International Air Leases, Inc., of Miami, Florida, is engaged in the business of leasing air transport-type aircraft to air carriers. That company opposes the enactment of HR 7488 and We have discussed these views with your staff and submit the enclosed memorandum for the record. Yours truly, /5/ Preiber Paul Reiber Attorney for International Enclosure MEMORANDUM The harsh penalties that can be imposed on lessors of aircraft should be removed from the Federal Aviation Act The existing Federal Aviation Act is harsh on lessors of aircraft, and the FAA has asked Congress to increase that harsh ness. We are calling this to your attention to ask your help in getting Congress to remove the unfair imposition on lessors in the present statute and to resist the effort of the FAA to make the law even worse. I. A lessor can have his aircraft seized If a lessee violates an F.A.R. 1/ so long as the violation is made by the person in command of the aircraft, the aircraft 1/ "Sec. 901 [49 U.S. Code 1471]. (a) (1) Any person who violates (A) any provision of title III, IV, V, VI, VII or XII, or of section 1114, of this Act, or any rule, regulation, or order issued thereunder,...shall be subject to a civil penalty of not to exceed $1,000 for each such violation.... "Sec. 901 (b) Liens-- In case an aircraft is involved in such violation and the violation is by the owner or person in command of the aircraft, such aircraft shall be subject to lien for the penalty:.... "Sec. 904 [49 U.S. Code 1474]...In case the violation is by the owner or person in command of the aircraft, the penalty shall be a lien against the aircraft...." is subject to a lien--no matter how innocent the owner of the articles exempts/from forfeiture when the vehicle is operated for an offense committed by B, the lessee. U.S. V. is totally contrary to our moral sense of justice and contrary to most of our laws. As the Supreme Court said, this type of statute was "...intended to impose a penalty only on those who are significantly involved in a criminal enterprise... U.S. Coin and Currency, 401 U.S. 715, 721-22 (1971). The courts are moving enforcement of the forfeiture statutes in this direction. A strong indication of this was the language of the Supreme Court when it decided that forfeiture statutes can be constitu (footnotes on page 2-A) tional (Calero-Toledo v. Pearson Yacht Leasing Co., 416 U.S. 663 (1974)). There, the Court stated that the owner could claim exception to forfeiture if he proved "not only that he was uninvolved in and unaware of the wrongful activity but also that he had done all that reasonably could be expected to prevent the proscribed use of his property." (footnotes to p. 2) 1/"Chapter 11. Section 782--Seizure and forfeiture of vessel, vehicle, or aircraft used--Innocent owners.- "Any vessel, vehicle, or aircraft which has been or is being used in violation of any provision of section 1 [$781 of this title], or in, upon, or by means of which any violation of section 1 [$781 of this title] has taken or is taking place, shall be seized and forfeited: Provided, That no vessel, vehicle, or aircraft used by any person as a common carrier in the transaction of business as such common carrier shall be forfeited under the provisions of this Act [SS781-788 of this title] unless it shall appear that (1) in the case of a railway car or engine, the owner, or (2) in the case of any other such vessel, vehicle, or aircraft, the owner or the master of such vessel or the owner or conductor, driver, pilot, or other person in charge of such vehicle or aircraft was at the time of the alleged illegal act a consenting party or privy thereto: Provided further, That no vessel, vehicle, or aircraft shall be forfeited under the provisions of this Act [SS781-788 of this title] by reason of any act or omission established by the owner thereof to have been committed or omitted by any person other than such owner while such vessel, vehicle, or aircraft was unlawfully in the possession of a person who acquired possession thereof in violation of the criminal laws of the United States, or of any State. (Aug. 9, 1939, c. 618, §2, 53 Stat. 1291.)." 49 U.S.C. 782. A comparable provision is found in 21 U.S.C. 881. 2/ We know of no instance when the FAA enforced a lien against an aircraft operated by a thief. Nevertheless, there is no pro vision in the statute to bar such a lien. Further support for that view is that since the 1974 Supreme Court decision, the Federal courts have interpreted the exception to be applicable if the owner "...was uninvolved in and unaware of any wrongful activity, and...that he acted as a reasonably prudent person under all the circumstances, doing all that could be expected of him to prevent illegal use of his property, [then] forfeiture...would be improper under the standard established by the Cupreme Court." U.S. v. One 1976 Lincoln Mark IV, 462 F. Supp. 1383, 1387 (1979). This fair standard is also in the more recent forfeiture statutes dealing with narcotics violations. Section 334 (d) (3) provides: "...the court shall allow the claim of any claimant, to the extent of such claimant's interest, for remission or mitigation of such forfeiture if such claimant proves to the satisfaction of the court (i) that he has not committed or caused to be committed any prohibited act referred to in such paragraph (2) and has no interest in any drug referred to therein, (ii) that he has an interest in such equipment or other thing as owner or lienor or otherwise, acquired by him in good faith, and (iii) that he at no time had any knowledge or reason to believe that such equipment or other thing was being or would be used in, or to facilitate, the violation of laws of the United States relating to counterfeit drugs." 21 U.S.C. 334 (d) (3). Another means by which other lien and forfeiture statutes try to be fair to innocent owners is a provision directing the agency to remit a fine to avoid clear injustice. Such provision is in the statute imposing fines and forfeiture for violating wherein customs laws/the Secretary of the Treasury is authorized to remit |