Few equestrians would disagree that buying and selling horses can be a minefield. If you’re buying, what can you do to protect yourself from being ripped off, or in possession of an unsuitable mount? And if you’re selling, what can you do to minimise the time-wasters and make the whole process run smoothly?
We’ve gone to some experts on the subject (see below) to get some tips and advice to reduce the frustration on both sides of the deal.
Our experts
Scott McKenna is a barrister and a director of Grantham Law, based in Hamilton. He rides at Grand Prix in dressage, and is the current Chair of Dressage NZ. Scott specialises in litigation and dispute resolution.
Joanne Bridgman of Quality NZ Horses has been involved with buying and selling for many years, acting as as agent. She has sold horses worldwide, including to international clients such as William Fox-Pitt, thanks to her extensive networks and a good eye for a horse.
Nick Brooks is a qualified solicitor who is now pursuing a full-time equestrian career; he events at three-star level and show jumps to Grand Prix. He worked at Vosper Law in Cambridge as a staff solicitor from 2013 until late 2018, when he moved to the UK.
Amanda Vosper is the principal of Vosper Law in Cambridge, and has practised for nearly 40 years. Her special interests include equine and rural law, and she is the honorary solicitor for a number of equestrian groups including the Waikato Hunt, Showjumping Waikato and both the Cambridge and Leamington Pony Clubs.
First things first
Scott McKenna has been involved in hundreds of cases involving horses, and says that the two most common areas of dispute he encounters are horses that are either unsound, or simply unsuitable.
Like all our experts, he says that getting a vet report should be your first step, whether you are buying or selling a horse.
As Nick points out, the cost of a vet check is far less expensive than buying a horse with an unknown problem and having to argue about it later.
If there are any conditions which the seller was not aware of and therefore did not disclose, if the buyer has not had a vet check done there is very little they can do after the completion of the purchase.
For example, a seller may not know that arthritis is developing in the horse – the horse may not being showing any symptoms. But a full vet check with x-rays would reveal the problem. The buyer can then make an informed decision whether to proceed with the deal, and how much they want to pay.
Scott stresses that a vet check protects the seller too – it can prevent the buyer coming back to the seller at a later date, accusing the seller of a misrepresentation.
“If you advertise a horse for sale, you are representing that that horse is sound and fit for purpose,” says Scott. “However, there can be things you don’t know about, such as navicular which hasn’t expressed itself in any actual unsoundness yet. But as a seller, you are expected to know. The seller could potentially be on the hook, through really no fault of their own. But if they got a vet report, then it is the vet who is on the hook.”
Scott says that the question then becomes whether that condition should have been picked up at the vet check. “The test is whether or not that vet acted as a reasonably competent vet would.”
In Scott’s experience, generally if it’s a soundness issue, the law favours the buyer. However, if it is a behaviour issue, the law favours the seller.
A condition like windsucking can cause issues; while windsucking does not make a horse unfit for purpose, buyers generally don’t want to discover their new horse is a windsucker once they get it home.
It’s therefore advised to disclose this sort of detail upfront, especially if your own reputation is important to you.
“Have that detail recorded in the contract so that the buyer then doesn’t turn around and say they were not told the horse was a windsucker,” says Scott.
“But remember, when you’re selling a horse, while you don’t have to disclose anything negative about the horse, you are representing that the horse is fit for its purpose. With a windsucker, you don’t have to disclose that, as it doesn’t make the horse unfit for purpose. However, if the buyer specifically asks if it windsucks or advises you that they are not interested in a horse that does, then you have to answer honestly.”
Horses for courses
Behaviour issues can often cause disputes between buyers and sellers. The most common example would be a buyer who is after a quiet, safe horse and who gets bucked off a few weeks after the purchase. The buyer might then feel they have been misled by the seller, who’d described the horse as quiet.
Scott clarifies the legal factors in this. “In law, we call lies misrepresentations. But for it to be a misrepresentation, it has to be a statement of fact.”
There is a clear difference between a statement of opinion and a statement of fact. Saying the horse is quiet is not a statement of fact but is an opinion, and therefore a buyer may not have any legal rights for recourse. However, if the seller was to say: ‘This horse has never misbehaved’ or ‘This horse has never bucked or reared’, which are statements of fact, and the buyer can prove this to be untrue, then they can sue the seller for misrepresentation.
Proving misrepresentation can be hard; it is rare to get evidence that will stand up in court. But it can happen, especially as the advent of smartphones has meant a huge increase in the number of sideline filming being done at horse shows.
One example is a lead-rein pony who was advertised as having never put a foot wrong. The pony misbehaved at the first show with the new owner, but was able to be returned as video evidence emerged showing the pony rearing with the previous owners, proving that the written statements that had been given were misrepresentations.
Scott has some advice for those seeking a new horse. “Whatever someone tells you about that horse, take it all with a grain of salt, and find out yourself.”
He suggests taking the horse out to strange places, and riding it a number of times in different atmospheres.
Nick’s advice is the same. “Sometimes a horse will be settled and rideable in its home environment but be more difficult in a different environment. The buyer should ask around about the horse or get references from the seller, instructors or other experienced riders who know the horse.”
Many of the enquiries Amanda receives from clients are when buyers have not done proper due diligence before purchasing, and are having problems with a horse seemingly not suitable. “Just because one rider cannot ride a horse or find it does not perform to the same level as it did for its prior owner is not grounds for cancelling a contract. There are many reasons why a horse may perform differently for a different rider,” she says.
Jo has seen plenty of examples when the new owners have not followed the management suggestions given by the seller. “Don’t take the horse home and put it on lush grass, or not ride it every day if that is what it is used to. Take the advice from the seller about how to manage the horse, what to fed it, or what bit or gear to use.”
As Scott says, going to a new home is a big change for a horse. “There’s a change of environment, pasture mates, diet, the way it is being ridden, the gear being used – everything changes. It’s naive to think this horse is not going to change.”
Trials and tribulations
Taking the horse on trial can be a good way of ensuring you know what you are buying. Scott has mixed opinions on this practice though. “If you are a buyer you should always do it, and if you are a seller you should never do it!” he says. “But in fact a trial protects the seller as well, because if it’s purchased after a trial, the seller can say that the buyer relied upon their own assessment of the horse.”
Nevertheless, Scott would be reluctant to send one of his own horses out on a trial. “You could send the horse away on a trial and it could be put through hell for two weeks and then sent home to you in a state. Unless it was someone I really trusted, I wouldn’t send a horse out on trial.”
Contractually speaking
Written contracts are the way to go in the majority of cases and don’t have to be complicated. If there is considerable money at stake, or payment will be in instalments, or delayed, or if you are buying without viewing the horse, then it is strongly suggested a written contract is used, ideally drafted by a solicitor.
Scott warns, though, that if you are dealing with someone who is prone to getting involved in disputes, even a written agreement won’t guarantee you will avoid a potential dispute.
“Obviously I can’t name names, but in all the cases I have dealt with, there seems to be a few characters that pop up pretty regularly.”
If you can, do some research on the other party’s reputation, he suggests.
In Joanne’s experience, there are many times when the horse will not leave the seller’s property immediately even though it has been fully paid for, as there can be a delay in arranging transport to the new owner. In these situations, the seller is left with all care and no responsibility – what would happen if the horse developed a serious colic, or injured itself in the meantime? It is certainly sensible to have this covered off in a contract.
When problems strike
If things go wrong with a newly-purchased horse, act immediately. Scott advises contacting the other party in writing, describing what is happening. “You would say that we’re putting you on notice that we’ve got a problem here. Do that straight away.”
If you wait for months to see if an unsound horse comes right, it could be too late.
“Potentially in this situation, the court could say that you became aware of the defect and you elected to keep the horse regardless, so you don’t have any recourse.”
The same thing applies with behavioural issues.
Scott has known of buyers who have taken their new horse to various trainers, therapists and even horse whisperers when it began to play up.
“Then when everything failed, they want to return it and get their money back. But it is now too late. They found out there was a problem, and they decided they would try to resolve it.”
On the other hand, if you’ve sold a horse and you receive a call or email to say that things are not going well, Scott says be careful not to make any admissions. “Ideally, don’t respond, and go to your lawyer. However, if you are going to propose some way of resolving the situation, make sure that it’s pointed out that you are not admitting any liability.” The legal term for this is ‘without prejudice.’
On behalf
There are some legal implications when horses are being sold on behalf of an owner, or through an agent. Anything that third party says is on behalf of the seller is legally just the same as if the owner had said it. If any issues arise, the buyer’s legal remedy is against the owner, not the agent.
The owner can then sue the agent, as they had a contract with that agent and the implied term of that contract was at the agent would tell the truth. As Scott says, one outcome in these three-way situations can be: “All the lawyers make lots of money and the rest of you go home angry!” However, things can usually be resolved with compromise on all parts.
Joanne agrees. “There can be occasions when things go wrong, but if everyone takes a sensible approach, they can be sorted out easily enough. It is all down to communication and transparency, and at the end of the day I want to make a sale that all three parties are happy with. As an agent, I do try to find out as much information as possible to present the horse for sale as fully as I can. I include video footage and good quality photos. But it is up to the owner to be transparent and honest, as they are the ones who know the horse fully.”
Be careful if the agent pleads ignorance on key details about the horse. Using a reputable agent is key. Often a good agent will have horses for sale that are not advertised elsewhere. Experienced agents will be more selective with what horses are shown to a prospective purchaser. The matching of horses and riders is a valuable skill, and finding an agent who can do this can save a lot of time and grief.
Especially for those new into the equestrian world, having someone experienced working as their agent is far better than leaving their child to pick out the prettiest grey from a website.
And for sellers, using an agent means you can avoid the time-wasters and tyre-kickers that can be encountered when a horse is listed for sale on a public site.
Joanne says that she sees plenty of examples of buyers getting overwhelmed with advice from so many different people. “Trainers can have a conflict of interest when they are involved in horse-buying decisions,” she says.
Of course, the service comes at a cost. A typical agent’s fee is 10% plus GST of the asking price, though this can vary.
The agent may charge the buyer or the seller, and the fee can be added on top of the price, or the seller may pay the agent the commission out of the sale price.
“Generally there is no rule as to who pays,” says Joanne. “It needs to be made clear at the beginning of the relationship.”
While it is not Joanne’s practice, there are scouts or agents who charge a ‘finders fee’ on top of the commission. This demonstrates how important it is to get the financial arrangements sorted out right at the start.
An agent who is honest, with years of experience and a large network of clients, is the way to go. Have a good discussion and open communication with them, whether you are selling or buying. That way, the process of buying or selling a horse can be enjoyable and relatively stress-free, as only horses who fit both budgets and briefs are presented.
Vosper Law’s pointers
When selling a horse, the seller must:
- Have the legal right to sell the horse.
- Ensure that the horse is free from any undisclosed security interests.
- Disclose what they have used the horse for and its full details including age, breeding and relevant information.
- Ensure the horse is reasonably fit for purpose, if the buyer has made known to the seller the particular purpose they want the horse for (so as to show that they are relying on the seller’s skill or judgement).
- Disclose any vices such as wind sucking, weaving or kicking.
- Disclose any injuries or soundness issues that they are aware of.
Written agreements
Preferably prepared by a solicitor, these should include:
- A full description of the horse including age, breeding, registration details, performance history and any other relevant matters.
- Purchase price and payment terms.
- Any conditions such as a vet check or finance and a time the buyer needs for satisfying the conditions. We would suggest no more than 10 working days.
- Delivery arrangements.
- That the horse will not be incapacitated ie (not fit for purpose on the settlement date).
- The timing of transfer of title and risk, which would usually be on delivery.
- Any other specific matters agreed between the buyer and the seller.
If you do get into a dispute, seek legal advice straight away as it can often be solved quickly and cost effectively.
FOOTNOTE: This article provides general information only. NZ Horse & Pony does not assume any responsibility for giving legal or other professional advice and disclaims any liability arising from the use of the information. If you require legal or other expert advice you should seek assistance from a professional.
