I had a great time talking with Laura and April over at Rein In Your Herd Podcast. On Episode 36, Legal Considerations for Horse Businesses with Jo Belasco, We discussed trademarks, liability, and business formation – all for equine businesses. Take a listen, and be sure to check out their other podcasts! Thanks Laura and April for having me on the show!
The wild Mustang community lost a beloved and talented photographer this past week. Lara Joy Brynildssen passed away unexpectedly after her most recent visit to the Onaqui wild Mustang herd in Utah. Lara was known for her amazing and beautiful photographs of many different wild Mustangs. She had a dedication to keep the Mustangs wild and in their homelands, with their families and friends. Please take a moment to look at her photography, and then do what you can to help keep these horses wild. #themagicofwild #larajoybrynildssen #onaqui #wildhorsephotographycollective #wildmustangs
This blog post is for educational purposes only. It does not create an attorney-client relationship. Seek an attorney’s advice for your specific situation.
Recently, I have seen posts on Facebook horse groups that ask if people have plans for the care of their horse if they are incapacitated or die. Many people say they have talked to a friend or they have written some informal agreement. Unfortunately, neither or those options are ones that will hold up if the person decides not to take care of the horse. Luckily, there is a legal vehicle that allows you to plan for your horse’s future in the event you are incapacitated or die. That document is called an animal trust, and you can have one for every animal in your family, not just your horse. Currently, every state and the District of Columbia had some form of legislation that allows for animal trusts. While an animal trust is a stand-alone document so it doesn’t need to be included in your estate plan, it is a good idea to let your estate planning attorney know that you have or want one.
Horses as Property Under the Law
Under the current law in every state, horses are considered property. This means someone literally cannot legally step in and take care of your horse if anything happens to you because they do not own your horse. For example, if you are in a coma and your riding buddy decides to move your horse to a less expensive boarding barn during that time so she can take over board payments for you, she could be charged with theft, no matter how good her intentions. She also could not access your checking account to make the regular monthly board payments she knows you would want to make to keep your horse where it’s currently boarded. She would literally be helpless to intervene if the barn owner decided he had to file legal papers to seize your horse and then sell it to pay for unpaid boarding costs if several months went by while you were incapacitated and unable to take care of things. We all would hope that a boarding barn owner would understand but sometimes finances take first priority, especially when it’s a business that relies on that income.
The way around this problem is to create a horse trust. The trust becomes active if you are incapacitated or when you die. Once you are no longer incapacitated, it is no longer active and returns control to you to handle matters concerning your horse.
A horse trust gives you the ability to provide funds for your horse’s care and to include specific instructions concerning that care. When you set up the trust, you set aside enough money in it to take care of your horse in the manner you prefer. How much money should you put into the trust? It depends on how long you want it to last. Write down a monthly budget that shows how much it costs to take care of your horse. Then decide how many months you want to provide care. For example, you may want to provide care for six months and then have a provision that if you have not regained capacity by then, you want your horse sold to someone or given to a specific person. If you want your horse taken care of after your death, you could put in enough money to care for him for several years. Make sure that the amount is reasonable, though. While horse trusts are generally not challenged in court, an argument could be made to reduce the amount you have left for care if one of your relatives or someone you left an inheritance to claim that the amount to care for your horse was excessive. Keep in mind that you can add money to the trust. So start with what you can afford and add more if that works best for your budget.
A horse trust also allows you to name a trustee, which is the person who will take care of your horse if something happens to you. You can be as specific or general as you want concerning that care. You can leave it up to the trustee, or you can put in specific provisions you want the trustee to follow. For instance, you can include directions concerning where your horse is stabled, how she should be fed, and additional instructions about the farrier and vet visits. You can even stipulate specific things such as how you want your horse to be blanketed and special treats she should get fed. It’s always a good idea to talk to the person you want to name as trustee before you set up the trust, to make sure she can take on that responsibility and is comfortable following your directions for your horse’s care. Depending on your state, there may be other people included in the trust, such as a vet who makes sure the horse is being taken care of properly.
When you decide you’re ready to create a horse trust, contact an equine or animal lawyer in your state so you can be sure the state’s legal requirements for the trust are met. If you are a Massachusetts resident, please feel free to contact me to discuss one. If you don’t live in Massachusetts, I may be able to refer to an attorney in your jurisdiction. Be sure to revisit the trust every year to make sure the funds you’ve set aside are still adequate and to make sure you don’t want to change any of the instructions for your horse’s care. Then enjoy the peace of mind knowing your horse will be taken care of if anything unexpected ever happens to you.
This blog post is for educational purposes only. It does not create an attorney-client relationship. Seek an attorney’s advice for your specific situation.
One of the big issues in equine law concerns buying 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. You want to make sure that your sales contract contains certain required parts. The best way to have a secure, and legally-binding sales contract is to hire an equine attorney to draft one. This blog explains some of the important parts the attorney will include in that contract.
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, then the contract should state the registry and 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.
The price of the horse as well 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.
“As Is” Clauses
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 (PPE) is performed the contract should mention it as well as any details, such as who will be performing the PPE. The contract should 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.
Two Important Sections
There are two sections in a sales contract that are important to include. 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. Contact me today if you are buying or selling a horse, and let’s make sure you have a contract in place so the sale can be a pleasant experience for all involved.
This blog post is for educational purposes only. It does not create an attorney-client relationship. Seek an attorney’s advice for your specific situation.
Business reputation is important in the horse world. In this blog, I am going to explain how registering your trademark is an important way to protect your professional reputation. If you don’t protect your brand, someone can use your name, logo, or slogan, and you can’t stop them. Someone could also use your name, logo, or slogan and hurt your business by doing disreputable business.
Two Trainers, One Stolen Logo
I once knew someone – we’ll call her Sally – who moved cross country after riding with a trainer – we’ll call her Mary – for years in Florida. Sally started to search for a new riding horse in her new home. She came across a horse on a horse sales website that interested her and went to the listed website to learn more about the horse and the person selling the horse. She was shocked at what she found. On the main page of the website was the logo for Mary’s barn! It was flipped, as if appearing in a mirror, but it was clearly the same logo. Sally knew that Mary’s brother had hand drawn the logo several years before. She immediately contacted Mary to tell her about the stolen logo. Sally never pursued the horse that led her to the website. She figured if that trainer would steal a logo, what else would she do that was dishonest. Mary contacted an attorney and filed a trademark registration to protect her brand.
The United States Patent and Trademark Office (USPTO) defines a trademark as a “word, phrase, symbol or design, or a combination of words, phrases, symbols, or designs, that identifies and distinguishes the source of the goods of one party from those of others.” If Mary had a registered trademark, then she could have had an attorney force the trainer to take it off her website, either through a cease-and-desist letter or a lawsuit.
One of the main reasons for registering a trademark harkens back to horses and livestock. It relates to branding. You may have heard that you should brand your company. Branding your company is a way of identifying your business and setting you apart from your competition. Registering a trademark is an important part of branding. Why? Because one of the main issues the USPTO considers when determining if a trademark should be granted is whether it creates confusion in the marketplace. Let’s say you want to create a company that provides packages of natural supplements to horse owners. And you want to call it SmartyPak. Your chances of getting that trademark approved are slim to none Why? Because SmartPak, the supplement company, already has that name trademarked. Allowing for two similar trademarks would cause confusion in the marketplace.
What happens if you don’t register your trademark? Well, someone else could register the same or similar name. That may not seem like a big deal but think of this. Once someone has a registered trademark, they can enforce it by issuing cease-and-desist letters to companies that are using their trademark. They can even take that company to court. Let’s say you are using a certain business name and another company trademarks it. Even if you can avoid court, you will have to rebrand. What does that mean? You have to choose a new name and reform your company with that new name. You have to change all of your merchandise to the new name. You have to let your customers and clients know. It can be a very expensive and time-consuming endeavor, as you might well imagine.
Save yourself the time, money, and headache. Contact me today so I can talk to you about the registration process and how to protect your equine business.
When you have a horse nonprofit, whether you are rescuing horses or providing horse therapy or some other work with horses, you invariably run into the issue of where to hold your programs. Having horses means there is a need for land to house those horses as well as having a safe, secure place where you can run programs with them. I have seen several scenarios where equine nonprofits have leased property and then run into difficulty when the lease ends. I have read Facebook posts from horse nonprofit leaders desperately seeking land for horses that need homes or even trying to rehome the horses themselves. Some nonprofits have even ceased functioning or had to put their programs on hiatus while a new location is found. How can you avoid these scenarios? By having your nonprofit own its own property.
Contrary to what many people think, a nonprofit can buy and own property. The first thing to know when deciding whether your nonprofit should buy property is that your board of directors must be involved. Since nobody owns a nonprofit, the board must be consulted about any property purchase. Your bylaws should actually include a provision that allows your board to make such a decision and exercise the right to buy property.
Another thing to keep in mind is that the property needs to be related to your nonprofit’s mission statement. Otherwise, you may need to pay taxes on it, and you may not be able to use grants and donations to purchase it. For example, if you rescue horses, and you purchase property, you might have to pay taxes on that property if you use it to raise Angus cattle instead. You might also have to pay taxes on the cattle sales as unrelated income. I say might because without knowing your nonprofit’s mission statement, I can’t say for certain. Selling Angus cattle might actually relate to your nonprofit’s mission.
Again, while most people think a nonprofit can’t get a loan to buy property, that simply is not true. I will caution you, though, that it may be more difficult than getting a personal mortgage. Why? As you know, when getting a mortgage, you need to assure the bank that you can pay the mortgage. Unfortunately, many horse nonprofits are huge labors of love, and they don’t bring in sustainable, dependable revenue. If your nonprofit has been around for many years, and you can show that you can pay off a loan, then you have a chance to get one. But if you are paying for most of the expenses out of your own pocket, or you haven’t been around very long, then you may have to make some changes before you can apply and expect to get a loan.
Grants and Donations
Another way that nonprofits purchase property is by grants and donations. This type of purchase can occur a number of ways. You can get a grant, a donation or several donations, or a combination of the two. If you are running a fundraiser for this specific purpose, then it is called a capital funds campaign. Many grants won’t allow you to use grant money for a capital funds campaign so you need to read the grant proposal carefully before you put in time to get a grant that won’t support your campaign.
You can use donations to buy property but you need to keep the idea of restricted and unrestricted funds in mind. If you receive a donation that is unrestricted, then you can use the funds for any of your programs or nonprofit work. However, if a donation is restricted, then it must be used for the purpose intended by the donor. For example, if someone donates $10,000 and says it’s for the capital funds campaign, then you must use it for that purpose. You may want to even place it in a separate account so that you are sure not to use it until you buy property. What happens if your nonprofit winds up not buying property? You either have to return the money to the donor or get permission from the donor to use it for other nonprofit purposes. I suggest you get that approval in writing, by the way, so there is no confusion at a later time concerning the purpose of the donation.
If you have more questions about purchasing property for your horse nonprofit or need legal services associated with it, please feel free to contact me. Along with equine legal services, I also provide equine business consulting services, including helping equine nonprofits.
As 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.
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.
State Liability Laws
As 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 your state. 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 the required language is not there. I have even found a liability release for download online used by a very popular clinician that is not valid in Massachusetts because it does not contain the required statutory language. What this means for your equine business is that this kind of form is not legally binding here in Massachusetts if someone sues you for injuries and you have to go to court. You may think you are protected but you aren’t.
Changing State Laws
Another problem with online legal forms you can download is that state laws change. 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. Doing so may even run afoul of the law concerning the unauthorized practice of law in a jurisdiction where she is not licensed to practice. You leave yourself open to liability if you rely on a release drafted by an attorney who is not licensed to practice law in your state and 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 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.
As 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 ride 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 the ways Massachusetts law may change and how that change impacts 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. I love bling bridles and other fun things we buy for ourselves and our horses. But putting off getting that bling bridle for a month or two 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.
An article in the Wall Street Journal entitled “Midlife Crisis? Maybe a Horse Will Help,” reported that women in their midlife years are returning to horses and horseback riding. Such a phenomenon is no surprise to horsewomen. But having this issue addressed in a well-respected, nationally-read newspaper raises our personal awareness of this issue to one of national interest. A lot of horse people, especially women, feel like people who aren’t involved with horses think their riding is not an important part of their lives. But this article, by virtue of being in the WSJ, shows it’s something that shouldn’t be dismissed. It pointed out that more than 75% of horse owners are women. We all know that at any given barn, way more than three-fourths of the people spending their time there are women, many of them riding horses they don’t personally own.
When I was a trainer and clinician, “mid-life” women riders were the group I especially focused on and worked with in lessons and clinics. Women in this demographic group just want to ride, and many of them either don’t want to compete or they want competition that’s centered more on fun than placings. Many of the women I worked with primarily wanted to explore the relationship they could have with the horse they rode. They valued the fact that being with their horse gave them time away from work and family obligations. And sometimes they wanted to find other “older” riders to explore the special life experiences and camaraderie that this group shares.
Concerned with Safety
The biggest concern women in this group of riders had was safety. Many of them remarked that they were fearless when younger, but now they were more focused on riding in a discipline that was safer – for instance, dressage rather than jumping — and having a horse they could trust. They didn’t want the young, green broke horse or the troublesome horse they might have ridden when they were younger. They wanted a safe horse they could really build relationship with and feel safe riding. Far too often, I saw women buying horses they’d been told were safe, but the horses wound up being difficult, even to the point of injuring some of those women.
There are several steps you can take to make it more likely that the horse you buy will be the safe and trustworthy horse you want. First, consider where you are buying the horse. There are a lot of great people out there selling horses, but, just like in every other aspect of life, there are also people who just want to make money. Other people who need to get rid of a difficult horse they can’t afford to keep will resort to bending the truth, lying, or simply not disclosing issues in order to do so.
One way to protect yourself is to ask a thorough list of questions instead of just relying on the information someone gives you about the horse. Doing so allows you to get information crucial to you, sometimes information that even an honest seller may not think is important. Some of those questions include: Has the horse ever bucked? If so, why and when? Has the horse ever bolted? What circumstances surrounded that incident and did it happen more than once? After all, a seller younger than 30 who’s been riding the horse in question may not think it’s a big deal if the horse has bolted – but that might matter very much to you.
Even if you ask all the right questions, another important way to protect yourself is to have a written purchase and sales contract, which I will explain more in future blogs. A well-written and understood contract may be the difference between you having a horse you can enjoy and one that injures you. Without a good purchase and sales contract, you may even find yourself with an unrideable horse you have to pay a lot of money to maintain — to the point that you can’t afford to buy a second horse you can ride.
An important thing to remember is that the cost to purchase the horse is just a small amount of what a horse costs. There are recurring fees that include feed, boarding, vet, and farrier, and even lesson or training costs. Asking the right questions means exposing needs that may lead to fees you never anticipated. Does the horse need special feed? What about special farrier needs? Getting as much information as possible before you purchase the horse – and documenting that information in a contract – can protect you from unwanted expenses later.
Contact me if you need a sales contract as you purchase your new horse partner.
I don’t know about you but one of the fun things about owning a horse business is that I get to look at horse photos practically every day. I love to look at horses and to photograph them (the photo to the left is one I took of my rescue Mustang, Isuba). Whether it’s on our websites or social media, we need to use a lot of photos with horses in order to talk about our businesses. There are literally millions of horse photos online. Really. I just did a Google search for “horse image” and got 1,990,000,000 results in .52 seconds.
But wait. Whoa. Not so fast. Did you read the viral story about the hipster? Yes, this does connect to your use of horse photos. A hipster guy got so mad thinking a journal had used his photo without permission when it reported on a study about hipsters that he threatened to sue the journal. The funny part of the story is that the photo wasn’t him but it confirmed the study results that hipsters tend to conform to a certain look. What’s important for us is the story behind the photo.
The journal had bought the hipster photo from Getty Images. You have may have bought their photos or spent time looking at their horse pictures. The journal’s editor-in-chief contacted Getty, and it had a signed release from the model in the picture. That release was worth its weight in gold because it showed the man who emailed was not in the photo and therefore had no legal action against the journal or Getty.
You hopefully now see where I am going with this and your horse photos. A lot of horse people download photos from the Internet of horses and riders. You should not use these photos on your website or social media unless you or the company you bought them from have a model release. (Yes, I know…what about pictures from horse shows. I will get to that issue in a blog this week, I promise.) Chances are good that you are going to have to pay for high-quality horse photos that you can use legally. Places like Getty, which has some stunning photos, may be a bit pricey for your budget, although the photos are certainly worth it. Take a look at a site like PixelRockstar. You can get photos for about $1 a picture.
Contact me if you want to discuss copyright protection for your equine creative works.
You may have heard the joke about “How do you make a small fortune with a horse business?” Answer: You start with a large one! For years now, I have heard people say you can’t make a living working with horses. When we say something repeatedly, we tend to start to believe it. But what if the story of not being able to make a living with horses is actually false? What if you can make a living?
Recently, the University of Minnesota Equine Extension Program shared the graphic to the left on its Facebook page. Contrary to what you may have heard, the horse industry is booming. And it’s doing so because of equine business owners. Think of how many businesses it takes to maintain horses. A short list includes vets, farriers, feed stores, hay producers, tack stores, equine dentists, equine chiropractors, equine massage therapists, horse trainers, riding instructors, clinicians, horse breeders, horse associations, and horse rescuers.
One of the keys to being successful as an equine entrepreneur is to realize that while you love working in the horse world, it is a business. That means it has to be run as one. You have to start with a business plan and the correct business formation. You need legal contracts drafted by an equine attorney. You need to protect your company with a trademark. You need a marketing plan. You may need liability insurance. You may need documents specific to your equine business, such as barn rules. If you have all of these things in place as you start your business, it is easier to assess where and how you need to make changes if something isn’t working right or if you want to expand your business.
If you feel passionate about horses, contact me so we can discuss how I can help you start, build, or rebrand your equine business with my equine legal and business consulting services.