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3 parties that can use a plane as collateral for debt collection

On Behalf of | Jun 3, 2024 | Business Litigation

Airplanes, including small aircraft, represent sizable investments. They are worth tens of thousands of dollars and are often a source of income for their owners. Properly maintaining them is the only way of legally using them, as planes typically need to undergo annual inspections.

The cost of keeping a plane safe and functional can be relatively significant. In some cases, owners may not be able to pay everything immediately. Occasionally, they may then fall behind on their obligations to businesses in the aviation sector. Businesses that don’t receive timely payment can seek a lien against the airplane itself as a way of securing collateral for the debt owed.

Who might be eligible to enforce a lien against an aircraft?

Mechanics who have provided work

The specialized mechanics who perform repairs and maintenance services on airplanes can request a lien against the title of the plane if they do not receive payment in full for the work that they performed. The law in Florida allows mechanics and companies that offer repair or maintenance services to ask the civil courts for a lien if an owner fails to pay for the costs of work on an aircraft.

Those who have provided parts

The labor required for repairs and maintenance isn’t the only expense that owners could default on after outsourcing work on an airplane. Parts obtained on credit could also lead to a business or individual supplier having grounds to request a lien.

Fuel suppliers

The specialized fuel for aircraft is quite expensive, and many fueling stations have credit programs. Both small aviation businesses and independent owners can fuel up in some cases without paying for the fuel in full immediately. If the fuel provider does not receive payment in full in a timely manner, they may be able to ask the courts for a lien against the plane to force the owner into paying what they owe.

There are limitations on how long organizations and professionals have to initiate civil litigation to seek liens against an aircraft after doing work, delivering materials or providing fuel. Having assistance when dealing with aviation-related collection issues and leads can help those owed money by plane owners obtain the repayment they deserve.