Seller Vulnerability

[MikeS]

I've gone through all the posts and threads on this subject that I can find on POA so I already know, I think, that nobody has ever been successfully sued for selling an Experimental aircraft that someone later crashed. Companies have been sued successfully of course - that's what killed GA in the 70's - but my situation is with an Experimental that's been through several owners since it received it's sign-off in 1974. The original owner is deceased.

The current owner is 87 and has owned his Cavalier SA102 for 28 years. He's incapacitated and has asked me to find a buyer and bring the plane into a legal and airworthy state. I've done all that was needed and am at the point of delivery and it just occured to me the owner and his family are trusting me to know what I'm doing and it's possible I'm overlooking the possibility that in delivering this plane and accepting money in return for a signed bill of sale, I may be opening the door, down the road, to possible harm to the owner's estate. The owner may not be around, but his wife, heirs, family will be and I think there is enough of an estate to get one of those "specialty" lawyers interested. Thanks to Geico's postings I know that EAA has some relevant forms and I'll get right on the trail to find those. But meantime, what's the current group wisdom on this question of liability with circumstances such as I'm presenting here?

Locally I see Experimentals sold very casually . . . that is, no particular concern for liability seems to be attached to selling a homebuilt airplane. Usually the deal is between fellow aviators and I'm sure in almost all cases nobody is interested in suing anybody else. But heirs and surviving spouses are another story that we never hear the end of since years go by.

This Cavalier is a very easy plane to fly and is utterly predictable and with no bad habits that I've encountered in my brief experience with it . . . but people manage to kill themselves with 172's. If they can do it with 172's they can do it with anything, including Cavaliers. Although a very tame one, it is a taildragger. Unfortunately over the last few months that I've been rehabilitating this aircraft I've been very comprehensive (thanks to my ninth grade typing class) in detailing the extensive maintenance and repairs that have been necessary to get this into the condition the owner claimed it was in back in July. This documentation could perhaps haunt the seller's estate down the road.

I'm perhaps giving this issue more concern than it deserves. Until this point I've given it no thought at all. I'm not experienced in selling planes so this is new territory for me. Other people's lives and assets are involved (I'm taking into account at the last minute it seems) so before I do this deal I think I should ask the question: "In selling this airplane am I exposing the seller & his family to possible problems in the future?" And a second question, depending upon the answer to the first one . . . what should I do to provide as much protection as possible or necessary - short of destroying or donating the aircraft. I've seen that done locally as well, precisely for reasons of perceived liability potential.

So I'm asking those who might read this for their thoughts on this issue. Perhaps you've been through this process or know someone whose experience you could draw upon in commenting. Gracias.

 

[Capt. Geoffrey Thorpe]

Does the guy have assets worth going after?

Is there a possibility that someone will eff up and someone will attempt to go after the previous owner. Just like if you sold a car - the next owner could claim that you had been negligent with maintenance which resulted in their crash. How often to you worry about that?

Or, selling a house. I got sued over that once (small claims) - it came down to the judge asking if the house had been inspected - yes - that was the end of it.

And in this case, if the seller isn't worried, then the seller isn't worried.

 

[RotorAndWing]

Anyone can be sued for anything and everything.

Don't live your life in fear of lawyers.

 

[Dan Thomas]

Don't live your life in fear of lawyers.

Lawyers only enable the real threats--the buyers of stuff--to sue the sellers. The buyers do dumb things with the stuff, and they hire lawyers that are able to convince the courts that the misfortune was the seller's fault entirely. It's the buyers who trigger the whole mess, with their foolishness and greed and projection of blame.

 

[RotorAndWing]

Lawyers only enable the real threats--the buyers of stuff--to sue the sellers. The buyers do dumb things with the stuff, and they hire lawyers that are able to convince the courts that the misfortune was the seller's fault entirely. It's the buyers who trigger the whole mess, with their foolishness and greed and projection of blame.

I agree with most of that. But our society is plagued by the bottom dwellers with law degrees. And these bottom dwellers are all too happy to convince someone that they "have rights" and require "justice"........for a price.

If we had a "loser pays" system the bottom dwellers wouldn't be so quick to file frivolous lawsuits in hopes of an out of court settlement.

 

[Let'sgoflying!]

Didn't John Denver's family or estate sue the (private) builder of that homebuilt he crashed in?

 

[kyleb]

Didn't John Denver's family or estate sue the (private) builder of that homebuilt he crashed in?

Probably, but the story is that the company that made the fuel valve took the brunt of the blow.

And saying nobody has ever won a liability case against the builder/previous owner of an experimental is misleading. Several suits have been brought and settled out of court. Certainly, some of those resulted in substantial pay-outs that were never made public.

That said, I'd have an IA or A&P perform a condition inspection and have a clear conscious in selling the airplane, knowing it has *some* liability trail, but that trail is pretty faint.

 

[bbchien]

The estate of John Denver vs. Adrian Davis. Davis paid out to his insurance limit. He wasn't worth much more.....

 

[weilke]

What is the plane worth in parts ?

 

[MikeS]

The plane is signed off with a fresh condition inspection. As for parts value - the airframe value would be in the eye of the beholder. The engine is a gem, Franklin 0-235, but as with the airframe the value of that would also basically depend on how much someone knowledgeable would value it. I've done a prop balance on it but even before I did that this engine was the smoothest four cylinder engine I can remember ever encountering.

This deal is done. Just needs to be delivered and balance paid. This liability question is just one of those last minute thoughts that occurred to me.

The 87 year old incapacitated owner is undergoing a number of medical procedures. Insurance covers most of it but before the story is finally told there may not be all that much of an estate left to entice a hungry lawyer. So I'm going to proceed with the transaction and deliver the plane. I just can't resist the opportunity to cross the country mid-winter in a plane with no cabin heat. One good thing is that I'm going west to east and with any luck the winter winds at 13.5 will get me there quickly. Yes I have oxygen.

Thanks for the replies everyone.

 

[N801BH]

The plane is signed off with a fresh condition inspection. As for parts value - the airframe value would be in the eye of the beholder. The engine is a gem, Franklin 0-235, but as with the airframe the value of that would also basically depend on how much someone knowledgeable would value it. I've done a prop balance on it but even before I did that this engine was the smoothest four cylinder engine I can remember ever encountering.

This deal is done. Just needs to be delivered and balance paid. This liability question is just one of those last minute thoughts that occurred to me.

The 87 year old incapacitated owner is undergoing a number of medical procedures. Insurance covers most of it but before the story is finally told there may not be all that much of an estate left to entice a hungry lawyer. So I'm going to proceed with the transaction and deliver the plane. I just can't resist the opportunity to cross the country mid-winter in a plane with no cabin heat. One good thing is that I'm going west to east and with any luck the winter winds at 13.5 will get me there quickly. Yes I have oxygen.

Thanks for the replies everyone.

My first impression by looking at that pic is.... The plane looks pretty well built since it was kept in darn good shape.. Usually when you see a sketchy plane,,, it is " rough" around the edges...... IMHO......

Have a safe trip back East sir....

 

[yakdriver]

He's not the builder of the airplane so he has no more liability than if he was selling a certified airplane. I have my name on two airplanes I built. I sold one and one other is for sale and I just don't worry about it. Don

 

[N801BH]

He's not the builder of the airplane so he has no more liability than if he was selling a certified airplane. I have my name on two airplanes I built. I sold one and one other is for sale and I just don't worry about it. Don

Agreed.....

But in 28 years of owning an experimental, you can bet he has made a "few" modifications... And that would give him some exposure...IMHO..

 

[denverpilot]

Judging by the other thread, the seller could simply make up a contract specifically mandating arbitration and by being very specific about the liabilities of purchasing an experimental, tie up the lawyers enough on the other side that he'd be long dead before it ever made it past his insurers and into the estate.

The legal bills would flow generously throughout that time period, however.

A good cheap umbrella policy would cover that, I assume. His attorney could advise on how much money it would take to make the idiot suing to go away. Depends a lot on how much money they're willing to waste against a guaranteed payout for the estate attorney's time.

$1M will pay a lawyer for nice lunches for a long time to keep messing with whoever is suing. Double it and he'll work hard enough to buy a nice new car as well.

 

[yakdriver]

Agreed.....

But in 28 years of owning an experimental, you can bet he has made a "few" modifications... And that would give him some exposure...IMHO

Any modifications would have to be signed off by an A&P at the condition inspection so it is not any different than doing a modification on a certified airplane that is signed off by an IA. Don

 

[N801BH]

Agreed.....

But in 28 years of owning an experimental, you can bet he has made a "few" modifications... And that would give him some exposure...IMHO

Any modifications would have to be signed off by an A&P at the condition inspection so it is not any different than doing a modification on a certified airplane that is signed off by an IA. Don

So. where does the responsibility lie then...

The seller .. Or the A&P..

 

[Palmpilot]

Judging by the other thread, the seller could simply make up a contract specifically mandating arbitration and by being very specific about the liabilities of purchasing an experimental, tie up the lawyers enough on the other side that he'd be long dead before it ever made it past his insurers and into the estate.

The legal bills would flow generously throughout that time period, however.

A good cheap umbrella policy would cover that, I assume. His attorney could advise on how much money it would take to make the idiot suing to go away. Depends a lot on how much money they're willing to waste against a guaranteed payout for the estate attorney's time.

$1M will pay a lawyer for nice lunches for a long time to keep messing with whoever is suing. Double it and he'll work hard enough to buy a nice new car as well.

I was under the impression that umbrella policies had aviation exclusions.

 

[N801BH]

I was under the impression that umbrella policies had aviation exclusions.

Mine does.... And that is on certified aircraft....

Throw in the "experimental" factor and the insurance guy will laugh you right out of the office....

 

[steingar]

If the estate is worth so much to attract trial lawyers perhaps they should simply have the aircraft disassembled. It sale will not enhance the estate in a meaningful manner but could decrease it substantially. I have heard of this being done.

 

[midlifeflyer]

Generally speaking, private sales are treated as "as-is" transactions. No warranties, with all defects. The degree to which that is true and what types of things take one out of that protection varies from state to state. An attorney in the seller's state should have no difficulty putting together a simple sales contract that confirms the sale is "as is" and advise how strong that disclaimer is.

 

[yakdriver]

So. where does the responsibility lie then...

The seller .. Or the A&P..

If the A&P signed it off he would probably have the majority of the responsibility if it was obvious that he missed something or did shoddy work. Since in this case the owner is not the "manufacturer" of the airplane it is no different than selling a certified. I think the question is if the person who manufactured the airplane has any liability after it has been sold. In this case it has had a couple previous owners so can all of them get sued in a lawsuit? Don

 

[denverpilot]

I was under the impression that umbrella policies had aviation exclusions.

Depends on the specific policy. I was told both are available but didn't price the aviation allowed one. Was also told it had verbiage that it was secondary to any existing aircraft / pilot liability coverage and couldn't be quoted "straight". Was mostly asked as a curiosity at the time, so I didn't pursue it further. YMMV. Probably not quite as cheap but still cheap in the context of the question if the old dude is worried about it.

 

[unsafervguy]

Agreed.....

But in 28 years of owning an experimental, you can bet he has made a "few" modifications... And that would give him some exposure...IMHO

Any modifications would have to be signed off by an A&P at the condition inspection so it is not any different than doing a modification on a certified airplane that is signed off by an IA. Don

Not exactly, unless the modification is "unsafe for flight" the A&P is not signing off on the mod. All the A&P is signing off on for a condition inspection is that "the aircraft is in a safe condition for flight" not a mod in particular. There is a difference, especially in a court of law

Bob

 

[N801BH]

Not exactly, unless the modification is "unsafe for flight" the A&P is not signing off on the mod. All the A&P is signing off on for a condition inspection is that "the aircraft is in a safe condition for flight" not a mod in particular. There is a difference, especially in a court of law

Bob

..

What if the mod was unsafe?

 

[yakdriver]

If there is an unsafe mod I'm not signing it off. When I put my signature on it I own everything before that date. Don

 

[MikeS]

> "But in 28 years of owning an experimental, you can bet he has made a "few" modifications..."

You'd think so . . . but not this guy. About all he did was keep the plane dry. Which, with a wood and fabric plane, is good enough really. There's no fixing wood rot and/or severe corrosion. The airframe on this one is in excellent shape. The Ceconite, although in need of two or three fabric patches where people have stepped on the wing instead of the wing walk, is also excellent despite its age. It's actually like new, amazingly so, except for the bit of damage around the wing walk. Those areas currently have some white vinyl tape on them.

Although the owner was at the hangar every morning early for years, the plane is pretty much as he bought it 28 years earlier. No improvements, no maintenance beyond the very basic such as oil changes. When I got my hands on the plane it was just as it was when the owner bought it, with some wear here and there. Once I realized the extent of neglect that had gone on with this plane I had to wonder just what my hangar neighbor was doing all those years, showing up at the hangar very early in the morning and leaving usually by 9. A regular routine. It was a place to go to get out of the house. Some old guys go to VFW and drink and others play golf or to the clubhouse and talk about golf. Or fishing. Or something. This guy went to his hangar and sat in his grimy chair at his grimy desk surrounded by an incredibly messy, oily, grimy, filthy hangar. The plane was filthy too and when asked why he never washed it he said he was worried about getting water through the fabric into the wood. That's a good reason I guess. Accumulated grime can be cleaned. Nothing can be done with wood rot.

Hardly anyone ever saw him fly it. I never did in the nine years that I've known him.

He had an A&P who signed it off every year for a hundred dollar bill without doing anything to speak of. That fellow disappeared as soon as the owner decided to sell it. Too bad . . . I could have used him.

I never gave the plane much thought when I would occasionally visit his hangar. It looked okay. I knew something about the design since I had helped another old fellow advertise a GY-20 Minicab about 20 years earlier so knew some of the history.

Clever me . . . I thought if I was lucky a buyer would show up from some other part of the country and I would get some expense-paid flying out of the deal if the new owner wanted it delivered. I had no time in this design so figured I'd gain some experience and have some free fun with a plane that was new to me. Taking trips are always fun. New airports, new things to see.

The fun started with trying to track down the A&P that had been signing it off. He turned out not to be available. After finding one of my A&P friends willing to touch the thing, the fun continued when I was told I had to replace engine mount bushings and tires. That was just the start. The old ARC transponder was useless, vacuum pump inop and of course the WWII era vacuum instruments also inop. I've installed some DC receptacles to run that new D2 "Pocket Panel" Dynon sells. If this doo-dad works (pirep to follow sometime later) as advertised I shouldn't need to worry about the inop instruments. I've put in power sources also for GPS and a back-up radio since the ARC panelmount works fine one day and is unreadable the next. Switches are all upside down for some reason. This plane cries for upgrades and improvements but the owner wasn't interested. I've no idea why, nor why he even bought the plane to start with. Clearly he had no interest nor aptitude in maintaining or improving it. I had assumed the plane must be in good shape since the owner is a retired Navy Commander. Those guys are usually pretty meticulous. Not this one. He did a good job of keeping it safe from the elements and kept fresh oil in the engine throughout his ownership, so the bones are good. The new owner is going to really enjoy owning this thing and doing those improvements it needs.

It flies very nice. It has some incredible split flaps that let you come down like a rock, especially if you side or forward slip it with full flaps. I haven't flown a plane with flaps that nice since C-310's.

I've done enough to feel safe about flying it some distance although I still don't like the rear fuel tank situation. Instead of feeding the front tank which feeds the carb with gravity, fuel is pumped from the rear through a fuel pressure regulator directly to the carb. Dumb set up and sure enough, the pump was inop and the pressure regulator is erratic. The fuel pressure gauge, inop of course, is no help and the only way I know fuel is flowing is when the engine dies, or not. Banging on the regulator seems to help. I'm planning to switch to rear tank only when I've got at least ten thousand feet under me. Gives me plenty of time to bang on the regulator. I really should do something about that but I'm fed up with working on this thing. Whatever thought I had of it being fun was replaced early on with a stubborn intention just to see it through and get it delivered. I've had enough justification to have backed out of the situation a long time ago - the owner had claimed the plane was in fine shape and needed nothing. How much of that was dementia and how much deceitfulness and how much just ignorance I don't know. It soon became apparent he was wrong, but I've kept at it. I've learned a few things I didn't know . . . about Franklins, about Goodyear wheels and brakes, about various odds and ends. That's always good, learning new things.

Something that might be of interest - on a table in the back of the hangar is a collection of aviation batteries which made me wonder why he'd gone through so many batteries? The owner was very diligent about keeping his Schumacher maintenance charger hooked up to the plane 24 hours a day for weeks/months/years on end. Early on, after buying a fresh Gill for the plane, I put a voltmeter on that thing and discovered it was steadily pumping 15+ volts into the battery. Constantly. Why did it never occur to the owner to wonder why he had to replace his batteries frequently? Why did it never occur to him to see just what that "battery maintainer" was actually doing to his battery? Many things never occurred to this owner. All that can be said of him is that he kept the plane dry.

************

Thanks for the informative discussion on the subject of insurance and liability issues. And beware everyone of offering to help demented old hangar neighbors.

 

[PPC1052]

Anyone can be sued for anything and everything.

This.

 

[N801BH]

> "But in 28 years of owning an experimental, you can bet he has made a "few" modifications..."

You'd think so . . . but not this guy..........
Thanks for the informative discussion on the subject of insurance and liability issues. And beware everyone of offering to help demented old hangar neighbors.

Great story.......

Hope the plane gets a loving home...

 

[midlifeflyer]

This.

The flip side is they can't actually get anything and everything.

 

[RotorAndWing]

The flip side is they can't actually get anything and everything.

No, but by initiating the process can cause both parties to expend huge outlays of cash.

The plaintiff can cause the defendant to spend huge amounts in defending himself regardless if he is innocent or guilty.

 

[MikeS]

I like the advice posted earlier to not live one's life in fear of lawyers.

I do live my life in fear of doing something stupid if it's something I don't know about, so I try and educate myself about things I'm ignorant of. So that fear goes away by replacing ignorance with information. Fear as a constant condition is toxic stuff, as is physical and/or psychological pain if not relieved.