Qatar Airways Group Q.C.S.C. v Airbus S.A.S.

On an application for a mandatory interlocutory injunction, the applicable approach is the conventional American Cyanamid analysis. There is no distinct, higher merits threshold merely because the relief sought would preserve performance of a contract pending trial.

Where the claimant has a serious issue as to its eventual entitlement to specific performance, the court must assess whether damages will adequately compensate the claimant during the period to trial. If suitable substitute performance can be obtained and the asserted loss is additional cost, delayed profits, or other quantifiable financial loss, damages may be plainly adequate. In that event the injunction should be refused without a further balance-of-convenience assessment.

Qatar Airways applied for an interlocutory injunction requiring Airbus to continue performing an agreement for the manufacture and delivery of 50 A321 aircraft. Airbus had purported to terminate that agreement under a cross-default provision after Qatar refused delivery of two A350 aircraft because of alleged degradation of their airframes.

Qatar sought to prevent Airbus acting on the termination, disposing of the relevant aircraft or delivery slots, and failing to perform the agreement pending trial. The application was in substance mandatory relief. The central issues were whether Qatar had a sufficient prospect of obtaining specific performance at trial and whether damages would adequately compensate it for the absence of aircraft before trial.

1. Application dismissed. Qatar established serious issues for trial concerning the alleged A350 breach, the validity of termination, and the possible availability of specific performance. That did not justify mandatory interim relief.

2. The reference in American Cyanamid to a claimant having a real prospect of obtaining permanent relief did not impose a higher threshold than a serious issue to be tried. Nor should a court mechanically require a higher merits threshold for mandatory relief. The ultimate interim question is which course causes the least irremediable prejudice.

3. It was not plain that specific performance would be unavailable at trial. The aircraft agreement was arguably a contract for a result rather than services requiring unacceptable supervision. The A321 was not bespoke in its core characteristics, and the evidence did not permit a final conclusion that it was insufficiently unique or obtainable only through a functioning substitute market. Those matters required trial evidence.

4. Clause 17.4 was, provisionally, strongly arguable to operate as a cross-default clause. Its language referred to failure to take delivery under any existing aircraft purchase agreement, and Qatar’s narrower construction risked making the clause redundant. The point remained for trial because Qatar sought no final construction and a serious issue was common ground.

5. For the pre-trial period, damages were plainly adequate. Qatar could source leased A321 aircraft or comparable Boeing aircraft, and its evidence did not show that temporary replacement was impracticable. Any additional leasing, training, route, or delayed-profit costs were monetary and capable of assessment. The potential inability to operate a small number of routes with an A321LR did not alter that conclusion, since replacement wide-bodied aircraft could be leased and the resulting cost sounded in damages.

6. Clause 11 of the Common Terms was provisionally inapposite to a claim for wrongful termination rather than delivery delay. Airbus had also confirmed that it did not rely on clause 12.5 for the wrongful-termination claim. No further balance-of-convenience inquiry was therefore required.

not stated in the judgment.