Calgary Airport Authority wins right to appeal denial of $2M in fees owed by bankrupt Lynx Air

Calgary Airport Authority wins right to appeal denial of $2M in fees owed by bankrupt Lynx Air

A group of five Canadian airport authorities fighting to receive unpaid fees from bankrupt Lynx Air have won a partial victory from Alberta’s top court.

The claimants, including the Calgary Airport Authority and Edmonton Regional Airports, are seeking immediate return of more than $4 million in unremitted airport improvement fees from Lynx, which filed for bankruptcy last February.

The Calgary Airport Authority is owed about half of the total unremitted amount, with another $1.1 million owed to the Vancouver airport.

Airport improvement fees of varying amounts are charged to departing passengers by airport authorities and earmarked for capital projects. They are collected by airlines and returned monthly to airport operators.

The five authorities had argued distribution of the fees collected by Lynx should be given priority over other claims under the airline’s creditor agreement. Their reasoning included that other Lynx creditors could otherwise benefit from distribution of the outstanding airport funds.

However, a Court of King’s Bench of Alberta ruling in August determined the airport authorities did not have claim over all other interests. Justice Barbara Romaine cited a 1999 agreement that stated airlines do not have a partnership or trust relationship with the five airports.

“It is clear that the parties defined their relationship with respect to (airport improvement fees) as being a principal/agent relationship, but the express denial of an intention to create a trust overrides any such implication,” Romaine wrote in her decision.

The airports sought to appeal, arguing Romaine erred in her assessment of the contractual obligations contained in the agreement.

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