Safety at heart of dispute

While lawyers square off in the Court of Appeal over banal, finer points of contractual law, spokesmen from protagonists The Helicopter Line and Airwork Holdings both highlight helicopter safety is their priority, reports senior business reporter Simon Hartley.

Safety issues have been aired out-of-court over the maintenance and operation of eight Queenstown tourism helicopters, whose routes range widely across the mountainous lower South Island.

Queenstown-based The Helicopter Line quit part-way through a 20-year helicopter leasing contract, citing "unacceptable levels of risk'' for staff and passengers.

However, chopper leasee Airwork Holdings of Auckland says the same craft flew for more than 35,000 hours with "no accidents involving injury or property damage''.

While the Court of Appeal is yet to set a time to hear a combined Airwork appeal and Helicopter cross appeal, both parties have responded to the ODT, primarily over the safety issues as opposed to contractual obligations.

Many of the 24 incidents were considered minor, but the High Court described one as having created "serious avoidable risks, including a risk of fatalities''.

Airwork spokesman Geoff Senescall said Airwork was proud of its safety standards and maintenance services.

"The Airwork-maintained helicopters were flown by The Helicopter Line for more than 35,000 hours and there were no accidents involving injury or property damage over that period as a result of Airwork's maintenance,'' he said.

An earlier High Court judgement between the pair, in favour of Airwork financially, had also highlighted 24 incidents reported to the Civil Aviation Authority by The Helicopter Line, against Airwork from 2008-13.

Despite winning judgement for $2million, Mr Senescall said Airwork disagrees with some of the judge's finding, "particularly around its safety record raised in the context of a contractual dispute with The Helicopter Line''.

He said all the incidents outlined in the judgement were considered by the CAA and no action was taken by it.

Airwork "was not aware of any ongoing concerns''.

The ODT had highlighted the 24 incidents to the CAA last month and asked if the case would prompt an investigation.

The CAA responded it had reviewed the High Court judgement and had asked for an investigation to ensure any outstanding safety issues had been resolved.

The CAA did not reply to a question then about how many staff may be involved, nor give an investigation timeframe.

Mr Senescall said of the incidents, where remedial action, or improvements were required, action was taken.

"This was followed up by the CAA, which conducted its routine audit and monitoring of Airwork. Airwork met and exceeded all remedial action points,'' he said.

The CAA told the ODT there was an "aviation-related concern'' in 2014 faced by Airwork, which was in the "assessment process''.

Mr Senescall said while CAA records showed an outstanding aviation-related concern, that was assessed in 2014 and "to date we have not been advised of any details or concerns''.

Skyline Enterprises' (parent of The Helicopter Line) chairman Mark Quickfall said last week the High Court findings, released in May, validated The Helicopter Line's decision to cease flying the Airwork helicopters in July 2013.

It ceased flying "over safety concerns relating to the standard of maintenance provided under the contract''.

"The Helicopter Line and the directors could not continue to operate helicopters under a contract that put its pilots, passengers and business under unacceptable levels of risk,'' Mr Quickfall said.

He cited the judge's decision "The evidence has satisfied me that, after 2 July 2013, the [THL] directors were justified in deciding there was too great a risk for THL's pilots, passengers and the business to continue operating Heli Holdings' aircraft and that they had genuinely lost the confidence and trust in Heli Holdings/Airwork''.

Mr Quickfall said safety was put first, "particularly'' once any hope of our concerns being addressed and efforts to work constructively with Airwork were "wiped off the table'' by Airwork on July 2, 2013.

He said the consequences of the decision for The Helicopter Line were "significant'' given it eventually faced a claim for $16million.

"Heli Holdings/Airwork was only successful in relation to [getting] $2 million; relating to historic charges that had accrued under the contract prior to July 2013.

"It is the findings over safety and the legal consequences of these that Airwork challenges on appeal,'' Mr Quickfall said.

He noted The Helicopter Line had accepted the findings of the High Court, in relation to the historic charges, and the decision "generally'', the cross appeal being in response to Heli Holdings' appeal to the Court of Appeal.

simon.hartley@odt.co.nz

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