Relevant Cases on Financial Lease Contracts

On August 29, 1986, the plaintiff Deutsche AG and the defendant leasing company entered into a cooperation agreement, and at the same time signed a master lease agreement, with a total financing amount of 23.9 million deutsche marks and 13.9 million U.S. dollars. Pursuant to the provisions of the Cooperation Agreement and the Master Lease Agreement, the parties entered into 43 sub-lease agreements between September 2, 1986 and May 30, 1989, agreeing on the amount of the lease payments to be made by the Leasing Company to Deutsche on the equipment leased under the respective sub-lease agreements, the term of the payments, and the manner of the payments.In 1990, the Leasing Company asked for a grace period for all of the Deutsche Mark-denominated sub-lease agreements. On December 28, 1990, the parties entered into a debt restructuring agreement, which changed the amount of the outstanding lease payments under the 17 subleases 6-7, 18-22, 30-36, and 42-44, which had been calculated and paid on an "early payment" basis since November 23, 1990, to a "rental plus lessor's sale" basis, which was calculated and paid on a "rental plus lessor's sale" basis. "Beginning in 1992, the Leasing Company failed to fulfill its commitments under Sublease Agreements Nos. 1, 6-7, 18-22, 26-28, 30-36, and 42-44 and the Debt Restructuring Agreement. commitments under the Restructuring Agreements and stopped making payments altogether in 1993. Thereafter, after several reminders from Deutsche, the Leasing Company failed to pay the delinquent lease payments.On December 29, 1995, Deutsche filed an action in the District Court of Frankfurt, and the District Court of Frankfurt entered a Default Judgment on December 4, 1998, ordering the Leasing Company to pay to Deutsche the principal amount of the Leasing Company up to December 29, 1995, together with interest thereon, * * * in the amount of 8 798,045.00 and $1,529,974.94, together with interest on those amounts at 5% from April 21, 1998.On March 9, 1999, and October 22, 1999, the District Court of Frankfurt entered a Resolution on Determination of Costs and its accompanying note, ordering Leasing Company to pay Deutsche AG the sum of DM 183,229.60 for costs of the litigation as well as interest on the amount of DM 183,229.60, calculated from the date of December 21, 1998, and the amount of DM 1,529,974.94 for the period from December 21, 1998 to the date of the judgment. December 21, 1998, with interest at 4%. The Leasing Company failed to execute the Default Judgment and the Resolution on the Determination of Costs. For this reason, Deutsche AG appealed to this Court to order: 1. Leasing Company to pay Deutsche AG the sums of DM 11,775,332.27 and USD 801,370.99, as well as interest on these sums at the rate of 6% per annum from June 30, 2002, to the date of actual payment; 2. Leasing Company to pay Deutsche AG the costs that Deutsche AG has incurred in connection with this case, including, but not limited to, attorneys' fees and travel expenses; 3. 3. Leasing Company to bear the litigation costs in this case. The defendant objected to the issue of jurisdiction.