Warranties in Horse Sales – I promised what? © 2021 Avery S. Chapman, Esq.1 When you sell a horse, most sellers understand that a written Equine Bill of Sale is best practice. If the deal has complexities, such as payment over time, trial period or lease-to-own, then a written Equine Purchase and Sale Agreement is a further best practice. However, what many sellers do not realize is that the form of the Equine Bill of Sale and the form of the Equine Purchase and Sale Agreement are very important. In a separate article, we discussed certain disclosure and language requirements in the Bill of Sale required in certain jurisdictions. Notably, Florida contains some of the most expansive requirements in those areas.2 Here, I address another area of horse sales: the warranties a seller gives a buyer when selling a horse. Some of these warranties exist whether or not any warranty is stated in the Bill of Sale or Purchase and Sale Agreement. You now thing, “can I be accused of giving a warranty if I did not put one in the equine sale transaction documents?” Short Answer: yes. With that “yes” comes a host of legal responsibilities. Now, with that thought in mind, let’s unpack the various warranties that might exist when you sell a horse: Here, I address another area of horse sales: the warranties a seller gives a buyer when selling a horse. Some of these warranties exist whether or not any warranty is stated in the Bill of Sale or Purchase and Sale Agreement. You now thing, “can I be accused of giving a warranty if I did not put one in the equine sale transaction documents?” Short Answer: yes. With that “yes” comes a host of legal responsibilities. Now, with that thought in mind, let’s unpack the various warranties that might exist when you sell a horse:
1. Express Warranties.
EQUINE Training & Showing
These are the warranties you commonly see in horse sale contracts. Promises that the seller has the capacity to sell the horse, that the horse is currently sound, that the horse is not subject to any lien or claim by a third parson, that the horse is as identified, that the horse is identified correctly. You can make any express warranty you want in your documents, not just those listed. The previously listed warranties are warranties that are the easy ones to give as a seller, and are the warranties that many purchasers will want to see included in the transaction documents.
2. Implied Warranties.
a. Implied Warranty of Fitness for a Particular Purpose An implied warranty, as opposed to an express warranty, is a warranty that arises from the particular circumstances of an equine purchase and sale transaction. Under many state laws, including Florida, an implied warranty of fitness for a particular purpose arises where a seller has reason to know a particular purpose for which the horse is required and the purchaser relies on the seller’s skill or judgment to select or furnish a suitable horse To enforce that 62
While a recipient of information about a horse will not have to investigate every piece of information furnished, he or she is responsible for investigating information that a reasonable person in the position of the recipient would be expected to investigate. type of implied warranty, however, a person must be in privity with the seller and must have justifiably relied on the seller. Many states have codified into their Uniform Commercial Codes the requirements to for that understanding and right to enforce to exist. What that means is that while a purchaser who is inexperienced with horses likely can justifiably rely on a professional horse seller, the same is not true when an inexperienced purchaser employs a team of equine professionals and equine veterinarians to assist the purchaser in examining the horse. In that case, the purchaser is relying on the purchaser’s own team, not upon the statements of the seller. The same is true when you have an equine purchase and sale amongst equals, such as when one equine professional sells to another equine professional. There is often a defense to such an implied warranty, so do not confuse justifiable reliance on a representation by the seller, which is not the same thing as failure to exercise due diligence. One does not necessarily translate into the other. While a recipient of information about a horse will not have to investigate every piece of information furnished, he or she is responsible for investigating information that a reasonable person in the position of the recipient would be expected to investigate. So it follows, if a purchaser does not exercise due diligence when purchasing a horse, that may defeat any claim of the implied warranty of fitness. b. Implied Warranty of Merchantability. Under this type of implied warranty, each sale of a horse comes with it the implied promise that the horse was at least of of average quality as similar horses in that category of horse, and the horse was fit for its intended and ordinary purpose. This implied warranty
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