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Amateurs by the Hour

April 7, 2019

AMATEURS BY THE HOUR: EXPERIMENTAL AIRCRAFT COMPLETION CENTERS AND TORT LIABILITY

By: Mitchell Williams, Volume 103 Staff Member

In the wake of the recent air disasters involving Boeing 737 MAX airplanes,[1] much media attention has been directed to the Federal Aviation Administration (“FAA”) for inadequacies in its certification process.[2] While stories like this are sensational to the public, there is a separate world within aviation, unknown to many people, that poses equally interesting questions of FAA regulation and legal responsibility: experimental aviation. In this world, an aircraft’s designer and manufacturer aren’t always the same nor easy to identify because different parties can be involved at stages of its development.[3]

There are different categories of experimental aircraft, but the one most relevant to the consumer population is the amateur-built category.[4] This category is defined by FAA regulation as “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.”[5] This “51% rule” allows individuals to operate light aircraft built from pre-fabricated kits so long as the individual performs at least half of the assembly,[6] and is the foundation for a large industry of aircraft kit manufacturing.[7] Aircraft manufactured from such kits comprise a significant portion of the general aviation fleet today.[8] Despite this large industry, there is anywhere from scant to nonexistent case law discussing most of the critical issues involving amateur-built experimental aircraft. The ongoing promotion of these aircraft is vital to the general aviation community, so these issues must be addressed.

For a typical kit-built aircraft, a manufacturer designs an aircraft, manufactures a kit with most of the components necessary for completion of the aircraft, and sells it to a buyer who will do the majority of the assembly and eventually apply for FAA airworthiness certification.[9] For airworthiness certification, the amateur-builder must certify to the FAA that amateurs completed the majority of construction of the aircraft for education or recreation.[10] However, there are entities sometimes called “completion centers” or “build centers” that provide assembly services to the kit buyer. These services can range from simple storage and tool rental to total assembly of the aircraft.[11] These are generally relied upon to perform specialty services such as wiring or painting but can be used to totally circumvent the 51% rule.

Completion centers operate on the fringes of what is permissible under the 51% rule.[12] To the extent that these completion centers offer storage, tool rental, or builder assistance,[13] the services will most likely be considered a permissible aid to an owner’s own amateur construction when the aircraft is certified.[14] Many kit manufacturers themselves offer such “builder assistance” or “factory assistance” services at their factories, and that the FAA seems to tolerate them.[15] Problems arise, however, when they take on a larger role in assembling the aircraft, such as assembling critical airframe components outside of the owner’s presence. Aircraft built in this manner are likely in violation of the regulations and subject to denial of airworthiness certification by the FAA.[16] Yet, this appears to take place with impunity.[17] How can this be?

It is possible that aircraft owners seeking airworthiness certification simply falsely certify that they built the majority of their aircraft. For example, in Wetherilt v. Moore,[18] an Arizona appellate case, the court condemned an aircraft owner’s fraudulent certification of an amateur-built airplane. In a footnote, the court noted that defendant Harvey, the owner and “builder” of the aircraft, had made such a certification despite the fact that co-defendant Snyder (d/b/a Sport Planes Unlimited), a completion center, had done all of the kit’s assembly.[19] It was mentioned that Harvey voluntarily relinquished the aircraft’s airworthiness certificate two years after the accident, but the exact circumstances are not discussed.[20] The validity of the airworthiness certificate was not causally related to the crash at issue, but the court was clearly concerned with this fraudulent certification.[21]

It’s easy to see how such an oversight by the FAA could take place for many common amateur-built experimental aircraft. While the builder has the burden of proof as to whether he or she performed the majority of construction,[22] the FAA is unlikely to inquire too deeply into the facts in certain scenarios, such as when an applicant seeks certification of an airplane built from a kit that is pre-approved by the FAA as meeting the 51% rule if assembled by an amateur.[23]There might be little reason to suspect that a builder of such a kit, who either fails to disclose or materially misrepresents the nature of his or her use of a commercial completion center, would be in violation of the rule. Perhaps the FAA simply tolerates this practice. In any case, perhaps the rule should be changed to allow professional commercial assistance. Given that many amateur builders have no prior aircraft assembly experience, it might be desirable from a safety standpoint to allow experienced completion centers to play a larger role in building experimental aircraft.

Whether or not completion centers are performing lawful services, there are no reported cases in which airworthiness revoked or denied for this reason by affirmative FAA action. Thus, we must assume that this practice will persist for now. So, if aircraft substantially built by these centers are involved in accidents, what are their tort liability risks? Wetherilt v. Moore[24] is perhaps the only reported case in which a completion center was named as a defendant. In Wetherilt, however, the completion center Snyder was dismissed without prejudice from the case after seeking bankruptcy protection,[25] so it’s unknown what the result would have been. In the absence of guiding case law, general product liability principles are informative.[26]

It is unlikely that a completion center could be strictly liable for an aircraft as a product.[27] On strict liability, the Restatement of Torts says “[o]ne engaged in the business of selling or otherwise distributing products who sells or distributes a defective product is subject to liability for harm to persons or property caused by the defect.”[28] Any completion centers would likely be shielded by a “stream of commerce” defense, arguing that they are not in the business of selling airplanes, but rather providing services.[29] A good cause of action against such an entity would likely be for negligence, [30] which requires proving the breach of a duty of care owed to the plaintiff as well as an injury caused by the breach.[31] Opportunities for breach are rife in the business of aircraft building; not only can errors occur in the course of building a kit aircraft according to its designer’s instructions, but small design deviations common in the experimental world could each give rise to liability if not executed with the appropriate level of care. This is problematic given that completion centers such as that in Wetherilt v. Moore may be uninsured and judgment-proof.[32]

The whole experimental industry is in need of changes to make outcomes more predictable for all parties involved. This is particularly true given that half of amateur-built experimental aircraft were built by someone other than the current owner, increasing the risk of litigation should things go wrong.[33] This could involve cracking down on Completion services in a way that limits the scope of their services and thus their liability. This could alternatively involve legitimizing these services and developing a comprehensive insurance scheme to deal with the risks. More research in this area is needed. Experimental aviation has become a vital segment of general aviation that should be supported with rational policy.

  1. The recent crashes of Lion Air Flight 610 in the Java Sea and Ethiopian Airlines Flight 302 near Addis Ababa both involved the same type of airplane, and lead to criticism of both manufacturer Boeing and the FAA for problems in its certification process. Kelly Cohen, Ethiopian Airlines, Lion Air Crash Linked by New Evidence, Vox (Mar. 16, 2019), https://www.vox.com/2019/3/16/18268646/ethiopian-airlines-lion-air-boeing-737-similarities. ↑
  2. See e.g. Chris Rodrigo, FBI Joins Criminal Probe of Boeing 737 Max Certification: Report, The Hill (Mar. 20, 2019), https://thehill.com/policy/transportation/435010-fbi-joins-criminal-probe-of-boeing-737-max-certification-report. ↑
  3. Paul A. Lange, Tort Liability Surrounding Homebuilt, Amateur-Built, and Experimental Aircraft, 60 J. Air L. & Com. 575, 594–95 (1994). For example, a designer might create a master plan for an aircraft. Sub-assemblies of the aircraft may then be assembled by a kit manufacturer that can make design changes to suit its own needs. An individual may then build the aircraft either from scratch (using the plans plans) or from such a kit. The builder may make design changes during the construction process. Further, possession of the aircraft or its components may change hands during or after the building process, introducing more opportunities for design changes. ↑
  4. See id. at 577 (“the most common aircraft in the experimental category are what the FAA calls ‘amateur-built.’”). ↑
  5. 14 C.F.R. § 21.191(g) (2019). ↑
  6. Fed. Aviation Admin. (FAA) Advisory Circular 20-27G, Certification andOperation of Amateur-Built Aircraft, June 20, 1990 [hereinafter Advisory Circular 20-27G]; Mark Phelps, Homebuilt ‘51% Rule’ Clarified by FAA, Flying (Oct. 14, 2009), https://www.flyingmag.com/news/homebuilt-51-rule-clarified-faa. ↑
  7. Experimental Aviation Association, About Experimental / Amateur-Built Aircraft, https://www.eaa.org/eaa/about-eaa/eaa-media-room/experimental-aircraft-information, (last visited Mar. 20, 2019). A few examples of popular kit aircraft manufacturers include Lancair, known for its ultra-high-performance composite airplanes, Lancair, Home Page, https://lancair.com/ (last visited Mar. 20, 2019), and Van’s, known for its easy-to-build, all-metal designs with aerobatic capability and good speed. Van’s, Home Page, https://www.vansaircraft.com/ (last visited Mar. 20, 2019). ↑
  8. In 2017, experimental aircraft comprised about 13% of the total general aviation fleet. Fed. Aviation Admin., FAA Aerospace Forecast 93 tbl. 28 (2018), https://www.faa.gov/data_research/aviation/aerospace_forecasts/; see also Phillip J. Kolczynski, Liability for Homebuilt Aircraft, AVweb (Feb. 16, 1999), https://www.avweb.com/news/avlaw/181900-1.html#market. ↑
  9. Lange, supra note 3, at 578. ↑
  10. Advisory Circular 20-27G, supra note 6, app 6 (FAA FORM 8130-6); see 14 C.F.R. §§ 21.191(g), 21.2 (2019). ↑
  11. Lange, supra note 3, at 602. ↑
  12. 14 C.F.R. §§ 21.191 (g), 21.2 (2019). ↑
  13. “Builder assistance” can refer to services in which the aircraft owner is present at the shop and is assisted. Any amount of such builder assistance is generally seen as permissible by the FAA, even though it might not be faithful to the 51% rule. Duane Swing, Are You Clear on the 51% Rule?, 5 Velocity Online (2007), http://www.velocityaircraft.com/newsv5/halfrule.html. ↑
  14. Advisory Circular 20-27G, supra note 6. ↑
  15. Swing, supra note 13. ↑
  16. Advisory Circular 20-27G, supra note 6; Experimental Aviation Association, The 51% Rule: Frequently Asked Questions, https://www.eaa.org/eaa/aircraft-building/building-your-aircraft/getting-started/the-51-percent-rule, (last visited Mar. 20, 2019). That is, if the aircraft owner does less than the majority of construction, it does not meet the requirement of 14 C.F.R. § 21.191(g) (2019). Because many aircraft kits are constructed so as to constitute just under 50% of the work towards a completed airplane, a kit builder who uses any significant outside services in assembling the kit would be in violation of the rule. ↑
  17. Lange, supra note 3, at 602; Swing, supra note 13. ↑
  18. No. 1 CA-CV 15-0143, 2017 Ariz. App. Unpub. LEXIS 382 (Ct. App. Apr. 6, 2017). ↑
  19. Wetherilt v. Moore, No. 1 CA-CV 15-0143, 2017 Ariz. App. Unpub. LEXIS 382, at *13 n.11 (Ct. App. Apr. 6, 2017). ↑
  20. Id. at *17. ↑
  21. See id. at *13. ↑
  22. Advisory Circular 20-27G, supra note 6, at 10. ↑
  23. Fed. Aviation Admin., Revised Listing of Amateur-Built Aircraft Kits (Sep. 24, 2018), https://www.faa.gov/aircraft/gen_av/ultralights/amateur_built/kits/media/amateur_built_kit_listing.pdf (“The primary purpose of this listing is to assist FAA Inspectors/Designees and other interested individuals by eliminating the duplication of evaluations for “major portion” determination when the aircraft is presented for airworthiness certification as an ‘Amateur-Built Experimental.’”). ↑
  24. No. 1 CA-CV 15-0143, 2017 Ariz. App. Unpub. LEXIS 382 (Ct. App. Apr. 6, 2017). ↑
  25. Id. at *2 n.2. ↑
  26. Of course, product liability law is generally a matter of state law and as such, there can be no single answer. But certain principles are more or less generally applicable and can be looked to for this high-level discussion. ↑
  27. Lange, supra note 3, at 602–03. ↑
  28. Restat 3d of Torts: Products Liability, § 1 (3rd 1998). ↑
  29. Lange, supra note 3, at 595. ↑
  30. Lange, supra note 3, at 602–03. ↑
  31. E.g. Benjamin Zipursky, The Restatement (Third) and the Place of Duty in Negligence Law, 54 Vand. L. Rev. 657 (2001) (describing the universality of these elements across states). ↑
  32. No. 1 CA-CV 15-0143, 2017 Ariz. App. Unpub. LEXIS 382 (Ct. App. Apr. 6, 2017). ↑
  33. Greene Broillet & Wheeler, LLP, Experimental Aircraft Accidents (Jan. 4, 2013), https://www.gbw.law/2013/01/experimental-aircraft-accidents/. ↑
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