Buying and selling airplanes is a balancing act. There is a small window, almost like the center of gravity envelope in an airplane, for a successful transaction to take place. Some things, like the right airplane, the right price, and willing buyers and sellers are obvious parts of the equation. Other items, like contractual terms, personality differences, and additional people involved in the transaction are not so obvious.
If there’s one thing I’ve learned in my years of selling hundreds of airplanes it is that trust is hard to earn, hard to keep, and nearly impossible to recoup once lost. Good communication goes a long, long way to keep everyone satisfied and out of the dark. I’ve also learned most people are reasonable and don’t expect perfection. They understand unusual situations may develop. They’re ready for the occasional curve ball. And they know things don’t always happen as planned. But if you throw them onto an unequal playing field their willingness to cooperate is sure to change…quickly.
Aircraft purchase agreements can be one of those uneven situations. A good PA has provisions that protect both the buyer and seller and don’t put undue burden or liability either party. Not all contingencies can be spelled out or even foreseen. But these agreements will contain most of the typical clauses that adequately address the needs of the buyer and the seller. If one party to the sale demands that their provisions be protected while stripping out the same protections for the other party animosity is sure to appear. Oftentimes, this is not intentional but may result after a third (or fourth or fifth) party gets involved – (a lawyer, another broker/dealer, a mechanic, a flight instructor, a buyer’s agent, or maybe even another family member). Often – but not always – with the best of intentions, theses “extra” folks draft a PA with their interested party and their pet provisions in mind without looking at the bigger picture. That picture, of course, involves the folks on the other side of the deal too.
The lesson to keep in mind is this: whether you’re a buyer or seller, don’t expect the other side to overlook your lopsided provisions and still be able to maintain any amount of trust with you later, if there is a later. It’s critical that both sides have the same level of comfort (or discomfort) throughout the process. That can be tough, especially if neither has the chance to meet the other face-to-face. Instead of trying to struggle through a process they believe to be tainted many people, regardless of the side of the table they’re on, will simply walk away if given a one-sided offer. Why waste time dealing with someone who doesn’t show any respect or common decency to them, they reason. Sometimes this works out to their benefit, sometimes not. What is clear though is that a well-structured, clearly communicated, and equitable contract will do a much better job at keeping everyone satisfied and greatly increase the odds that your sale or purchase will close with limited hassle. So, if you retain a 3rd (or 4th or 5th) party in your transaction, ask to read the agreement before you put it forth and try to put yourself in the shoes of the other side. Preventing cold shoulders from other side will make your effort extremely worthwhile.