Aircraft Co-Ownership Agreement Florida: What Happens If Your Partner Stops Paying

by Contract & Business Attorney Attorney Carolina Nunez

Aircraft Co-Ownership Agreement in Florida: What Happens If Your Partner Stops Paying?

Co-owning an aircraft is one of the most practical ways to enjoy the benefits of private aviation without bearing the full financial burden alone. For business partners, pilots, and investors throughout Orlando, Winter Park, Daytona Beach, and Central Florida, an aircraft partnership agreement can make ownership of a single-engine Cessna, a turboprop, or even a light jet financially realistic when sole ownership would not be.

The reality that many co-owners discover too late: when you share ownership of an aircraft, you also share risk. If your partner stops making payments, refuses to contribute to maintenance, or disappears entirely, you could be left holding the full financial responsibility for an asset you only partially own. Without a clear, enforceable aircraft co-ownership agreement, your legal options may be limited and your exposure significant.

At The Law Offices of Carolina Nunez, P.A., Attorney Carolina Nunez helps clients navigate complex contract disputes, partnership breakdowns, and asset protection issues across Central Florida. If you are dealing with a co-ownership dispute involving an aircraft, a business, or any other shared asset, call (407) 900-FIRM to schedule a consultation.

Common Problems in

Aircraft Co-Ownership Arrangements

Aircraft co-ownership disputes arise from the same types of conflicts that affect any shared asset arrangement. The difference is that aircraft carry unique regulatory, financial, and safety obligations that can escalate disagreements quickly.

The most common problems include:

• A co-owner who stops making payments on the loan, insurance, or hangar fees; disagreements over scheduling and who gets to fly the aircraft and when;

• Disputes over maintenance obligations and whether required inspections, annuals, and repairs are being properly funded;

• Misrepresentation about the aircraft's condition, history, or value at the time the agreement was entered;

• Co-owner making unauthorized modifications or incurring expenses without the other's consent.

These issues become significantly more complicated when the plane ownership contract is vague, verbal, or nonexistent.

Under 14 CFR Part 47, all co-owners must be named on the FAA aircraft registration certificate. But the FAA registration itself does not create a contract between the parties, does not define payment obligations, and does not provide remedies if one co-owner defaults. That responsibility falls entirely on the co-ownership agreement and applicable state law.

Key Terms Every Aircraft Co-Ownership Agreement Should Include

A well-drafted aircraft co-ownership agreement Florida owners can rely on should address every foreseeable scenario. The agreement is the single most important document governing the relationship between co-owners, and it should be treated with the same level of care as any significant business contract or real estate transaction.

Ownership Percentages and Financial Obligations

The agreement must clearly state each party's ownership percentage, whether that is 50/50, 60/40, or any other split. It should also define exactly how costs are divided, including the aircraft loan or financing payments, insurance premiums, hangar or tie-down rental, annual inspection costs, engine reserve contributions, and all routine and unexpected maintenance expenses.

Scheduling and Usage Rights

Under 14 CFR §91.501(c)(1), joint ownership arrangements require that one of the registered owners employs and furnishes the flight crew while each registered owner pays a share of the charges specified in the agreement. A strong agreement includes a scheduling system, priority rules, advance notice requirements, and consequences for cancellations or unauthorized use.

Maintenance and Airworthiness Responsibilities

Both co-owners have a legal and safety obligation to keep the aircraft airworthy. The agreement should designate which party is responsible for coordinating maintenance, which mechanic or shop will be used, how emergency repairs are authorized, and how engine overhaul reserve funds are managed.

Buyout, Exit, and Default Provisions

Perhaps the most critical section of any aircraft partnership agreement is the one that addresses what happens when the relationship ends. The agreement should include a right of first refusal, a buyout formula or appraisal mechanism, a process for forced sale, and default provisions that specify what constitutes a breach, what the cure period is, and what remedies are available.

What Happens When a Co-Owner Stops Paying

When one co-owner stops contributing financially, the consequences cascade quickly. If the aircraft is financed, the lender does not care which partner stopped paying. Both co-owners are typically jointly liable for the full loan amount, and a default by one partner affects both credit profiles and can trigger repossession of the entire aircraft. Insurance carriers may cancel or refuse to renew the policy if premiums are not paid in full, leaving both owners exposed to catastrophic uninsured liability.

The paying co-owner is then forced into an impossible position: continue covering 100 percent of the costs for an aircraft they only partially own, or stop paying and risk losing the entire asset. This is exactly the kind of co-owning a plane legal issues scenario where having a written agreement with enforceable default provisions becomes essential.

Legal Options in Florida for Aircraft Co-Ownership Disputes

Florida provides several legal avenues for resolving aircraft co-ownership disputes, depending on how the ownership is structured and what the agreement says.

Breach of Contract

If a written co-ownership agreement exists and the non-paying partner has violated its terms, the paying partner can file a breach of contract action in Florida court. Under Florida contract law, the non-breaching party may seek compensatory damages, specific performance, or an order for the sale of the aircraft.

Florida's five-year statute of limitations under Florida Statutes § 95.11(2)(b) applies, meaning you should not wait to pursue your rights.

Partnership Dissolution

If the co-ownership arrangement constitutes a partnership under Florida law, the provisions of Florida Statutes Chapter 620, Part II (Revised Uniform Partnership Act) may apply. This can include the right to seek judicial dissolution, an accounting of all financial contributions, and equitable distribution of partnership assets.

Partition Actions

While partition actions under Florida Statutes Chapter 64 are most commonly associated with real estate, the principle of forcing the sale of jointly owned property can apply to personal property as well, including aircraft.

Aircraft Ownership Disputes vs. Real Estate Co-Ownership Disputes

If you have ever been involved in a real estate co-ownership dispute, an aircraft partnership breakdown will feel familiar. In both scenarios, co-owners share financial obligations for a high-value asset, each party's failure to pay can trigger defaults that affect the other, the asset can depreciate without proper maintenance, and legal remedies often require court intervention to force a sale or buyout.

The key difference with aircraft is the additional layer of federal regulation. The FAA maintains a registry of ownership, liens, and security interests under 14 CFR Part 47 and 14 CFR Part 49, and any transfer of ownership must go through the FAA Aircraft Registration Branch. An attorney familiar with both Florida contract law and federal aviation registration requirements is essential.

Why These Disputes Require Both Legal and Investigative Insight

Aircraft co-ownership disputes often involve more than a simple failure to pay. Attorney Carolina Nunez brings a unique combination of civil litigation experience, technology and digital asset knowledge, and investigative background to partnership and contract disputes.

Checklist:

Before You

Co-Own an Aircraft

✔ Execute a written co-ownership agreement before any money changes hands

✔ Define ownership percentages, cost-sharing formulas, and payment schedules

✔ Establish a scheduling system with priority rules and dispute resolution

✔ Assign maintenance coordination responsibilities and designate approved mechanics

✔ Include buyout provisions with a fair market value formula or appraisal requirement

✔ Add default and cure provisions that specify timelines and remedies

✔ Include a right of first refusal before any sale to a third party

✔ Verify insurance requirements and ensure both owners are named insureds

✔ Confirm all co-owners are properly registered with the FAA under 14 CFR Part 47

✔ Have the agreement reviewed by a Florida attorney experienced in contract and partnership law

Frequently Asked Questions About Aircraft Co-Ownership in Florida

Do I need a written agreement to co-own an aircraft in Florida?

While the FAA requires all co-owners to be listed on the registration certificate, there is no federal or state law that mandates a written co-ownership agreement. However, operating without one leaves both parties with almost no legal protection if a dispute arises. A written agreement is strongly recommended.

Can I force the sale of a co-owned aircraft if my partner will not cooperate?

Yes, depending on the circumstances. Florida courts can order the sale of jointly owned property, and partnership dissolution proceedings under Florida Statutes Chapter 620 may also result in the forced sale and distribution of assets.

What if we never signed a formal partnership agreement?

Florida courts may still recognize an implied partnership based on the conduct, contributions, and shared profit-and-loss arrangements between the co-owners.

Does the FAA get involved in co-ownership disputes?

The FAA does not resolve private contract disputes between co-owners. However, the FAA Aircraft Registry under 14 CFR Part 47 and 14 CFR Part 49 maintains ownership and lien records critical to any transfer, sale, or enforcement action.

Protect Your Investment

Contact Attorney Carolina Nunez Today

Whether you are entering into a new aircraft co-ownership arrangement or already dealing with a partner who has stopped paying, having the right legal counsel matters. Attorney Carolina Nunez serves clients throughout Orlando, Winter Park, Daytona Beach, Kissimmee, Sanford, Lake Mary, DeLand, Altamonte Springs, Casselberry, Oviedo, Deltona, and all of Central Florida in contract disputes, partnership issues, real estate matters, and estate planning.

Call (407) 900-FIRM or click here to fill out our online case review to schedule a consultation with The Law Offices of Carolina Nunez, P.A..