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Historic FAA filings: the ghost of transactions past
20 August 2009
Hugh Garety and Chris Healy from law firm Bird & Bird write a practical article looking at issues with historic FAA filings when purchasing an aircraft
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[FAA]
[Bird & Bird]
[aircraft]
In a recent financing transaction involving one of our airline clients, US counsel acting for the US financing party, in line with their standard practice, conducted searches at the FAA in respect of all the aircraft to be mortgaged, all of which were UK-registered and none of which had been registered in the US in recent years.
These searches revealed that there was an unreleased recording against one of the aircraft dating back to 1988, relating to a lease between a non-US lessor and a non-US airline. Subsequent inquiry revealed that the lease had been terminated in 1998; in addition, the lessee itself had long since passed into aviation history.
Nonetheless, US counsel to the finance party advised that these filings would need to be removed from the FAA Register before the financing could be completed, as (in their view) they constituted a “lien” against the aircraft and a “cloud...
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