The Nigerian Airspace Management Agency (NAMA) has grounded the operations of Arik Airline over a $2.5 million debt owed to Atlas Petroleum International Ltd.
The development was made known in a statement issued Tuesday by NAMA’s director of public affairs and consumer protection, Abdullahi Musa.
According to the statement, the decision is in compliance with a court ruling regarding the debt case.
“On the 19th day of July 2024, the enforcement department of the FCT High Court enforced an Order made by the Court regarding a debt of $2.5 million owed by Arik Airline to one Atlas Petroleum International Ltd by attaching their aircraft,” NAMA said.
It noted that the court further gave Arik a notice of Public Auction of the planes slated for 26 July if it fails to pay the judgement debt.
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“All these were served on our agency and also on our supervising minister, the minister of aviation The records show that on the 8th day of March, 2016, the Judgement Debtor (ARIK) appealed the decision of the High Court of Lagos State entering judgement against it to the Court of Appeal and on 30th September 2021, the appeal was dismissed by the Court of Appeal in a unanimous decision with cost,” NAMA said.
According to the statement, Arik again appealed to the Supreme Court for leave to appeal the decision of the appeal court, and on 9 January, the Supreme Court delivered its ruling dismissing Arik’s application for leave to appeal.
NAMA explained that the judgement was registered in the FCT High Court and that on 26 June, Justice O. A. Adeniyi, then sitting in Court 8, Maitama in Abuja, made an order after hearing the motion (No: M/9785/2024) filed on behalf of Atlas Petroleum.
“…attaching all the moveable properties belonging to the Judgement Debtor, including the Judgement Debtor’s aircraft with Registration No: B737-700/ 5N-MJF, B737-800/ 5N-MJQ, DASH8-Q400 and 5N-BKX, in satisfaction of the judgement debt,”the statement partly read.
NAMA explained that copies of the court order and Certificate of Judgment were served on it and the aviation minister, but that Arik obtained an ex parte order stopping further execution of the court ruling even though they have not been formally served the exparte order.
“In the circumstances, since the first execution took place by attaching the aircraft, further execution by way of sale can be halted whilst the parties go back to court to resolve the issues,” NAMA said.
“However, in order to preserve the subject matter of the present dispute which are the aircraft in question (the res), which have already been attached, we have decided to comply with the effect of the supreme court order, by grounding the aircraft (subject of dispute) so that they are not taken out of the jurisdiction of the court or tampered with in a way as to frustrate the courts.”
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The agency also said the aviation minister, Festus Keyamo, being a senior advocate, understands the implication of the Supreme Court order dismissing the motion for leave to appeal.
“The minister will not risk his licence as a legal practitioner or his privilege as a Senior Advocate of Nigeria by engaging in acts that will frustrate an order of the Supreme Court of Nigeria,” NAMA added.
NAMA urged the parties to the dispute to resolve their issues as quickly as possible so Arik aircraft could resume flight operations.
Arik airline reacts
In his reaction to the situation, on Tuesday, the Chief Executive Officer of Arik, Roy Ilegbodu, lamented that this decision was made without warning or consultation. He said the decision has serious repercussions for the airline’s passengers, dedicated employees, and the Nigerian economy.
“Our priority has always been to connect people and facilitate commerce, especially on critical domestic routes. The grounding of our fleet disrupts these vital services, leaving passengers stranded and inflating already high travel costs. This decision hurts everyday Nigerians who rely on our flights for business, family, and essential activities,” the official said.
He said NAMA’s decision also disregards ongoing judicial processes, explaining that on 26 February 2016, a judgement was made in favour of Atlas Petroleum International Limited and Engineer Arthur Eze.
He, however, explained that there is an ongoing case in the Federal High Court, where Asset Management Corporation of Nigeria (AMCON) is asserting its secured interest in Arik’s assets.
Despite this, Mr Ilegbodu said, a writ of attachment was issued on 18 July, targeting Arik’s aircraft.
“The High Court of the FCT on July 25, 2024 clearly instructed all parties to maintain the status quo. We therefore are perplexed as to the grounding of our fleet, which is an overreach of the ongoing judicial processes and directives of court,” the official said.
“We believe this action undermines the rule of law and sets a dangerous precedent, prioritising unsecured private interests over the public good and the rights of secured creditors. We are committed to following the legal process and have full faith in the judiciary to resolve these matters fairly.”
Mr Ilegbodu said Arik airline has always been a proud partner in Nigeria’s growth, providing reliable and safe air travel. He urged the authorities to reconsider their decision.
“Lift the grounding order, and allow us to continue serving the public and supporting the economy. We stand with our passengers and employees during this challenging time and are working tirelessly to resolve this situation. Your support and understanding are greatly appreciated.
“We sincerely regret any inconvenience caused to our esteemed passengers,” he added.
Measures
Meanwhile, the Federal Airports Authority of Nigeria (FAAN), in a statement issued by Obiageli Orah, its director of Public Affairs and Consumer Protection, said it has implemented proactive measures to assist stranded Arik Air passengers.
“This is to inform the public that the Federal Airports Authority of Nigeria (FAAN) is aware that Arik Airline has been grounded due to litigation issues between the airline and their creditors,” FAAN said.
It said the authority has instructed all airport managers across the country to assist the affected passengers as Arik Airline works out plans to rebook and transfer passengers to other available flights.
“For further information, please contact Arik Airline on these lines: 0700003592745, 02012799999. FAAN will continue to ensure safety, security, and comfort for all air travellers in Nigeria,” the statement said.
Similarly, the Nigeria Civil Aviation Authority (NCAA) in a statement by its spokesman, Michael Achimugu, said it is aware of the grounding of Arik’s aircraft over legal issues and the attendant impact on its flights and intended passengers.
“While the NCAA monitors the situation and engages Arik Air on its plans for affected passengers, our Consumer Protection Officers are available at the terminals to monitor passenger handling and to offer information,” the NCAA said.
It said affected travellers may also walk into the NCAA Consumer Protection offices or send an email to cpd@ncaa.gov.ng
“NCAA empathises with all affected passengers and wishes to assure the protection of their rights as critical stakeholders,” Mr Achimugu said.
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