Builder exposure and liability after resale?

[ColdFusion]

So I want a tundra Kitfox V - VII for adventure in Utah. I am reaching out to see what liability exposure may exist down the road if the aircraft I build is ever resold and is ever involved in a crashed by a future owner.

Because of this unknown forever liability threat I am leaning toward buying a built/flying Kitfox or SLSA instead of a kit.

Regardless of any legal document agreed to between the builder and future buyer releasing builder of any liability for any reason, I think it is easy and possible for the builder to remain exposed and pulled into an expensive court defending self.

I do not know the legal protection of experimental status aircraft and if there is any protection for the builder. I understand placing the aircraft into an LLC, and this may soften interest in low seller asset conditions, but may also promote great interest in pushing deeper to gain access with high asset builders.

Thoughts???

[jrevens]

This is a very common question... you can find answers all over the internet. There has supposedly never been a successful lawsuit against the builder of an experimental aircraft that was sold to someone else. That doesn't mean that there haven't been lawsuits that require builders to defend themselves... I don't know what the statistics are on that. There are far too many people who have no problem taking whatever they can get from others, disregarding personal responsibility and due diligence, and mostly driven by lawyers in this country. If you build a good airplane your exposure may be diminished somewhat. If you build something that is structurally unsound it goes without saying that you're asking for trouble if you sell it to someone. The EAA has a bill of sale form that is properly worded to minimize exposure also. If you do things properly you will probably never have a problem, statistically. There are many other things that are commonly done by people in this country that expose them to much greater risk than selling a homebuilt, especially if you are well-off and have a target on your back. It's pretty sickening to me.

[mr bill]

Sad, but true.

[Dave S]

T,

I think if this is something you are genuinely concerned about - your best advice will come from a competent aviation attorney.

Or you could consider the reduced return of parting it out (rather that selling it as a operational aircraft) when you are done with it as part of the cost of the project.

[Pmcc]

The shame is that the real attorneys hate these personal injury sharks. Needed? A little. Abused? A lot.
I have friends who practice and love the law. They understand its importance in civil society for the conduct of business both personal and professional, in determining ownership and in criminal justice, for the protection of the rest of us.

[PaulSS]

I think there should be a law suit raised against beginning any sentence with 'so' and using the phrase 'reaching out'.

Sorry, just pet hates of mine

Back to proper, adult discussion.

[David47]

.....There are far too many people who have no problem taking whatever they can get from others, disregarding personal responsibility and due diligence, and mostly driven by lawyers in this country. If you build a good airplane your exposure may be diminished somewhat. If you build something that is structurally unsound it goes without saying that you're asking for trouble if you sell it to someone. The EAA has a bill of sale form that is properly worded to minimize exposure also. If you do things properly you will probably never have a problem, statistically. There are many other things that are commonly done by people in this country that expose them to much greater risk than selling a homebuilt, especially if you are well-off and have a target on your back. It's pretty sickening to me.

Well said John .... personal responsibility and accountability are something in short supply by some people these days. And Lawyers make their $M's off that very thing. I would think that if you build it well, document what you built, detailed any changes you made (these should be discussed with someone knowledgeable in the areas you've changed) and you've maintained it in accordance with a good maintenance schedule, you've done what any reasonable person building a homebuilt would be expected to do. It should also be remembered that aircraft issued with an Experimental Certificate do not comply with a "normal" certification standard and therefore attract a greater level of risk in the eyes of the Regulator. As long as you've spelled that out to any prospective buyer, (your aircraft placarding states that anyway), this together with everything else above means you've exercised a reasonable level of duty of care. That may not be a full defence in court if it ever got to that point, but it sure helps ....

[n85ae]

Haha, yes - So true!

I think there should be a law suit raised against beginning any sentence with 'so' and using the phrase 'reaching out'.

Sorry, just pet hates of mine

Back to proper, adult discussion.

[TY2068]

Thought this was a good article on the subject.

https://www.eaa.org/en/eaa/aviation-...ng-a-homebuilt

[Flienlow]

Should one build their aircraft under a corporate veil?

Meaning create "John Smith Aircraft Corp." It would seem that if you sold the Plane under that veil and something happened, the end user would have to sue a corporation. If the Corporation had no assets, it would be meaningless to sue and the corp could just file bankruptcy and simply go out of business.

I am no authority on this strategy, but have been victimized by it in the real estate world. I am not sure if would work in this instance either.