Tour operator Novaturas unlawfully terminated a charter flight agreement, and the court awarded damages plus 8% annual interest to charter flight company GetJet Airlines.
The Vilnius Regional Court rejected Novaturas’ request to declare that even after the lifting of the Covid-19 quarantine, the plaintiff, Novaturas, had not fulfilled its obligations under the charter flight agreement with GetJet Airlines due to force majeure circumstances. The court also dismissed Novaturas’ request to exempt them from contractual civil liability for force majeure circumstances as unfounded, recognizing the unilateral termination of the contract as unlawful and awarding GetJet Airlines €1.65 million in damages plus 8% annual interest.
“This is precisely the decision we had hoped for. The court has confirmed that attempting to justify unilateral contract terminations and unjustified non-performance of long-term obligations in a legal state’s business environment is neither acceptable nor tolerable,” says Rūta Kulvinskaitė, CEO of GetJet Airlines.
According to her, in the wake of the pandemic and its impact on the aviation sector, GetJet Airlines invited all partners to engage in dialogue and, above all, seek compromise solutions.
Long-term Contract Encouraged Investment
The legal dispute between Novaturas and GetJet Airlines arose from a long-term charter flight service agreement signed in 2018. According to the agreement, the companies’ collaboration was supposed to continue for six years until the end of 2024. The contract also allowed for termination after four years, at the end of 2022.
The contract guaranteed a significant number of flight hours for GetJet Airlines, prompting the acquisition of three Airbus A320 aircraft by GetJet Airlines one year after signing the contract. The value of these investments exceeded €60 million.
Unilateral Contract Termination
In June 2020, following the end of the COVID-19 pandemic quarantine, Novaturas informed GetJet Airlines in advance that it did not intend to continue the contract beyond 2022. However, Novaturas, failing to comply with the contract’s terms, unilaterally and unlawfully terminated the agreement at the end of 2020, seeking to avoid the damages stipulated in the contract.
The Vilnius Regional Court recognized Novaturas’ unilateral termination of the contract as unlawful and terminated the contract by a court decision from January 1, 2021. Novaturas will have to pay €1.15 million, along with 8% annual interest from January 1, 2021.