Summary
The Louisiana Court of Appeal, Second Circuit, affirmed judgment for Bastrop Aircraft and its liability insurer following a fatal private-aircraft crash. The court held that the pilot-renter was not an omnibus insured under the aircraft owner's liability policy because the policy excluded persons operating under a rental agreement providing remuneration to the named insured. The court also rejected claims based on the owner's independent negligence, vicarious liability, federal preemption, and a CAB endorsement.
Topics
Practice areas
Questions Presented
- Whether the pilot who rented the aircraft under a verbal rental agreement providing remuneration to Bastrop Aircraft was an omnibus insured under the liability coverage of Bastrop Aircraft's policy.
- Whether the CAB standard endorsement created omnibus liability coverage for the renting pilot.
- Whether Bastrop Aircraft was independently negligent in its aircraft checkout procedures, entrustment, or maintenance.
- Whether federal aviation law imposed or permitted imputation of the pilot's negligence to Bastrop Aircraft.
- Whether Bastrop Aircraft was otherwise legally obligated under Louisiana law to respond for the pilot's negligence.
Holdings
- The pilot was not an omnibus insured under the liability coverage because he operated the aircraft under a rental agreement that provided remuneration to the named insured.
- The CAB standard endorsement did not create omnibus liability coverage for a pilot who rented the aircraft from the owner, particularly where no showing established that the aircraft was operated as an air taxi.
- Bastrop Aircraft was not independently negligent in its checkout procedures, entrustment of the aircraft to the pilot, or maintenance of the aircraft.
- Federal aviation law did not impose vicarious liability on Bastrop Aircraft or otherwise impute the pilot's negligence to the aircraft owner.
Key quotations
“While a liability policy must be construed as a whole, each of the several sections of the policy (such as the definition of Insured in the Coverages section and the Use and Purposes section) must be recognized and considered as serving a different purpose and coverage.” (1314)
“In Louisiana, the negligence of one person is not to be imputed to another in the absence of a legal obligation on the part of the other person to respond for the fault of the negligent person.” (1315)
Factual background
A pilot rented a private aircraft from Bastrop Aircraft, Inc., on September 16, 1980, intending to fly to Texas with friends. Shortly after takeoff from the Oak Grove airport around dawn on September 17, the aircraft crashed, fatally injuring the pilot and three passengers. The passenger's widow and heirs sought recovery from Bastrop Aircraft and its liability insurer, arguing that the pilot was an omnibus insured and that Bastrop Aircraft was independently or vicariously liable.
Procedural history
After a fatal private-airplane crash, the widow and heirs of a passenger sued the aircraft owner and its liability insurer. The trial court ruled for the defendants on the issues presented. The Louisiana Second Circuit affirmed. The Louisiana Supreme Court denied writs on December 5, 1986.