I love aviation. It’s exciting; it’s an industry of travel and exploration and let’s not forget, it’s sexy.
But, then again, I’m not an avionics tech, or an A&P mechanic, or a metal bender, or any number of allied support staff that keeps our aviation fleet in the air. You are the folks that work strange hours, often in un-air conditioned hangars. Regularly, you are asked to show up at 6:00 a.m. because someone wants to launch at sunrise and you are the heroes that assure that the aviation industry continues to fly.
It’s all very meritorious of you, and sometimes, it even has its financial reward until some poor soul comes in to your office and hands you a check made of rubber; an insufficient funds check that won’t clear the bank. Perhaps your client will use another favorite technique. They’ll take you ninety days down the line only to let you know that they can’t pay after all, or even worse; they’ll file bankruptcy just to make sure you never get paid.
What’s a working guy to do? Well, that’s where this article comes in. Hopefully, as an attorney of almost thirty years, I’ve seen a few creditors and debtors come and go, and I have learned how to deal with them effectively. Take a moment and read on. Let’s explore some of the options to getting paid from those to whom you provide your valuable service.
The Illusion Of Flight
When I was a kid, and still to this day, I would dream of flying. I, as many others have, made this into a hobby, a business, a career, and an avocation or vocation. This is common malady around airplane people. Many believe they can fly with little sense of the need to land safely. And they can fly, until the reality sets in. Aviation isn’t just about “flying”. Every airplane or helicopter or other flying machine needs an Annual Inspection, periodic maintenance, and parts far more expensive than an equivalent car part. So the dream turns to the reality of how to pay for these dreams, and sometimes the dream runs out of money. Let’s take a look at a few techniques that a prudent aviation support businessperson can take to at least minimize the pain caused to you, by these dreamers.
The place to start any business relationship is at the “meeting of the minds”.
• What does the client want or expect?
• Make a list of the details.
• What does the support shop understand of what the client wants or is willing to pay?
• The parties put their mutual understanding “in writing” so that they both understand the expectations of each other as to job requirement, costs, and terms.
That is “the contract”. There are dozens of forms which are in use, but regardless of the form, make sure that it contains certain minimal requirement. Every contract must have the consumers name and the shops name. Be careful here. Who is the consumer? Is it:
• The person in your shop?
• The corporation for whom the person in your shop, works?
• The name to who the aircraft is registered?
• The prime contractor mechanic who you are sub-contracting to?
• The lessee or lessor of the aircraft?
• An aircraft management entity?
Ideally, you want all of these listed as the customer, and you want to know that the person with whom you are speaking has authority to speak for the rest of these players. At very least, you want to make sure that your actual customer is the owner of the aircraft. After all, you are working on “the aircraft.”
Terms & Conditions: Technically, a contract can be oral, or verbal. A handshake still works in this world, but keep in mind that your handshake lacks specific terms and conditions. It’s nice to agree with your customer that if widget “A” gets fixed, they will be paid a specific amount of money, but it’s doesn’t always work. You must therefore look to the “terms and conditions.” When is payment required? Is it due upon work starting or upon completion of work? Perhaps within thirty days of completion. Is payment to be by cash, check, or credit card? Is a parts deposit required in advance? Does your agreement provide for lien rights? These are just a few of the core terms that should and must be considered. Some less-thought-out terms are:
• An Attorney Fees clause: If you have to fight for $10,000.00, it becomes frustrating if you win, but it cost you $12,000.00 to do it. An attorney fee clause provides that when you win, you are entitled to ask the court for reimbursement.
• A Governing law provision and a Venue provision: Airplanes are mobile creatures and owners are often domiciled in other states. If the aircraft is in Idaho, and the registered owner is in Delaware, and you are in New Orleans, you may have a problem. Will you sue here or there? Who’s law will be used Louisiana, Delaware