Bad Bad Bad Leaseback
I received an email from a girl looking to help her 71 year old Father with a terrible leaseback relationship. It sounds like her father just wanted to learn to fly and got sold a bill of goods by the flight school. Unfortunately, there is not a lot of help to give, her situation requires a lawyer.
I thought her email would be a good read for both schools an prospective aircraft owners / leasors. (I promised to withold her name.) I think the point to the story for both sides is be honest and have a good contract. Also, for aircraft owners, do not let the aircraft log books out of your sight. Anyone with advice for her can comment to this post.
Email 1:
My father bought and leased back two airplanes to a flight school and I think he's been seriously ripped off.
Would you be able to indicate an organization that could help me understand my father's rights in a lease-back situation. My first thoughts would be something like a consumer protection agency, better business bureau, pilot's association ... ?
Dad has a contract with the school (with a 70/30 splilt - seems 80/20 is standard practise). He wants to sell his planes and for that needs the log books which the school will give him in exchange for $2,000.
Knowing he ows nothing to the school dad went directly to an attorney. Now the school is claiming more than $5,000 to retrieve the log books!
Thanks so much for any recommendations that would help me out.
Email 2:
This really made me feel good. My father lives in XXX, and I am in Europe where I live, and I'm trying to help him with this.
Yes I would like you to post my letter but keeping out names. I read a lot about lease-backs this weekend and see that many especially through schools, have been taken advantage of. I feel so bad for dad - he's 71 - was just working on the pilot's licence when he had a heart attack which changed everything for two years. Inspite of that, his medical was approved a month and a half ago I think via the FAA and he can get that licence and now this !
Email 3:
Dad is a member of the AOPA - and they recommended an attorney who to me, seems a little shy after having recieved rebuttal from the opposing attorney.
I may look for a stronger one but would like to keep costs down.
Since writing you I have obtained the TACK readings for both of dad's planes and he has moved them off the premises of the school but their attorney has put a "lien" on one of the planes.
I don't know how this was possible - because we have absolutely no bill or invoice from the school that corresponds to the school's claims of non payment. Within a few days their "overdue bills"have gone from $808 to $2,000 and finally to over $5,000. The opposing attorney is threatening to increase the value of the lien saying that if dad wants to keep his planes he'd better pay his bills and that the school is still calculating what he owes. I find this very strange!
But we don't know what is supposed to be paid! and after calculating, I think the school actually owes money to dad! especially after comparing the flight fees with the Tack readings.
I will contact the BBB - I have written to the Washington State Legislature and the FSDO (as they have been informed my father doesn't have his log books).
I'll also be going to the press if necessary and transmitting dad's story across as many blogs and forums as possible.
I would send my dad down with the police if I knew that he would be able to get the log books and that it truly is illegal to withhold them - we have received opposing information in that regard. When you say it's not an ideal option what do you mean?
The opposing attorney says that the school has the right to keep the books. My father's first attorney says the school has no legal right to keep the books.
