Durham Tees Valley Airport wins £12m Bmibaby compensation claim
06.05.10
Budget airline bmibaby, part of BMI and owned by German airline Lufthansa, has been ordered to pay damages to Durham Tees Valley Airport after it withdrew services in 2006. Appeal Court judges ruled in favour of the airport, which had estimated its losses at £12m. The airline plans to appeal this decision.
The airport claimed bmibaby flouted a deal signed in 2003 to fly two of its planes out of the airport for a minimum of 10 years. The airline blamed its decision to pull out in 2006 on mounting losses and said it could no longer justify operating services from the airport.
Durham Tees Valley lost an initial claim for damages in May 2009, but mounted an immediate appeal, which was heard in London yesterday. Lord Justice Patten, sitting at the Civil Appeal Court with Lord Justice Mummery and Lord Justice Toulson, said bmibaby were in ‘repudiatory breach’ of the contract. In addition to damages, the airline also faces legal cost bills likely to exceed £1m.
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