A court mandate requires Kelowna Flightcraft to continue its contract with Flair air for the time being. (File)

Kelowna Flightcraft nearly plunges Flair Airlines in contract dispute

A court mandate saved the budget airline from going out of business in “approximately 10 days”

Flair Airlines was saved by a Supreme Court mandate earlier this month that will see Kelowna Flightcraft carry on its business with the airline, at least for the time being.

An Oct. 10 court decision shows that the budget airline contracted Kelowna Flightcraft to provide dispatch services in August 2015. On June 24, 2019, Kelowna Flightcraft gave three-months notice, as per the termination provision in the contract, to end business with Flair due to an outstanding debt of $204,750. The letter demanded payment within five days.

For “reasons that are not explained,” Flair did not receive the letter until July 9. Upon receipt of the notice letter, it was construed as a demand for payment, submitted to Flair’s accounts department and subsequently paid.

The notice letter did not come to the attention of senior executives at Flair until Aug. 13.

READ MORE: Flair Airlines halts new routes to Florida, California

READ MORE: UBCO lecturer is crawling with spooky spider knowledge

On Oct. 9, the termination date of the contract, Flair brought the matter to the court on an “urgent basis” for an interim injunction to extend the life of the deal — and their business — a little further. Flair was granted the order, despite claims from Flightcraft stating they will be unable to seek out new customers and will remain “stuck at least for another 90 days providing dispatch services for a company that owes it approximately $4 million in respect of airline leases.” Flair disputes the $4 million figure.

Flightcraft made its intentions clear that it would send another termination notice, effective the date of the court’s decision. Flair has secured $150,000 to pay the contract for the next three months.

Among the judge’s considerations were the fact that without the injunction, Flair would not be able to meet commitments to approximately 120,000 customers who have purchased tickets for flights, including some 15,000 who have pre-purchased tickets for travel within the next week. It would also cause layoffs for 200-300 individuals employed by Flair.

“If the injunction is not granted, the services provided by Kelowna Flightcraft under the contract will terminate immediately, Flair Airlines will not be able to carry on business until it obtains a new dispatch contract from a new provider,” read the decision from Justice Walker.

“Flair Airlines will likely put out of business within a short period of time (it estimates in approximately ten days).”

The judge also noted that communications from Flightcraft suggest its intention to continue providing services to Flair under the contract well into 2020, in spite of the notice letter.

“It is arguable that Flair Airlines need not show a change in position if it reasonably relied on Kelowna Flightcraft’s representations and conduct to assume the status quo would not be effective, and in that sense, it could argue that it acted to its detriment.”


@michaelrdrguez
michael.rodriguez@kelownacapnews.com

Like us on Facebook and follow us on Twitter.

Get local stories you won't find anywhere else right to your inbox.
Sign up here

Just Posted

(Kelowna Capital News)
B.C. Labour Board orders Peachland cannabis company to reinstate laid-off employees

The B.C. Labour Relations Board determined the employees were laid off due to their plan to unionize

École de L’Anse-au-sable. (Google Maps)
COVID-19 outbreak at Kelowna Francophone school

Three cases of the virus have been identified at École de L’Anse-au-sable

In this file photo, snow is seen falling along the Coquihalla Highway. (Liam Harrap/Revelstoke Review)
Weather statement issued for Coquihalla, Hwy 3, as arctic front approaches

The early season snowfall expected to hit Fraser Valley, Friday, Oct. 23

BC Green Party candidate Amanda Poon (left) and BC Liberal Party candidate Renee Merrifield (right). (Michael Rodriguez - Capital News)
Person who attended BC Liberal candidate’s Kelowna home event tests positive for COVID-19

Kelowna-Mission candidate Renee Merrifield has not exhibited any symptoms of the virus

Myra Canyon Halloween SCARE Park opens on Friday, Oct. 23, 2020. (Contributed)
Myra Canyon SCARE park returns this Halloween season

Opening night is this coming Friday, Oct. 23 at 5:30 p.m.

Provincial health officer Dr. Bonnie Henry presents modelling of COVID-19 spread in B.C., March 25, 2020. (B.C. government photo)
B.C. sets another COVID-19 record with 203 new cases

up to 1,766 active cases in B.C., two more deaths

RCMP. (Phil McLachlan - Black Press Media)
British Columbia man dies during ski trip near glacier west of Calgary

Kananaskis Public Safety and Alpine Helicopters responded around 2:30 p.m.

Prime Minister Justin Trudeau arrives on Parliament Hill in Ottawa on Monday, Oct. 19, 2020, following a week-long break for the House of Commons. THE CANADIAN PRESS/Sean Kilpatrick
One crisis after another for Trudeau since last federal election one year ago

It has been a year of unprecedented calamity and crisis

Curtis Sagmoen
Public warning issued to North Okanagan sex trade workers

RCMP warns workers to stay away from Salmon River Road area

Is it time to start thinking about greener ways to package cannabis?

Packaging suppliers are still figuring eco-friendly and affordable packaging options that fit the mandates of Cannabis Regulations

Two pigs roam the Salmon Arm Walmart parking lot during a prior visit photographed by Danielle Burgi. (Danielle Burgi photo)
Pigs trot over for a visit at Salmon Arm shopping centre

Employees say this was the second drop-in from the temporarily free-range porkers

Join Black Press Media and Do Some Good

Pay it Forward program supports local businesses in their community giving

Penticton law courts. (Black Press file)
Osoyoos man in court for alleged shooting

The Oct. 11 shooting left a man with non-life threatening injuries

Most Read