Interpreting the Federal Aviation Act's limitation of liability for aircraft lessors, owners and secured parties.

Under Section 44112 of the Federal Aviation Act, an aircraft lessor, owner or secured party is insulated from liability for personal injury, death or property damage "on land or water," unless the aircraft is in the "actual possession or control of the lessor, owner or secured party." 49 U.S.C. § 44112. Florida, like some other U.S. jurisdictions, has a dangerous instrumentality doctrine that extends vicarious, or absolute, liability to aircraft owners and lessors. The issue before the Florida Supreme Court in Vreeland v. Ferrer was whether Section 44112 supersedes, or preempts, Florida's dangerous instrumentality doctrine to permit a wrongful death claim to proceed against a lessor that indisputably did not exercise actual possession or control over the aircraft at the time that it crashed. In deciding the issue, the Florida Supreme Court ruled that Section 44112's preemptive effect was limited to claims made by persons on the ground and outside the aircraft, leaving passengers and aircrew free to pursue lawsuits against passive lessors and owners pursuant to Florida's dangerous instrumentality doctrine. In Vreeland, the estate of a passenger who was fatally injured in an aircraft accident sued the plane's lessor, alleging, in relevant part, that it was liable for the passenger's death because, as the owner of the plane, it was responsible for the pilot's operation and inspection of the aircraft. The lessor, which did not have any involvement with respect to the aircraft during the lease period, relied upon Section 44112's limitation of liability and argued that the statute preempted Florida's dangerous instrumentality law and, hence, the plaintiff's wrongful death claim. The trial and intermediate appellate courts agreed, but the Florida Supreme Court reversed, reasoning that, in light of the general presumption against preemption and the legislative history of Section 44112, the statutory language "on land or water" meant that Congress only intended to protect lessors and owners from claims made by persons on the surface of the earth; not those who are in the aircraft. Thus, passengers and aircrew who are injured in an aircraft accident are not restricted, under Florida law, in pursuing claims against a lessor, owner or secured party that did not exercise actual possession or control of the aircraft. Although the Florida Supreme Court's decision conflicts with other reported opinions interpreting or applying Section 44112, the ruling is significant for those involved in aircraft or component leasing, not only in drafting agreements with lessees, but also in defending claims made pursuant to Florida law or in other jurisdictions that have a dangerous instrumentality doctrine that extends to aircraft.

Case Law Alert - 4th Qtr 2011