CHAD Law and Practice Contributed by: Claudy Monja and Felana Ranaivoson, John W Ffooks & Co
2.9.5 Other Effects of a Lessee’s Insolvency A lease is not automatically terminated upon the issu - ance of an insolvency judgment. The following sce - narios may apply: • the syndic may decide to continue the lease sub - ject to the payment of the rent; or • the syndic may decide to terminate the lease, in which case, the lease is terminated by simple notice given by an extrajudicial act. The lessor is required to comply with the procedure of declaration mentioned in 2.9.1 Overview of Relevant Laws and Statutory Regimes Governing Restruc- turings, Reorganisations, Insolvencies and Liquida- tions . In addition, the lessor must specify in its decla - ration that it intends to exercise its reclamation right. 2.9.6 Risks for a Lender if a Borrower, Guarantor or Security Provider Becomes Insolvent The unsecured lender may run the risk of not being paid in full. Indeed, when the debtor’s assets are not sufficient to ensure the payment of the insolvent credi - tors, including the lender, the latter will be considered as any other ordinary creditor to be paid in equal parts with the existing assets of the debtor. 2.9.7 Imposition of Moratoria in Connection With Insolvency Proceedings In the case of legal redress, the debtor must propose an arrangement with its creditors. This arrangement can usually impose moratoria. In all cases, the lease will not automatically be terminated when the insol - vency judgment is pronounced. The syndic may decide to continue the lease subject to payment of the rent, or to terminate the lease. In the latter case, the lease is terminated by a simple notice given by an extrajudicial act. 2.9.8 Liquidation of Domestic Lessees The lessee can lodge a declaration of cessation of payment with the commercial court and request the initiation of insolvency proceedings. The cessation of payment and the insolvency proceedings (ie, either a judicial restructuring or a winding-up) can also be requested by the creditors or the court itself. In theory, three scenarios are possible:
• self-declaration; or • request by the creditors; or • request by the court. 2.9.9 Ipso Facto Defaults
See 2.9.1 Overview of Relevant Laws and Statutory Regimes Governing Restructurings, Reorganisa- tions, Insolvencies and Liquidations . 2.9.10 Impact of Domestic Lessees’ Winding-Up See 2.9.1 Overview of Relevant Laws and Statutory Regimes Governing Restructurings, Reorganisa- tions, Insolvencies and Liquidations and 2.9.5 Other Effects of a Lessee’s Insolvency . 2.10 Cape Town Convention and Others 2.10.1 Conventions in Force Chad is not a member state of the Convention on International Interests in Mobile Equipment (the “Con - vention”) and the related Protocol on Matters Specific to Aircraft Equipment (the ”Protocol”). However, the Chadian Civil Aviation Code provides that the Con - vention and Protocol are applicable and enforceable in Chad. 2.10.2 Declarations Made Concerning Conventions No declarations under the Convention or the Protocol have been made, to the best of the authors’ knowl - edge. 2.10.3 Application of Article XIII of the Protocol on Matters Specific to Aircraft Equipment The letter of the law is silent on how an IDERA should be submitted to or recorded in the ADAC’s register, but it is recommended that the IDERA be filed with the ADAC. 2.10.4 Enforcement of Conventions The authors are not aware of any experience on the part of local courts in the enforcement of the Conven - tion or the Protocol. 2.10.5 Other Conventions Chad is a party to the 1948 Geneva Convention on the International Recognition of Rights in Aircraft. Chad is not a party to the 1933 Rome Convention on the Uni - fication of Certain Rules relating to the Precautionary Arrest of Aircraft.
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