Aviation Manufacturers Long Term Liability
In pertinent part, the General Aviation Revitalization Act of 1994 (GARA) provides that:
"no civil action for damages or death or injury to persons or damage to property arising out of an accident involving a general aviation aircraft may be brought against the manufacturer of the aircraft or the manufacturer of any new component, system, subassembly, or other part of the aircraft, in its capacity as a manufacturer if the accident occurred . . . more than 18 years after the date of delivery of the aircraft and/or component to the first purchaser or lessee." (GARA, Pub.L. No. 103-298, 2(a), 108 Stat. 1552).
GARA established a " 'statute of repose to protect general aviation manufacturers from long-term liability in those instances where a particular aircraft has been in operation for a considerable number of years.
A statute of repose is a legal recognition that, after an extended period of time, a product has demonstrated its safety and quality, and that it is not reasonable to hold a manufacturer legally responsible for an accident or injury occurring after that much time has elapsed.' " ( Altseimer v. Bell Helicopter Textron, Inc. (E.D.Cal. 1996) 919 F. Supp. 340, 342, quoting 140 Cong. Rec. H4998, H4999 (Daily ed. July 27, 1994)).
A statute of repose differs from a statute of limitations in that statutes of limitation bar suits filed more than a specified period of time after an injury occurs or is discovered, whereas a statute of repose is a bar on all suits brought more than a specified period after the date of manufacture of a product and delivery to the purchaser.
Because the date of injury is not a factor used in computing the running of the time period and because statutes of repose typically do not have tolling provisions, they "acquire a substantive nature, barring rights of action even before injury has occurred if the injury occurs subsequent to the prescribed time period." ( Wayne v. Tennessee Valley Authority (5th Cir. 1984) 730 F.2d 392, 402; Alexander v. Beech Aircraft Corp. (10th Cir. 1991) 952 F.2d 1215, 1223).
GARA expressly preempts state law. Section 2(d) provides that "This section supersedes any State law to the extent that such law permits a civil action described in subsection (a) to be brought after the applicable limitation period for such civil action established by subsection (a)." (GARA, Pub.L. No. 103-298, 2(d), 108 Stat. 1552).
The legislative history of GARA indicates that it was passed in response to a serious and "precipitous" decline in the manufacture and sale of general aviation aircraft by United States companies, caused in part by the tremendous increase in the industry's liability insurance. (GARA, H.R. No. 103-525(II), 103d Cong., 2d sess. (1994) p. 1646; Campbell v. Parker-Hannifin Corp. (1999) 69 Cal. App. 4th 1534, 1545 82 Cal. Rptr. 2d 202).
By establishing a statute of repose of 18 years, GARA was intended "to limit excessive product liability costs, while at the same time affording fair treatment to persons injured in general aviation aircraft accidents." (GARA, H.R. No. 103-525(I), 103d Cong., 2d sess., supra, p. 1638).
Studies indicated that "nearly all defects are discovered during the early years of an aircraft's life" and only a small percentage of general aviation accidents are caused by design or manufacturing defects. (Id. at p. 1640.)
Furthermore, products in the aircraft industry are highly regulated "to a degree not comparable to any other industry." (GARA, H.R. No. 103-525(II), 103d Cong., 2d sess., supra, p. 1647).
Manufacturers are required to report any incidents indicating product defects to the FAA, which has the responsibility for ordering corrective action if defects are revealed after an aircraft design is approved. Moreover, the older an aircraft gets, the more likely it is to have had a number of owners and to have undergone modifications, overhauls and other maintenance procedures.
This makes it increasingly difficult as time passes to determine whether the manufacturer or some other person who used or repaired the aircraft was primarily responsible for a mechanical failure. Nonetheless suits were frequently filed against the original manufacturers of aircraft and component parts long after the aircraft or part had been in use and had demonstrated its safety.
Manufacturers incurring substantial expenses settling or defending these cases were being driven out of business.
Relief from this long "tail" of liability, it was believed, would revitalize the industry and result in an increase in jobs, enable manufacturers to spend more on research and development, and enhance manufacturers' ability to compete with foreign companies. (GARA, H.R. No. 103-525(I), 103d Cong., 2d sess., supra, p. 1641.)
The statute does not apply if manufacturers fail to fulfill their obligations to report known defects or other safety information to the FAA. (GARA, Pub.L. No. 103-298, 2(b)(1), 108 Stat. 1552).
It also does not provide protection for a manufacturer acting in any other capacity than "as a manufacturer." (GARA, 2(a)).
For example if the manufacturer committed a negligent act repairing or servicing an aircraft or as a pilot, and such act was the proximate cause of an accident, the victims would not be barred from bringing suit against the manufacturer acting in a capacity other than as a manufacturer.
There are also exceptions in the statute for passengers being transported for medical emergencies and persons injured on the ground or in other aircraft. (GARA, 2(b)(2), (3).)
Another perceived element of fairness in the legislation is that GARA is a "rolling" statute of repose. When any part or subassembly in an aircraft is replaced with a new part, a new 18-year period begins for that part from the date it is installed. (GARA, Pub.L. No. 103-298, 2(a)(2), 108 Stat. 1552; GARA, H.R. No. 103-525(II), 103d Cong., 2d Sess., supra, p. 1647).
Since almost every major component of the aircraft will be replaced over its lifetime, the "rolling" aspect of the statute of repose was intended to provide that victims and their families would have recourse against the manufacturer of the new component part in the event of a defect in the new part causing an accident.
Given all of these considerations, "The legislation attempts to strike a fair balance by providing some certainty to manufacturers, which will spur the development of new jobs, while preserving victims' rights to bring suit for compensation in certain particularly compelling circumstances.
In essence, the bill acknowledges that, for those general aviation aircraft and component parts in service beyond the statute of repose, any design or manufacturing defect not prevented or identified by the Federal regulatory process by then should, in most instances, have manifested itself." (GARA, H.R. No. 103-525(II), 103 Cong., 2d Sess., supra, p. 1648.)