Ann always wanted to own a top show horse. Now, she found her chance. Someone has advertised for sale a gorgeous 12-year-old gelding. After years on the show circuit the horse developed an outstanding show record, with several championships. Ann wanted to make him her champion. The asking price of $3,000, she thought, was surprisingly low for a horse of his caliber. She promptly called the seller and made an appointment to see the horse. When she arrived, the seller had the horse saddled and waiting for her. She took her “test ride” in a quiet, empty arena. The ride went beautifully. A short time later, Ann paid the seller in cash and the horse was her.

Would is surprise you to learn that this sale did not have a happy ending? Soon after Ann took the horse home, she discovered many problems. The horse lashed out aggressively while being saddled and bridled. He constantly kicked at, and practically destroyed, his stall walls. He was lame unless treated with expensive hock injections. When other horses approached him in the arena or on the trails, he kicked out. Ann tried to return the horse for a refund, but the seller refused. She now is considering a lawsuit but realizes that her legal fees could well exceed the horse’s purchase price, and she knows that there is no guarantee that a court will order the seller to pay her legal fees if she wins.

Does Ann have a case against the seller? Probably. However, with a little more effort before the sale concluded, Ann might have spotted problems and avoided the purchase — and a lawsuit — entirely. This article discusses four of the problems with this sale transaction and how they could have been avoided.

Problem #1 – Buying a Horse With Cash
Ann’s lawsuit against the seller will seek, among other things, a refund of the purchase price as well as a refund of any incidental expenses Ann incurred in keeping the horse. With a cash sale, however, Ann has no record of what she paid the seller. When expensive items, such as horses, are bought with cash, Ann should have insisted on a simple bill of sale or contract that reflects the amount paid, the seller’s receipt of the payment, and the horse sold. Ann’s lawsuit against the seller will seek, among other things, a refund of the purchase price as well as a refund of any incidental expenses Ann incurred in keeping the horse. With a cash sale, however, Ann has no record of what she paid the seller. When expensive items, such as horses, are bought with cash, Ann should have insisted on a simple bill of sale or contract that reflects the amount paid, the seller’s receipt of the payment, and the horse sold.

Problem #2 – Assuming that a Pre-Purchase Examination is Unnecessary
A pre-purchase veterinary examination is designed to test a horse’s overall health and condition. Although these exams can offer many benefits to the buyer, they may take time to arrange and can be costly, especially if the buyer requests several X-rays or other tests. Here, a pre-purchase examination, had Ann ordered one, might have revealed the horse’s health problems. Also, because the horse in the example was an older horse with a lengthy history of being shown, and because Ann planned to show him in the future, a pre-purchase would be especially important. Whenever possible, the examination should be conducted by an independent veterinarian who is not familiar with the horse and does not work for the seller. A pre-purchase veterinary examination is designed to test a horse’s overall health and condition. Although these exams can offer many benefits to the buyer, they may take time to arrange and can be costly, especially if the buyer requests several X-rays or other tests. Here, a pre-purchase examination, had Ann ordered one, might have revealed the horse’s health problems. Also, because the horse in the example was an older horse with a lengthy history of being shown, and because Ann planned to show him in the future, a pre-purchase would be especially important. Whenever possible, the examination should be conducted by an independent veterinarian who is not familiar with the horse and does not work for the seller.

Problem #3 – Failing to Observe The Horse
Only one short ride convinced Ann that she had found the horse of her dreams. Before parting with her money, Ann did not ask questions. She had no idea about the horse’s manners and behavior. She soon learned, however, that there is far more to a horse than its ability to ride alone in an arena. Only one short ride convinced Ann that she had found the horse of her dreams. Before parting with her money, Ann did not ask questions. She had no idea about the horse’s manners and behavior. She soon learned, however, that there is far more to a horse than its ability to ride alone in an arena.

Aside from asking the seller numerous questions, Ann could have done many things to evaluate the horse on her own. For example, she could have observed the horse as he was being saddled. She could have asked to saddle and bridle the horse herself. With the cooperation of the seller, Ann might also have asked to watch how the horse behaved in his stall in order to check for vices such as kicking or cribbing (wind sucking). Ann might also have insisted on examining how the horse behaved when he was fresh out of his stall before he had been exercised. Before the sale, the seller might have allowed Ann, had she asked, to practice loading the horse in a trailer or to ride in an arena with other horses. This would have allowed Ann to see how the horse tolerated the activities Ann intended to pursue with the horse.

Problem #4 – No Written Sales Agreement
Written sales contracts can protect the buyer and the seller in many different ways. Without a contract, Ann was left to rely only on her recollection of any promises or statements the seller made regarding the horse — statements that the seller might later deny having made. Written sales contracts can protect the buyer and the seller in many different ways. Without a contract, Ann was left to rely only on her recollection of any promises or statements the seller made regarding the horse — statements that the seller might later deny having made.

As this author was written in her book, Equine Law & Horse Sense, contracts are nothing to fear; a simple sales contract can take as little as five minutes to prepare. At a minimum, the buyer should insist on a document signed by both the seller and the buyer acknowledging: (1) the specific horse sold; (2) a promise that the seller owns the horse and has the legal authority to sell it to the buyer; (3) the amount paid to the seller; (4) the date of the payment; and (5) that the seller was paid in full (or the remaining sum due and when it must be paid).

Conclusion
In conclusion, please keep the following ideas in mind: In conclusion, please keep the following ideas in mind:

  • The phrase caveat emptor (buyer beware) is not meant to suggest that buyers have no legal rights. They certainly do. Buyers can, and do, sue sellers for breach of contract, fraud, violations of deceptive trade practice laws, and other things. However, sales-related lawsuits, particularly when a sale is not documented in a well-written contract, can be expensive..
  • In the beginning of this article, Ann probably had no way of knowing that the horse’s low price reflected many behavioral and soundness problems. Before buying a horse, particularly one that sounds too good to be true, buyers like Ann should consider seeking advice from well-respected people who are knowledgeable of horses and the buyer’s intended use for the horse.
  • Horses can make poor impulse purchases. Buyers who take the time to plan ahead, ask good questions, carefully evaluate a horse before buying it, and insist on a sales contract will find that they are more satisfied with the horse they purchased. These efforts will likely avoid a legal dispute or will narrow the lawsuit substantially.
  • This article is not intended to constitute legal advice. When matters arise based on specific situations, direct your questions to a knowledgeable attorney.

Julie I. Fershtman, Esq.
About the Author

Foster Swift Collins & Smith PC
One Northwestern Plaza
28411 Northwestern Hwy., Ste. 500
Southfield, Michigan  48034

jfershtman@fosterswift.com 

www.equinelawblog.com | www.equinelaw.net

Common Sense Ways to Avoid Legal Disputes When Buying a Horse

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