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Thread: Experimentals for hire?

  1. #21
    kscessnadriver's Avatar
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    Quote Originally Posted by Sam Buchanan View Post
    You can allow your friend to fly your aircraft and he can purchase fuel to top it up when he returns but he cannot pay you for the use of the plane.
    So then, let him pay a small fee to become a non-equity owner of the aircraft, and pay for the costs of using the aircraft that way.
    KSCessnaDriver
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  2. #22

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    "Non-equity owner" sounds like a contradiction for an airplane. Your name is on the registration or it is not. If it is not, in the eyes of the FAA you are not an owner. Now for a Normal, Aerobatic, etc category aircraft, a company or partnership's name may be on the registration, and you may be a documented owner of that entity, but that means that there is a paper trail from you to the airplane's registration that the FAA can follow. And as with all things involving a governmental regulatory agency, its the paper trail that counts.

    Best of luck,

    Wes
    N78PS

  3. #23

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    The FAA has probably done legal interpretations for this exact scenario before. You can search for previous legal interpretations and opinions here: http://www.faa.gov/about/office_org/...terpretations/

  4. #24
    kscessnadriver's Avatar
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    Quote Originally Posted by WLIU View Post
    "Non-equity owner" sounds like a contradiction for an airplane. Your name is on the registration or it is not. If it is not, in the eyes of the FAA you are not an owner. Now for a Normal, Aerobatic, etc category aircraft, a company or partnership's name may be on the registration, and you may be a documented owner of that entity, but that means that there is a paper trail from you to the airplane's registration that the FAA can follow. And as with all things involving a governmental regulatory agency, its the paper trail that counts.

    Best of luck,

    Wes
    N78PS
    So, put the airplane in a club. Club is the owner. You, the builder of the airplane, own the entire club, and sell memberships (owning a very, very small portion of the plane) to the club members, who can only sell it back to you or new members when they leave.
    KSCessnaDriver
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  5. #25

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    Would this hypothetical person that would like to rent an Experimental be a friend or "some random dude?"

    Close friend would simplify things. Just lend him the aircraft and have him top it off when he's done. Then, in an unrelated and very coincidental transaction, sell him a ballpoint pen for fifty bucks. Heck, put him on the insurance as a named pilot.

    "Some random dude" = a business, and you're asking for BIG TROUBLE if it isn't legal all the way through; not that anybody would care until he wrecks the plane and the family sues you. See the FAA Counselor as suggested.
    The opinions and statements of this poster are largely based on facts and portray a possible version of the actual events.

  6. #26

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    So post #24 distills the question to ask the FAA Chief Counsel down to "Can a flying club, where one member holds a 90% interest and several other members hold small minority interests own and operate an E-AB aircraft with all members paying equal shares of the operating expenses." The answer to that question should be very interesting. I would not proceed with that scheme until I go an affirmative answer.

    After all, its your pilot certificate at risk here. If the certificate is your livelihood, how will you explain to your wife if the FAA suspends it and you no longer have a paycheck? That question is one factor that shapes the behavior of most professional pilots.

    Best of luck,

    Wes
    N78PS

  7. #27
    kscessnadriver's Avatar
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    Quote Originally Posted by WLIU View Post
    After all, its your pilot certificate at risk here. If the certificate is your livelihood, how will you explain to your wife if the FAA suspends it and you no longer have a paycheck? That question is one factor that shapes the behavior of most professional pilots.
    The question really comes down to, what would cause the FAA to find out about something like this between friends?
    KSCessnaDriver
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  8. #28
    Sam Buchanan's Avatar
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    Quote Originally Posted by kscessnadriver View Post
    The question really comes down to, what would cause the FAA to find out about something like this between friends?
    An accident or insurance claim? Falsifying info in the course of a ramp check? Falsifying tax documents?
    Sam Buchanan
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  9. #29

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    As suggested above, you don't know if your friends are really your friends until something bad happens. And at that is when you find out if there is really "honor among thieves." Life really is easier if you try to follow the rules and avoid deals which look too good to be true.

    But many people seem to have a need to skate around the edges and in truth many do not run into problems doing so.

    But discussing the mechanics of skirting the FAR's is probably not a wise discussion to have on a public internet forum.

    Best of luck,

    Wes
    N78PS

  10. #30

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    Can a Club be a corporation? If so, then members would buy shares in the LLC and get equity. The club could have overhead expenses, ie. hangar rental, maintenance, rental manager's salary, etc. - wouldn't that be perfectly legal along the lines of EAB aircraft? There would be monthly dues to cover overhead costs and hourly dry rate based on expenses or a combination thereof?
    -Jim

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