Guest Post: Minimum Warranties Applicable to Horse Sales in the European Union

Happy Tuesday, Equine Law Blog readers!  I hope you find this guest post by my friend and colleague, Dutch equine attorney Luc Schelstraete, both interesting and informative. 

"Pursuant to European legislation, a horse that is delivered to a buyer in a horse sale transaction needs to meet up to the purchase and sale terms agreed upon between seller and buyer. For example, if the parties agreed upon specific qualities of the horse, the horse needs to have these specific qualities at the time of sale. If a buyer can prove after the sale that the horse did not have these specific qualities at the time of sale, the seller can be held liable for this shortcoming. In cases where no specific qualities are agreed upon, and/or it is not discussed that the horse needs to meet specific criteria, the horse still needs to be suitable for so-called 'normal use'."

"What constitutes 'normal use' depends upon what the buyer may expect under the circumstances of each particular sale. Another factor used in Europe to determine whether a horse is suitable for 'normal use' is the amount of the agreed purchase price. In cases where, for instance, the horse is found to have been permanently lame at the time of sale, most courts in Europe will find that the horse was not suitable for 'normal use'."

 "In cases where the seller has guaranteed or expressly warranted specific characteristics or qualities, the horse needs to meet up with the features that were guaranteed or expressly warranted by the seller. In cases where the horse is found to have not possessed these guaranteed characteristics or qualities at the time of sale, the seller can be held liable.  When the seller makes a guarantee or express warranty about a horse, the buyer does not have to investigate whether the horse indeed has these qualities and the buyer may rely upon the seller’s representations. In other words, in cases of express warranties, courts in Europe will not hold it against the buyer that he did not investigate the seller’s representations about the guaranteed or warranted qualities."

When does EU law apply to a horse sale?  

"EU countries are required to revise their national statutes / codes, if necessary, so that they are compliant with EU legislation. In other words: EU member countries have to implement the EU legislation into their own statutes / codes. Therefore, because national statutes must comply with EU legislation, this EU law may apply to every horse sale where EU law or the law of an EU member country governs a sale.  Note:  the implementation of EU law is a minimum requirement for EU countries. EU countries can make their national statutes more specific.  If parties explicitly agree that Dutch law, for example, will apply to a horse sale, then Dutch law will indeed apply.  But indirectly, EU law will apply as well because Dutch law is based upon on EU legislation."

About the Author

Mr. Luc Schelstraete is the founder of European Equine Lawyers and Equestes. Both entities are based in Holland. Luc and his staff (6 attorneys and 5 office staff) specialize in international equine law. They assist clients in purchase and sale documentation and litigation involving horses purchased in Europe.

For further information, see: www.europeanequinelawyers.com and www.equestes.com.

 

Sale Documentation Tips for International Horse Sales Involving a Party in the United States

Happy Thursday on a short Labor Day holiday week, everybody!

Today's post is a reprint of a "blurb" I did for a colleague's newsletter this week.  My colleague, Luc Schelstraete, is a top-notch equine attorney practicing in the Netherlands and his firm is called European Equine Lawyers.  Luc and I are pictured below at the "Poco Bueno" brand clothing booth at the Americana 2011 trade show in Augsburg, Germany.

There is no federal law in the United States that uniformly governs documentation and disclosure requirements for horse sales. Only three U.S. states have enacted statutes specific to horse sale documentation and disclosure requirements (California, Florida, and Kentucky).

In general, the horse sale statutes in California, Florida, and Kentucky [click hyperlinks to view statute / rules] all require the following for most private treaty horse sales:

1)         A written bill of sale that is a) signed by both parties, and b) sets forth the purchase price for the horse;

2)         Written disclosure to both purchaser and seller of sales commissions in an amount or value of $500 or more; and

3)         Written consent by both purchaser and seller if someone is acting as a dual agent (i.e. a sales agent for both the buyer and the seller of the horse).

The penalties for failure to comply with these statutes can be harsh (i.e. “treble damages”). Determining which state’s law might apply to an international horse sale involving a buyer or seller in the United States might be tricky for a party based in Europe. 

Due to these concerns, parties to all international horse sales involving a party in the United States would be well advised to at least comply with points 1-3 above and further stipulate in writing which state or country’s law will apply in the event of a dispute arising from the horse sale. 

Parties are further advised to review Florida’s rules carefully if they might apply to a sale. Florida’s rules contain more extensive requirements for horse sale documentation and disclosures than those found in Kentucky and California’s statutes."

As a P.S., don't forget that tomorrow (September 9) is the deadline to nominate blogs for the "ABA Best 100 Law Blogs" and I'd appreciate your vote.  See my bleg from August 11 for more info!

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