Buyer fails to report transfer

Let'sgoflying!

Let'sgoflying!

Touchdown! Greaser!
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Dave Taylor
What should a seller do to avoid liability when buyer fails to submit bill of sale etc to the FAA?
In Texas, we have a ‘vehicle transfer notification’ form we fill out to notify the state when we sell a car, because failure of buyer to report is rampant.
Wondering if the FAA has same.
 
You are supposed to keep your FAA registration and mail it in, indicate that you sold it and to whom, and date it.
 
Yes, and if they don’t do that?
 
As mentioned, you sign and return the registration to the FAA. I scan and retain a copy of it and also a copy of the bill of sale (AC 8050-2).
 
I'm not aware of a deregistration form other than the one used for export. But there must be some process if you didn't keep the registration to turn in. I suggest contacting the registration branch to ask them what to do.

I'm curious - how do you know the buyer didn't turn it in?
 
Let'sgoflying! said:
What should a seller do to avoid liability when buyer fails to submit bill of sale etc to the FAA?
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What liability are you concerned about? As mentioned theres a requirement per Part 47.41 to return the reg cert after certain events so no separate form on transfers. However its one of those rules not widely known about.
 
mandm said:
You are supposed to keep your FAA registration and mail it in, indicate that you sold it and to whom, and date it.
Click to expand...
It was on loan for a period then decided to transfer later, so I don’t have the registration.
I was told it happened over a year ago.
Registry shows no activity.
I think there is liability.
Even if I’m wrong, I want it changed.
 
Just remember that you are the owner until the transfer form is filled out and mailed. If the new owner has an accident before it is sent in, it is your liability.
The legal costs of straightening that out is significant. Not personal first hand, just my best high school friend's catastrophe.

I go to settlement with an envelope with the address, and postage. When all the documents are signed, I drop the envelope at the nearest POST OFFICE. I also keep a copy of the documents for my file, at least until I have proof that the transaction is recorded.

This is for airplanes, boats, cars, and houses.
 
Let'sgoflying! said:
It was on loan for a period then decided to transfer later, so I don’t have the registration.
I was told it happened over a year ago.
Registry shows no activity.
I think there is liability.
Even if I’m wrong, I want it changed.
Click to expand...
If you are concerned then write an email to the FAA that you sold the airplane but don’t have the registration card to return and you want to let them know. Last time I wrote an email I got a response it must have been within hours or one business day at the latest. The registering process takes a long time, for me it was well over a year (I also have the previous owners registration card IIRC, they forgot to keep it). If one box on the registration application form is checked wrong you have to redo it and start from scratch including the waiting period.
 
Let'sgoflying! said:
It was on loan for a period then decided to transfer later, so I don’t have the registration.
I was told it happened over a year ago.
Registry shows no activity.
I think there is liability.
Even if I’m wrong, I want it changed.
Click to expand...
The FAA has been sending out updated registrations to the listed owner so that the new expiration date is displayed. You may be in luck, as you could return that stating it is sold once it arrives.

Or you could request a replacement and return that once it shows up.
 
The FAA bill of sale form 8050-2 specifically states on it in part -

"ACKNOWLEDGMENT (NOT REQUIRED FOR PURPOSES OF FAA RECORDING: HOWEVER, MAY BE REQUIRED BY LOCAL LAW FORVALIDITY OF THE INSTRUMENT.)"

"This is intended only to be a suggested bill of sale form which meets the recording requirements ofthe Federal Aviation Act, and the regulations issued thereunder."


geezer said:
Just remember that you are the owner until the transfer form is filled out and mailed. If the new owner has an accident before it is sent in, it is your liability.
The legal costs of straightening that out is significant. Not personal first hand, just my best high school friend's catastrophe.

I go to settlement with an envelope with the address, and postage. When all the documents are signed, I drop the envelope at the nearest POST OFFICE. I also keep a copy of the documents for my file, at least until I have proof that the transaction is recorded.

This is for airplanes, boats, cars, and houses.
Click to expand...
This is not correct.
 
mandm said:
If you are concerned then write an email to the FAA that you sold the airplane but don’t have the registration card to return and you want to let them know. Last time I wrote an email I got a response it must have been within hours or one business day at the latest. The registering process takes a long time, for me it was well over a year (I also have the previous owners registration card IIRC, they forgot to keep it). If one box on the registration application form is checked wrong you have to redo it and start from scratch including the waiting period.
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The guy I sold a plane to last summer sent a photocopy of the Bill of Sale (AC 8050-2) instead of the one with my original ink signature. After a year in the queue it got rejected and he had to resubmit. Both the Bill of Sale and Registration Application must have the signatures in ink. The instructions say a digital signature is OK but I've never done it that way and don't know how it's done.
 
Yep. You have to have the original "wet" signature. In my experience, the digital signature is only accepted when a title company like AIC submits it.
 
geezer said:
This is for airplanes, boats, cars, and houses.
Click to expand...
This has not been my experience with the aircraft registration process. The FARs provide time frames to comply with the process with some instances taking up to a year while the new owner has flown the aircraft. And in some cases wrecked on his 1st or 2nd flight. No liability issues based on registration or ownership.
 
k9medic said my previous post was not right.

The following is what happened:

The new owner had fully extended his finances, and did not have money for insurance, required to get tags. He borrowed tags from another (wrecked) car, and drove. He hit and severely injured a pedestrian, abandoned the car, and ran.

The registered owner, my friend, was sued for a couple of hundred thousand dollars, and it took him about a year to clear his liability, and his attorney was not cheap.

Unfortunately, he had transferred his insurance to a new car he bought after the sale, or his insurance company would have been defending from the suit.

The injured pedestrian had legal bills too, and no chance of collecting from the actual owner of the car. He never did send in the transfer papers. The victim will be using 2 crutches the rest of their life.

The deadbeat owner simply disappeared, probably to a distant state. A small name change, a phoney SS number, and life goes on.
 
I'm not saying your story did not occur. I am saying that the civil liabilities associated with a vehicle, or residence that is sold, transfers to the person immediately. If this were not the case, any delay in the processing of the paperwork for ANY purchase would have significant ramifications.

Unfortunately, you can, at any time (as your friend found out) be sued so you may have to defend yourself against said civil liability. Tort liability is a fun topic for the ambulance chasers.

How do I know??? I sold a vehicle to a guy who did not register it at all. A year later, the vehicle was used in an armed robbery and was impounded. It took me a bit to clear things up (I had not filed a copy of the sales form with the state but had a copy) and at the end of the day I was able to provide enough information that the person who purchased it was arrested.
 
geezer said:
k9medic said my previous post was not right.

The following is what happened:

The new owner had fully extended his finances, and did not have money for insurance, required to get tags. He borrowed tags from another (wrecked) car, and drove. He hit and severely injured a pedestrian, abandoned the car, and ran.

The registered owner, my friend, was sued for a couple of hundred thousand dollars, and it took him about a year to clear his liability, and his attorney was not cheap.

Unfortunately, he had transferred his insurance to a new car he bought after the sale, or his insurance company would have been defending from the suit.

The injured pedestrian had legal bills too, and no chance of collecting from the actual owner of the car. He never did send in the transfer papers. The victim will be using 2 crutches the rest of their life.

The deadbeat owner simply disappeared, probably to a distant state. A small name change, a phoney SS number, and life goes on.
Click to expand...
Cars have special rules in most states related to mandatory insurance requirements.
 
geezer said:
The registered owner, my friend, was sued for a couple of hundred thousand dollars, and it took him about a year to clear his liability, and his attorney was not cheap.
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I think you supported k9medic's point. Your friend was sued, as anyone can be, but he was not liable since he didn't own the car.
 
Takeaway: yet another lesson in the importance of an escrow and one of the many registration problems that happen without it.
 
In Canada, when you sell a plane, you as the previous owner de-register it with Transport Canada. It used to be done via mail, which took some time, but can now be done online and is immediate. I sold a plane two years ago. I de-registered it the same day. The new owner still hasn't registered the plane. Not my problem. Transport Canada knows I no longer own the plane. I know for a fact the new owner has been flying the plane, probably not very legal unless he got some temporary cert.
 
Let'sgoflying! said:
What should a seller do to avoid liability when buyer fails to submit bill of sale etc to the FAA?
In Texas, we have a ‘vehicle transfer notification’ form we fill out to notify the state when we sell a car, because failure of buyer to report is rampant.
Wondering if the FAA has same.
Click to expand...
The aircraft in question wasn't a Bellanca Viking was it?

Asking because I know of a Viking that was bought by a dude in Virginia that never completed the registration and airplane still shows registered to the previous owner in Texas 2 years later.
 
Chrisgoesflying said:
In Canada, when you sell a plane, you as the previous owner de-register it with Transport Canada. It used to be done via mail, which took some time, but can now be done online and is immediate. I
Click to expand...
It's similar and has been mentioned here. De-registering involves mailing the registration certificate to the FAA. I only too a brief look but was surprised there wasn't an online something easily found.
 
Fearless Tower said:
The aircraft in question wasn't a Bellanca Viking was it?

Asking because I know of a Viking that was bought by a dude in Virginia that never completed the registration and airplane still shows registered to the previous owner in Texas 2 years later.
Click to expand...
it is a BSV, coincidentally - but it has not left Texas
 
Well. Sounds like you still own it. Might as well take it back.
 
another cool tidbit.
I called to get a liability policy on the airplane, thinking nice to be protected until this is resolved.
Nope. Insurers cannot cover an airplane for which you do not have "care, custody and control" regardless of what the registration says. :(
 
Let'sgoflying! said:
another cool tidbit.
I called to get a liability policy on the airplane, thinking nice to be protected until this is resolved.
Nope. Insurers cannot cover an airplane for which you do not have "care, custody and control" regardless of what the registration says. :(
Click to expand...
That re-enforces the statement that liabilities transfer upon the change in possession.
 
The giftee is making me a named insured on his policy.
The FAA has the registration application but no response so far so an online attempt is being made as well.
I am happy.
Thanks for the input.
 
This is one of the reasons the FAA changed from non-expiring aircraft registrations to 3 year and now 7(?) year registrations. The aircraft database was full of inaccurate or non-existent aircraft registrations and the FAA had no way to filter out the garbage.
 
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