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Should You “Half Lease” Your Horse to Save Money?
lessors could also be targeted, as well. Is the lessor properly protected against this risk? Will the lessee hold harmless and protect the lessor? • The lessee seriously injures the horse.
By Julie I. Fershtman, Attorney at Law
W
hat is a “half-lease” (sometimes called a “share board” arrangement)? Don’t ask any lawyer since the term won’t be found in law books (except for this author’s Equine Law books). These arrangements enable horse owners to continue use of their horses, though limited, while another person shares use of the horse. Horse owners sometimes consider these arrangements as a way of sharing expenses of boarding and care. The problem is, these arrangements can create problems and unintended consequences. This article discusses legal aspects of “half lease/share board” arrangements.
“Half-Lease”/“Share Board” Arrangements These arrangements usually involve a horse owner agreeing with another person to divide days of the week for riding the horse. At all times, the horse remains boarded at the same stable.
Risks What can seem like a simple and riskfree arrangement can be just the opposite. Before agreeing to enter into a half-lease arrangement, consider the risks involved. Here are some of them: • Improper Use of Your Horse by the Lessee. By entering
into a lease with another person (called the “lessee”), you are taking a risk that the lessee might not use your horse as you expect. If the horse, for example, has restrictions against jumping, what if the lessee jumps the horse anyway? What if the lessee uses her own tack or equipment that do not fit the horse properly and make the horse sore? What if the lessee allows others to ride the horse, but those people have insufficient experience, not only putting 24
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themselves at risk but also setting back the horse’s training? • The Other Person Fails to Pay. In these arrangements, the parties usually agree to share the horse’s maintenance expenses such as boarding fees, farrier, and routine veterinary care. But what if the lessee fails to pay his or her share of the bills? • The lessee suffers a serious injury while riding or handling the horse. During a
lease or “half-lease” arrangement, the fact is that lessors still own the horse during the lease arrangement. As owners of the horse, lessors run the risk of being targeted in a lawsuit if the lessee is injured (or worse) while riding or handling the horse. Is the lessor ready for the expenses and risks associated with defending against a possible lawsuit? • The horse injures someone other than the lessee.
While the lessee is riding or handling the leased horse, there’s always a risk that the horse could bite, kick, throw, or injure someone. Certainly, injured people might target their claims or suits against the lessee, but because lessors own the horse,
Emergencies could arise from the “halflessee’s” use of the horse, resulting in huge veterinary bills. For example, the horse might receive a severe cut during a trail ride or come up lame after a particularly strenuous ride. If any of these should happen while the “half-lease” arrangement is in effect, and if the problem is linked to the lessee’s use of the horse, who will pay the veterinary bills?
Risk Management These and other risks in horse sharing arrangements demand careful attention and planning. Here are some options for lessors to consider in “half-lease” arrangements:
Liability Insurance Horse owners could consider buying a policy of liability insurance that is designed to protect them if the lessee, or anyone else, brings a claim or a suit against them based on the horse’s actions. One type of insurance commonly available is a Personal Horse Owner’s Liability Insurance policy. Horse owners should discuss this, and other advisable coverages, with their insurance agents. When applying for coverage, horse owners should explain that the horse is subject to a lease arrangement so that the insurance company can evaluate whether this impacts, or prevents, coverage.
Waivers/Releases (Where Allowed by Law) Courts in most states have shown a willingness to enforce releases of liability as long as they are properly worded and signed. Where allowed by law, lessors can ask lessees to sign a carefully worded release of liability (sometimes called a “waiver”) that conforms to applicable law. Lessors might also want lessees to have all persons of legal age, before handling or riding the horse, sign a different release form in which the signer agrees to release the lessor, and
