What options do pilots and mechanics have when an aircraft owner doesn't pay up?

Lnafziger
  • What options do pilots and mechanics have when an aircraft owner doesn't pay up? Lnafziger

    If someone does a contract flight, or a mechanic does contract maintenance for an aircraft owner and they refuse to pay after the fact, what options do they have to "encourage" the owner to pay?

    One of the big problems is that this tends to happen informally:

    Owner: "Hey, can you do this flight for me?"
    Pilot: "Sure, I charge $xxx." "
    Owner: "Okay, great. See you on Monday morning at 9:00."
    Pilot: "Sounds good, see you then."

    So they show up, do the flight, send an invoice, and wait. And wait.. And wait.... After a few weeks or 30 days, they send the invoice again. Give it a bit and make a phone call. Eventually it becomes clear that they just aren't that interested in paying a lone individual without the typical resources of a larger company. Unfortunately, this happens more than you would think in this industry.

    It probably isn't enough money to actually go out and hire a lawyer for, but it's irritating and they want their money. It's the principle! I've heard of people placing a lien against the aircraft. Is that something that an individual can do, or do you have to hire a lawyer? Is small claims court an option?

    I'm looking for an answer that describes general approaches that can be taken, as obviously specific legal advice cannot be given without details of a situation like this.

  • You should be able record a lien against the aircraft.

    Avionics News ran a Legal Ease piece about just this, which is well worth reading fully:

    If a lien is properly asserted, the lien claimant (the aircraft mechanic) has encumbered the aircraft in question, meaning the aircraft no longer has clear title.

    Clear title is highly desirable to an aircraft purchaser, who can determine if an aircraft has any liens on its title through a simple title search. Once there is a lien on an aircraft, to sell the aircraft with clear title, the aircraft owner must obtain a release from the lien claimant. This means the owner must pay you for your services before they are able to sell the aircraft with clear title.

    If the owner fails to pay the lien claimant to have the lien lifted, the aircraft will be sold subject to the lien. This means the aircraft does not have clear title, and although the aircraft will have a new owner, your lien will remain in effect.

    Most buyers, however, will not purchase an aircraft subject to a lien, and thus, you usually will manage to receive the money owed to you when the owner decides to sell the aircraft.

    If you do not want to wait for the aircraft to be sold to satisfy your lien, you can bring a foreclosure proceeding, forcing the sale of the aircraft, usually at an auction.

    The proceeds from this sale go to the lien claimant to extinguish the lien. If the proceeds are greater than the lien, any money exceeding the amount of the lien goes to the aircraft owner. Additionally, if there are no bidders at the sale (an unusual occurrence), the aircraft may be given to the lien claimant for the price of the lien.

    One thing worth bearing in mind, is the Aero Liens List - a free resource which lists liens placed against aircraft owners. If your new client is on their "deadbeat client list" then you may want to think twice about doing the trip or get paid in advance!

    You asked whether a lien could be registered by a pilot for lost wages (rather than a mechanic for lost labour/parts); just searching the above list for "John", I found at least one pilot who has two liens (against seperate companies) for lost wages: #1 #2

    Another lien (PDF unavailable) lists its nature of the claim as "Salary owed".

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