ICON A5 — The BUSKLAW Newsletter

To continue the title: Paul. As in Sir Paul McCartney. But in 1969, there was a problem: several radio stations broadcast a conspiracy theory: Paul died in a car crash in 1966. And the remaining Beatles covered it up and replaced the dead Paul with an (apparently equally-talented) imposter. Fans began scouring Beatles songs for evidence of the ruse; they pointed to "The walrus was Paul" line from the song White Onion, concluding that "walrus" was the Greek word for corpse (it isn't). in reality, John Lennon was messing with fans' propensity to find meaning to those lyrics when there was none. In an interview for what later became the Beatles Anthology television documentary, John said:

I threw the line in—"the Walrus was Paul"—just to confuse everybody a bit more. It could have been "The fox terrier is Paul." I mean, it's just a bit of poetry. I was having a laugh because there'd been so much gobbledygook about Pepper—play it backwards and you stand on your head and all that.

Despite John's explanation for Paul the walrus, the Paul is dead urban legend continued long after 1969; in 2009, Time magazine included the tale in its article on ten of "the world's most enduring conspiracy theories."

Because there's something in the human psyche that won't let go of patently false assumptions. Psychologist Valerie Tarico observes that "false ideas can be sticky...they can spread from person to person, getting elaborated along the way until they become virtually impossible to eradicate." Examples of widely-adopted beliefs that aren't grounded in facts abound. Climate change is not happening. An American president was born in Kenya. Wind turbines cause cancer. Vaccinations kill children. And I have another candidate for that list: Legal jargon benefits society.

Time and again this argument has been debunked but persists as a sticky false assumption. Professor Joe Kimble, in his book Writing for Dollars, Writing to Please: The Case for Plain Language in Business, Government, and Law (2012), cites empirical evidence (summaries of 50 case studies) for the enormous benefits of using plain language. And see this Michigan Bar Journal article that my colleague Michael Braem and I wrote describing several proposed justifications for legal jargon and why they must fail.

This brings us back to last month's post where we pulled apart the purchase and operating agreements for the ICON A5, the snazzy, pricey "jet ski with wings." I reached out to ICON's senior management with predictable results. They first thought that I wanted to purchase one of their planes. (No, can't afford it, no place to park it.) Then they thought that I wanted to discuss "jet card options." (What are those, my precious?) When I stated that I was simply giving them the link to my constructive critique of their contract documents, I was met with stony silence.

As the venerable Cully Wilson said, "I tried, puppy." ICON has the right to preserve the useless accuracy of their legal jargon (thanks to Professor Patrick Barry for coining that fitting term). Perhaps I planted a seed, ICON will take another look at their contracts without telling me, and revised, cleansed versions will miraculously appear on their website. (Hope springs eternal, so I'll have to keep checking their website.)

Or perhaps ICON has another motive. One of my constant readers remarked that ICON may want to force a purchaser (or their counsel) to figure out how many ways jargon-filled and vague contract language could be interpreted. Like first having to scale the medieval wall of jargon before getting inside the castle of contents. "It works well, so no reason to 'monkey' with success!" ICON claims that they have sold around 100 A5s, but who's to say that they couldn't have sold more (or the same number with less deal fatigue) with clear and concise contract language?

False ideas and fanciful conspiracies aside, we are left with this truth, so well put by Justice Ruth Bader Ginsburg: "The law should be a literary profession, and the best legal practitioners do regard law as an art as well as a craft." Designing sleek, innovative airplanes (and cars and boats and rockets) is an art too. It's time that the purchase contracts for these marvelous machines join the team!

If you find this post worthwhile, please consider sharing it with your colleagues. The link to this blog is www.busklaw.blogspot.com and my website is www.busklaw.com. And my email address is busklaw@charter.net. Thanks!

The ICON A5 is an amphibious "light-sport aircraft" that is marketed primarily to adventurous amateur pilots with deep pockets (and spacious home garages in which to store their ICONs). The plane has a recreational focus; it can seat only two, has limited load capacity, and isn't intended to go very far. The cost of the plane was $139K when first introduced in 2006 but is now $389K for a "fully-loaded version."

YouTube is full of videos showing how much fun you can have with an ICON A5 (especially with water landings and take-offs), bringing to mind the "jet ski with wings" analogy. So the ICON A5 is perhaps the ultimate high-tech, outdoor adult toy (unless you're afraid of heights). There have been several fatalities with the A5, but these apparently resulted from pilot error in one case and reckless flying in another rather than from mechanical defects or design flaws.

The ICON A5 Purchase Agreement (including the Operating Agreement as Exhibit B) may be freely downloaded from the ICON Aircraft, Inc. website. Because folks have criticized ICON for these one-sided contracts in the past, I decided to review the circa 2016-2017 (and supposedly more user-friendly) versions and evaluate them from a structure, style, and content perspective. Here's what I found:

Structure
Lawyers don't often worry about how a contract "looks and feels" on the page, but they should. Font choice and size, text justification, kerning, page margins, numbering schemes and "waterfall" text (long paragraphs with no breaks) adversely affect a contract's readability. If the writing is too dense, the less likely it will be for a deal to be consummated. Contract structure matters.

The ICON Purchase and Operating Agreements are poorly structured, for example:
> The font is too small, giving a new meaning to the term "fine print."
> Kerning issue - the space between the characters is inadequate.
> The text is fully justified but should be left-margin justified for easier readability.
> The Agreements confusingly refer to both "Sections" and "Paragraphs" without explaining a reason for that distinction.
>The Agreements put key provisions in CAPS (again affecting readability) when bold text is sufficient. And there's no need to put the paragraph headings in underlined CAPS. PUTTING TEXT IN CAPS IS SHOUTING, AND NO ONE APPRECIATES THAT! AND BOLD TEXT IN CAPS IS WORSE!
>Romenettes ("i," "ii," "iii," etc.) are used that are non-intuitive.
> Much of the Operating Agreement's legal content could be included in the Purchase Agreement; the Operating Agreement could be shortened and simplified as a result. There's no reason to say the same thing twice - once in the Purchase Agreement and again in the Operating Agreement.

Style
The style of a contract is whether the plain language is used rather than archaic, ambiguous, and confusing legal jargon.

The ICON Purchase and Operating Agreements are rife with legal jargon, for example:
> Use of RECITALS with multiple "WHEREAS" clauses and completely unnecessary consideration recitations.
>Unnecessary capitalizations (e.g., "Parties," "Paragraph," "Agreement,").
>Using the word "executed" when "signed" is intended.
>Use of archaic legalisms (e.g., "IN WITNESS WHEREOF").
>Use of the confusing "and/or" term and redundant phrases like "among other things" and "payment by check will not be deemed received until final funds have cleared the issuing bank."

Content
The content of a contract is judged on whether it efficaciously accomplishes the intended legal and business purpose. In ICON's case, the purpose is twofold: first, to create a legally-binding ICON A5 aircraft purchase obligation; and second, protect ICON from liability for property damage or death resulting from the A5's ownership and operation.

The ICON Purchase and Operating Agreements contain several ambiguous provisions that don't protect the company but are likely to trouble a potential pilot/purchaser:
> The Agreements contain broad liability release and covenant not to sue provisions that include ICON'S negligence, but these provisions will be deleted if the customer agrees to pay $10K more for the aircraft. But $10K more is only a mere 2.6% increase in the cost of the plane! Why not simply exclude the broad liability exclusions from the agreements and increase the cost of the plane to begin with? This would help simplify the contract and make the deal much more palatable to potential ICON A5 purchasers.
>At the aircraft sale closing, ICON will deliver the "then-current" A5 Limited Warranty. If I'm the buyer, I'd want a representation that the Warranty delivered at the closing won't be any less favorable to me than the Warranty that I reviewed when I signed the purchase agreement.
>As stated in the agreement, ICON may delay the sale closing date indefinitely (but must adjust the purchase money deposit due dates). Buyer should have the right to cancel the purchase agreement (and receive a full refund of their deposit) if ICON delays the estimated closing date by more than "X" days. (30 days would be typical.)
>Buyer acknowledges that the A5 is not "suited or authorized...for aerobatics." The buyer should ask that "aerobatics" be defined since part of the appeal of flying the aircraft is that it can be used for fun, arguably including "aggressive flying."
>Buyer understands that it is "receiving an early production run aircraft and as a result, service bulletins may initially be frequent, and that ICON's service network is not yet fully developed." The buyer should demand this sentence be deleted because the aircraft was first marketed in 2006 and the ICON service network should be fully developed (in the U.S.) by now. (If the service network isn't fully developed, the gaps should be identified.)
>I have several "inside baseball" criticisms better discussed between lawyers.

The purchase and operating agreements show that ICON is very sensitive about its reputation. It doesn't like negative publicity, including reports of accidents involving its aircraft. And ICON recognizes that it has liability exposure to amateur pilots looking to have fun in an aircraft that can cause trouble; there's little chance of successful legal action against ICON for death, injury, or property damage resulting from the plane's use or ownership. So if you buy an ICON A5, you are "joined at the hip to ICON" for as long as you own the plane (and you can only re-sell it to an ICON-approved buyer). Caveat emptor.

Conclusion
ICON's purchase and operating agreements aren't acceptable from either a structure or style view - they are over-lawyered. The sleek lines of the ICON A5 aren't carried over to their contract documents. Their content is generally acceptable but should be reworked and reorganized. This contractual renovation wouldn't be a trivial undertaking; however, it could be accomplished without reducing the protection that the contracts' risk-shifting provisions afford to ICON. And here's the upside of a clear and concise ICON A5 purchase and operating agreement: selling more airplanes!

I plan to send ICON a link to this post to see if they care to respond to this constructive critique, and I'll let you know if they do.