Terms of Business
The definitions and rules of interpretation set out in Schedule 1 (Interpretation) apply to these terms and conditions.
2. REPRESENTATIONS AND WARRANTIES
Each Party represents and warrants to the other that it has the power to enter into, perform and deliver, and has taken all necessary action to authorise its entry into, performance and delivery of the work bound by these terms and conditions.
(a) Customer will transport the Engines to and from the Facility at the customer’s own risk;
(b) Custodian will evidence its acceptance of the delivery of each Engine at the facility by completing our in house engine receipt paperwork and process, including taking photographs and carrying out an incoming inspection.
(c) The Customer will collect or make arrangements to collect the Engines from the Facility when they have been informed that the requested works have been completed.
(d) The parties further hereby acknowledge and agree that Custodian shall not in any event be liable for damage to Engines during transportation to and from the Facility.
4. PAYMENT, QUOTATION AND TAX
(a) Custodian will invoice the applicable agreed amounts for work undertaken.
(b) Custodian may request payment in advance, in part or in full, if deemed necessary and work may not commence until receipt of funds has been confirmed.
(c) Customer will pay all undisputed invoices within 30 days of invoice date.
(d) Custodian reserves the right to charge interest at a rate of 3% above Bank of England Base Rate on a daily basis on any amounts which are outstanding in excess of the due date.
(e) If there is a bona fide disputed amount, Customer will advise Custodian immediately on becoming aware of such disputed amount and within 15 days of invoice date. Both parties acting reasonably will meet to resolve such disputed amount. The raising of a dispute does not impact any other
(f) Pricings given are not final until a full and final work pack has been provided to Custodian.
(g) All Taxes, other than Custodian’s Taxes, levied in connection with work contracted for by the Customer will be for the account of Customer and must be paid by Customer within the period specified for payment permitted by Law.
5. CUSTODIAN’S COVENANTS
5.1. Care of Engine
(a) Custodian will take all reasonable care of each Engine and ensure that it is stored in accordance with all applicable laws and regulations as detailed in the AMM.
(b) Custodian must not transfer, represent itself as the title-holder or owner of, or abandon possession of, Engines or any part of an Engine.
(c) Custodian must not permit installation of an Engine or any part, component or module comprised within the Engine on any aircraft or any aircraft engine or any component comprised within any aircraft engine without the prior written consent of the Customer.
(d) Custodian will not cause Engines to be seized, detained or expropriated.
(a) Custodian will maintain Insurances including £10million public liability and £5million employer’s liability insurance (or other comparable insurances) whilst the Engines are held at the Facility.
(b) Custodian will maintain comprehensive third party legal liability insurance covering its activities and matters for which it is liable under these terms and conditions in line with current market practice of the London Aviation insurance market whilst the engines are stored at the Facility. Such insurance will be in the form of a Hangar Keepers insurance policy with
(c) Subject to the limitations of liability stated in Clause 7, the Customer will effect and maintain property damage insurance for the Engines at all times whilst the Engines are being transported to and from the Storage Location and whilst the Engines are being held at the Facility.
(a) Without prejudice to Clause 5.3(b), Custodian will not permit any third party (with the exception of UK government authorities, the occurrence of which has been notified to Customer by Custodian) to have any access for any reason to an Engine at the Facility without the prior written consent of Customer, such consent not to be unreasonable withheld.
(b) Custodian will procure any security authorisations, such authorisation not to be unreasonable withheld, as may be required by Customer or their third parties in accordance with Clause 5.3(a) to enable access to the Storage Location.
(c) Custodian will:
i. Grant or procure rights of access to Customer upon reasonable notice at all times during the period the Engine is held within the Facility to conduct inspections of any Engines; and ii. Provide any reasonable assistance required to conduct such inspections.
5.4. Removal of Parts Custodian must not make or permit any change, modification, alteration or addition to be made to Engines, nor remove any parts, components or modules from an Engine, without prior written consent of Customer.
(a) Custodian will ensure that Engines do not become the subject of any Security Interest.
(b) Custodian will not, in any circumstance, seek to assert, claim or exercise any Security Interest over or in respect of an Engine.
5.6 Workscope Escalation
(a) Custodian shall not carry out any services in excess of the services which have been agreed to in the workscope or which incurs a cost in excess of the agreed price without Customers prior written approval.
6. TITLE AND RISK
6.1. Title The terms and conditions confer neither title nor any proprietary rights or interests of whatever nature in Engines on Custodian and Custodian acknowledges that title to and right to possess, use and enjoy an Engine remains at all times with Customer.
6.2. Risk of loss and damage
(a) Subject to Clause 6.2(b) and Clause6.2(c), Custodian will insure the Engines for all risks including whilst being held at the Facility and all risk rests with Custodian.
(b) Risk of loss or damage to any Engine whilst being transported to or from the Facility resides with Customer. Customer will deliver Engines to the Facility and collect such Engines. Custodian will, subject to written consent by Customer, be willing to liaise with pre-appointed transportation companies to arrange for transportation of Engine to and from the Facility, however risk of loss or damage to any Engine remains with Customer.
(c) As far as Customer is aware, the Engine and Engine stands are, on the date of delivery to the Facility, are in a suitable condition.
(d) If any Engine delivered to Custodian or a Supplier is lost, destroyed or damaged during Custodian’s period of care as a consequence of a breach by Custodian of the Warranty as disclosed in Clause 7.1(b) then Custodian will, at its election and subject to the receipt by Custodian of a formal written claim by Customer within 30 Business Days of such loss, destruction or damage, either:
i. Repair such damage free of charge; or ii. Provide Customer with a cash to the Mutually Agreed Value of the Engine taking into account, age, usage and condition, not to exceed the original net price paid for the Engine.
(e) The parties agree that each will accomplish the transfer to the other of full legal title to any Engine exchanged, free and clear of all charges, liens and encumbrances.
(f) Neither Party is liable for any consequential losses which may arise as a result of this Agreement.
7. WARRANTIES AND LIMITATION OF LIABILITY
7.1. Warranty Custodian accepts
(a) Custodian warrants to Customer that it will carry out all necessary storage of the Engines at the Facility, in accordance with the AMM (Customer must provide copies of relevant sections of the AMM and transportation manuals applicable to the stored engines), all relevant rules and regulations in force at the date of these terms and conditions, and with reasonable skill and care being the level of skill and care that Custodian applies when storing its own engines (the “Warranty”).
7.2. Limitation of Liability
(a) Customer’s remedy for Custodian’s breach of, or failure to perform, any obligation with respect to the storage of Engines is as set out in these terms and conditions and not otherwise.
(b) Customer’s entitlement to the warranty granted by these terms and conditions, are in lieu of and to the exclusion of any other right or cause in action in contract (including negligent breach of contract), tort (including negligence and product liability whether strict or otherwise) or under statue or any other legally recognised cause of action or liability whatsoever.
(c) The protection afforded by this Clause 7.2 extends to, and for the benefit of Custodian and its Suppliers and owners of Engines.
(a) Custodian agrees to defend, indemnify and hold harmless Customer and its successors and assigns, financiers, shareholders, subsidiaries, affiliates, partners, directors, officers, agents, contractors, subcontractors, personnel and employees in full and on demand from and against any and all liabilities, claims, damages, losses, Custodian Taxes, fees, fines, penalties, suits, demands, costs, expenses, proceedings and judgments (whether in contract, tort, negligence of any degree, strict liability, or otherwise), including all costs, expenses and reasonable attorneys’ fees incidental thereto, which may be suffered by, accrued against, charged to, or recoverable from Customer and/or any third party (including, but not limited to, personal injury and/or death and property damage claims), arising out of or in any way connected with Custodian’s performance or non-performance of the services carried out in accordance with this Agreement, delivery, possession, performance, refurbishment, storage, management, control, maintenance, condition, service, repair, overhaul, redelivery and Services to be performed under any Purchase Order to which these terms are subject, except where such loss or damage results solely from the gross negligence or willful misconduct of Customer.
8.1. Confidential Information Each Party agrees to hold in confidence any Information (including these terms), which it acquires directly or indirectly form the other Party and agrees:
(a) To protect the Information with at least the same degree of care used to protect its own Information;
(b) Not to use the Information otherwise than for the purposes of these terms and conditions;
(c) Not to disclose the Information at any time or to any third person without the written approval of the other Party;
(d) Not to copy or reduce the Information to writing or store, whether in a machine readable form or otherwise, except as may be reasonably required for the purposes of our work; and
(e) Not to remove, alter or deface any proprietary or confidential designation denoted on the Information.
8.2. Exceptions The provisions of Clause 8.1:
(a) Do not apply to Information which is generally known in the Aero Engine Industry, received from a third party who is without an obligation of non-disclosure, or which is required to be produced by a legitimate legal authority (in which case the Party compelled to disclose will promptly advise the other Party);
(b) Will not prevent any necessary disclosure of Information to enable Customer or third parties to support safety investigations.
Neither Party will assign or transfer (whether voluntarily or involuntarily, by the operation of Law or otherwise), declare a trust of, or create or permit to exist any Security Interest over, any of its rights or obligations under these terms and conditions without the prior written consent of the other, such consent shall not be unreasonably witheld.
10.1. Further Assurance Each Party agrees from time to time to promptly do and perform such other and further acts and execute and deliver such other instruments as may be required by Law to carry out and effect the intent and purpose of these terms and conditions, all at the expense of the Party requesting such acts and instruments.
10.2. Costs and Expenses Each Party will pay its own charges, costs and expenses in the performance of its own obligations in these terms and conditions.
10.3. Waiver, remedies cumulative The rights of each Party under these terms and conditions may be exercised as often as needed, are cumulative and (except as set out in the terms and conditions) apply in addition to its rights under the general Law and may be waived only in writing and specifically. Not exercising or delay in exercising any right is not a waiver of that right.
10.4. Severability If a term of these terms and conditions is or becomes illegal, invalid or unenforceable in any jurisdiction in relation to any Party, that will not invalidate the remaining provisions of this agreement or affect the legality, validity or enforceability of that or any other provision in any other jurisdiction.
10.5. Amendment Any Amendment to these terms and conditions must be made in writing and signed by or on behalf of the Parties.
10.6. Survival The provisions of: Risk of loss and damage, Limitation of Liability, Indemnity, Confidentiality, Severability, Survival, No partnership or agency, Precedence, Notices, Law and Jurisdiction of this Agreement will survive and remain in force should this Agreement expire or be terminated for any reason or after this Agreement becomes impossible of performance or is otherwise frustrated.
10.8. Entire Agreement
(a) This Agreement constitute the entire agreement between the Parties with respect to the storage and work on Engines.
(b) Custodian assumes no contractual obligation with respect to the storage of the Engines other than as expressly set out in this Agreement, whether arising under any condition or warranty of merchantability, fitness or quality or any other contractual condition or warranty express or implied by statue or otherwise.
(c) Custodian assumes no collateral duty in tort or negligence to the customer with respect to the storage or work on the Engines.
(d) The terms of this Agreement apply to the exclusion of the terms of any other document which may be issued by either Party relating to the storage or work on the Engines.
(e) Neither Party has placed any reliance on any representations, agreements, statements or understandings made prior to the signature of this Agreement, whether orally or in writing, relating to the storage of the Engines other than those expressly incorporated in this Agreement, which has been negotiated on the basis that its terms represent their entire agreement relating to the storage or work on the Engines and supersede all such representations, agreements, statements and understandings.
(f) Neither Party may place any reliance on any and all future representations whatsoever in respect of the performance of this Agreement unless expressly agreed by the Parties in writing to form part of this Agreement. It is not the intention of this Clause 11.9 to exclude the liability of either Party for fraudulent misrepresentation.
10.9. No partnership or agency
(a) Nothing in this Agreement will:
i. Constitute a partnership or joint venture between the Parties;
ii. Constitute any Party the agent of any other Party; or
iii. Create any fiduciary obligations between the Parties.
(b) Neither Party will:
i. Represent itself as the agent or partner of the other Party; or
ii. Do anything (or omit to do anything) which might result in any person believing that such Party has the authority to contract or enter into commitments on behalf of, or in the name of, the other Party.
10.10.Precedence If there is any conflict or inconsistency between the provisions of this Agreement and any other document referred to in this Agreement, then the provisions of this Agreement prevail.
11.1. Any notice or communication in connection with this Agreement must be in writing, in English and, unless otherwise stated, may be given in person or by certified post.
11.2. Our address for delivery of a notice or communication for in connection with this Agreement is as follows:
11.3. Any notice given in connection with this Agreement will only be effective:
(a) If delivered in person, when delivered;
(b) If by certified post, five days after being deposited in the post, postage prepaid, in a correctly addressed envelope and subsequently signed for by the receiving Party.
11.4. The provisions of this clause will not apply to the service of any proceedings or other documents in any legal or arbitral proceedings.
11.5. A notice or other communication required to be given under or in connection with this Agreement are not validly given if sent by e-mail.
12. LAW AND JURISDICTION
12.1. Governing law
This Agreement is, and non-contractual obligations arising out of or in relation to it are, governed by, and are to be construed in accordance with, English Law.
(a) The English courts have exclusive jurisdiction to settle any dispute arising out of or in connection with Agreement or the legal relationships created by it and any non-contractual obligations arising out of or in relation to it, and the Parties submit to the exclusive jurisdiction of the English courts without disputes.
(b) Each Party:
i. Waives any objection to the courts of England on grounds of inconvenient forum or otherwise as regards proceedings in connection with this Agreement; and ii. Agrees that a judgement or order of a court of England in connection with this Agreement will be binding on it and may be enforced against it in the courts of any other jurisdiction; and
iii. Represents and warrants that it is subject to civil and commercial law with respect to its obligations under this Agreement and that neither it or its assets enjoys any right of immunity from set-off, suit or execution in respect of its obligations under this Agreement and the Parties hereby waive any immunity it may have inconsistent with the foregoing.
12.3 Force Majeure:
(a) Neither Party shall be liable for nor deemed to be in default on account of any delay or for the consequences of any delay in performing of any of its obligations under this Agreement or any order by Customer if such delay is due to a Force Majeure Event. Any period of delay which is deemed to be reasonable shall lengthen the affected parties due date for completion of its obligations under this Agreement for an equal period of time.
SCHEDULE 1 – INTERPRETATION
In this Agreement:
“AMM” means the aircraft maintenance manual as approved by the Customer’s local airworthiness authority in respect of the aircraft type on which the Engine is permitted to be installed as made available to Custodian in advance of Period of Storage.
“Business Day” means a day (other than a Saturday or Sunday or National or Bank Holidays) on which business related to this Agreement is carried out in London or New York.
“Custodian Taxes” means any Tax assessed on Custodian under the Laws of its jurisdiction of incorporation if that Tax is imposed on or calculated by reference to its net income, profits or gains.
“Customer” means the legal owner of the Engine or the entity which has appointed us to carry out the required works on the Engine
“Engine” means an aero engine
“Facility” means Aero Engine Centre, 109 Green Lane, Hounslow, Middlesex, TW4 6DF.
“Force Majeure Event” means any event beyond the control of either Party but shall include but not be limited to acts of God or the public enemy; civil war; insurrection or riots; fires; floods; explosions; earthquakes; labour disputes, work stoppages, restrictions or strikes; compliance with government legislation, acts, orders or regulations; inability or failure of Suppliers to deliver (to the extent caused by reasons similar as those mentioned in this provision); or for any other cause to the extent that it is beyond the Parties reasonable commercial efforts to control..
“Information” means any commercial, financial, technical or operational information, know-how, trade secrets or other information of or in the possession of the disclosing Party in any form or medium (including, but not limited to, all data, know-how, calculations designs, drawings, methods, processes, systems, explanations and demonstrations) as has been or may be disclosed or otherwise made available to the receiving Party or any Representative, whether orally or in written, electronic or other form including any copies or reproductions of such information in any form or medium and any part or parts of the same;
“Insurances” means the insurances referred to in Clause 5.2 of this Agreement;
“Law” means all rules and regulations (regardless of their source), including judicial or administrative interpretation thereof, in force from time to time;
“Mutually Agreed Value” means the value to be agreed between Customer and Custodian as the replacement amount for each Engine and is to be shown on the Engine Acceptance Certificate for each Engine.
“Party” means a party to this Agreement;
“Representative” means any one or more employee, servant, agent, consultant, or other person representing or purporting to represent a receiving Party including (without limit) any director, officer or professional adviser of such receiving Party;
“Security Interest” means any mortgage, charge, pledge, encumbrance, lien, right of set-off, assignment, hypothecation or any other arrangement or agreement having the effect of conferring security;
“Suppliers” means the servants and agents of Custodian, and any person engaged directly or indirectly in the storage of the Engines.
“Taxes” means all present and future income, turnover, sales, use, business, value added, licence, corporation, capital gains, franchise, export/income, registration, stamp documentary and other taxes, levies, duties, imposts, fees, charges and withholdings of whatever nature together with interest and penalties, if any, and any payments made on them or in respect of them and Tax and Taxation will be construed accordingly;
“Warranty” has the meaning set out in Clause 7.1(a)