Arizona law permits a proprietor to place a mechanic’s lien on another’s aircraft for labor, materials, supplies, and storage in the amount of the agreed upon charges. However, the proprietor can relinquish possession of the aircraft and still retain the lien by recording it in the office of the county recorder in the county of the labor, materials, supplies, and storage, provided he or she does so within 30 days of the relinquishment.
The proprietor also has the option of recording the lien on the aircraft with the aircraft registry of the Federal Aviation Administration (FAA). The lien must comply with all requirements of federal law, including an accurate description of the aircraft, the amount of the lien, and the date on which the proprietor last furnished the labor, materials, supplies, and storage. The proprietor must sign the claim, including his or her title, and pay the appropriate recording fee.
It is important to take the additional step of recording the aircraft lien with the FAA. That is because a mechanic’s lien that has merely been recorded with the county does not bind a purchaser of the aircraft who does not have actual notice of the lien. If the lien has been recorded with the FAA, though, the purchaser is bound by the lien, even if he or she has no actual notice of the lien.
Once the owner of the aircraft has satisfied the lien, the lienholder has 30 days in which to issue a release of the lien to the owner. The lienholder also must record the lien release with the county in which the lien was filed and the FAA aircraft registry, if applicable. If the lienholder fails to file the lien release and provide it to the aircraft owner, then he or she is subject to statutory penalties.
Aviation law can be complex, and no two aviation-related cases are the same. When these types of disputes arise, you need experienced legal representation and advice. Williams Commercial Law Group, L.L.P., is a law firm focusing on aviation law, business divorce, and high stakes litigation. Contact us at (602) 256-9400 and schedule a time to meet with us today.