University of Vermont AAHS

LITIGATION CORNER

Will the Remedy Cost More than the Problem Itself Is Worth?

by Jan Dawson

President, AAHS

[reproduced from Summer 2004 issue of Caution:Horses]

 

Will the remedy cost more that the problem itself is worth?  Serious disputes can arise over the sale of recreational horses, unpaid board bills, training fees and hauling expenses.  In the world of litigation the amounts involved may seem miniscule.  To the people involved the amounts may equal several months’ or years’ earnings.  To the people involved these disputes are gravely important.

 

As important as these disputes are, the agreements that led up to them are so often treated so casually that one wonders why the money wasn’t just given away.  It would often cost more to hire an attorney and litigate than the amount in dispute.  In other cases any writing that exists is inadequate.

 

Inexpensive horses often have high value to the people who own them.  These horses, priced from one dollar and maybe including a load of hay, to five thousand dollars, are often sold on a handshake or with a few sentences hand written on a page to prove that there was a sale to a certain person.

 

Problems involving small amounts of money can be handled in a Small Claims Court.  This is a court whose jurisdiction is limited by the amount of money at stake, often five thousand dollars or less.  In these courts it is common for citizens to go in without an attorney and represent themselves to the judge.

 

If the amount at stake is beyond small claims into the next level, an attorney will be helpful.

 

Fortunately the problem has a fairly easy fix.

 

Whether you buy or sell a horse the agreement needs to be in writing and both the buyer and the seller need to sign and date the agreement and they each need a copy.

 

Just saying that Jake sold Ole Dobbin to Jim Bob for $300 and 60 bales of hay won’t do it.  Jim Bob can take ole Dobbin, pay with any kind of hay he chooses that was cut in any year.  If Jim Bob gave Jake a check and took the horse and said he would bring the hay over after he cut and bailed this year, so what.  He has a bill of sale.

 

The agreement needs to AT LEAST state the following things:

 

Who is selling which horse to whom?

For how much?

To be paid how and when?

When does the buyer get the horse? 

When does ownership of the horse transfer?

 

It is also helpful to include the following, as it will aid the Buyer in knowing what s/he is getting.

The name, age, color, sex of the horse and a good description.

Is the horse guaranteed sound and free of any preexisting health or lameness issues and if any show up within 30 days from the date of sale the Seller will return the purchase price, as long as the horse was being used as expected OR

The Buyer has had a veterinary exam and is satisfied that the horse is sound with any agreed upon exceptions listed in this part.  The veterinarian should clear the horse as serviceably sound for the use to which it will be put.

There should be an agreed upon return policy or it should be stated that the sale is final except upon proof of fraud.

If the horse is being sold “as is” with no representations or guarantees whatsoever, then the agreement should say that the sale is an “as is” sale.

Seller should state clearly that the horse has no vices or bad behavior or should disclose what it has been known to do.  To sell a horse that has a history, even if it was one bad act, can come back to haunt you.  Disclosure cannot.

DO NOT EVER SAY A HORSE IS BOMB PROOF, WILL NEVER BUCK OR IS KID GENTLE.  You may say that the horse has never behaved inappropriately, to your knowledge, since you have owned it.

If there are terms of payment they should be included and it should be stated when ownership transfers, taking into consideration that liability follows ownership.  However, once the ownership passes, the debt and the sale are no longer related.  The Seller may want to consider keeping possession of the horse until the price is paid in full.

A registration certificate is NOT proof of ownership except to the breed association itself, in most cases.  Withholding papers to settle a dispute does not necessarily affect actual ownership but only the ability to show a horse at a recognized show.

If the seller wants to be able to get the horse back if the whole purchase price is not paid or is not paid within a certain date, it is best not to deliver the horse until the money is in hand.  This is the stuff of which disputes are made.  Stating that the horse must be returned seldom works.  It may be better to have an attorney draw up a lease purchase agreement but for the inexpensive horses this is probably not realistic.  One can agree to lease a horse until the lease payments reach an agreed-on purchase price and then the horse can be purchased “for the amount paid on the lease.”

 

Some of the same principles hold true for boarding and training agreements.  No matter if they are between relatives, they need to be in writing so that each party knows what is expected.  Writing down the terms or using a good form checked out by a proper attorney in your state makes sure that each party has thought through the action about to be taken.  Below are the areas that seem most frequently to give rise to disputes:

 

Are health papers, especially a negative Coggins, required for horses coming into the barn?

What does the boarding fee include?

Number of feedings a day: hay and grain

Supplements – does it cost extra to have them given?  Does the customer bring them to the barn or does the barn purchase what the client wishes?

Turnout – times per week/hours per day/alone/pairs/groups

Daily stall cleaning – picked out additionally

Grooming & exercise

Blanketing in cold weather – is this an extra charge?

Nightly barn check – is one done regularly?

Who pays vet and farrier when they come?  Does the stable pay and bill the customer or does the stable make the vet/farrier collect from the customer?

 

What are the training issues that need to be specified?

Veterinarian has cleared the horse for training.

Owner has disclosed any bad habits and all difficulties.

Owner has disclosed any known physical or mental limitations.

Who will do the riding?  Most owners care and if an assistant will be used the owner has a right to know.

Times per week the horse will be ridden.  Many owners assume that their horse will be ridden every day.

Is there a probationary period when the trainer can decide to take the horse or not?  This may be a few days to a few weeks but should be stated.

Is there a statement of expectations from the owner so that the trainer knows what is hoped for?  If this is unreasonable then this is the time for the trainer and owner to agree on what is possible.  This may be something that needs to be done after the probationary period.  Sometimes the owner will say “She promised that in 90 days my horse would be…” or the trainer will say, “This horse did not even have a left lead when he came so there was no way he was going to make any of those early competitions.”

 

Many disputes arise from problems dealt with after the agreement is signed.  An oral agreement is rarely enforceable.  It is not possible to alter a written agreement with an oral one.  Once the agreement is made, two parties may agree verbally to do things differently but if a dispute arises it is the written agreement that is enforceable, not a oral one made later.  That problem shows up over and over in boarding agreements, with training arrangements, and with payment or buy-back terms of horse sales.

 

It is never a waste of time to put the whole agreement in writing.  If a business is involved an attorney should assist with the form.  If the agreement involves less than the cost of an attorney to solve a later problem one should use a form available in one of the many books or online, or at the very least put down everything of importance to both parties.  Anytime the agreement is altered, it should be done in writing or the agreement should be rewritten to reflect the change.

 

To ignore the importance of this written record of the agreement may result in the loss of the amount of money represented in the agreement because the remedy may cost considerably more.


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