In the thread about the football player perishing together with the pilot, the possible liability when carrying and injuring somebody with very high income has come up.
So I started wondering what one can do about that. I am starting from the scenario that (a) I am the pilot, (b) I am actually at fault, (c) the injured party wants as much as they can get and (d) I have done nothing to invalidate the insurance cover. So I should make good the damage I caused, the insurance company will pay, but I need to pay a LOT more – let’s just say the damage not covered was 10 million of your favourite major currency unit.
If I survive the accident, I would be personally liable, and would end up bankrupt according to the law of the country I live in. My wife’s own assets and joint assets would be treated according to that bankruptcy law, which in most jurisdictions means that the wife’s assets are protected, while my own and joint assets will be gone.
So far, so straightforward.
But what happens if I die in the accident? In the UK, my estate is liable for any debts incurred before death, but how are joint assets (typically at least the family home) treated here? And what happens in other countries?
And what happens to a life insurance pay-out where the beneficiary is the wife/family? As I understand it, in the UK it goes to the beneficiary of the policy, which means the injured person would have no claim to it.
Cobalt you may have answered your own question, the bulk of your assets need to be in your spouses’ name 
‘Happy wife, happy life’
Related, but with a commercial vehicle: someone I know was faced with potential legal problems in the tens of millions, analogous to an aircraft owner being sued because they’re the only person (even loosely involved) that has substantial assets. His course of action:
I’m deliberately vague on the details, but life-changing is an understatement. Operating under limited liability is best, but you have to be prepared to walk away from the business you built; you can still potentially be found negligent or reckless as a private individual. I believe assets can’t be transferred after a claim has been made, so this would have to be done quickly and pre-emptively.
This will be country dependent but in the UK “undervalue transfers” (such as giving your house to your wife) need to be done 7 years before the incident, to be protected. This creates an interesting problem where such a house is to be sold (I mean conventionally, in the open market) within the 7 years; the buyer doesn’t necessarily get a good title – but he can buy insurance for this, assuming his solicitor is doing the proper job and even finds out, hey ho; I was involved with such a scenario many years ago where I gave half a house to my then wife, and it was sold a few years later.
I know of a GA accident where the pilot did transfer all he could to his wife but only afterwards. This was partly facilitated by the litigation taking ~10 years, but in the end he lost a few hundred k and it cost him his marriage (and the house he gave her ).
Also even if a Ltd Company was involved, and it gets sunk under a claim, the Administrator is free to pursue to Director(s) personally for having failed in their duty by not having appropriate insurance. This is rare however; for further research you can look up the principle of “Piercing of the corporate veil”.
So unless you organised everything years back, there is no way to protect yourself or your family assets if you are the pilot. If you are not the pilot, then there are some avenues. This sort of thing has been frequently examined in the US where GA insurance is not mandatory.
There are of course many details. In the UK, with its highly developed legal system, you have lots of these. For example it is difficult or impossible to force the sale of a house which has under-18 children living in it (unless it is a big house). This obviously frequently comes up in divorce actions… In practice the house value becomes inaccessible to the creditors but it can be possible to register a charge (a second charge, if there is already a mortgage which is normally a first charge) on it so the creditors grab their slice if/when it is sold, perhaps many years later. And there are regs on what a bankrupt person must be left with; you cannot strip off their clothes and leave them to die in the gutter.
Holy Moses, I’m going to get a single seater! Any suggestions?
A PA46 Meridian with the 1999kt STC gets close
Sr. Don Aart the Pitts S1-C of course!
So far, so bad for the surviving pilot. But once peacefully dead, I won’t have that problem. Is the liability limited to my estate?
Because in the UK the joint assets are NOT part of the estate (although their value might attract inheritance tax), so if I cling to the romantic notion that my wife and I share all, it should not cause her a problem.
Or would my share of the assets be used to satisfy the damage claim before what is left goes into my estate?
(a) I am the pilot,
(b) I am actually at fault,
(c) the injured party wants as much as they can get and
(d) I have done nothing to invalidate the insurance cover.
Is passenger compensation automatically payable in all cases of pilot error, or only negligence? If the latter, point (b) may be difficult to prove on balance of probability.
A suggest a search here on
“civil aviation act”
(with the quotes) and you get a good reason to be concerned if you are not in the plane but are a part owner or “operator”.
AIUI, in the UK, on a non airline flight, passengers can collect on liability only if the pilot(s) are found negligent. This is no doubt why the finding of negligence is pushed so hard by families of the deceased – e.g. in the Mull of Kintyre Chinook crash. There is a big financial incentive to get that finding.
