Ninth Circuit Takes Strict View of Aircraft Statute of Repose

Wednesday, October 3, 2012

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Ninth Circuit Takes Strict View of Aircraft Statute of Repose

By a MetNews Staff Writer

A suit for damages caused by a defective airplane component cannot be brought more than 18 years after the plane originally containing the part was delivered to its initial purchaser, even if the suit relates to a different plane, the Ninth U.S. Circuit Court of Appeals ruled yesterday.

The decision strictly interpreted the statute of repose enacted as part of the General Aviation Revitalization Act of 1994, known as GARA. The panel affirmed the grant of summary judgment to Nabtesco Corporation, a Japanese manufacturer, and its U.S. subsidiary, Nabtesco Aerospace, Inc.

United States Aviation Underwriters, Inc. brought a subrogation action against Nabtesco after indemnifying the owner of a plane damaged in a runway accident at Long Beach Airport in 2009. US Aviation claimed that the accident resulted from Nabtesco’s manufacture of a defective part, a nose landing gear actuator.

The actuator was manufactured in April 1990 and installed in a Cessna 550 in October 1990 as an original part. The Cessna 550 was delivered late that month.

Years later, the actuator was removed from that plane and overhauled by a third party. In April 2007, the actuator was installed in the Cessna 560 that was subsequently damaged in the Long Beach accident, a plane that had been delivered to its first purchaser in December 1991.

Senior U.S. District Judge Thomas Zilly of the Western District of Washington, in tossing the subrogation action, held that Gara’s 18-year statute of repose ran from the date that the 550, not the 560, was delivered to the original purchaser.

Nelson Opinion

Senior Judge Dorothy W. Nelson, writing yesterday for the Ninth Circuit, agreed with the district judge.

Nelson explained that under GARA, the statute of repose is triggered on “the date of delivery of the aircraft to its first purchaser or lessee.” An alternative “rolling trigger date” provided for in the legislation—the date that a new component alleged to have caused an accident replaces an existing component or is added to the plane—has no application in this case because the actuator was used, not new, the judge said.

While the statute is ambiguous as whether “aircraft” means only the “indivisible” plane, or whether it means the plane plus its component parts, Nelson explained, Congress intended the latter definition.

‘Object and Policy’

The “object and policy” of the statute, Nelson wrote, was to protect manufacturers from what an earlier case described as “the long tail of liability attached to” general aviation aircraft, which can be used for decades after their original manufacture and sale.

The judge reasoned:

“Thus, the purpose behind enacting GARA — to relieve manufacturers’ burdens of liability costs over a long period of time — applies equally well to the manufacturers of general aviation aircraft as to the manufacturers of the parts therein, used or new. In light of this objective, it is highly unlikely that Congress intended for the statute of repose to protect all manufacturers except those of used parts. On the contrary, it is far more likely that Congress meant what it said when it defined the limitation period to embrace general aviation aircraft and all their component parts.”

Senior Judge Procter Hug Jr. and Judge Consuelo M. Callahan concurred in the opinion.

Attorneys on appeal were Jon A. Kodani and Jeffrey J. Williams of Santa Monica, California for the plaintiff and Christopher S. Hickey and James W. Hunt of Fitzpatrick & Hunt, Tucker, Collier, Pagano, Aubert, LLP in Los Angeles for the defendants.

The case is United States Aviation Underwriters v. Nabtesco, 11-35440.