Sales Contract Basics

equine law contracts estate planning business With spring finally sprung and show season either in full swing or happening soon, now is a popular time to buy a horse. Many people buy one on a handshake, trusting the other person at her word. Unfortunately, doing so can lead to both headaches and heartaches. Having a simple sales contract can make the experience a positive one for all parties.

A horse sale contract should include the names of the seller and buyer and all the details of the sale. A thorough description of the horse should be included and one or more pictures can even be attached. If the horse is registered, include any registration number. Keep in mind that the seller is held to whatever description is included in the sales contract. For example, if the contract says the sale is for a Paint mare, then the seller has made the guaranty that she is selling a Paint mare. If she delivers a sorrel Quarter Horse instead, she is breaching that contract.

boarding barn sales breeding training riding liabilityThe price of the horse as any payment terms should also be in the contract. Sometimes a buyer needs to make payments on a horse instead of paying the entire sale price upfront. If the seller agrees to this, the payment terms should be clearly spelled out in the sales contract, including the amounts and the dates by which they should be paid. The seller can even require the payments be made in a certain manner, such as by electronic deposit instead of by check. Terms should be included that address what happens if the buyer fails to make a timely payment or is unable to pay the entire amount within the time frame specified in the contract. If the seller and buyer renegotiate the payment terms, that new agreement should be written up, signed by both parties, and attached to the original contract.

You may see what is called an “as is” clause in a sales contract. Such a clause means that the buyer accepts the horse in the condition at the time of the sale, and the seller makes no further guaranties about the horse. Even though these situations are common in the horse world, a buyer should still be cautious. If there is a particular issue a buyer is concerned about, for example lameness or a training issues like bucking, then the buyer should make sure that issue is addressed in the contract. Even though “as is” clauses are legal, a seller may be liable if she engages in fraud. For example, a seller can’t lie about the horse, stating the horse is sound when she knows the horse is lame. If a pre-purchase exam is performed, make sure to mention that in the contract. Also include any limitations the buyer is accepting. For example, if the vet states that the horse may need hock injections in five years or is not capable of becoming a Grand Prix jumper due to physical limitations, include those restrictions in the sales contract. Doing so can prevent a future lawsuit or aid in defending one by showing that everyone was on the same page with the same expectations about the horse at the time of purchase.

contracts estate planning business trademarkThere are two sections in a sales contract that you might not have thought of including. One is an explanation of who will pay attorney’s fees if the sale winds up in court for some reason. Litigation is expensive, and you may find that you win a court case but wind up losing financially when you add in what you must pay your attorney for winning the case. You can avoid this possibility by including a section stating that the party who loses at trial will pay attorney’s fees for the party who wins. In addition, you want the contract to set forth what state will have jurisdiction if the matter goes to court. Imagine living in Massachusetts and buying a horse in California. You would not want to go to California to litigate any problems.

While it may cost a bit more, you should have an equine attorney or at least an attorney familiar with contracts draft your sales contract for you. A little bit of foresight can save a lot of time, money, and energy if something goes wrong with the sale. And at this time of year, it can help make sure that a special dream-come-true horse doesn’t turn out to be a nightmare.

 

 

 

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 your business 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.

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.

Contact me today, and we’ll set up a time to see how I can help with your equine legal needs.