Palm Beach Roamer, Inc. v. McClure

• Decision Date: 12 February 1999
• Docket Number: No. 97-1102.,97-1102.
• Citation: 727 So. 2d 1005
• Parties: PALM BEACH ROAMER, INC., Appellant, v. William P. McCLURE, Albert Schneider, et al., Appellee.
• Court: Florida District Court of Appeals

727 So.2d 1005

PALM BEACH ROAMER, INC., Appellant, v.William P. McCLURE, Albert Schneider, et al., Appellee.

No. 97-1102.

District Court of Appeal of Florida, Fifth District.

February 12, 1999.

Rehearing Denied March 22, 1999.

Michael J. Ferrin, West Palm Beach, for Appellant.

Thomas E. Ice, of Barwick, Dillian, Lambert & Ice, P.A., Miami, for Appellee.

THOMPSON, J.

Palm Beach Roamer, Inc.("PBR"), timely appeals from a final judgment in part finding Albert Schneider and Schneider Mills, Inc.(collectively, "Schneider") not liable for fraud and conspiracy to commit fraud.Specifically, PBR challenges the directed verdict for Schneider on the fraud claim.¹We affirm.

In a three-count complaint against William P. McClure, McClure Aircraft, Inc.(collectively, "McClure"), and Schneider, PBR alleged that, in 1993, Schneider had an aircraft for sale and retained McClure to find a buyer.McClure, in turn, retained Discovery Aviation, Inc., whose agent, Gary Kimball, advertised the plane for sale.David A. Johnson, an employee of PBR, saw the advertisement and contacted Kimball.Kimball represented that the plane was owned by Discovery Aviation and was in excellent condition.Johnson and F. Lee Bailey, president of PBR, inspected the plane and its log books, and took the plane for a test flight.Thereafter, PBR bought the aircraft for $129,000.

PBR alleged that, shortly after the sale, it learned that Schneider held title to the plane at the time of the transaction.Also, after the purchase, PBR took the plane to Downtown Airpark in Oklahoma for maintenance and inspections.There, PBR learned that Downtown Airpark had inspected the same plane in February 1992 and found "excessive wing spar corrosion."²The inspection is known in the industry as a "208 inspection."The inspection results and a notation about the necessity for repair or replacement of the lower spar cap "prior to further flight" had been recorded in the plane's log book.

PBR alleged McClure and Schneider knew the plane had failed the inspection but decided to have the plane inspected by another organization which was not told about the previous inspection results.PBR further alleged McClure removed the results of the previous inspection from the log book with Schneider's knowledge and consent, and Bailey and Johnson were not told of the failed inspection when they went to see and test fly the plane.

Count I of the complaint charged McClure and Schneider with fraudulently concealing the dangerous condition of the plane and misrepresenting its true condition.Count II charged the defendants with conspiring to commit fraudulent concealment, and Count III sought punitive damages.

At trial, McClure, who is in the business of selling aircraft, testified that he originally sold the subject aircraft to Schneider in 1986.In 1992, McClure found a tentative purchaser for the plane.A pre-purchase inspection was done by Downtown Airpark in Oklahoma in February 1992.McClure learned that the plane had failed the 208 inspection and that repairs would cost anywhere from $55,000 to $100,000.Downtown Airpark placed in the plane's log book a computer-generated sticker which showed the inspection results and the requirement for repair or replacement of the wing spar cap.There was conflicting evidence regarding whether the sticker was actually affixed to a page in the log book or merely placed loosely in the book.

McClure advised Schneider of the failed inspection and repair estimates.After the sale fell through, McClure told Schneider he disagreed with the results of the inspection done by Downtown Airpark.McClure testified that if a pre-purchase inspection reveals a defect and the prospective buyer rejects the plane, the owner has the option to have a second inspection done by another company.He suggested this to Schneider and told him that this is acceptable practice within the industry.Schneider, who is not in the business of buying and selling aircraft and who has no expertise regarding wing spar inspections, agreed to a second opinion.

The wing spar had not been repaired or replaced when, in April 1992, McClure arranged to have a second 208 inspection performed by Aero Inspection Services.The Aero inspector neither saw the log book containing the results of the prior inspection nor was advised that the plane had previously failed the inspection.McClure did not reveal the prior results because he wanted "an unbiased inspection."

When the plane passed the second inspection, McClure removed the Downtown Airpark sticker from the log book and discarded it, finding it "inaccurate" and superseded by the Aero inspection results.He then had the Aero inspector make a log book entry indicating a "satisfactory inspection."McClure testified that FAA rules permit an inspection report to be discarded when superseded by a subsequent inspection.He faxed Schneider copies of both inspection results and a note advising Schneider of the substitution made in the log book.

Schneider decided to keep the plane after learning it had passed the second inspection.However, in January 1993, he traded in the plane to purchase a larger one from McClure.McClure took possession of the plane, although no paperwork was generated to effect a change of title.Gary Kimball of Discovery...