Have you put your horse out on loan, and the loaner has breached the loan agreement?
Introduction
Horse owners represent only 0.3% of all households in the UK, which may not sound like a lot, but that equates to approximately 374,000 horse owners. The loaning of a horse is a great way for someone to have the experience of owning a horse without the steep initial upfront cost, and for owners, it can be a good way of maintaining ultimate control over a horse and its future but taking away the day-to-day care responsibilities.
Drawing up a contract and obtaining signatures from both parties can help provide you with clarity and certainty. It could allow you to enforce terms contained therein and provide protection should anything untoward arise.
Should a dispute arise, and you have a contract, you are potentially able to seek remedies if the contract is legally binding.
Loan contract (full or part loan)…
A loan contract is slightly different to a sales contract, as you are not selling the horse, you are simply letting someone “borrow” them.
Within the contract, it is crucial to explicitly state that the equine in question is on loan and not to be sold (if this is what you want). It is beneficial to include a loan period, the purpose for the loan and what you do/ do not wish the horse to do, as well as access you require to the horse and care that is required.
A loan contract can be slightly more complex as there is no transfer of ownership. Therefore, the whole time the contract is running, you are still the owner. This can make for the contract to require updates more often, if your wishes or preferences change.
Like the sales contract, this provides all the same benefits but, if not more.
Breach of the loan contract
There are many reasons why a loan contract could be breached, subject to the terms within. The most common breaches range from failure to provide proper care, unauthorised use, failure to return the horse at the end of the agreement etc.
Initially, we need to establish whether or not there is a valid and enforceable contract in place. If there is, then we need to establish the breach. What has the loaner done to breach the contract, and what evidence do you have in support of this?
Unfortunately, when a breach of contract happens there is usually some type of loss or damage that will be encountered in a monetary sum. This can be by way of vet bills, loss of value, medication, additional feed, etc.
Every case is different, the amount you can claim will be dependant upon the contact and the nature of the breach.
When I loaned my horse, no money was exchanged. Do I still have a case?
Potentially!
In an equine loan contract, the consideration might be the care and maintenance of the horse rather than a monetary sum. If one party fails to fulfil their obligations under the contract, it can still be considered a breach, and the non-breaching party may seek remedies.
How can we help?
Leah Mackay is a Solicitor Apprentice in our Dispute Resolution Team.
If you need assistance with regards to a breach of a loan agreement and wish to seek legal advice, please contact Leah or a member of the team on 01245 584549 or complete our online enquiry form.
Disclaimer: As every case is different the information provided in this blog is for general informational purposes only and does not constitute legal advice. While every effort has been made to ensure the accuracy of the content at the time of writing, it should not be used as a substitute for professional advice or consultation with qualified professionals.