Junkie's Accident - a debate regarding claims and insurance

[Gadget]

Ja Boet. I believe everyone is entitled to freedom of speach and expression, unlike some moderators on this forum. Yes I know where they live. We need to discuss this issue because it touches a lot of us, not just because of the loss of our dear friend but also because a lot of us deal with schools on a regular basis and rent/hire/leen skelm airplanes from them. So this it is very important that this issue be used as an example of how horribly an innocent flight or small mishap can affect you.

As to the (I will not stoop so low to put the words I want to put here) who is sueing the family, why are you not replying and defending yourself. I also ask this of his/her buddys who nailed those of us that previously discussed this issue. I still have my ideas about the involved school owner and still do not like him, that won't change and that is my personal opinion. He does not have a good name and he is not making many friends out there, not just because of the current issue.

Most of us are not lawyers and this forum serves as a discussion point to keep us out of trouble.

So let it be, and let's get to the bottom of this. I for one have my old sanna ready if need be.

My R 1.00 worth. ( I still believe in our currency although a beer now costs more than ten rand.)

Gadget

[John Young]

If a flight school operating as a going concern makes a “business decision” to under insure its principal assets by 40% for “business reasons”, is it then fair for the flight school to make a claim for the “consequent shortfall” against a deceased estate?

Well Louis Come and "speak"

After all the denial. And from complete rude twits like Xplorer too.

Are you now suing an innocent family because you under insured your principal assets by 40%

What gives

Are you saying that an innocent family should pay for a “poor or wrong business decision” made by yourself

Hindsight is a good teacher.

Regards
John ZU-CIB

[Spongebob]

I have been flying weightshift by hire for more than a year. None of the places where I hire have asked me to read and sign any paperwork related to insurance, damages or excesses thus far. I have not received any verbal briefing on insurance/excesses or my possible liabilities from the places either.

I do not have excess insurance.

I will not hire and fly again unitill the places where I fly start putting the insurance issues on paper with them and me signing and having copies.

I will not expose my family to the potential risks this is bringing to light, even if it means I have to stop flying.

P.S. There goes the &*^%$ flight I was planning for this coming weekend.

P.P.S Flight schools, please get teh paperwork in order.

[KFA]

Most schools do not have insurance. It's unaffordable. As far as I know you are not allowed to hire&fly any NTCA and that is why you will also not get insured on this. Then I might be wrong?

[skidmark]

I did post something yesterday...was it that bad? I see it was removed without a moderator contacting me. I have no problem with it being removed and if its in the structure of this forum to keep it out I have no problem. Please let me know how or why I stepped over the mark. Privately please!!

[Boet]

Mmmmm. A bit more like it. This forum is certainly NOT there for slandering who-ever. Treating this topic as a debate looks a lot better. Please keep it informative, and leave your personal vendettas out of it. I hope that the matter will be resolved in a decent way.

[emil]

i agree with boet again..

knew junkie and know Louis.

and i know Louis wont do whats wrong.... nobody here except Boet see Louis point in....

there must be a Reason why he/ or hes insur is doing this not true ???

[RV4ker (RIP)]

I did post something yesterday...was it that bad? I see it was removed without a moderator contacting me. I have no problem with it being removed and if its in the structure of this forum to keep it out I have no problem. Please let me know how or why I stepped over the mark. Privately please!!

Wasn't me

[RV4ker (RIP)]

Most schools do not have insurance. It's unaffordable. As far as I know you are not allowed to hire&fly any NTCA and that is why you will also not get insured on this. Then I might be wrong?

All the Jabi's, Sportstars, Stings, Technams blik flight schools are using are insured NTCA's. I had insurance on NTCA for Hire & Fly, but it is very expensive in relative terms, especially if it a taillie. Again it is a business risk which needs to be assessed. By way of EG. Guideline rates were between 10-14% of the agreed value, which is expensive if usage is low. Also the insurance contract is complex and specifies mojor components and max cost/claim of each. It does make it easier if there is a local assembly setup which can give insurers an idea of cost in the event of a claim (like the Jabi factory for eg). If the plane is flying alot then it is worth it. If not the insurance cost component is very high.... Chat to Graham on the forum. He is in the game and had some interesting points regarding the actual cost of claims which are alot higher on avg than I first thought.

PS
A while back the Cubby was uninsurable. Nobody would insure it for some reason, so it appears that it depends to a large extent on the aircraft type and the insurer. Some insurance companies will not insure NTCA, but that is changing.

Try Regent, Businesssure & DJ&A for assistance... They have been most helpful to me with NTCA in the past. Insurance costs and allowing low time pilots loose (solo) on your aerie cost even more. This is why there are almost no twin aeries available for hire and fly. Insurance cost on a blik twin like a Baron for H&F would be in the region of R210'000 a year. Give 100hrs a year that equates to R2100 per hr for insurance alone... Same priciple but smaller numbers when relating to NTCA's... I assume that is why so many of the schools send students "solo" on Xcountries with a "safety" pilot?

I know in the past most trikes and "cheaper" 3 axis (550 Beaver for eg) have been self insurred as the cost to insure is too high in relation to the capital cost, but with the price of the new "microlights" insurance seems to be a must... To raise R60K for a replacement windlass or beaver can be managed, but R300K for a new cheetah, Jabi etc is beyond most as is evidenced by this case where the school is trying to recover the costs.

another 2c

[John Young]

Again it is a business risk which needs to be assessed...

....is beyond most as is evidenced by this case where the school is trying to recover the costs.

This is the very ethos of the elements that I entered into the debate.

If a flight school deliberately under insures its principal assets, should they be allowed to try and transfer their resultant exposure (Insurance Shortfall) onto any other innocent third party?

Morally, I feel that any flight school suing an innocent third party for its own self-incurred insurance shortfall is inappropriate.

I have no doubt that any competent court of law will see it the same way as I do.

Regards
John ZU-CIB

[Bacchus]

I also knew Junkie and I know Louis.
Lets keep personalities and perceptions out of this. Theres always two sides to a storie. I made contact with Louis and asked him what exactely happend. I just want to say, without taking sides here, that there are certain agreements that Louis have in writing that was done between him and Junkie. There is also very good reasons why that trike was under insured and Junkie was according to Louis aware of the fact. Louis does not want to respond on this forum because he says that he gets it on the receiving side, even from people who have not even met him.
There is a lot of other things as well, but I will keep my word to Louis and not put it on this forum. If he wants to do it, it is his prerogative and not mine.
Now I know I will also probably get the boot from many of you now, but I have spoken to the man himself, made a promise to him which I will honour, and I am much more at ease with the method behind the madness.
Make no mistake, Louis and myself had our BIG differences in the past and this is NOT a choosing sides thing.
I am merely trying to put some perspective to this issue.

Before we have a go at somebody, write or wrong, lets just make very sure of all our facts and not let emotions take over.

[Tumbleweed]

All rental agreements hold the hirer responsible. Should an owner insure his property and rent out, his insurers are entitled and will try recouperate any payout to him from the hirer, or anyone.

3rd Party Liability Cover.

AS in the case of Plant Hire (cranes, bulldozers e.t.c.) the owner / rental company states on the hire agreement (after several small clauses holding you responsible for anything that may go wrong, again contestionable (sic) that you may take out 3rd Party Liability Cover.

This would cover you againt the shortfall value between what the insurance value is covered for and the actual damage. This is the excess payment and shortfall between the last agreed upon value and the present replacement value. (Many under-insure coz e.g. like a Windlass, a incident can normally be rebuilt and is seldom a total right- off)

This would normally take a quick phonecall to the broker, and agreed amount (eg 10 %) and a number issued. Thats all.

You are then basically covered against any claim against you. Loss of earnings for downtime is another matter. I don't think the hirer can be held liable.

However, regardless of any indemnity clauses that you see / sign / verbally recieved are all questionable and can be contested in court(i.e.) a painted sign at the Auto Electrician. If your car is stolen overnight and it is found that thay the owner never took sufficient measure to protect contents then he can be held liable.)

Perhaps, once speaking to a specialist broker, it is possible to get blanket cover for yourself against any liabilities regarding hiring any plane, e.g. for R500 k?

Just my opinion, I'm not in insurance.

[LarryMcG]

Hi All

I agree with KFA. Many schools etc dont insure their aircraft, especially the lower end value trikes. In this case, as I do, and was told when I trained, when you fly with an instructor, the instructor carries full reponsiblity when flying together, and the student /flyer carries full responsibity when flying alone on the -you bend, you mend - category. Very clear, fly at your risk, or buy your own plane, regardless of negligence, bad weather or aircraft fault. Trikes are generally not to expensive to fix, after the usual minor prang, fortuntalely.

In the case of a student/flyer being told that the aircraft carries insurance, and he is liable for the excess, defintely liable for the excess, irrespective of being injured, dead or whatever. But defintely not for any shortfall, if the insurer failed to insure for full value.

So. split this into two catergories, and sort out accordingly

This should always be made clear, beforehand.

LM[/u][/i][/b]

[skidmark]

Sorry guy's if you are this type of business ... do it properly. Lets not play games... and enjoy how we make our livings. In everything there is risk ...cover that risk.. you never know that maybe oneday it's going to hup you in the gat! If you don't cover don't cry...we as humans are totally expendable we are nothing when we gone ... our actions create the problems we leave behind. Please look and think carefully before we jump around and make each other look bad. If you not covered don't cry...your risk? If you are covered well.. you laughing all the way to the bank lets not split hairs over crap. It really hurts me to read this ... it will be very interesting to see the outcome. I think I know where its at. Time will be the judge off that. Makes you think about the pat on the back and its cool...maybe when we enter into any agreement...becareful! Lets take note of what has happened and learn that a deal is a deal no matter what.

[FAWGie]

I know non of the parties involved and have read through this thread...there are a few points I wish to add....

LEGAL ASPECT

1. The law will cover any claim that one individual has against another in the circumstances where the defendant party (or their estate) has caused the damage to the first parties property (whether negligent or not), however, this is the usual claim if there was no contract between the said parties. (Written or Verbal)

2. There probably was a contract of sorts (assumption), so in this case, the agreement conditions would override whatever claim would materialise in point 1 above. Let's assume that there was a verbal contract in place whereby the defending party is advised that the property is indeed insured and that their only exposure is the excess, then the first party has contracted limited liability to the third party and the first party would have no claim on the defending party in the case of underinsurance as that is the first partie's own neglegance that has resulted in the shortfall. The only amount righfully liable then by the defendant would be the excess as that was the contractual understanding. Of course, the first party could test the right to claim for underinsurance, butt he defendant would be entitled to a counter claim on the basis that the owner did not disclose underinsurance and was neglegant in ensuring that the aircraft was adequately insured. At the end of the day, underinsurance will become the responsibility of the aircraft owner who declared that is was insured.

3. The Insurance Company, however, would have the right to claim against any party that they deemed responsibly or partially responsible for the cause of the damage to recover their insurance payout...a practice that Insurance Companies often follow if they feel other 3rd parties were involved, but seldom followed against the owner pilot or pilot of the insured aircraft.

4. Whether the pilot was flying in an "employed capacity" or "self" category has merit, because if flying in the "employed capacity", then the excess and liability becomes the responsibility of the employer. The deceased estate might also consider suing the owners of the school / aircraft on the grounds that perhaps there were mechanical failure factors which could have resulted in or form part of the events that resulted in the pilots death - again, one would have to provide reasonable proof that this was the case.

NEGLEGANCE

One of the most difficult things to prove, especially without a "black box" data recorder. If the pilot had encountered wind shear for example, it would refute the neglegance theory and of course difficult to prove. Personally, I doubt that the neglegance theory would pass the legal test.

MORAL ISSUE

Well now that is another matter entirely. We can only hope that all the individuals involved would look clearly at their motives and apply considerable compassion to this sensitive matter. Fortunately there is also a lot that the wider aviation community can do to assist as already suggested.

FURTHER LEGAL POINTS

1. A student contracts with a flying school. A flying schhol employs the instructor. The legal liability remains with the flying school.

2. The student contract should always imply that the risk of damage is for the student (who is hiring the aircraft), even if the instructor is acting as PIC (The student has hired the services on the instructor through the school), but the student remains responsible at all times.

3. If the Instructor has a deal with the school to use their property in exchange for instruction, then effectively, the property when used is deemed exchange for compensation and the instructor has effectively "hired" the aircraft on the same basis as other students and the contractual understanding of insurance and excess remains the same.

4. CAA accident findings are not deemed conclusive when it comes to law....and stand little water in a civil law suite...There are only three factors that could contribute to an accident: mechanical failure, pilot error, third party influence, natural factors (like wind shear, etc..., pilot heart failure, etc...)
CAA have limited resources to perform accident investigations and therefore probably arrive at a "probable conclusion", but not a "conclusive conclusion" which would be needed if relied upon for a law suite.

CONCLUSION

Any loss of life is sad and it is also sad that the issue of claiming against the deceased estate has materialised due to the already massive emotioanl burden placed on those close to the deceased.

The good part of this thread, though, will illuminate the potential legal risks found in owning, operating , hiring or flying an aircraft, so that we may all learn from this and be better protected. The contractual paperwork BEFORE you fly is so important, because it governs what happens if things go wrong.

I don't mean to knock lawyers here, but that they earn their money from litigation and "keeping the ball in play". Of course they will take on your case, anyone's case and tell you that you have a fair chance, etc..etc... Always rely on your own judgements as to what's fair, proper and moral and this would provide you with the best decision.....