NOVATION IN AIRCRAFT LEASING: WHEN A NEW CONTRACT EXTINGUISHES THE OLD ONE

Aircraft leasing is the legally most complicated area of commercial aviation finance, and one in which the re-arrangement of multi-party transactions over their lifetime is relatively common. This article explores the functioning of the mechanism of novation within the specific context of aircraft lease novations, under Indian law, the Cape Town Convention, and in comparison with the treatment in English, American, and Irish law. The article argues that while section 62 of the Indian Contract Act 1872 provides a solid legal basis, important gaps remain, especially around regulatory novation, insolvency, and international priority interests. It concludes with suggestions to improve Indian practice to better meet the global aviation leasing industry's needs.