PLA 4861: AVIATION LAW

October 16, 2020

VIII. AIRCRAFT OWNERSHIP, FINANCE, AND REGISTRATION

Assigned Reading and Review:

 Ravich, Course Supplement, Aircraft Purchase and Sale

 Fed. Aviation Admin., Aircraft Certification, Registration Forms,

https://www.faa.gov/licenses_certificates/aircraft_certification/aircraft_registry/aircraft_r
egn_forms/

 Aircraft Purchase Agreement,

https://www.aopa.org/go-fly/aircraft-and-ownership/buying-an-aircraft/forms-for-buying-
and-selling-aircraft/sample-purchase-sales-agreement
 You’re hired!

Dr. Avia Tor just obtained her pilot’s license and she wants to buy an airplane for her
medical business, AirHealth, a corporation established in London, United Kingdom. A citizen of
Belize, she intends to deliver prescription medicine to rural communities in Latin and South
America.

This one (below) looks affordable. The Seller if Fly-By-Night, Inc., which is based in
Ramsey, Isle of Man.

Please finalize the deal by answering the questions below.

1. First of all, various potential liability comes along with the decision to purchase and
operate an airplane. Watch the oral argument of Vreeland v. Ferrer, 71 So. 3d 70 (Fla.
2011) (807) in its entirety, http://www.wfsu.org/gavel2gavel/viewcase.php?eid=172, and
discuss what counsel for the petitioner is arguing? Did the respondent’s lawyer do a
good job? Who did you find most persuasive and why? (Complicated stuff here, but do
your best. Does Justice Quince think this makes sense?)

2. Turning to your client, is this the right airplane for your client? How do you plan on
advising her? (Hint: Marc C. Lee, Top 20 Tips for Buying an Airplane, Plane & Pilot,
Aug. 16, 2016, https://www.planeandpilotmag.com/article/top-20-tips-for-buying-an-
airplane/#.WWO6f4jythE)

3. Should your client trust the seller? Give examples of potential pitfalls:
http://gcaircraft.com/three-aircraft-sales-scams/

4. Complete this Aircraft Purchase Agreement: https://www.airloans.com/pdfs/NAFCO-

Purchase-Agreement.pdf. In the event you are unable to complete certain portions,
identify what information you would like to know and how you intend to obtain the
information.

5. See the Bill of Sale, https://www.faa.gov/documentLibrary/media/Form/ac8050-2.pdf.

What does it say about registration under 49 U.S.C. § 44101. What does this mean?
(Hint: https://www.law.cornell.edu/uscode/text/49/44101) (Second hint:
https://www.aopa.org/go-fly/aircraft-and-ownership/buying-an-aircraft/tips-on-buying-
used-aircraft#bill)

6. What does it mean for an airplane to be “airworthy”? See

https://www.faa.gov/aircraft/air_cert/airworthiness_certification/aw_overview/.
Specifically, what is the definition of airworthy and how will you get the seller to prove
the airplane your client wants to buy is in airworthy condition?

7. See AOPA, Tips on Buying Used Aircraft, https://www.aopa.org/go-fly/aircraft-and-

ownership/buying-an-aircraft/tips-on-buying-used-aircraft, and in your own words,
describe a “pre-purchase inspection.”

8. Is the purchase price “reasonable”? Is it “market”? How would you know and what can
you do to get a better sales price for your client? (Hint: Watch: Cessna 172 Ownership
Costs Explained, http://www.aircraftbluebook.com/)

9. Is the purchase price the only concern about which you should counsel your client?
(Hint: No.) (Second Hint: https://www.youtube.com/watch?v=eXsvJjn9yb0

10. What are “warranties”? Given an example of one you want for your client. And, discuss
whether the purchase should be “as is” – why or why not. (Hint: Kent S. Jackson, Selling
a Plane, ‘As Is, Where Is,’ AVIATION WK. NETWORK, Aug 26, 2015,
https://jetlaw.com/wp-content/uploads/Selling-a-Plane-As-Is-Where-Is-08-2015.pdf.
11. What is the hobby loss rule? See https://www.aopa.org/go-fly/aircraft-and-
ownership/buying-an-aircraft/the-pilots-guide-to-taxes.

12. Briefly summarize what your client will want to know about insurance as part of her
aircraft purchase. See A Few Tips for Buying Aircraft Insurance,
https://www.eaa.org/en/eaa/eaa-news-and-aviation-news/eaa/2013-10-31-a-few-tips-for-
buying-aircraft-insurance.

13. Change of plans. Your client wants to lease rather than buy the airplane. What is a “wet
lease”? What is a “dry lease”?

14. What is NBAA and what resources do they offer in connection with aircraft operation
and ownership? Explain briefly. (Hint: https://www.nbaa.org/admin/options/leasing/)

15. Change of plans: Your client wants to use a drone instead of a traditional airplane. How
must she register her aircraft? See https://www.youtube.com/watch?v=Uxad7S9QB1Q.