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Disputing an Aircraft Mechanic's Lien

by Greg Reigel 1. July 2009 00:00
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What happens if someone records, or threatens to record, a mechanic's lien against an aircraft and the aircraft's owner believes the lien is improper? After all, once recorded, a lien is a "cloud" on the title to the aircraft and, typically, a release or a court order is required to clear the aircraft's title.

So, how does the aircraft owner dispute the lien or have it released if it has been recorded? Fortunately, several options and/or strategies are available for dealing with the situation.

Resolution Through Negotiation

If the dispute is about the amount of money owed, the best way for the aircraft owner to resolve the situation is to try and reach some agreement with the lien claimant regarding the amount owed. This will certainly save both parties money in the long run. If the lien claimant refuses to settle, the lien claimant will incur significant expense if he or she has to initiate a lien foreclosure action.

Additionally, the lien claimant may also have exposure for slander of title if a court determines that the lien was improper. This could mean that the lien claimant would be required to pay not only the aircraft owner's costs and attorney's fees, but also any losses incurred by the aircraft owner if the lien prevented a sale of the aircraft or forced the aircraft owner to accept less in a sale than he or she would have in the absence of the lien.

Similarly, the aircraft owner will incur significant expense to defend against a mechanic's lien foreclosure action and, if unsuccessful, the aircraft owner could ultimately be required to pay the full amount of the lien plus the lien claimant's costs and attorney's fees. Also, in the meantime, the lien could prevent the aircraft owner from selling the aircraft.

Clearly, both parties have incentives to try and settle the lien claim to avoid the risks and expense associated with litigating the claim. However, if the parties cannot reach an agreement, litigation is available and may be required to resolve the situation.

Resolution Through Litigation

The Mechanic's Lien Foreclosure Action. To enforce a mechanic's lien against an aircraft, a lien claimant must start a lien foreclosure action. In the foreclosure action, the lien claimant asks the court to validate his or her lien and order the aircraft sold to pay the lien claimant the amount owed.

Once the foreclosure action is started, many jurisdictions allow the aircraft owner to post a bond or deposit money with the court to obtain a release of the mechanic's lien before the lawsuit is decided. The amount of the bond or deposit will vary, but is usually the amount of the lien claim plus some additional percentage of the claim (e.g. 125%-150%). The bond or deposit replaces the aircraft as security for the lien claimant's claim. When the court receives the bond or deposit, it then issues an order discharging or releasing the lien. A certified copy of the order must then be filed with the FAA Registry to clear the aircraft's title.

The aircraft owner also has the opportunity to defend against the lien claim in the foreclosure action and to assert any claims the aircraft owner may have against the lien claimant. One common defense to an aircraft mechanic's lien foreclosure action is that the lien was not properly perfected. In this situation, the aircraft owner asserts that the lien statement was not filed within the proper time period after the last day of work or that the lien claimant did not follow the proper procedures to perfect the lien. Similarly, if the foreclosure proceeding was not initiated within the time period allowed by law, the aircraft owner may also assert that defense.

Another defense an aircraft owner may assert is that the lien is invalid because the lien claimant is knowingly demanding an amount in excess of what is justly due. This defense is very common in situations where the aircraft owner initially disputed the amount being charged by the lien claimant. However, this defense usually requires that the aircraft owner show bad faith on the part of the lien claimant or that the lien claimant knew the lien statement was overstated.

If the aircraft owner is successful in defending against the foreclosure proceeding, the aircraft owner will also probably succeed in a slander of title claim against the lien claimant. An aircraft owner asserting a slander of title claim alleges that the lien claimant improperly encumbered the aircraft with an invalid lien. A slander of title claim could have serious and expensive implications for the lien claimant if the improper lien prevented a sale of the aircraft or forced the aircraft owner to accept less in a sale than he or she would have in the absence of a lien.

As a practical matter, a lien claimant does not foreclose on its lien as often as you might think. Oftentimes, the aircraft has a mortgage that takes priority over the lien claimant's claim. As a result, even if the lien claimant succeeded in his or her foreclosure action, the lien claimant would still have to deal with or pay off the lender who holds the mortgage.

In most cases, this doesn't make financial sense for the lien claimant and the lien claimant does not intend to foreclose on its lien. Rather, the lien claimant records the lien with the hope that the aircraft will be sold in the future and the lien claimant will receive some payment in exchange for a release of its mechanic's lien.

The Declaratory Judgment Action. In situations where the lien claimant does not initiate a foreclosure action, an aircraft owner may file a declaratory judgment action to ask the court to determine the validity of the lien. The aircraft owner would raise the same defenses to the lien as in a foreclosure action and would be able to assert any additional claims the aircraft owner may have against the lien claimant (e.g. slander of title). The opportunity for the aircraft owner to post a bond or deposit with the court in order to obtain a discharge or release is also available in a declaratory judgment action. The only real difference from the foreclosure action is that the aircraft owner is initiating the lawsuit rather than the lien claimant.


Once a lien is asserted against an aircraft, an aircraft owner isn't without options. Unfortunately, each of the options available to an aircraft owner has a cost, both in time and money. If you find yourself in this situation, I recommend that you contact an aviation attorney familiar with your state's aircraft mechanic's lien laws to analyze your situation and help you choose the best course of action.

Do you have addition helpful information about this topic? Please discuss it with us!

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Greg Reigel

Owner Performed Aircraft Maintenance

by GlobalAir.com 1. July 2009 00:00
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This month's article is about Owner Performed Aircraft Maintenance in honour of the Experimental Aircraft Associations' Annual Convention which will be held at Wittman Regional Airport, and on the West Shore of Lake Winnebago, on July 27 through August 2, 2009. Back in 2000 I was scheduled to make a power point presentation at that year's Air Venture, but unfortunately an aircraft deal took me to another place instead of Oshkosh. Well I have dusted off the power point, updated it and made it more like an article. So please enjoy.

Experimental versus Certificated Aircraft
An aircraft that has had an Experimental certificate issued for one of following purposes:

  1. Operating amateur-built aircraft. Operating an aircraft the major portion of which has been fabricated and assembled by persons who undertook the construction project solely for their own education or recreation.
  2. Operating kit-built aircraft. Operating a primary category aircraft that meets the criteria of § 21.24(a) that was assembled by a person from a kit manufactured by the holder of a production certificate for that kit, without the supervision and quality control of the production certificate holder under § 21.184(a).

Ref. Cfr 14, FAR Part 21.191 - Experimental Certificates.
Type Certificated:
An aircraft in the normal, utility, acrobatic and commuter category that conforms to the airworthiness standards prescribed for the issue of a type certificates and changes to those certificates.
Ref. Cfr 14, FAR Part 23.1 - Applicability.

What is a Repairman's Certificate?
Repairman Certificate (Experimental Aircraft Builder and/or Light Sport Aircraft Owner) \ Eligibility,
Privileges and Limitations. Reference cfr 14, FAR Section 65.104
To be eligible for a repairman certificate (experimental aircraft builder), an individual must:

  1. Be at least 18 years of age;
  2. Be the primary builder of the aircraft to which the privileges of the certificate are applicable in the case of an Experimental Aircraft. In the case of a Light Sport Aircraft the applicant must undergo 120 hours of classroom training for an Airplane, 104 hours for a Weight-shift Control or Powered Parachute, and 80 hours for a Lighter than Air, or Glider;
  3. Show to the satisfaction of the Administrator that the individual has the requisite skill to determine whether the aircraft is in a condition for safe operations; and Be a citizen of the United States or an individual citizen of a foreign country who has lawfully been admitted for permanent residence in the United States.

The holder of a repairman certificate (experimental aircraft builder) may perform condition inspections on the aircraft constructed by the holder in accordance with the operating limitations of that aircraft, ONLY.

It's an Experimental, but I didn't build it myself.
Regarding Maintenance, if you didn't build it then there is NO difference between this aircraft and a Type Certificated Aircraft.
Further more, you are NOT eligible to become a Repairman for this aircraft as you did not originally construct it yourself; you can however perform Preventative Maintenance on this aircraft I.A.W. cfr. 14, FAR 43, Appendix A.
All subsequent Annual Condition Inspections and any associated repair work, can ONLY be performed by either an A & P Mechanic, or a Repair Station.

I am NOT an A&P or a Repairman, Am I still Legally Qualified?
If you currently hold a pilot certificate issued under part 61, you may perform PREVENTATIVE MAINTENANCE on your own aircraft as long as you do not operate your aircraft under part 121, 127, 129, or 135.
However, unless you already hold either a valid Mechanics or Repairmans Certificate, you only qualify to perform all other maintenance and alteration work only under the direct supervision of an A&P mechanic or a repairman who personally observes your work. However you are not authorized to perform any inspection required by part 91 or part 125 of this chapter or any inspection performed after a major repair or alteration.

What is Preventative Maintenance?
"Preventive maintenance" means:
simple or minor preservation operations and the replacement of small standard parts not involving complex assembly operations.

The 31 items that you CAN do yourself
1. Removal, installation, and repair of landing gear tires.
2. Replacing elastic shock absorber cords on landing gear.
3. Servicing landing gear shock struts by adding oil, air, or both.
4. Servicing landing gear wheel bearings, such as cleaning and greasing.
5. Replacing defective safety wiring or cotter keys.
6. Lubrication not requiring disassembly other than removal of nonstructural items such as cover plates, cowlings, and fairings.
7. Making simple fabric patches not requiring rib stitching or the removal of structural parts or control surfaces. In the case of balloons, the making of small fabric repairs to envelopes (as defined in, and in accordance with, the balloon manufacturers' instructions) not requiring load tape repair or replacement.
8. Replenishing hydraulic fluid in the hydraulic reservoir.
9. Refinishing decorative coating of fuselage, balloon baskets, wings tail group surfaces (excluding balanced control surfaces), fairings, cowlings, landing gear, cabin, or cockpit interior when removal or disassembly of any primary structure or operating system is not required.
10. Applying preservative or protective material to components where no disassembly of any primary structure or operating system is involved and where such coating is not prohibited or is not contrary to good practices.
11. Repairing upholstery and decorative furnishings of the cabin, cockpit, or balloon basket interior when the repairing does not require disassembly of any primary structure or operating system or interfere with an operating system or affect the primary structure of the aircraft.
12. Making small simple repairs to fairings, nonstructural cover plates, cowlings, and small patches and reinforcements not changing the contour so as to interfere with proper air flow.
13. Replacing side windows where that work does not interfere with the structure or any operating system such as controls, electrical equipment, etc.
14. Replacing safety belts.
15. Replacing seats or seat parts with replacement parts approved for the aircraft, not involving disassembly of any primary structure or operating system.
16. Trouble shooting and repairing broken circuits in landing light wiring circuits.
17. Replacing bulbs, reflectors, and lenses of position and landing lights.
18. Replacing wheels and skis where no weight and balance computation is involved.
19. Replacing any cowling not requiring removal of the propeller or disconnection of flight controls.
20. Replacing or cleaning spark plugs and setting of spark plug gap clearance.
21. Replacing any hose connection except hydraulic connections.
22. Replacing prefabricated fuel lines.
23. Cleaning or replacing fuel and oil strainers or filter elements.
24. Replacing and servicing batteries.
25. Cleaning of balloon burner pilot and main nozzles in accordance with the balloon manufacturer's instructions.
26. Replacement or adjustment of nonstructural standard fasteners incidental to operations.
27. The interchange of balloon baskets and burners on envelopes when the basket or burner is designated as interchangeable in the balloon type certificate data and the baskets and burners are specifically designed for quick removal and installation.
28. The installations of anti-misfueling devices to reduce the diameter of fuel tank filler openings provided the specific device has been made a part of the aircraft type certificate data by the aircraft manufacturer, the aircraft manufacturer has provided FAA-approved instructions for installation of the specific device, and installation does not involve the disassembly of the existing tank filler opening.
29. Removing, checking, and replacing magnetic chip detectors.
30. Removing and replacing self-contained, front instrument panel-mounted navigation and communication devices that employ tray-mounted connectors that connect the unit when the unit is installed into the instrument panel, (excluding automatic flight control systems, transponders and microwave frequency distance measuring equipment (DME)). The approved unit must be designed to be readily and repeatedly removed and replaced, and pertinent instructions must be provided. Prior to the unit's intended use, an operational check must be performed in accordance with the applicable sections of part 91.
31. Updating self-contained, front instrument panel-mounted Air Traffic Control (ATC) navigational software data bases (excluding those of automatic flight control systems, transponders and microwave frequency distance measuring equipment (DME), provided no disassembly of the unit is required and pertinent instructions are provided. Prior to the unit's intended use, an operational check must be performed in accordance with applicable sections of part 91.

What will I need?
i.e. Maintenance or Service Manuals for your aircraft, any pertinent Advisory Circulars like AC43.13 1B, AD's, and any Special Instructions provided for the Continuing Airworthiness of Supplemental Type Certificate.
Perform the work at a location where all removed parts are protected from dust, dirt or damage.
May include jacks, air tools, multi-meter, wrenches, sockets and special tools specific for the work, etc.
If the preventative maintenance work that you intend to perform is not simple in nature and is beyond your ability, you are not qualified to continue and must seek the assistance of a certified Mechanic.

The Sign-Off
Ref. Cfr 14 FAR 43.9 - Content, Form, and Disposition of Maintenance, Preventive
Maintenance, Rebuilding, and Alteration Records
Each person who maintains, performs preventive maintenance, rebuilds, or alters an aircraft, airframe, aircraft engine, propeller, appliance, or component part shall make an entry in the maintenance record of that equipment containing the following information:
(1) A description (or reference to data acceptable to the Administrator) of work performed.
(2) The date of completion of the work performed.
(3) The name of the person performing the work if other than the person making the entry.
(4) If the work performed on the aircraft, airframe, aircraft engine, propeller, appliance, or component part has been performed satisfactorily, the signature, certificate number, and kind of certificate held by the person approving the work. The signature constitutes the approval for return to service only for the work performed.
In the case of a Repairman who performs his own Condition Inspection, the Logbook Entry must also include:
(5) The type of inspection and a brief description of the extent of the inspection.
(6) The date of the inspection and aircraft total time in service.

Owner Assisted Annuals
Annual Time always provides an excellent opportunity for an aircraft owner to become better acquainted with his/her aircraft. Obviously in the case of a Type Certificated Aircraft, an A&P Mechanic with an Inspection Authorization or a Certified Repair Station, are the only entities that are normally authorized to perform your Annual Inspection. However with careful coordination with the Inspector, it is usually possible for you to assist, not only by removing panels, seats, etc., but also to actually perform some of the required maintenance and repair tasks (under the supervision of an A&P Mechanic) that may result from the inspection.
Don't expect to save yourself much money by talking your Inspector into letting you assist, as I have found from personal experience that by asking your chosen Inspector to supervise you and to also answer your questions, he/she is spending a not inconsiderable amount of time in providing you with Training. As we all know, Training Consumes both Time and Money, when it is done Right.

Airworthiness Directives
Airworthiness Directives are published in the Federal Register as amendments to part 39.
Each AD contains an applicability statement specifying the product (aircraft, aircraft engine, propeller, or appliance) to which it applies. Some aircraft owners and operators mistakenly assume that AD's do not apply to aircraft with other than standard airworthiness certificates, i.e., special airworthiness certificates in the restricted, limited, or experimental category. Unless specifically stated, AD's apply to the make and model set forth in the applicability statement regardless of the classification or category of the airworthiness certificate issued for the aircraft. Type certificate and airworthiness certification information are used to identify the product affected. Limitations may be placed on applicability by specifying the serial number or number series to which the AD is applicable. When there is no reference to serial numbers, all serial numbers are affected. The following are examples of AD applicability statements:
The registered owner or operator of an aircraft is responsible for compliance with AD's applicable to the airframe, engine, propeller, appliances, and parts and components thereof for all aircraft it owns or operates. Maintenance personnel are responsible for determining that all applicable airworthiness requirements are met when they accomplish an inspection in accordance with part 43.

Experimental Liability
This is a very misunderstood subject that deserves at least a very short mention, even though it does not entirely relate to Owner Maintenance.
When selling a Homebuilt/Experimental Aircraft, the seller has a legal duty to the buyer as legally the Homebuilder is the Manufacturer with all of the potential liability of any other manufacturer for Negligence, Product Liability and Warranty Exposure when the aircraft is sold.
Based upon the legal principles of Negligence, if the aircraft or a component of it fails, or if the aircraft crashes because the builder didn't use Reasonable Care in Design, Construction or Maintenance, the Builder will be liable EVEN IF THE AIRCRAFT IS PARTIALLY DISASSEMBLED BEFORE BEING SOLD. This is called TORT LIABILITY.
All you can do is minimize the risk of liability based upon the total circumstances of the sale and purchase of a particular homebuilt/experimental aircraft. This can be done by reading the EAA publications that have been written on this subject and also by hiring the services of a good aviation lawyer.

Get to know your Local FAA FISDO Personnel
There are nine domestic FAA Regions that are home to 83 Flight Standards District Offices (FSDO's) in the U.S.A.
Each FSDO is staffed by knowledgeable Maintenance Inspectors, who have been trained to oversee, assist and provide you with guidance in the field of aircraft maintenance.
To get the location of your FSDO office, call the FAA Aviation Safety Hotline at:

See you all next month.

Have you had experience with this topic or a similar one? Please discuss it with us!

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Jeremy Cox

Summer Thoughts

by David Wyndham 1. July 2009 00:00
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In late summer 1988, a singer Bobby McFerrin had a hit single called "Don't Worry, Be Happy." In that song he recounts various woes declaring

"When you worry you make it double,
So don't worry, be happy."

I think that is good advice for the summer of 2009. Some economic news is encouraging, but in the next day's news we have a new, bad economic report. Within aviation, we are wallowing in the depths of this recession. Reports are mixed, but from where I see things, if we haven't hit bottom, we are real close. New aircraft sales are slim, but most manufacturers are keeping going off of (rapidly diminishing) backlog sales. Used aircraft sales are still hurting, with moribund being used to describe older, used aircraft selling conditions. Operators are still under a lot of pressure to cut costs. Flight hours are down in every major sector.

Don't worry, be happy.

Fuel costs, although they are on the rise, don't appear to be headed to new highs just yet. Be happy about that. Keep flying using economy settings unless speed is critical. Keep using those fuel discount programs and check fuel prices and other fees before your trip.

Manage and control your costs. Have a system in place to collect your costs. Separate them into appropriate categories that you can analyze and understand. If you don't have sufficient detail in your aviation costs, you can't expect to be able to manage them. In about five years' worth of typical turbine aircraft utilization, you will spend as much money operating an aircraft as it costs to acquire it. Other than overhauls and refurbishments, most of the operating costs go out the door in small enough increments that we don't realize their total magnitude.

Maintenance is one of your biggest cost areas and one where you do have the most control. Evaluate how you do your repairs and overhauls. Using loaner parts while yours are repaired may be less costly than exchanging for new. Evaluate ways to maintain quality without adding cost.

Have a strategic plan. One question that can come up is "Are we operating the best aircraft for the job?" A strategic plan addresses this question with the reasoning and justification as to why you fly the aircraft you do. It also ties into the company's mission statement. Having and updating your strategic plan pays off in being able to better anticipate and adjust to changes without "shooting from the hip."

Communicate to management what you are doing and how to interpret your costs correctly. Paying out for a major phase inspection or an engine overhaul may make it look like your costs are too high. Educate the CFO as to the nature of aircraft costs. That $200,000 component overhaul might have taken six year's worth of flight hours to accrue. Don't assume they realize that. Let them know you are concerned about managing costs and keep them informed as to what you are doing to minimize costs while maintaining the highest levels of safety and service.

Communicate to management about the importance of the aircraft in helping them effectively run the company during these stressful times. Time is a non-renewable resource. A business aircraft is an essential business tool by enabling rapid travel, face-to-face communication in many places over a few days, and allowing productive work to be done while en route.

You need to address all the concerns that management may have. Anticipating them in advance is far better than the panic that comes with the 5 PM phone call from the boss. These are not easy times, but we can all learn to be leaner and more effective so that when things improve, we are still around to enjoy them, and to be happy.

What positive things have you learned from these current economic times? Click reply and let us know!

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David Wyndham


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