situs
or the law of the register (or, indeed, any of the other possibilities which he mentions). See also R. C. Cuming, “International Regulation of Aspects of Security Interests is Mobile Equipment” [1990–1991] Unif LR 64.
2. L. Collins (ed), Dicey & Morris on the Conflict of Laws
, 13th edn (Sweet & Maxwell, London, 2000) (hereafter, “Dicey & Morris
”), esp. chs 22 and 24; P. North et al.
, Cheshire and North’s Private International Law
, 13th edn (Butterworths, London, 1999), esp. ch 20. The main cases on the conflict of laws aspects of the transfer of proprietary interests in general chattels are: Cammell
v. Sewell
(1858) 3 H & N 728; 157 ER 1371; Winkworth
v. Christie, Manson and Woods Ltd
[1980] Ch 496; Inglis
v. Robertson
[1898] AC 616; Glencore International AG v. Metro Trading International
Inc [2001] 1 Lloyd’s Rep 284.
3. The expression “general chattels” is used to mean tangible movables other than aircraft (or ships). The English conflict of laws position in relation to ships is complex and, with due respect to the treatment in Dicey & Morris
, potentially different from that in relation to aircraft. It is beyond the scope of this note.
4. Mortgaging of Aircraft Order 1972: SI 1972 No. 1268, as amended. It should also be noted that the UK aircraft register is an operator’s register and not a register of title.
LLOYD’S MARITIME AND COMMERCIAL LAW QUARTERLY
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