What You Wish You Considered for Your Equine Lease
Equine lease transactions have become increasingly popular. Surprisingly, some people continue to lease horses merely on a handshake or use very short lease agreements, only to encounter costly problems later. Over the years, several people who have contacted us with equine lease disputes wished their contract had been more detailed. Detailed contracts can help avoid disputes, which can save very substantial amounts of money.
Recognizing that equine lease transactions differ, here are a few items to consider:
Payment Obligations (and When They Stop)
Does the document make clear what the lessee is expected to pay during the lease term – and possibly afterwards? Aside from mentioning who pays for the horse’s routine veterinary care, does the lease address non-routine veterinary expenses the lessee must pay, and for how long, if the leased horse becomes injured, lame, or ill during the lease term?
Restrictions on Use and Location
Equine leases can address restrictions on use of the horse, such as:
- Training and showing. Can the horse, for example, be jumped over 3’6” in training or showing?
- Recreational uses. Can the lessee take the horse on trail rides?
- Permitted riders. Can the lessee allow others to ride the horse? Some lessors, usually due to liability concerns, forbid this.
- Permitted horse show events. Does the lessor want to restrict the type or number of events in which the horse can be shown
- Breeding. Is the lessee allowed to breed the horse? Can the lessee flush an embryo from a leased mare and keep the resulting foal? Can the lessee collect the stallion and freeze semen for the lessee’s use, or sale, later on? Although some leases specifically apply to breeding stock, the parties can consider restrictions, if any, in the document.
- Restricted trainers. Is the lessor opposed to allowing certain trainers to ride, handle, or work with the leased horse?
- Location. Do the parties intend to keep the horse only at a specified location, except in emergencies?
Equine insurance can pose troublesome issues for lease transactions. As a matter of law, lessees do not own the horse they lease, and they cannot buy equine insurance for themselves. Insurers have issued mortality policies naming both the lessor and lessee as insured parties. The parties might want their lease agreement to address who pays the insurance premium and how insurance proceeds (if any) from claims are to be distributed.
Standard and Quality of Care
Lessors fear that the lessee will skimp on important veterinary or farrier attention or, worse, neglect the horse. (This blog has written on this issue.) In an effort to avoid these problems, equine leases can specify a standard of care that the lessee is expected to follow in the horse’s care and keeping. As one example, for valuable, well-trained show horses, the lease can specify that the lessee agrees to provide the horse with “a high quality of care and humane treatment that is customarily given to top quality show horses in (a particular breed or discipline).” In addition, lessors may want to detail the type of care expected of the leased horse, such as the type and quantity of feed, required supplements, type of hay, turnout (individual or group), blankets, use of splint boots/protective wraps, and more.
One Lawyer Representing Both Lessor and Lessee?
Lessors and lessees have different interests in equine lease transactions. Certainly, the jurisdiction’s ethical regulations might permit a lawyer to represent both sides, with proper advance disclosures, waivers, and written consent, but the risk exists that protections could be compromised if both parties use the same lawyer. For their protection, lessors and lessees should secure separate counsel.
When people enter into equine leases, they don’t expect to become embroiled in a dispute. Yet, disputes occur. Lawsuits are expensive and, with very few exceptions, each party must pay its own legal fees. Because of this, the parties can consider including an attorney fee clause in their lease. This blog has discussed attorney fee clauses, and how they differ. Learn more here.
Equine lease arrangements can be complex, generating a host of risks, disputes, and liabilities. Plan ahead, protect yourself, and consider securing knowledgeable legal counsel.
Julie Fershtman is considered to be one of the nation's leading attorneys in the field of equine law. A frequent author and speaker on legal issues, she has written over 400 published articles, three books, and has lectured at seminars, conventions, and conferences in 29 states on issues involving law, liability, risk management, and insurance. For more information, please also visit www.fershtmanlaw.com and www.equinelaw.net, and www.equinelaw.info.View All Posts by Author ›
Our Equine law blog (and its author) in the news!
Julie Fershtman, author of our popular and prolific Equine Law Blog, was interviewed this week by the State Bar of Michigan. The interview, which called Fershtman "Lawyer-Blogger," discussed our Equine Law Blog. We truly believe that this blog is the nation's most active blog serving the equine industry on equine law topics, and we thank you for visiting it. Read more here.
Honors & Recognitions
Congratulations, Julie! We're proud to share that Julie Fershtman has received two prestigious awards.
On April 13, 2013, she received the American Youth Horse Council's 2013 "Distinguished Service" Award. As the award itself states, she received it "[i]n recognition of years of dedicated service to the American Youth Horse Council and tireless efforts to touch the lives of youth involved with horses." For more information about the American Youth Horse Council, please visit www.ayhc.com/.
On May 7, 2013, Julie received the 2013 "Industry Award" from the Michigan Equine Partnership for her work over the years supporting legislation to promote and protect the Michigan equine industry. For more information about the Michigan Equine Partnership, please visit www.miequine.com/.
RECENT EQUINE LAW COURTROOM VICTORY
We're pleased to share that Julie just won a case in Michigan where she defended a boarding and training stable that was sued by a visitor who was injured in the barn aisle. Julie cautions that this case might have been avoided altogether if the stable required every visitor to sign its waiver/release of liability. (Julie, interestingly, drafted that stable's release document years ago but the stable only presented it to customers.) Make sure that your release is well-worded and complies with the laws of your state.
"The Seller's Contract Includes an "As Is" Disclaimer – Now What?" - Desert Mirage Magazine, August 2013
Win Equine law Books!
We're always on the lookout for good article and update ideas for the Equine Law Blog. Please share yours! We'll give the sender of best tip of the month a free copy of Julie Fershtman's books, EQUINE LAW & HORSE SENSE and MORE EQUINE LAW & HORSE SENSE. Click here to send your ideas. [For more info on these and other publications written by Julie Fershtman, please visit www.equinelaw.net and www.equinelaw.info or call her directly at (248) 785-4731.]
Large Step Forward for the Horse Industry
We applaud the American Horse Council (www.horsecouncil.org) for its national marketing initiative for the horse industry. The AHC joined together ten national associations and large corporate industry stakeholders to make this happen. We await its marketing plan, which will propose ways to help people become more interested in horses and equine activities, either as participants or spectators.
THE NATION'S MOST SOUGHT-AFTER EQUINE LAW SPEAKER
Did you know Julie Fershtman has spoken at the American Horse Council Annual Meeting, Equine Affaire, Midwest Horse Fair, Equitana USA, US Dressage Federation Annual Meeting, North American Riding for the Handicapped (now PATH International) Annual Meeting, American Morgan Horse Association Annual Meeting, American Paint Horse Association Annual Meeting, US Pony Clubs, Inc.'s Annual Meeting, All-American Quarter Horse Congress, American Youth Horse Council Annual Meeting, American Riding Instructors Association Annual Meeting, CHA Annual Meeting, and numerous others? Consider signing her up for your convention. Contact Julie.
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