A New South Wales Supreme Court judge has denied an application by US MRO firm Jet Midwest to recover USD7.2 million from Rex - Regional Express (ZL, Wagga Wagga) after it alleged the carrier stole four Saab (Sweden) turboprops from Arizona's Kingman Airport in 2020.
The matter is Jet Midwest, Inc. v Regional Express Holdings Limited trading as Regional Express Airlines (case no: 2024/00264848).
As reported by The Australian, in Sydney this week Justice James Stevenson denied Jet Midwest's application to proceed, citing s.440D of the Corporations Act (2001). The section bans the start or continuation of proceedings against a company without permission from the administrator or leave from the court while the company is in administration. Rex filed for administration in July owing around AUD500 million dollars (USD329 million) and is currently up for sale.
Jet Midwest alleges that Rex stripped its aircraft for parts and sold the remaining airframes for scrap without fully paying for them.
Stevenson also said that while a company is in administration, the owners of assets held by that company cannot take possession of them. However, as the newspaper noted, administrators Ernst & Young had identified some aircraft parts, including propellor blades, in an Indonesian storage facility and elsewhere, and were prepared to return them.
"The administrators are willing to make these parts available for immediate collection,” Stevenson said.
Meanwhile, Ernst & Young is yet to find a buyer for Rex, which continues to operate a fleet of Saab 340B and Saab 340B(Plus) types on regional routes around Australia. The airline has abandoned its loss-making B737-800 operations. There are reports that the age of the fleet (the average age of the 340Bs is 33.4 years, the Plus types 28.4 years) is deterring prospective buyers. However, ch-aviation is aware that most of the aircraft have relatively low hours and all are well-maintained.
The administrators are looking to sell Rex for around AUD300 million (USD197.1 million).
