Not to invite a huge discussion on this, and at the risk of over simplifying 
the situation, from what I read the decision from the court revolved around 2 
factors: first what were the original limitations spelled out by the DAR/FAA 
certifying authority; second what constituted a modification that required FAA 
notification.  The Avemco policy had an exclusion which allowed them to deny 
coverage if an unauthorized modification was made, and flight operations 
continued.  The original limitations were so general and all encompassing in 
scope that virtually no modification could be made to the aircraft without at 
least getting a field certification from the FAA, if not re-certification 
inspection.  This would also be accompanied by an associated testing period 
appropriate to the change, that would be required by the inspector.  After the 
combination was once again "proven" by the test period being successful, normal 
flight operations would then be allowed and Avemco would have to cover. Minor 
corrective repairs that return the aircraft to its original state at the time 
of certification are okay, and only need to be logged properly. The addition of 
avionics equipment for added safety or utility is permitted as long as the 
ORIGINAL certified equipment is retained, as long as the weight and balance 
reflects the installation of said equipment, or if substitutions are made, 
field approval must be granted by an inspector, which alot of times can happen 
over the phone, if you can clearly communicate the changes, and fax 
documentation to the inspector for sign off.  Your copies then go in your log.  
As my DAR explained, when in the test Phase I whatever you test for is what you 
can do as normal operations in Phase II.  Major changes cause an automatic 
return to Phase I to prove that combination, that can then be used in Phase II 
normal operations.  That is the purpose of the Phase I testing to find problems 
with your combination and correct them so that when you enter Phase II 
operations you have a proven combination that is safe, and you just maintain 
from that time forward.

Colin & Beverly Rainey
Apex Lending, Inc.
www.eloan2004cr.com
crai...@apexlending.com
407-323-6960

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