part owner

TaxSrv wrote:
"Jon Kraus" wrote:
We set up a Limited Liability Corporation to cover us in
case of an accident....

What liability are you referring to? In the case of an accident,
that
would be potential tort liability, in which case it is the pilot of
the aircraft who gets sued, not just the LLC.

After my friend's accident, his partner was sued by one of the
passengers. His only connection to the accident was a part ownership in
the aircraft. The pax had lost wages well in excess of the insurance
limits.

-Robert

"Robert M. Gary" wrote:
...
After my friend's accident, his partner was sued by one of the
passengers. His only connection to the accident was a part ownership
in
the aircraft. The pax had lost wages well in excess of the insurance
limits.

That sounds like the problem of co-ownership of the aircraft. The
contra to that is the situation where the same guy is a shareholder in
a corp or member of an LLC. It is true there that such person cannot
be named in a suit for alleged tort by another shareholder/member who
actually flew the airplane.

But when it comes to judgment time in a successful suit, and a partner
is not named as defendant, then that partner cannot be made to fork
over his interest. As a practical matter also, the plaintiff may not
seek dissolution of the partnership to obtain some more dough,
especially if there's a loan on the aircraft. However, if the
aircraft is owned by a corp or LLC, and both pilot and corp/LLC are
named in a successful suit, then the plaintiff automatically gets to
own all the assets of the corp or LLC, namely the aircraft, which
leaves the other guy bewilderingly "holding his schmeckle," without
even being sued! Potentially to lose either way, no?

Fred F.