ADs, Bulletins, and Other Nonsense
By Stephen P. Prentice
Do we all remember the well known Statute of Repose? It now insulates aircraft manufacturers from product liability lawsuits where the product is over 18 years old. All the whining from manufacturers about plaintiff lawyers and lawsuits seems to have stopped or at least slowed down. Well, you might have thought that this would allay the manufacturer's fears so that they would not run scared every time they found a potential product defect. Wrong!
Mandatory service bulletins (SB) and airworthiness directives (AD) ordering expensive changes are more prevalent now than ever. When the manufacturer wants to cover its rear, they issue a service bulletin and do everything it can to convince the FAA to make it an airworthiness directive. An incidental benefit is the fact of profit and the bottom line.
The Continental crank shaft replacement (VAR vs. "melt" versions) comes to mind along with very recent expensive Hartzell propeller upgrades of the steel barreled propeller series, among many others. Hartzell is going to have major customer problems just like Continental has experienced. Both of these factory-mandated improvements soon became ADs requiring compliance by all. However, there are many other obscure mandatory service bulletins that are issued by our industry that receive considerably less attention.
I recently came across the mother of all service bulletins in general aviation. It deals with a mandatory requirement to replace elevator trim actuators on all Westwind and Jet Commander executive jets. This may seem like a simple item, but the cost to the owner is some $50,000 plus the labor to do the job!
We all know that jets are somewhat more expensive to maintain than pistons, but this would appear to be just a little gross. Hot section overhauls can cost $50,000 and some propellers can run that much, but an elevator trim actuator that is simply a reworked old one — I don't think so.
In some cases, this job can cost over 10 percent of the aircraft total value. Operators of older versions could be forced to junk them. What a great way to get the product out of the market!
The problem has to do with a failure found on two aircraft operated by the same company. Rumor has it, however, that the aircraft and systems were operated well beyond recommended specs and hence the failure. There are no other reported failures of the particular part at this point in time. There are over 300 affected aircraft in service. When a manufacturer cannot justify a substantial and costly change, something is going wrong. It seems that the public relations department is getting shortchanged in order to improve any threat to the bottom line.
Add to the list a Piper PA 31 mandatory SB that subsequently became an AD (96-21-3). The subject here is aileron hinge brackets and spar replacement. This is an expensive one for any operator. Prior to the AD being published, there were alternative methods to fix the problem without spending an arm and a leg for new parts.
Many of the more sensible maintenance bulletins provide for alternate means of completing the work, usually involving less expense. But once an AD comes out, you have no alternatives. You might keep this in mind if you think a bulletin will eventually become an AD. If you comply with the bulletin, in your alternative approved way, you are exempted from compliance with the AD that may mandate replacement of parts.
WHAT TO DO
What are your alternatives? If the order is a factory-mandated item, you can ignore it or modify the requirement if you operate under the rules of FAR Part 91. There is no mandatory requirement to do anything the factory says. However, FAR Part 135 air carrier people are in a different category. As an air carrier you have an operations specification that usually, but not always, requires adherence to factory-mandated service bulletins. Therefore, under pain of being accused of not following your own op specs, you must consider doing the bulletins.
There is another route. You can petition to the FAA for, and sometimes receive, an extension of time or alternative means to comply and even a total exemption in some cases. It is best to request all three in the alternative and hedge your bets. You simply have to petition for such relief in a timely manner, usually with the advice and consent of your local PMI. He should support your position and will if it is logical and reasonable. The FAA does not necessarily have to agree with everything the factory puts out.
If any of these bulletins are a hardship to comply with, the petition process is there to help. Major airlines use this route to seek relief from regulations including mandatory service bulletins and airworthiness directives. Indeed, any licensed person or entity has the right to petition for relief. FAR Part 145 repair stations frequently use this process.
Now you are going to say Part 91 operators under a factory-approved maintenance program must follow so-called mandatory service bulletins; technically maybe. But there is nothing in the rules that says you can't change your inspection program. In fact, the FAR provides for it in detail.
FAR 91.409 covers the subject in detail.
(f) The owner or operator (of turbine aircraft) . . . must select, identify in the maintenance records, and use one of the following programs:
(1) a continuous inspection program;
(2) an approved program under 135.419;
(3) a program recommended by the manufacturer;
(4) any other inspection program established by the owner or operator.
Anyone operating turbine equipment under FAR Part 91 need not perform factory-mandated service bulletins. You can simply advise the Flight Standards District Office (FSDO) of a change in program and get out from under the factory system as described in the FAR. You can also seek an exemption or an alternative method to complete a service bulletin. If the bulletin becomes an airworthiness directive, then you have no recourse but to seek an exemption or other relief through the petition process.
THE INSURANCE ANGLE
Some operators have expressed concern about insurance requirements. They might be inclined to think that their insurance carrier would be upset about not performing bulletins or airworthiness directives. The operator might say this gives the company an excuse to deny coverage if there was a claim against the policy. Needless to say, it is a valid concern. The proper action is simply to advise the carrier of your course of action and let the chips fall where they may. If they object, then go to plan B.
You should always have an alternate insurance carrier waiting in the wings anyway. Talk to your broker and put the issue to him. Tell him that if you are forced to do everything the factory mandates, there will be no aircraft to insure and he will lose the business anyway!
Send your broker something that looks like the following:
Please be advised that we are seeking an exemption from the mandatory requirements of that certain factory service bulletin (or airworthiness directive) requiring replacement, inspection etc. of certain components of our insured aircraft. We are advised by licensed personnel that there is no immediate airworthiness issue involved and therefore are delaying or seeking exemption from application to our aircraft. This is a courtesy notice in accord with the terms of our policy.
This notice should be sent certified mail return receipt requested so that there is no question about your advising the carrier. If they object, go to plan B.
Many of the aircraft types have owner organizations that should exert more pressure on the manufacturers to look close at their reaction to what they perceive as a potential safety-of-flight item and products liability threat, which is typically the real issue.
When you have an isolated singular incident of failure in the field that is confined to one operator or one aircraft, the factory must be careful to do its homework and look carefully at the situation. In too many cases, they merely jump in and force a mandatory bulletin without adequate investigation of the failure or doing sufficient engineering testing to determine the cause.
In addition, all too often corporate counsel weighs in with the threat of litigation and the manufacturer is forced to forget that cost is still paramount in the minds of the operator who many times is on a razor thin profit margin. The products liability threat is the bottom line that still drives manufacturers motives.
Unfortunately, in this case, the prudent operator has to pay what might be described as protection dough for the manufacturer to protect their bottom line from lawsuits. You just can't win.