Equine Estate Planning

equine law horses boarding contracts liability lawsuit accidentHow will your horse, your horse property, and even your horse business be taken care of if you are ever incapacitated or after your death?

I know that these are not pleasant topics to read about. We all want to think that we will never get badly injured, but we know it happens. We’ve all read about the tragic riding accidents suffered by Christopher Reeves and Courtney King Dye. You may have also seen the various Facebook posts asking for help to care for a horse whose owner was injured in an accident and didn’t have any system in place to pay for horse care. These kinds of situations can be addressed before they ever happen. Estate planning documents that take into consideration your equine lifestyle can give you peace of mind that your horse, as well as property and business, are will be taken care of in the case of incapacitation or death. First, let’s look at estate planning documents and then I’ll talk about how they apply to horse interests.

As you will see, there many considerations with your estate planning if you are involved with horses. There are also many options that allow you to create a plan that works for your individual needs, as well as the needs of your horse, property, and business. As a horse person and an estate planning attorney, I can talk with you about your various options so that you have an equine estate plan that meets your specific needs and provides you peace of mind about the care of your horse, property, and business.

Wills and Trusts

wills trusts horse trusts equine lawTo provide for the distribution of your estate after your death, you should have a will or trust. If you own anything — like a car, house, or horse tack — then you have an estate. Under Massachusetts law, horses are considered property so they are handled just like any other kind of property. If you do not plan for how you want that estate to be distributed, then you will die intestate, and your items will be distributed according to the state intestacy laws.

Everyone has heard of a will when it comes to estate planning. A will is a legal document that allows you to leave property to certain individuals and organizations. What you may not know is that a will does not automatically give your estate away the moment you die. It must go through probate, which means it is filed with the court and becomes a public document that can be seen by anyone who looks up the file. Probate is a process that takes anywhere from 9 months to several years, depending on the complexity of the estate and any challenges to the will. It usually costs several thousand dollars to have an estate probated. A will usually requires the payment of estate and inheritance taxes. If you haven’t made other plans for the probate period, your assets are not available to pay for horse needs, such as board, feed, and farrier care.

trusts wills horse lawA trust is another estate planning vehicle that allows you to leave your estate to certain individuals or organizations. A trust does not go through probate so it is effective as soon as you die. It is also not a public document. Oftentimes, it is used as a way to defer and avoid certain taxes. During your lifetime, you place your estate in the trust. As trustee of the trust, you still have full control over the items as if you owned them. One advantage of the trust is that funds to care for your horse are be available automatically because it does not go through probate.

There are several factors to consider when deciding if you want a will or trust as your main estate planning vehicle. I go over those considerations when I counsel my clients on what would work best for their individual situation.

Additional estate planning documents

There are also several other documents you should have as a part of your estate plan. These documents are very important in the case of incapacitation.

Durable Power of Attorney:  This document allows you to appoint an agent to handle your financial and other affairs if you become incapacitated.

Health Care Proxy:  This document allows someone you have designated to make medical decisions for you should be you become unable to do so.

Advance Directive:  Sometimes called a living will, it is a guide for your agent listed on your health care proxy concerning what health measures you want taken should you become unable to make those decisions for yourself.

HIPAA Release:  This document allows your medical information to be released to individuals or organizations you list in the release.

Horse Trusts

care horses hay feedEveryone with a horse should have a horse trust in addition to the other estate planning documents. You can have a horse trust even if no other property is in a trust. Massachusetts law provided for horse trusts beginning in 2011.  The law allows you to create a trust to take care of your horse or any other animal in the event you are incapacitated. The trust can terminate when you are able to take care of the animal again or at the animal’s death.

A horse trust gives you the ability to include specific instructions concerning the care of your horse. You can specify basic care such as where your horse is stabled, how it should be fed, and additional care, such as farrier and vet visits. You can name the person who will take care of your horse, which means you can make sure the person you want is taking care of your horse. You can even stipulate specific things such as how you want the horse to be blanketed and special treats for your horse. One of the biggest advantages to a horse trust is that it takes effect at the moment of incapacitation or death. This means you don’t have to worry that your horse will be neglected should anything happen to you.

Horse Property

equine law attorney presentationsUnlike having a house, a horse property provides you with additional considerations when it comes to your estate plan. As with a house, you may stipulate whether your horse property is sold after your death or whether you leave it to someone. You may also want to ensure that the property remains available for a horse lover to purchase at some time in the future and not turned into a shopping mall or housing development. To do so, you can have a conservation easement put on the property. A conservation easement allows you to determine limitations on future development, and it may also lead to some positive tax consequences. One negative to these kinds of easements is that it may lower the property value if the property is sold at some point.

Horse Business

equine lawyer attorney jo belasco presentation workshop seminarIf you are a horse professional, you want to decide what will happen to your business when you die. One option is to simply let the business end. But if you want the business to continue, you should consider how you want it to operate without you. This is called succession planning. Some of the considerations include who will own and manage the business as well as the development and training of successive owners. There are several different ways to create a succession plan, some of which involve trusts in order to reduce taxes and avoid probate.

If you would like to discuss any of the options you have just read about, contact me today.

The Hazards of Preprinted Liability Releases

hay bale mustang horseAs a horse professional, you try to save money wherever you can. As a former horse trainer and clinician, I understand your concern with the bottom dollar. I also remember all the tales I used to hear from clients about the “cheap” hay they had found. They would always tell me they’d gotten a great deal. When the concern would appear on my face, they would tell me — before I could say a word — that they knew the hay was going to be just great. It never failed that after they got the hay, sometimes right away and sometimes after the passage of time, the person would complain that the hay wasn’t as good as they thought it was or even had serious mold in it. The person invariably had to either buy new hay or supplement the hay with grain, and they never got any kind of refund. I guess the take-away is that you get what you pay for.

The same is true with the legal documents that you use in your horse business. I know it is sorely tempting to get inexpensive legal documents off the Internet for your horse business, but doing so could literally cost you that business in the end. Let’s take one of the most popular documents for any horse business, the liability release. Where did you get your current liability release? Did you make it up on your own? Did you buy a preprinted form online from an online legal website? Did you download one from another facility that had one online? If you did any of these things, your liability release may not be worth the paper it’s printed on. And that means it isn’t providing you any protection from a lawsuit.

ride equine liability release lawAs you probably already know, many laws concerning liability are controlled by state rather than federal statutes. That means that something that is legal in one state may not be legal in another. The problem with downloading a preprinted liability release form from a website, even if it is supposedly written by an attorney, is that the form you download may not be valid in Massachusetts. For example, under Massachusetts law, a very specifically-worded warning must appear in your release. That language isn’t included in a preprinted liability release that anyone from any state can download. And yes, I am telling you that I have looked at the forms commonly available for download online and that language is not there. What this means for your business is that such a form is not legally binding here in Massachusetts if someone sues you for injuries and you have to go to court. You will think you’re protected but you really won’t be.

Another problem with online legal forms you can download is that state laws change constantly. An attorney focuses on the law of her own jurisdiction. She doesn’t have the time to constantly look for changes in the laws of all 49 other states so she can update her online release form to make sure it’s valid outside the state where she practices. Again, you leave yourself open to liability if you rely on a liability release drafted by an attorney who is not licensed to practice law in Massachusetts, whose business is keeping abreast of all the changes and updating forms accordingly.

You can even have problems if the forms themselves are valid, simply because you don’t know how to fill it out properly. I know of a case where a barn that downloaded a liability release from the Internet and got sued wound up in big trouble. The release they’d used did them no good because they had neglected to put their barn’s name in the spaces left blank for that purpose. They simply didn’t know how to fill out the form properly and never had a local attorney check it over. In the end, they lost a lot because of trying to save money in the wrong place.

consultations questions equine law horses law joanne belascoAs an attorney, I am trained to pay attention to details. While this can be frustrating for some life activities – making sure every piece of leather is tucked into its keeper even though I’m just going on a short hack and no one will see me or my horse, for instance – it is essential when doing legal work. I know what language legally has to be there for your liability release to hold up in court. As a Massachusetts attorney, it’s my job to pay attention to ways the law changes that impact you and the liability release you use. And as an equine attorney, I know what things might be important in a liability release for your specific business that might not be important for someone else’s. Think of it this way: a liability release is meant to protect you from being sued successfully. If it can’t do that because it doesn’t meet Massachusetts state law or isn’t filled out properly, then what’s the point of having it? It’s just a worthless piece of paper.

So, while you may cringe at having to pay an attorney to have your documents drafted, it’s well worth doing so. And it’s still not all that expensive. Just putting off getting that bling bridle for one more month can provide you with the right documents to protect you and your business.

Contact me today to learn how I can help you make sure you have a valid Massachusetts liability release.

 

 

What is equine law?

equine law horses law joanne belascoWhen I tell people I am an equine attorney, a lot of people think I represent horses in legal actions.  That’s not quite how it works, although I hope that horses benefit from the work I do with humans.  An explanation of equine law might help explain the wide breadth of this area of law and what I can do for you.

Equine law focuses more on the community it serves rather than a specific area of law.  As an equine attorney, I work with people who have horses in their lives.  My clients can run the gamut from a person who has a horse in the backyard as a companion animal to someone who competes at the national level. I also work with individuals and companies, both for profit and non-profit, who are involved in the horse industry.  These people have different legal needs depending on their role in the horse world.  Some of the people who require equine legal services include horse trainers, riding instructors, boarding barn owners, clinicians, breeders, horse sellers, horse purchasers, equine vets, horse chiropractors, and horse massage therapists.

In order to meet the various needs of the horse community, equine law encompasses several areas of law.  Business law applies to many horse-related activities, especially when dealing with contracts.  The horse industry has historically conducted business “on a handshake,” but that leads to many problems.  Contracts are a way for all parties involved to make sure everyone has the same understanding concerning the transaction.  Some of the contracts necessary to the horse community are boarding contracts, sales contracts, breeding contracts, and liability releases.  Business law also applies if a person wants to create a company or a nonprofit.  Many horse people are great with horses, but not with the business side of being a horse professional.  Hiring an equine attorney allows you to feel confident that you have picked the right business structure and that it has been set up properly.

horse law business law contracts real estate salesEstate planning is an important legal area to include when thinking about equine law.  In Massachusetts, an individual can have a horse trust, which ensures that a horse or horses are taken care of if the owner is incapacitated or dies.  You may think your will is all you need in those situations, but a will has no effect if you are incapacitated, and it must go through probate before it can take effect when you die.  Money and other assets are not available until the will is probated, which can take several months or even years. A horse trust gives you peace of mind that your horse is taken care of as soon as you are incapacitated or during the time your will is probated.

Other legal practice areas include real estate law, which can come into play when a horse person wishes to buy horse property, whether for personal or professional purposes.  Equine law also can also include legal matters concerning equine insurance.  Finally, litigation, which many people want to avoid, may be an option of last resort if a contract is violated or harm is done to a horse or person.  I generally do not handle litigation matters, so I refer clients to other attorneys who do.

There are only about 100 attorneys in the country who practice equine law.  To be a good equine attorney, the person should obviously be a good attorney but she should also have a solid working understanding of the horse industry.  The more experience an equine attorney has around horses, the better she will be able understand the many scenarios that can happen and she will be able to craft solutions to avoid problems or to handle them if they arise.

horse law joanne belasco equine attorneyI practice preventive equine law, which means that I work with clients to avoid problems that may lead to litigation.  When you talk to me about your legal concerns, I understand your problems because of my experience as a horse professional and personal horsewoman.  An attorney without knowledge of horses and the horse industry is not able to understand basic terms and broader situations that we, as horse people, do.   You don’t have to spend time explaining basic concepts to me, such as your horse colicking, because I know the term and have gone through the experience myself with my horses.

If you would like to discuss how equine law can help you and your horses, I offer a 30-minute consultation for $100. We can talk by phone or Skype, and I also make on-site visits to equine facilities to meet with people and give presentations.  Contact me today, and we’ll set up a time to see how I can help with your equine legal needs.