In most countries, a condominium scheme is considered a common lease that is considered a common lease only if that provision is expressly created. Even the use of the term “common tenant” or co-tenant is not clear enough in most countries to create a common tenancy agreement, as people often use these terms in the non-technical sense to refer to a common tenancy agreement. Therefore, if you wish to create a common tenancy agreement for any reason, you must refer expressly to the right of reversion, in addition to the use of the terms common tenant or common rent. The two co-owners had basically the same maintenance philosophy, an important consideration for each joint purchase. “Dad and I are very much in agreement on this,” says Bill, “and it should be established in all condominiums. Nothing less than mechanical perfection should be acceptable. Some people tend to drag things a little bit, but we insist that every system and radio works all the time, or we won`t fly the plane. The most important distinction between these two forms of ownership is related to the transfer of the interests of each co-owner if he dies. The interest of a common tenant is transferred to the heirs of a person in the absence of will, in accordance with his will or the law of the state. The surviving heirs and co-owners then become tenants together. On the other hand, the common rent is characterized by a right of reversion, which means that the interest of a deceased tenant is transferred to the surviving tenant or tenant. As far as aircraft co-ownership is concerned, this would mean that if you die, your share of the aircraft would go directly to your co-owner and not to your heirs. Bill says he and his father never bothered to figure out the hourly costs of their common Mooney 201, not because they wouldn`t know it just as quickly, but because it`s not that important. “Keeping the plane in the family of course gives us some advantages over other co-owners, but we try to maintain a very close attitude to the company on all aspects of Mooney`s operation,” he says.
Don and Bill are so pleased with the profitability of their current condominium that they do not intend to update aircraft for the foreseeable future. “The 201 is the right plane for us,” says Bill. “It`s more than fast enough for our missions, carries what we need to wear, and what`s most important is within our respective budgets.” [For more information, check out our web-inclusive story “Mooney 201: The Airplane That Saved A Company” at the end of this article.] Other issues that should be raised are whether the co-owners will perform owner-supported maintenance, as preparing an aircraft for annual inspections can save a lot of money. Finally, an emergency fund is recommended to deal with unforeseen maintenance problems. There are several online contract templates (z.B. try aPAOAs free-for-members version under www.aopa.org/members/files/guides/multiple.html). What kind of organization? There are different ways to organize a condominium in law and there are pros and cons for everyone. The type of organization has various financial and liability implications and indicates the legal parameters of the company.