Petition for Writ of Certiorari — Howell v. United States Fire Insurance

~

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> 4 Supreme Court, U.S,

88-482 FILED

No. 86- SEP 19 1988

| “JOSEPH F. SPANIOL, JR,

IN THE : =

Supreme Court of the United States

OCTOBER TERM 1988

ROBERT-E. HOWELL, BETTY

CHAVEZ AND ERNEST SCHUMACHER,

AS ADMINISTRATOR OF THE ESTATE OF RODNEY L. HOWELL,

DR. AND MRS. J. CRAYTON

PRUITT, INDIVIDUALLY AND AS

ADMINISTRATOR OF THE ESTATE OF MARK H. PRUITT,

CORINA K. YIN, INDIVIDUALLY AND

AS ADMINISTRATRIX OF THE ESTATE OF PAUL C. YIN,

CHARLES BOLAND, INDIVIDUALLY AND

AS ADMINISTRATOR OF THE ESTATE OF

ANN RENEE BOLAND AND CYNTHIA BOLAND,

y Petitioners,

UNITED STATES FIRE INSURANCE COMPANY,

Respondent.

PETITION FOR WRIT OF CERTIORARI TO

THE GEORGIA COURT OF APPEALS

WARREN CANDLER FORTSON, ESO. WILLIAM C. LANHAM, JR.. ESQ.

JOHN ALLEN HOWARD, Esq. Lanham & McGhee, P.C.

Fortson and White 2100 Equitable Building

300 Atlanta Financial Center 100 Peachtree Street, N.W.

3333 Peachtree Road, N.E. Atlanta, Georgia 30303

Atlanta, Georgia 30326

(404) 239-1900 NICHOLAS C. MORAITAKIS, ESQ.

Gorby, Reeves, Moraitakis

DONALD ROSS ANDERSEN, ESQ. & Whiteman, P.C.

Suite 200 Hollowbrook Court Harris Tower, Suite 2200

1479 Brockett Road 233 Peachtree Street, N.E.

Tucker, Georgia 30084 Atlanta, Geogia 30343

(a Eee, ev

1

QUESTIONS PRESENTED FOR REVIEW

I. Whether 14 C.F.R. 298 et seq applies to a local flight,

where the flight is conducted by an air carrier registered under

Part 298, supra, and where it otherwise constitutes air transporta-

tion affecting interstate commerce.

II. Whether an air taxi operator (charter operator) regis-

tered under Part 298, supra, is required to carry insurance where,

within the scope of the carrier’s operation for which it is regis-

tered, it conducts a local flight that affects interstate commerce.

Ill. Is the fact that a particular flight begins and ends within

the confines of a single state always determinative of whether the

flight affects interstate commerce? The Georgia Court of Appeals

applied a strict geographical test in determining that such a flight

would always constitute an intrastate operation.

THE PARTIES

ROBERT E. HOWELL, BETTY

CHAVEZ and ERNEST SCHUMACHER,

as Administrator of the Estate of Rodney L. Howell,

DR. and MRS. J. CRAYTON

PRUITT, Individually and as

Administrator of the Estate of Mark H. Pruitt,

CORINA K. YIN, Individually and

as Administratrix of the Estate of Paul C. Yin,

CHARLES BOLAND, Individually and

as Administrator of the Estate of

Ann Renee Boland and CYNTHIA BOLAND,

Petitioners

V.

UNITED STATES FIRE INSURANCE

COMPANY,

Respondent

ii

TABLE OF CONTENTS

PAGE

Questions Presented for Review................ i

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Table of Authorities

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Reasons for Granting the Writ 4

8

Conclusion

iil

TABLE OF APPENDICES

PAGE

APPENDIX A: Howell v. United States Fire

Insurance Company, 185 Ga. App.

154, 363 S.E.2d 560 (1987)..... la

Summary Judgment Order ...... 8a

Order Granting Certiorari....... lla

Order Withdrawing Certiorari.... 12a

Order Denying Rehearing....... 13a

4 C.F.R. §298.1, 14 C.F.R.

NS saa 6 pa bux ak a l4a

14 C.F.R. §298.3(a), 14 C.F.R.

I ee l4a

14 C.F.R. §298.37 and 14 C.F.R.

lo cc esas as 15a

iV

TABLE OF AUTHORITIES

Cases

Corin v. Puritan Insurance Company, 184

Ga. App. 667, 362 S.E.2d 380 (1987) .....

Howell, et al v. United Fire Insurance

Company, 185 Ga. App. 154, 363 S.E2d 560

TE bg kk clas peer a leaned cco uw

Braniff Airways, 40 C.A.B. 887 (1964)... ..

Administrator v. Ferguson, N.T.S.B. Order

Pe Eo FA bake tae ee ds

Dower v. United Airlines, 329 F.2d 684 (9th

ar ame eS IN

Meee oo os a

14 C.F.R. §298.2(b)(c).........0--000-

| a

OCP STIS... .. . os ce cs ance

Pleo |S ans

14 C.F.R. §298.41(a) .................

PAGE

IN THE

Supreme Court of the United States

TERM 1988

ROBERT E. HOWELL, BETTY CHAVEZ

AND ERNEST SCHUMACHER,

as Administrator of the Estate

of Rodney L. Howell,

DR. AND MRS. J. CRAYTON PRUITT,

Individually and as Administrator of the

Estate of Mark H. Pruitt,

CORINA K. YIN,

Individually and as Administratrix

of the Estate of Paul C. Yin,

CHARLES BOLAND,

Individually and as Administrator of the Estate of

Ann Renee Boland and CYNTHIA BOLAND,

Petitioners,

V.

UNITED STATES FIRE INSURANCE COMPANY,

Respondent.

PETITION FOR WRIT OF CERTIORARI TO

THE GEORGIA COURT OF APPEALS

Petitioners respectfully request that a Writ of Certiorari

issue to review the decision of the Georgia Court of Appeals in

this case.

>

Official Report

The opinion of the Georgia Court of Appeals is reported at

Howell, et al v. United States Fire Insurance Company, 185 Ga.

App. 154, 363 S.E.2d 560 (1987).

Jurisdictional Grounds

The Supreme Court of the United States has jurisdiction

pursuant to 28 U.S.C. §1257.

Moreover a State Court has decided an important question

of Federal law which has not been but should be, settled by this

Court, and in addition, has decided a Federal question in a way

that conflicts with applicable decisions within the same state. Sup.

Cr, i, 87,

The original denial of a Motion for Rehearing was dated

June 22, 1988. This Petition for Certiorari is being filed within

ninety days from the denial for Motion for Rehearing.

The history of this case shows that the Georgia Court of

Appeals rendered its consolidated decision in Howell v. United

States Fire Insurance Company, on November 5, 1987. The

Georgia Supreme Court granted certiorari on January 21, 1988.

Inexplicably, the Georgia Supreme Court then withdrew its Writ

of Certiorari on May 4, 1988. A Motion for Rehearing upon the

Georgia Supreme Court's decision to withdraw its previous grant

of certiorari, was denied, after oral argument, on June 22, 1988.

Regulations

14 C.F.R. §298.1

14 C.F.R. §298.2(b)(c)

14 C.F.R. §298.3(a)

14 C.F.R. §298.21(a)

14 C.F.R. §298.37

14 C.F.R. $298.41 (a)

See Appendix (F)

3

Statement of the Case

This appeal arises out of the crash on September 29, 1985 of

an aircraft federally registered as NS551CC near Jenkinsburg,

Georgia. It raises the question of whether an interstate air taxi

operator's insurance carrier can escape liability where the fatal

crash occurs during a local flight which does not cross state lines

but which is otherwise within the scope of the carrier's registered

operation and which affects interstate commerce.

In this case seventeen people died when the aircraft appar-

ently stalled and fell from flight shortly after take-off. The pur-

pose of the flight was to transport, for compensation or hire, sport

parachutists.

The aircraft was titled in the name of Air Carriers Express

Services, Inc., and was registered as an air taxi operator under

Part 298 of the Economic Regulations [14 C.F.R. §298 et seg]

and also was certificated under Part 135 of the Federal Aviation

Regulations. Ail air tax operators engaged in air transportation

(interstate commerce) are required by 14 C.F.R. §298.3 and

§298.21 to register with the Civil Aeronautics Board (now

Department of Transportation). This carrier’s registration as an

air taxi operator was in full force and effect on the date of the

crash.

Moreover, registered air taxi operators are required by 14

C.F.R. §§298.37 and 298.41 to maintain aircraft accident liabil-

ity insurance. Air Carriers Express Services, Inc. and its insurer

filed C.A.B. Form 257 certifying insurance in compliance with

applicable regulations.

Although Air Carriers Express Services, Inc. was registered

as an interstate air taxi operator under Part 298 and was operat-

ing within the scope of its registration at the time of the fatal

flight, the Georgia Court of Appeals nevertheless permitted the

operator’s accident insurance carrier to escape liability to fare

paying passengers upon a finding that Part 298 was inapplicable

to intrastate (local) flights. The overall operation of Air Carriers

Express Services, Inc., however, was factually interstate in

4

nature, as evidenced by the fact it registered under these

regulations.

Federal Question

The federal question presented was first raised in the Cross-

motions for Summary Judgment and briefed by both parties in

the court below and at all stages in the proceedings. [R-338, 639]

The federal question presented in this appeal was the determina-

tive issue in the decision below.

Reasons for Granting the Writ

This case involves the important question of whether

Part 298 of the Economic Regulations is applicable to local flights

by an interstate operator registered under these regulations and

which otherwise constitutes air transportation affecting interstate

commerce. (See 14 C.F.R. §298.2(b) & (c)).

This question is vitally important not only to the litigants in

this case, but also to all citizens because the answer determines

whether insurance will be available to air crash victims as pro-

vided in the Economic Regulations. If insurance is not mandated

by 14 C.F.R. §§298.37 and 298.41, then no required insurance

will cover fare paying passengers traveling between points within

a state, even though the air taxi operator is registered as engaged

in air transportation under 14 C.F.R. §298 et seq. There is no

state law which requires any such insurance in the State of

Georgia.

The Georgia courts are evenly split on this issue. In Corin v.

Puritan Insurance Company, 184 Ga. App. 667, 362 S.E.2d 380

(1987), the Georgia Court of Appeals correctly noted that insur-

ance was required for a registered operator for an intrastate flight

where the overail operation is or even may include authority for

interstate flights. A local joy ride was at issue in Corin.

in the case below, however, a different panel of the Georgia

Court of Appeals held that the fact the actual accident flight was

local was determinative of the question of whether the flight was

— —o

5

intrastate, and consequently, was determinative of the question of

coverage and the applicability of 14 C.F.R. §298 et seq. Howell,

et al v. United States Fire Insurance Company, 185 Ga.

App. 154, 363, S.E.2d 560 (1987).

The court below erred when it apparently attached no conse-

quence to the following undisputed, material facts: (1) the air taxi

operator was registered as interstate air taxi operator under

Part 298 of the Economic Regulations; (2) the air taxi operator’s

insurance carrier had filed a certificate of insurance as mandated

by the Economic Regulations; (3) the fatal flight was within the

scope of the carrier’s operation for which it was registered; (4) the

parachuting operation was in fact interstate in nature in that the

operator routinely flew from state to state for this purpose, adver-

tised the flights in national and international publications; and

(5) because at least one of the parachutists killed had flown in

from out-of-state to jump from this particular airplane.

In disregarding the above-stated facts, the Georgia Court of

Appeals utilized a strict geographical test to determine whether

the flight was intrastate or interstate for purposes of the applica-

bility of the Economic Regulations. Thus, under this opinion the

question of required insurance coverage depends solely on the

question of whether the flight crossed state lines. No analysis of

the impact of the scope of the interstate commerce clause of the

Constitution of the United States was considered by the Georgia

Court of Appeals.

The practical effect of this ruling can be gleaned by the

following example: A registered charter operator transports pas-

sengers for compensation or hire from Columbia, South Carolina

to Atlanta, Georgia. Under the ruling below by the Georgia Court

of Appeals, insurance coverage would be afforded under

14 C.F.R. §298.41. Should the same charter operator then pick

up a load of passengers and transport them from Atlanta, Georgia

to Albany, Georgia, however, the Georgia Court of Appeals

would find no mandatory coverage for the flight.

a

6

The ruling ignores the authority granted the Civil Aeronau-

tics Board (now Department of Transportation) under the Inter-

state Commerce Clause and applicable statutes and regulations.

For example, that authority was properly asserted in Braniff

Airways, 40 C.A.B. 887 (1964) where the Board rejected an

interstate carrier’s attempt to circumvent its jurisdiction where

proposed intrastate flights were at issue. In Braniff, the carrier

had filed an application for a Declaratory Order seeking to dis-

claim the Board’s jurisdiction over a proposal to carry passengers

wholly intrastate for free. Braniff argued that neither interstate

air commerce nor interstate air transportation was affected and

the Board was therefore without any regulatory jurisdiction. The

C.A.B. flatly rejected this position and held:

The Board has concluded that the proposed service con-

stitutes air transportation within the meaning of the

Act, and accordingly it will deny the application for

disclaimer of jurisdiction. The factors which determine

whether Braniff’s proposed operation is intrastate or

interstate transportation are the essential nature of the

movement and the character of the traffic... .

Admittedly Braniff is a common carrier in the services it

operates over its certificated routes, including points

within the State of Texas, and also holds itself out to

perform common carriage service between all points for

the transportation of persons and property on a charter

basis. .. .

On the basis of the matters set forth in the application,

particularly the geographical area of the prenosed oper-

ations and the alleged benefits which will accrue to

Braniff's common carriage operations, it is concluded

that the proposed tour is within the scope of Braniff’s

holding out as a common carrier and constitutes com-

mon carriage.

Braniff Airways, 40 C.A.B. 887, 888 (1964).

In the case sub judice, Air Carriers Express Services, Inc.

was not only a registered operator, but its registered geographical

4

limits also included the entire United States, Canada, Republic of

Mexico and the Bahama Islands. Moreover, the nature of the

operation at the time of the crash was within the scope of the

carrier’s operation, i.e., flights advertised and conducted through-

out the United States involving parachuting.

Further support for Petitioners’ Petition is found in Admin-

istrator v. Ferguson, N.T.S.B. Order No. EA-1822 (1982). At

issue were charges against a pilot for air taxi flights in air com-

merce with passengers for compensation or hire to and from

Tyrell, Texas without a Part 135 certificate. The N.T.S.B. easily

decided the question of whether the flight constituted interstate or

intrastate commerce, noting:

Respondent first argues that these flights were not ‘air

commerce’ which is defined in the Federal Act as inter-

state, overseas or foreign air commerce or the transpor-

tation of mail by aircraft or any operation or navigation

of aircraft which directly affects or may endanger safety

in, interstate, overseas or foreign air commerce. The

intrastate nature of those flights however, does not

mean that the safety regulations promulgated and

enforced by the FAA are not applicable. It is well settled

that the FAA’s authorities have been broadly construed

to extend to such flights because of their safety impact

on interstate commerce.

N.T.S.B. Order No. EA-1822

The Respondent has relied heavily upon the case of Dower v.

United Airlines, 329 F.2d 684 (9th Cir. 1964), for the proposition

that purely intrastate flights are exempt from the Economic Reg-

ulations. A close reading of that case, however, reveals that the

complaint in Dower failed to allege that the flight was interstate.

The court noted that there was nothing in the record to demon-

strate that the flight was “interstate.” Hence the court simply

directed the plaintiff to amend the petition to allege that the flight

was interstate. When the plaintiff, for some unknown reason,

refused to amend, the court dismissed the petition. Factually and

procedurally, Dower is inapposite to the case at bar. Moreover,

8

Dower pre-dates enactment of the liability insurance requirement

under Part 298 of the Economic Regulations which relates to

charter operators. Also, it does not appear that Dower would be

followed today.

Conclusion

The Georgia Court of Appeals erred in refusing to acknowl-

edge that a local flight can be “interstate” for purposes of the

interstate commerce clause and the applicability of 14 C.F.R.

§298 et seq. The test employed by the Georgia Court of Appeals

was strictly geographical, i.e., was the flight to begin and end

within the confines of the State of Georgia? The fact that the

flight was conducted by a registered air carrier and affected inter-

state commerce was not a consideration.

This is not a case where the Petitioners are burdened with

having to contend with whether the operator should have regis-

tered with the C.A.B. in order to conduct the accident flight. This

is a case where Air Carrier Express Services, Inc. in fact regis-

tered with the C.A.B. as an air taxi operator engaged in air

transportation, and in which the Respondent issued a policy of

insurance in compliance with, and subject to, the Economic

Regulations.

It is not difficult to understand why Air Carriers Express

Services, Inc. came to the conclusion that it was an air taxi

operator and that its operation was interstate in nature. This

carrier used the means and instrumentalities of interstate com-

merce in the conduct of its operation. It not only advertised flights

in a variety of national and international publications but it actu-

ally carried passengers for compensation or hire in interstate

commerce. There was in fact a passenger on board the fatal flight

who had flown into Georgia from out-of-state for the purpose of

sport parachuting. The aircraft routinely operated between

Peachtree-DeKalb Airport in Atlanta, Georgia and states

throughout the United States for the purpose of sport parachut-

ing. The policy of insurance was given pursuant to regulation for

SE SEEM S55 jh SOAR:

SR

9

the benefit of the public and should be interpreted subject to such

regulations.

For the foregoing reasons, Petitioners respectfully request

that this Court issue a Writ of Certiorari to review the decision of

the Court of Appeals of Georgia to the extent it holds that an

intrastate (local) flight conducted by a federally certificated air

carrier within the scope of its certificate is not subject to the

mandatory insurance requirements of Part 298 of the Federal

Aviation Regulations.

This day of September, 1988.

WARREN CANDLER FORTSON

JOHN ALLEN HOWARD

OF COUNSEL

Fortson and White

300 Atlanta Financial Center

3333 Peachtree Road, N.E.

Atlanta, Georgia 30326

(404) 239-1900

DONALD ROSS ANDERSEN

OF COUNSEL

Donald Ross Andersen

Suite 200 Hollowbrook Court

1479 Brockett Road

Tucker (Atlanta), Georgia 30084

(404) 939-0888

10

WILLIAM C. LANHAM, JR.

OF COUNSEL

Lanham & McGehee, P.C.

2100 Equitable Building

100 Peachtree Street, N.W.

Atlanta, Georgia 30303-1962

(404) 524-5626

NICHOLAS C. MORAITAKIS

OF COUNSEL

Gorby, Reeves, Moraitakis &

Whiteman, P.C.

Harris Tower, Suite 2200

233 Peachtree Street, N.E.

Atlanta, Georgia 30343

(404) 527-4340

APPENDICES

APPENDIX A

SEPTEMBER TERM, 1987. (185 GA. APP.)

75040. HOWELL et al. v. UNITED STATES FIRE

INSURANCE COMPANY.

75041. PRUITT et al. v. UNITED STATES FIRE

INSURANCE COMPANY.

75042. WILSON et al. v. UNITED STATES FIRE

INSURANCE COMPANY.

75043. YIN v. UNITED STATES FIRE INSURANCE

COMPANY.

75044. BOLAND et al. v. UNITED STATES FIRE

INSURANCE COMPANY.

75045. AIR CARRIERS EXPRESS SERVICES, INC. et al. v.

UNITED STATES FIRE INSURANCE COMPANY.

(363 SE2d 560)

CARLEY, Judge.

On September 29, 1985, a Cessna 208 Caravan aircraft

carrying a pilot and sixteen parachutists crashed shortly after

take-off. All seventeen persons on board were killed. The aircraft

was owned by appellant-defendant Air Carriers Express Services,

Inc. (ACES). Appellee-plaintiff insurer had issued a policy which

provided coverage to ACES for damage to the aircraft and for

liability resulting from its operation. Appellee initiated this

declaratory judgment action, naming as defendants appellant

ACES and the appellant-administrators of the estates of

Mr. Steven Wilson, the pilot of the aircraft, and of Mr. David

Williams, the president of ACES. The remaining appellant-

defendants sought and were granted permission by the trial court

to intervene in the action as personal representatives of four of the

parachutists killed in the crash.

In its petition, appellee sought, insofar as it is relevant to

these appeals, a declaratory judgment to the effect that there

existed no insurance coverage for the crash and that it had no

duty to defend any civil action arising from the crash. Although

2a

appellee’s petition stated several grounds for its denial of cover-

age, it moved for partial summary judgment based only on the

ground that the pilot, Mr. Wilson, did not meet the terms and

conditions set forth in the “open pilot provision” of the policy

declaration. Appellants in case nos. 75040, 75041, 75043, and

75044 filed their own cross-motions for summary judgment

against appellee. The trial court granted appellee’s summary

judgment motion and denied the cross-motions for summary

judgment against appellee. Appellants filed separate appeals

from the order of the trial court granting summary judgment in

favor cf appellee. The resulting six cases are hereby consolidated

for disposition in this single opinion.

1. Appellants first urge that, pursuant to certain provisions of

federal aviation law, appellee has bound itself to provide cover-

age. However, the provisions of federal law upon which appellants

rely apply only to interstate flights. If the possibility exists that air

transportation services will cross state lines, then the air carrier

must secure “liability protection for bodily injury and property

damage in the event of such interstate travel and to avoid [fed-

eral] sanctions. . . . [The air carrier is required to be in] com-

pliance with [federal] requirements for any air taxi service where

interstate operations may be involved.” (Emphasis supplied.)

Coren v. Puritan Ins. Co., 184 Ga. App. 667, 669 (2) (1987).

That the fatal crash in question was an intrastate flight is uncon-

troverted in the record. Therefore, the issue of the extent to which

coverage would be afforded must be determined on the basis of

the policy as interpreted by applicable Georgia law. See Coren v.

Puritan Ins. Co., supra at 669 (2).

2. Appellants contend that the appellee is bound by the pilot

clause language which appears on the binder form issued to

ACES rather than that which appears in the policy. “A binder is a

contract of insurance in praesenti; temporary in its nature,

intended to take the place of an ordinary policy until the same can

be issued. It is a short method of issuing a temporary policy for

the convenience of all parties, to continue, unless sooner canceled,

until the execution of a formal policy . . . ‘[A binder is] . . .

3a

itself a contract — temporary, sketchy, and informal, but a con-

tract notwithstanding. [Cit.] Usually it fixes the term and cover-

age of the policy, but by express reference leaves the details of the

contract to the latter. [Cits.] Hence as to such details the contem-

plated policy rather than the binder is the determinative docu-

ment.’ [Cit.]”’ (Emphasis supplied.) Fort Valley Coca-Cola Co. v.

Lumbermen’s Mut. Cas. Co., 69 Ga. App. 120, 124 (24 SE2d

846) (1943). See also Cincinnati Ins. Co. v. Stuart, 139 Ga. App.

80, 81-82 (1) (227 SE2d 771) (1976).

Appellants urge, however, that the binder form was, in fact,

itself a policy of insurance rather than a mere binder. In one place

on the original form the following appears: “binder No.

However, the word “binder” had been stricken and the term

“assigned policy” inserted in its place, so that the form read:

“assigned policy No. ” As the result of this alteration,

appellants contend that the binder was itself a formal policy and

that the pilot clause typed on the binder form was therefore a

policy provision which could not be changed without the consent

of the insured. See Broome v. Mut. of Omaha Ins. Co., 119 Ga.

App. 443, 446 (2) (167 SE2d 607) (1969).

However, the alteration did not purport to change the very

nature of the document from a temporary binder to a formal

insurance policy. On its face, the document is clearly shown to be

a mere temporary binder rather than a formal insurance policy,

and this is made manifest by its language, including among

others, the following reference: “[u]nless this binder is replaced

by the issuance of policy. . . . ” (Emphasis supplied.) Since a

formal insurance policy was issued before the crash of the air-

craft, it is the language of the pilot clause in that formal policy

which controls. Compare /nternational Indem. Co. v. McKeever,

174 Ga. App. 871 (331 SE2d 909) (1985) (holding that where the

incident giving rise to the claim occurs before the policy is issued

the language of the binder controls). Accordingly, whether or not

the language of the pilot clause in the binder was ambiguous or in

conflict with the language of the policy are issues which need not

be addressed.

4a

3. On the date of the crash, the pilot clause of the policy

declaration stated as follows: “PILOT CLAUSE: Only the fol-

lowing pilot or pilots holding valid and effective pilot and medical

certificates with ratings as required by the Federal Aviation

Administration for the flight involved will operate the aircraft in

flight: 1. Pilots who must have a commercial or airline transport

certificate with an instrument rating and a minimum of 2000

logged pilot hours of which 250 hours have been in turbine air-

craft and are graduates of the ground and flight training school

conducted by the manufacturer or an entity under contract to it

for the [Cessna 208 Caravan] aircraft . . . otherwise Tom

Beaudrot. 2. A two person crew consisting of: A. Pilot in com-

mand: [same as | above]. B. Co Pilot: David Williams.”

“A provision in the policy that the aircraft should be piloted

only by the named insureds or a qualified private or commercial

pilot with a minimum of 200 logged hours as a pilot in command

of aircraft, 10 hours of which must have been in a Cessna 172 or

aircraft of similar type, and who has a valid and effective pilot

certificate with proper rating as required by the Federal Aviation

Agency for the flight involved, is a valid and binding one.” Grig-

sby v. Houston Fire &c. Ins. Co., 113 Ga. App. 572, 573 (2) (148

SE2d 925) (1966). See also Ranger Ins. Co. v. Colum-

bus-Muscogee Aviation, 130 Ga. App. 742, 745 (4) (204 SE2d

474) (1974) (holding that where the pilot of the plane at the time

of the crash did not possess a valid medical certificate as required

by the “Pilot’s Clause” summary judgment for the insurer was

mandatory); see also Atlanta Air Fleet v. Ins. Co. of N. America,

130 Ga. App. 15 (202 SE2d 192) (1973) (upholding the validity

of a “Pilot’s Clause” requirement that the pilot in command be

properly certificated and rated for the particular aircraft). In the

instant case, the policy requirement that pilots must be graduates

of the manufacturer’s ground and flight training school is valid.

Such a provision, like those previously held to be valid, “had an

obvious relation to the degree of risk or hazard assumed by the

insurer....” Atlanta Air Fleet v. Ins. Co. of N. America, supra at

16.

Sa

Appellants urge that this requirement is void because no

manufacturer's flight school existed from which a pilot could

graduate and, therefore, the requirement could not be met. How-

ever, the record shows that the manufacturer did operate a

pilot-training program under the name “Caravan I Flight Crew

Training,” which program was designed to provide training for

the type of aircraft in question. It is also clear from the record

that “Caravan I Flight Crew Training” was the on/y ground or

flight training for the particular make and model of aircraft that

was Offered by the manufacturer, and that there was no other

entity under contract to the manufacturer to provide such train-

ing. Accordingly, it is clear that “Caravan I Flight Crew Train-

ing” was ‘the ground and flight training school conducted by the

manufacturer or an entity under contract to it for the [Cessna 208

Caravan] aircraft” referred to in the policy declarations.

(Emphasis supplied.) At least two of the pilots employed by

ACES were graduates of the “Caravan I Flight Crew Training”

course. However, Mr. Steve Wilson, the pilot of the aircraft at the

time of the crash, had not attended that training program and was

not a graduate thereof. That actual flight training may not have

been a mandatory part of the curriculum of the “Caravan I Flight

Crew Training” does not obviate the fact that it was rhe manufac-

turer’s ground and flight training school for the particular air-

craft. The pilot clause of the policy requires graduation from the

manufacturer’s ground and flight training school, and it does not

expressly require that there be a specified amount of either

ground training or flight training. Rather, the pilot clause leaves

the requirements for graduation or certification to the manufac-

turer of the aircraft.

The fact that there were employees of ACES who were

graduates of the manufacturer’s only flight crew training pro-

gram for the make and model aircraft involved in the crash

negates appellants’ argument that the pilot training requirement

of the pilot clause of the policy was void because it could not be

satisfied. Accordingly, the trial court did not err in granting sum-

mary judgment in favor of appellee in that it was established that,

in violation of the pilot clause of the policy, the pilot at the time of

6a

the crash was not a graduate of the manufacturer's ground and

flight training school.

4. Appellants in case nos. 75040, 75041, 75043, and 75044

enumerate as error the denial of their cross-motions for summary

judgment. However, in light of our holding in Division 3 that the

trial court did not err in granting summary judgment in favor of

appellee, it follows that the trial court did not err in denying these

appellants’ cross-motions for summary judgment.

These appellants also enumerate as error the trial court's

denial of their motions to compel discovery of the investigatory

file prepared by Aviation Office of America (AOA) following the

crash. The trial court made specific findings that AOA was the

agent of appellee, and that AOA’s investigatory file was prepared

in anticipation of this litigation. The trial court’s order also recites

ample evidence to support its finding that the requested material

comes within the ambit of OCGA § 9-11-26 (b) (3), and the trial

court correctly held that discovery of such material could not be

had in the absence of a showing of substantial need and undue

hardship. See Tobacco Rd. v. Callaghan, 174 Ga. App. 539 (330

SE2d 768) (1985); Warmack v. Mini-Skools, 164 Ga. App. 737,

738-740 (2) (297 SE2d 365) (1982); Georgia Inti. Life Ins. Co. v.

Boney, 139 Ga. App. 575, 580-582 (3) (228 SE2d 731) (1976).

The trial court’s finding that appellants had “not made such an

affirmative showing of need” is not clearly erroneous, and there-

fore, the denial of the motion to compel discovery was not error.

a iti aes Me il, Pisstid ’

A Tithe alleys le a se ie

ae. ee

7a

Judgments affirmed. Banke, P. J., and Benham, J., concur.

DECIDED NOVEMBER 2, 1987 —

REHEARING DENIED DECEMBER 2, 1987 — CERT. APPLIED

FOR.

Action on policy. Fulton Superior Court. Before Judge

Langham.

John A. Howard, for appellants (case no. 75040).

William C. Lanham, Clark H. McGehee, for appellants

(case no. 75041).

Gregory T. Presmanes, James G. Jackson, for appellants

(case no. 75042).

Nicholas C. Moraitakis, for appellant (case no. 75043).

S. Phillip Brown, for appellants (case no. 75044).

John W. Henderson, Jr., H. Brian Sams, for appellants

(case no. 75045).

Sewell K. Loggins, John J. Wiles, for appellee.

8a

APPENDIX B

IN THE SUPERIOR COURT OF FULTON COUNTY

STATE OF GEORGIA

UNITED STATES FIRE

INSURANCE COMPANY,

Plaintiff,

CIVIL ACTION

V.

AIR CARRIERS EXPRESS SERVICES, FILE NO. D-27263

INC., JOHN WALTON HENDERSON,

Administrator of the Estate of

David L. Williams and

LOUIS LEVENSON, Temporary

Administrator of the Estate of

Steve Herbert Wilson, et al.,

Nm me ee ee ee

Defendants.

ORDER GRANTING PLAINTIFF’S MOTION FOR

SUMMARY JUDGMENT AND DENYING DEFENDANT’S

MOTION FOR SUMMARY JUDGMENT

This matter is presently before the Court on cross motions

for summary judgment of the plaintiff and of the defendant,

Estate of Rodney L. Howell.

The issues have been briefed and argued to the Court. After

a thorough consideration of the briefs, arguments and the entire

record (except for the affidavit of W. R. Scott which was not

considered), the Court enters this order.

The Motion for Summary Judgment of defendant Estate of

Rodney L. Howell is denied.

The Motion for Summary Judgment of plaintiffs is granted.

ere = ME re ot

9a

It is hereby ORDERED and adjudged that United States

Fire Insurance Company has no coverage under policy number

700AC-32-US-57005 for the accident of September 29, 1985 as

to any of the defendants: and that United States Fire Insurance

Company has no duty to defend any civil actions arising out said

accident or to pay any judgment which might be rendered against

defendants or any of them; and that United States Fire Insurance

Company has no duty to pay defendant Air Carriers Express

Services, Inc. or John Walton Henderson, Administrator of the

Estate of David L. Williams for any sums alleged to be due for

damage to the aircraft in question as a result of the accident of

September 29, 1985.

SO ORDERED, this 28th day of January, 1987.

/s/ Don A. Langham

DON A. LANGHAM, Judge

Superior Court of Fulton County

Copies to:

Sewell K. Loggins, Esq.

MITCHELL, LOGGINS,

CAMPBELL &

ELSBERRY, P.C.

One Lakeside Commons

Suite 400

990 Hammond Drive

Atlanta, Georgia 30328

S. Phillip Brown, Esq.

BROWN, KATZ,

FLATAU & HASTY

355 Cotton Avenue

Macon, Georgia 31201

Louis Levenson, Esq.

990 Edgewood Avenue, N.E.

Atlanta, Georgia 30307

John W. Henderson, Jr., Esq.

MOFFETT &

HENDERSON, P.C.

1916 Piedmont Road, N.E.

Atlanta, Georgia

30324-4187

10a

John A. Howard, Esq.

FORTSON & WHITE

300 Atlanta Financial Center

3333 Peachtree Road, N.E.

Atlanta, Georgia 30326

Ncholas Moraitakis, Esq.

GORDY, REEVES,

MORAITAKIS,

& WHITEMAN, P.C.

P.O. Box 56690

Atlanta, Georgia

30343-0690

James G. Jackson, Esq.

HINES & LOWENDICK

600 Peachtree

Palisades West

1800 Peachtree Street, N.W.

Atlanta, Georgia 30309

lla

APPENDIX C

CLERK’S OFFICE, SUPREME COURT OF GEORGIA

ATLANTA: January 21, 1988

Dear Sir:

Case No. 45318. ROBERT E. HOWELL, ET AL. v.

UNITED STATES FIRE INSURANCE COMPANY, ET AL.;

Case No. 45319. HERBERT WILSON, ET AL. v. UNITED

STATES FIRE INSURANCE COMPANY, ET AL.; Case No.

45320. AIR CARRIERS EXPRESS SERVICES, INC. v.

UNITED STATES FIRE INSURANCE COMPANY

The Supreme Court today granted the writ of certiorari in

this case. All the Justices concur, except Marshall, C. J. and Bell,

J., who dissent.

THIS CASE WILL BE ASSIGNED TO THE MARCH

1988, ORAL ARGUMENT CALENDAR.

The Court is particularly concerned with the following:

Is there a conflict between this case and Coren v. Puritan

Ins. Co., 184 Ga. App. 667, cert. den. (1987)? If so, how should

the conflict be resolved and how does the resolution affect the

insurance in this case?

Briefs filed in the Court of Appeals are included in the

record presented to this court. Additional briefs are not required

but may be submitted.

Very truly yours,

JOLINE B. WILLIAMS, Clerk

12a

APPENDIX D

In the Supreme Court of Georgia

Decided: May 4, 1988

45318. HOWELL v. UNITED STATES FIRE

| INSURANCE CO.

45319. WILSON v. UNITED STATES FIRE

INSURANCE CO.

45320. AIR CARRIERS EXPRESS SERVICES, INC. v.

UNITED STATES FIRE INSURANCE CO.

PER CURIAM.

After plenary consideration of this matter (Howell v. U.S.

Fire Ins. Co., 185 Ga. App. 154 (1987)), it is found not to satisfy

the criteria for the grant of certiorari, and the writ is therefore

vacated.

All the Justices concur.

l3a

APPENDIX E

CLERK’S OFFICE, SUPREME COURT OF GEORGIA

ATLANTA: June 22, 1988

The motion for a rehearing was denied today:

Case No. 45318, 45319, 45320, Howell, Wilson, Air Carriers

Express Services, Inc. v. United States Fire Ins. Co. et al.

Yours very truly,

JOLINE B. WILLIAMS, Clerk

l4a

APPENDIX F

Part 298 Title 14—Aeronautics and Space

Chapter II—Civil Aeronautics Board

§ 298.1 Applicability of part.

This part establishes a classification of air carriers known as

“air taxi Operators,” provides certain exemptions to them from

some of the economic regulatory provisions of Title IV of the

Federal Aviation Act and specifies procedures by which such air

carriers may obtain authority to conduct operations, and estab-

lishes rules applicable to their operations in air transportation in

all States, Territories and possessions of the United States. !

§ 298.2 Definitions.

(b) “Air taxi operator” means an air carrier coming within

the classification of “air taxi operators” established by § 298.3.

(c) “Air Transportation” means interstate, overseas, or for-

eign air transportation or the transportation of mail by aircraft as

defined by the Act.

§ 298.3 Classification.

(a) There is hereby established a classification of air carri-

ers, designated as “air taxi operators,” which directly engage in

the air transportation of persons or property or mail or in any

combination of such transportation and which:

| Footnote Omitted

1Sa

§ 298.21 Filing for registration by air taxi operators.

(a) Every air taxi operator (whether or not he is also a .

commuter air carrier as defined in this part) who plans to com-

mence operations under this part shall register with the Board not

later than 30 days prior to the commencement of such operations,

unless, upon a showing of good cause satisfactory to the Director

of the Bureau of Pricing and Domestic Aviation, registration

within a lesser period of time is allowed.

§ 298.37 Prohibition of services not covered by insurance.

An air taxi operator shall not operate in air transportation or

provide or offer to provide air transportation unless there is in

effect liability insurance which covers such transportation and

which is evidenced by a current certificate of insurance on file

with the Board as required by Subpart E.

§ 298.41 Basic requirements.

(a) Each air taxi operator engaging in air transportation

shall maintain in effect liability insurance coverage which com-

plies with the requirements of this subpart and which is evidenced

by a currently effective policy of insurance, with an attached

standard endorsement, available for inspection by the Board and

the public at its principal place of business. Evidence of such

insurance coverage, in the form of a certificate of insurance, shall

be maintained on file at the Board at all times.

l6a

CERTIFICATE OF SERVICE

I, Warren Candler Fortson, hereby certify that I have a

served three true and correct copies of this Petition for Writ of

Certiorari, by hand, before the time of filing with the Clerk of this

Court upon:

Sewell K. Loggins

Mozley, Finlayson & Loggins

1800 Coastal States Building

260 Peachtree Street, N.W.

Atlanta, Georgia 30303

I further certify that all parties required to be served have

been served.

This day of September, 1988.

WARREN CANDLER FORTSON