Part 91 or Illegal charter

[FlySacto]

Hi All,

Here's a situation that I'd like to get some other opinions on. Three of us in a conversation had different views, so let's hear your thoughts:

A) My wife asks me to fly her to a business meeting instead of making an eight-hour drive. She gets compensated with a travel allowance that is put towards the rental of the aircraft. The two of us fly the trip alone.

B) Same as above, but now two of her co-workers want to tag along on the flight. They contribute money also, covering 3/4 of the entire cost of the flight amongst the three employees.

C) My wife's boss ask her if I (a commercial pilot) could rent a plane and fly my wife and two other employees to a business meeting so they won't have to hang out in a car all day long traveling. Her company wants to pay for the entire cost of the rental and pay me for my time.


We all agreed that "A" would be pt. 91 without question, but we had different views throughout the other two situations. I argued that "B" was a gray area and might be construed as a charter to an over-jealous inspector, but should prevail as a pt 91 flight. I also argued that "C" would be an illegal charter, even though there was not a "holding out to others" involved, but I would be supplying the aircraft through the FBO where I work.

Give us a hand and offer your opinions!

Thanks!

FlySacto

 

[avbug]

Flysacto,

To address your scenarios in order, it's first important to address the issue of operations under Part 91. Because a flight is conducted under Part 91 does not make it acceptable under the law. Part 91 encompasses operating rules, but does not prescribe certification requirements, or hold forth issues regarding charter. Therefore, to state that a flight is conducted "under Part 91" and therefore make it acceptable with respect to charter issues and holding out, is incorrect.

For example, a company owns an aircraft, and flies it's employees from A to B on a regular basis. This is acceptable. The company may also carry non-employees, without compensation. However, if the company attempts to take payment or compensation from an employee or non-employee on the corporate aircraft, then the operations is not legal unless also conducted under Part 135 (depending on the aircraft and situation).

Moving to rental of an aircraft to provide these services, instead of a company provided aircraft, the situation changes somewhat. The passengers must provide the aircraft. The following statement is taken from an FAA Legal Interpretation, dated April 8, 1991:

"It is important, however, to distinguish the situation where there is a simple provision of pilot services, and the pilot has no part in the renting of the aircraft, where it is clear that the renter hires the pilot and has operational control over the airplane. The pilot must be the servant of the entity renting the aircraft, and the fewer the ties between the pilot and the FBO who rents the airplane the clearer the line between pilot service and an operation conducted for hire. The pilot must be paid by the entity renting the aircraft, and should not be involved in any way in the renting process. An enterprising businessman may realize that he can save money over charter rates by renting an aircraft and hiring a qualified local pilot to fly the trip for him, and we are not criticizing such an arrangement."

At issue is weather this represents a common carriage operation. In the first scenario, if your wife asks you to fly her, and then reimburses you, despite the relationship of husband and wife, by tecnicality, this is a chartered flight and is not legal. I believe this would be very unenforcable and difficult to clarify, because of the marital relationship. However, suppose you were separated from your wife, and she contacted you to fly her some place, and offered to reimburse you for the time or aircraft. Clearly this is unacceptable, despite the marital relationship. In such a case, regardless of your living arrangement, the flight is unacceptable unless she pays for and arranges the flight by renting the aircraft and then hiring you to fly it.

Would such a scenario present an enforcemnt problem to you? Unlikely, as no one would suspect in the slightest that your wife had chartered you to fly her some place. The flight would have the appearance of a private operation, and in truth, that's probably how it should be (my opinion). In all technicality, however, it is not legal. If your wife owned the aircraft, or had rented the aircraft herself, it would be legal.

In the second scenario, your wife brings two coworkers along. The coworkers pay for the flight. At this point, even if your wife has arranged for the flight by renting the airplane or providing it herself, she has taken payment from passengers, and the flight is not legal. It has become a common carriage issue, and requires an operating certificate under Part 135.

In the third scenario, you are again providing both the aircraft and pilot services, and are clearly entering into an illegal arrangement without the benifit of an operating certificate. However, if the company rents the aircraft, they may hire you to fly the aircraft, paying both for the rental, and for your time. At issue in this case, aside from the technicality of arranging the aircraft, is the liklihood of the FBO of renting the aircraft to someone other than the pilot in command.

The issue becomes one of negligent entrustment, which provides that the FBO has a duty to determine that the person to whom the aircraft is rented, who will be exercising operational control of the aircraft, is qualified and current in terms of the FAR. If the FBO rents to a non-pilot, or to a pilot who will not be flying the aircraft, the FBO is breaching duties of entrustment to the pilot, passengers, and public at large. If the FBO is made aware that the aircraft is being rented in order to hire another pilot, the FBO will most certainly require the other pilot to act as PIC, to take full responsibility of the aircraft as dictated in Part 91.3.

Accordingly, it may be very difficult to get a FBO to rent an airplane to joe blow off the street, as opposed to an individual known to that FBO who has been checked out in the airplane and can provide evidence of currency. In the very least, the airplane would then be rented to the actual PIC, instead of the CEO or other individual who claims to hold operational control as the renter. This puts the onus back on the pilot, and makes the operation an illegal charter instead of merely providing piloting services.

Assuming for a moment that the FBO is willing to rent to someone other than the pilot (it does happen), the FBO must admit to an understanding that the flight is arranged for the purposes of bypassing charter regulation under Parts 119 and 135, and must assume some liability in the event that operations certificate issues are breached. Will that FBO be willing to assume this liability? That can't be answered, except by the FBO.

In the present political climate, it's hard to imagine an FBO being willing to rent to someone other than a known pilot who will actually be flying the airplane. A distantly related type of operation would be a fractional owner who is not a pilot, but this differs in that the person arranging the flight actually owns the aircraft, and thus may retain operational control without the FBO liability issues associated with a rental aircraft.

You indicated a concern about "holding out." This is not a necessay component to the question of legality of these operations, as you have provided the airplane. This suffices, as referenced in the origional excerpt from the FAA legal interpretation cited above. If your friends arrange the airplane and hire you to fly it, so much the better. As indicated in the excerpt, it's much better for the FBO if you aren't associated with the FBO, as the association may appear to be the parceling of charter and pilot services, by the FBO. In such circumstances, it's best if all three parties are separate and independent.

Even with one person providing the aircraft, if others on the aircraft are paying for the cost of the flight, again it has become a common carriage operation, and requires an operating certificate. The flight is not legal.

 

[A Squared]

This is a little off the subject of the original questions, but Avbug sort of touched on it, and I thought I'd ad my two cents. All of those flights would be "Part 91" flights. All civil flights in aircraft (as opposed to ultralight vehicles) in the US are "Part 91" What I am saying is that even though a flight might operated under Part 135 or Part 121, it is also operated under part 91. We often refer to "under Part 135" or "under Part 91" as if hte two are mutually exclusive. Operating under the provisions of Part 135, or 121, does not relieve you from complying with Part 91. There are a very few specific regulations in Part 135 and 121 which allow releif from specific provisions of part 91. Other than those few cases, you must comply with all the applicable regualations in Part 135 or 121 and all the regulations in Part 91. It is true that in many cases Part 135 and 121 has more restrictive requirements than Part 91, but we're still operating under Part 91 also.


regards

 

[RJones]

Cost splitting

Part 135 and 121 are commercial operating rules only and part 91 is the foundation that we all fly under...along with the 60's rules, med certification and pilot certification etc.

Basically you cannot charge for your services as a pilot unless the plane is on a 135 or 121 certificate and you've been checked by the FAA or checkairman and have received the training approved for that company.

That aside you can receive money for the cost of operating the plane, rental, gas etc., but you cannot except any cash for flying them. I think it's 91.501(d), check it out and let me know.

RJ

 

[stingray]

Reality Check,

 

[Timebuilder]

If it's your plane, or one that you rented, you can't be paid in most cases. However, someone can hire you to fly THEIR plane.