Liabilities of the A/HB builders

[N801BH]

..............
I just know of the one where one apparently paid a settlement in the John Denver case.

And that was a totally BS conclusion......

If I remember correctly the actual seller of the fuel valve was Wicks Aircraft and not Aircraft Spruce.... The valve performed as designed for years for the original builder.. The location the original builder installed it at was somewhat
unconventional but it did serve it purpose... The scumbag lawyers stretched and distorted the truth and planted the concept that it's location was substandard.... The plane was an experimental and substandard is a moot point in my mind....

For some reason Wicks and the valve manufacturer caved under pressure and paid out..... An absolutely weak position to take but probably coached into settling by more scum bag attorneys...... ...

 

[RotorAndWing]

And that was a totally BS conclusion......

If I remember correctly the actual seller of the fuel valve was Wicks Aircraft and not Aircraft Spruce.... The valve performed as designed for years for the original builder.. The location the original builder installed it at was somewhat
unconventional but it did serve it purpose... The scumbag lawyers stretched and distorted the truth and planted the concept that it's location was substandard.... The plane was an experimental and substandard is a moot point in my mind....

For some reason Wicks and the valve manufacturer caved under pressure and paid out..... An absolutely weak position to take but probably coached into settling by more scum bag attorneys...... ...

When someone settles out of court they have come to the conclusion that fighting on will cost more than the settlement. It comes down to how much does one want to pony up. Lawsuits cost both parties and in the end the only winners are the lawyers.

To quote Steven Wright "99% of all lawyers give the remaining ones a bad name".

 

[jsstevens]

Yeah, made me suspect there was a bit of maintenance and modification fairy work on the plane.

According to Collins' own article on the subject it had to do with ethical responsibility and not financial liability. He was concerned that an owner not familiar with the type would not understand the required maintenance issues with the fuselage up close to the life limited number of pressure cycles.

Avoiding mentioning "fairy maintenance" in public? Maybe. But all the info I've read on Richard Collins he was (is?) a straight shooting kind of guy.

John

 

[Henning]

I could see the ethical responsibility issue being prevalent in a home built as well.

 

[wabower]

There were other MX issues as well, some of which had been difficult to troubleshoot and resolve in spite of his numerous efforts. He told me about some of them at the time, and IIRC some of the most difficult were engine/turbo/controller-related but he didn't share the entire list.

According to Collins' own article on the subject it had to do with ethical responsibility and not financial liability. He was concerned that an owner not familiar with the type would not understand the required maintenance issues with the fuselage up close to the life limited number of pressure cycles.

Avoiding mentioning "fairy maintenance" in public? Maybe. But all the info I've read on Richard Collins he was (is?) a straight shooting kind of guy.

John

 

[wsuffa]

Seems to me that if there were truly "no issues or successful lawsuits against A/HB builders" then there would be multiple insurance companies willing to take your money and provide a lasting product liability policy.

That there is no such policy available tells me that the risk is >>0, and that they might incur substantial losses. They seem to have more lawyers and actuaries than the letter organizations....

 

[Jim Logajan]

According to Collins' own article on the subject it had to do with ethical responsibility and not financial liability. He was concerned that an owner not familiar with the type would not understand the required maintenance issues with the fuselage up close to the life limited number of pressure cycles.

Avoiding mentioning "fairy maintenance" in public? Maybe. But all the info I've read on Richard Collins he was (is?) a straight shooting kind of guy.

John

Here's some of what he wrote about his decision in his book "The Next Hour":

"The other limiting factor on airframe life is fatigue. Airframes are subjected to fatigue testing on the ground during the certification process. An airframe is put into a machine and the structure is loaded and unloaded in a repetitive manner to simulate the fatigue wear that comes from flying, especially in turbulence.

This is good testing and so far it has served well. As airplanes get older, though, you have to wonder about the cumulative effects of both corrosion and fatigue. And, under the present system, the only way that we are really going to learn about airframes failing is when they actually start failing. In most cases, older airplanes will likely lose their viability because of maintenance costs and parts availability long before they reach whatever actual life limit might be out there.

In 2007 I made the decision to retire the pressurized 210, P210, that I had flown for 8,963.44 hours in 28 years, five months and 13 days. I had gotten my money’s worth out of the airplane and in my mind it was worn out. P210s have had a bad reliability record over the years and while I spent a ton of money maintaining mine, I had been having trouble keeping everything on the right side of what I consider to be perfect shape.

There was another factor in my decision to put the airplane down. Years ago, when the airplanes were first being built, I asked a Cessna engineer how many hours he thought one would last. He said the amount of testing done so far was probably equal to about 10,000 hours of flying. My airplane was getting close to that.

Some people thought I was nuts to scrap an airworthy airplane but I was and still am comfortable with the decision. I had gone a lot of places and done a lot of things with the airplane and knew it as well as a pilot could ever know an airplane. And when I felt like the airplane whispered “enough” into my ear, I thought I should listen.

A lot of mechanically-related problems come after pilots don’t listen when an airplane suggests it is not a good idea to go flying. If everything isn’t working perfectly before takeoff, then it’s time to taxi back and seek help. Even after taking that precaution, there will always be times when something will malfunction after the airplane is airborne. How a pilot deals with the airborne problem has everything to do with the happiness of the ending."

 

[wabower]

That jives with my collection of our conversations at the time, but it was long before the book that for some odd reason I didn't read. Maybe because I didn't know about it until now. He kiddingly (I think) used to say that he wrote a book whenever he needed a little extra cash for a college kid or wedding, but stopped doing so when the publisher/author split of sales revenues changed adversely.

Here's some of what he wrote about his decision in his book "The Next Hour":

"The other limiting factor on airframe life is fatigue. Airframes are subjected to fatigue testing on the ground during the certification process. An airframe is put into a machine and the structure is loaded and unloaded in a repetitive manner to simulate the fatigue wear that comes from flying, especially in turbulence.

This is good testing and so far it has served well. As airplanes get older, though, you have to wonder about the cumulative effects of both corrosion and fatigue. And, under the present system, the only way that we are really going to learn about airframes failing is when they actually start failing. In most cases, older airplanes will likely lose their viability because of maintenance costs and parts availability long before they reach whatever actual life limit might be out there.

In 2007 I made the decision to retire the pressurized 210, P210, that I had flown for 8,963.44 hours in 28 years, five months and 13 days. I had gotten my money’s worth out of the airplane and in my mind it was worn out. P210s have had a bad reliability record over the years and while I spent a ton of money maintaining mine, I had been having trouble keeping everything on the right side of what I consider to be perfect shape.

There was another factor in my decision to put the airplane down. Years ago, when the airplanes were first being built, I asked a Cessna engineer how many hours he thought one would last. He said the amount of testing done so far was probably equal to about 10,000 hours of flying. My airplane was getting close to that.

Some people thought I was nuts to scrap an airworthy airplane but I was and still am comfortable with the decision. I had gone a lot of places and done a lot of things with the airplane and knew it as well as a pilot could ever know an airplane. And when I felt like the airplane whispered “enough” into my ear, I thought I should listen.

A lot of mechanically-related problems come after pilots don’t listen when an airplane suggests it is not a good idea to go flying. If everything isn’t working perfectly before takeoff, then it’s time to taxi back and seek help. Even after taking that precaution, there will always be times when something will malfunction after the airplane is airborne. How a pilot deals with the airborne problem has everything to do with the happiness of the ending."

 

[vintage cessna]

Seems to me that if there were truly "no issues or successful lawsuits against A/HB builders" then there would be multiple insurance companies willing to take your money and provide a lasting product liability policy.

That there is no such policy available tells me that the risk is >>0, and that they might incur substantial losses. They seem to have more lawyers and actuaries than the letter organizations....

There are policies that will insure the seller of an AB-EXP, but only for 12 months, same coverage that is provided for Part 23 aircraft. In that regard the insurance company makes no distinction between AB-EXP and Part 23 aircraft.

Note how other people have stated they can't get umbrella policy coverage for anything to do with aviation.

People are concerned about liability when selling a Part 23 aircraft also, but I'm not aware on any GA policy that will provide for more than 12 months coverage after the sale.

 

[Henning]

The answer to the original question, "How much should someone worry" is, "Not much".

 

[vintage cessna]

Learn as much as you can, evaluate the risk. If you're the type that will lose sleep over this kind of thing, stay on the front porch.

 

[wabower]

Yep, just ignore all risks related to any activity in which you engage. They might go away.

Learn as much as you can, evaluate the risk. If you're the type that will lose sleep over this kind of thing, stay on the front porch.

 

[vintage cessna]

Yep, just ignore all risks related to any activity in which you engage. They might go away.

Or, dream up something that may happen.

 

[wabower]

Which is more prudent in terms of protecting your net worth? Do you buy life insurance? Is your out-house covered for lightning damage?

Or, dream up something that may happen.

 

[Henning]

Which is more prudent in terms of protecting your net worth? Do you buy life insurance? Is your out-house covered for lightning damage?

That is probably apropos to the level of worry one should have.

 

[vintage cessna]

Which is more prudent in terms of protecting your net worth? Do you buy life insurance? Is your out-house covered for lightning damage?

I didn't say ignore the risk, I said evaluate the risk. People can come to different conclusions looking at the same info.

 

[wabower]

And the lesson to be learned. PC companies just include outbuildings in the coverage because of low risk, low cost, and ease of sales and admin. In contrast, none of the umbrella carriers will touch GA-related risks with a long stick.

I think we all agree that the legal game can be played as an extortion racket with the "win" strategy of the plaintiff being mediation that will pay a nice return even though the size of the claim isn't in the big-buck range that's been discussed. I've been involved with airplane deals in which it happened, and have since become aware that one guy at KADS does it as a matter of course.

I haven't heard any Chicken-Little arguments regarding the exposure or eminent threat, but it's hard to keep up on things if you choose to live in the closet.

That is probably apropos to the level of worry one should have.

 

[Dav8or]

The answer to the original question, "How much should someone worry" is, "Not much, as long as you don't have significant assests".

I suggest this little edit to this post. What this means is, 99% of home builders don't have much to worry about. People that have significant assets, don't spend their time building airplanes and they also have legal advisers to guide them. These people have other people build their planes for them.

 

[Henning]

I suggest this little edit to this post. What this means is, 99% of home builders don't have much to worry about. People that have significant assets, don't spend their time building airplanes and they also have legal advisers to guide them. These people have other people build their planes for them.

Not necessarily, I know very wealthy people who have built their own planes because they enjoyed the process of creation. They remediate their risk by not selling it, simple as that.

 

[JeffDG]

I didn't say ignore the risk, I said evaluate the risk. People can come to different conclusions looking at the same info.

Yes you have. You keep telling people they have no risk, and belittling people who disagree and present well-founded legal principles that lead to the conclusion that they have risk.

Nowhere has anyone said "You can't sell your plane." They've said "If you've built a plane and sell it, you have some liability exposure. You might want to understand that risk before you do."

 

[Dav8or]

Not necessarily, I know very wealthy people who have built their own planes because they enjoyed the process of creation. They remediate their risk by not selling it, simple as that.

Yep and they're 1%. I said 99% of home builders have not much to worry about.

 

[vintage cessna]

Yes you have. You keep telling people they have no risk, and belittling people who disagree and present well-founded legal principles that lead to the conclusion that they have risk.

Nowhere has anyone said "You can't sell your plane." They've said "If you've built a plane and sell it, you have some liability exposure. You might want to understand that risk before you do."

Chill. I never said there is no risk. You say a home builder is a manufacturer, the EAA attorney thinks otherwise, take it up with him.

There may be more risk selling an old Part 23 airplane. The purchase agreement for an AB-EXP ( that EAA recommends), states in bold letters, that what is being bought is basically a pile of junk. Additionally, the buyer and the buyers spouse sign a waiver. After signing all that, pretty difficult hill to climb if something happens.

 

[vintage cessna]

Not necessarily, I know very wealthy people who have built their own planes because they enjoyed the process of creation. They remediate their risk by not selling it, simple as that.

Some don't want any kind of exposure . I know a wealthy fellow with a CFI rating who would love to teach, but won't for fear of being sued.

 

[bbchien]

Chill. I never said there is no risk. You say a home builder is a manufacturer, the EAA attorney thinks otherwise, take it up with him.

There may be more risk selling an old Part 23 airplane. The purchase agreement for an AB-EXP ( that EAA recommends), states in bold letters, that what is being bought is basically a pile of junk. Additionally, the buyer and the buyers spouse sign a waiver. After signing all that, pretty difficult hill to climb if something happens.

The first inquiry of Adrian Davis in the John Denver deposition was apparently, "Did you have a production certificate for that airplane?" Never mind the rejoinder. A jury is going to hear that the guy was producing airplanes without a production certificate. Multiple airplanes.

You need to reassess, but I think more likely you are viewing this from the point of view of someone without much to lose. So you're right, YOU have little risk.

 

[vintage cessna]

The first inquiry of Adrian Davis in the John Denver deposition was apparently, "Did you have a production certificate for that airplane?" Never mind the rejoinder. A jury is going to hear that the guy was producing airplanes without a production certificate. Multiple airplanes.

You need to reassess, but I think more likely you are viewing this from the point of view of someone without much to lose. So you're right, YOU have little risk.

What questions that may have been put to Mr. Davis during a deposition doesn't shed any light on what consequences Mr. Davis ultimately suffered.

I thought the risk situation this thread was addressing was a home builder selling an airplane within the letter and spirit of the regulations, not someone making a profitable business out of it.

If Adrian Davis was doing what you say, maybe that is why it is the only case anyone has heard about .

 

[wabower]

So are you worried about Geico's little build-buy-sell-trade business with RV's that he regularly mentions here?

What questions that may have been put to Mr. Davis during a deposition doesn't shed any light on what consequences Mr. Davis ultimately suffered.

I thought the risk situation this thread was addressing was a home builder selling an airplane within the letter and spirit of the regulations, not someone making a profitable business out of it.

If Adrian Davis was doing what you say, maybe that is why it is the only case anyone has heard about .

 

[vintage cessna]

So are you worried about Geico's little build-buy-sell-trade business with RV's that he regularly mentions here?

I don't know what Geico does, but I would certainly think engaging in that kind of business is a whole different thing than what I thought we were discussing.

Is the FAA turning a blind eye to that sort of thing ?

 

[Henning]

I don't know what Geico does, but I would certainly think engaging in that kind of business is a whole different thing than what I thought we were discussing.

Is the FAA turning a blind eye to that sort of thing ?

Blind eye? There is nothing at all against the rules about building and selling Ex/AB planes, or dealing in them. The experimental I had was built by someone else and I would buy anything he built sight unseen if it was something I wanted. I would trust his product over any factory built Pt 23 airplane any day.

 

[vintage cessna]

Blind eye? There is nothing at all against the rules about building and selling Ex/AB planes, or dealing in them. The experimental I had was built by someone else and I would buy anything he built sight unseen if it was something I wanted.

Are we talking about someone who buys one kit after another and then sells with an intent of making a profit, or someone who just buys airplanes from the market and then re-sell?

 

[Henning]

Are we talking about someone who buys one kit after another and then sells with an intent of making a profit, or someone who just buys airplanes from the market and then re-sell?

Nothing illegal about either, but Geico is the latter. BTW, I know of no one who makes a profit building kit planes.

 

[vintage cessna]

Nothing illegal about either, but Geico is the latter.

Then, my opinion , FWIW, is that Geico's risk is that of any other broker.

But someone who is buying and assembling kits and then selling, and a convincing case could be made that this person is conducting a business and not building for " education and recreation" , then yeah, they could get their pants sued off.

 

[wabower]

Depends on your definition. I know several who make nice chunks by providing labor.

Nothing illegal about either, but Geico is the latter. BTW, I know of no one who makes a profit building kit planes.

 

[Henning]

Depends on your definition. I know several who make nice chunks by providing labor.

As builders for kit buyers yes, although that is against the rules IIRC.

 

[wabower]

If a group buys a kit, how do the rules govern which of them provide labor? Or how internal funding and sales proceeds are split?

As builders for kit buyers yes, although that is against the rules IIRC.

 

[Henning]

If a group buys a kit, how do the rules govern which of them provide labor? Or how internal funding and sales proceeds are split?

Right, and the loophole seekers will bring the problems with them. If you can't follow the spirit of the simplified rules, they will come in and codify 20 pages of legalese. This is the type of stuff that opens up liability exposure. There is a reason it is called Amateur Built, read the definition of amateur. When you don't meet the definition of amateur by being a professional (someone who receives compensation/consideration according to the FAA) you open yourself up to exposure on multiple fronts, so does everyone in the group. If you are part of a group that has a kit, builds it and sells it and you get a share of the sales proceeds, you're on the ok side of the line. If you get paid for providing the labor to build a kit for someone, it gets very dicey on the 51% rule.

 

[wabower]

Somebody recently noted that Van's first kit was sold in 1972. When are you thinking a dramatic rule change will occur?

Right, and the loophole seekers will bring the problems with them. If you can't follow the spirit of the simplified rules, they will come in and codify 20 pages of legalese. This is the type of stuff that opens up liability exposure. There is a reason it is called Amateur Built, read the definition of amateur. When you don't meet the definition of amateur by being a professional (someone who receives compensation/consideration according to the FAA) you open yourself up to exposure on multiple fronts, so does everyone in the group.

 

[Henning]

Somebody recently noted that Van's first kit was sold in 1972. When are you thinking a dramatic rule change will occur?

What's wrong with providing kits that don't violate the 51% rule? Besides that, there have been several rules in the mean time that have dealt with the professional assist builders.

 

[wabower]

Rules is rules. Best I can tell the FAA is much more interested in the way they're being flown (and crashed) than in how they're being bought and put together.

I don't foresee much chance of being involved in violating any of them.

What's wrong with providing kits that don't violate the 51% rule? Besides that, there have been several rules in the mean time that have dealt with the professional assist builders.

 

[Jim Logajan]

Rules is rules. Best I can tell the FAA is much more interested in the way they're being flown (and crashed) than in how they're being bought and put together.

I don't foresee much chance of being involved in violating any of them.

Hmmm. I'm not sure if you or Henning know, or are simply failing to recall, that the FAA made some significant changes to the so-called 51% rule in 2009 to address the very issues you are both discussing. The FAA is interested in how homebuilts were and are being bought and put together, otherwise they would not have expended the effort to update and clarify those rules. And then send out teams to aircraft kit manufacturers to check on compliance.

They've also been checking into how well SLSA manufacturers are complying with the ASTM requirements.

They are now interested in how they are being flown and crashed, but at least in recent years they were first expending more effort on the building of the aircraft. Oddly their own analysis showed that their own rules made it harder to accomplish the transition training that was found would help reduce crashes.

 

[Tom-D]

What's wrong with providing kits that don't violate the 51% rule? Besides that, there have been several rules in the mean time that have dealt with the professional assist builders.

When you do use commercial help, who excepts the liability for that work?

you see that name does go on the application for the AWC.

Now you see you have 2 maybe more names in the liability loop. some body may have a deep pocket.