Alafco Sues Boeing for Non-delivery of Max Jets

Kuwaiti aircraft lessor Alafco has filed suit against Boeing in federal court in Chicago for failure to return payment on undelivered 737 Max 8 jets. The filing claims rights to the return of $336 million in advance payments for the first 10 of 40 aircraft on order, the first delivery of which Boeing had set for March 2019. All global aviation authorities grounded the 737 Max by March 13, when the U.S. FAA became the last to do so.  

According to the lawsuit, although Boeing notified Alafco of delivery delays involving “many” of the aircraft, it has not yet given the lessor an estimate of revised delivery months.

The filing indicates that Alafco sent a letter to Boeing terminating orders for the aircraft scheduled for the March delivery based on a non-excusable delay. Boeing countered in a December 3 letter that it “respectfully disagrees” with Alafco’s assertion of non-excusable delay rights and refused to return the payment. On March 6 of this year, Alafco canceled the orders for all 40 aircraft after Boeing failed to make “timely” delivery of nine of them.

Alafco claims a provision in the contract that limits Boeing’s liability in the event of an excusable delay does not apply, arguing that fault for the grounding of the airplanes lies with the manufacturer.

In an emailed response to a query from AIN on Thursday, Boeing said it would not comment on the matter.