A very large proportion of legal queries from horse people are centered around misrepresentation and the duty of disclosure during equine sale transactions. In this series of articles, we will review the most commonly asked questions raised by both buyers and sellers.
I was told the horse was sound when I bought it, and it went lame in the first week – can I get my money back?
Prevention is better than cure, as the saying goes. Buyers are always advised to get a pre-purchase examination done by an impartial veterinarian, i.e. not the seller’s normal veterinarian, before the buyer commits to purchasing the horse. Sellers may also have the horse vetted prior to advertising the horse, especially if the history of the horse is not well known. This can help prevent the situation where the seller is surprised by the results of the first pre-purchase examination conducted on the horse and is disappointed at the true value of the horse.
Sellers should also be careful when writing the advertisement for the horse. Simple phrases in the ad can be interpreted differently by buyer and seller and could be used against the seller later. Sellers should be careful to not make exaggerated or vague statements about a horse, whether it is in the ad or in a conversation about the horse. It is better to be honest, so that both buyers and sellers do not waste their time or end up in a dispute. Sellers must also be aware that they have a duty of disclosure, so they should be up front and tell the buyer about any bad characteristics, such as vices or misbehaviours, that the horse has.
But what if the transaction has already taken place and it is too late to implement the above tips? Whether or not the buyer can get his or her money back will depend on the factual circumstances. Just because the horse is now lame, does not necessarily mean that the horse was misrepresented. For example, it is possible for the horse to be injured after purchase, which would not be the fault of the seller. The cause of the lameness needs to be determined.
In order to make out misrepresentation, the buyer must show that the seller represented something about the horse, which is untrue. If for example the seller represented that the horse was not on any medications, and then the buyer discovers that the horse was receiving medication regularly and is now lame because the medication has worn off, this would be a misrepresentation.
Even if the buyer believes that the seller did misrepresent the horse, in order to achieve an outcome the buyer still needs to be able to recover from the seller. It is advisable that both buyers and sellers:
- Insist on a properly drafted sale contract; and
- Keep all documents and correspondence including advertisements, emails, the pre-purchase examination report, etc that may help to prove the misrepresentation.
The buyer may be able to recover by way of damages or compensation, or be able to return the horse for a refund, depending on the circumstances.