A ruling by the Supreme Court of Canada may allow Kuwait Airways to seize new planes being built by Bombardier Aerospace for Iraq Airways.
The ruling is the latest in a long-running dispute between the two nations, with Kuwait seeking compensation for planes that were seized by Iraq during the first Gulf War in 1990.
In 2008, the national Kuwaiti carrier won a case in a British court against Iraq and was awarded the equivalent of $84m. In August of that year the airline applied to the Quebec Superior Court for the English ruling to apply in Canada. This application and a subsequent one to the Quebec Court of Appeal were dismissed. However, this latest appeal has upheld that the concept of state immunity should be allowed, Canadian media reports.
“Iraq’s invasion of Kuwait in 1990 and the ensuing Gulf War are today having unforeseen consequences for Canadian courts,” wrote Justice Louis LeBel. “The military conflict has now given way to a courtroom battle.”
Bombardier is involved in the dispute after Iraq awarded the Montreal manufacturer two contracts for 10 CRJ-900 regional jets, worth about $400m, Dow Jones reports.
“Bombardier would like to get on with deliveries of the CRJ-900 to our customer,” Bombardier spokesman John Arnone told Dow Jones in an email. “It’s unfortunate that we find ourselves in the middle of this dispute. We are reviewing today’s court ruling and are in discussion with our customer, the Government of Iraq.”
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