"A verbal agreement isn't worth the paper it's written on!"
by Marnie Somers, CQHA Past President
This humourous quote, first attributed to Samuel Goldwyn, is just applicable to the purchase of a horse as it is to any other large financial transaction. In my eleven years as President of the Canadian Quarter Horse Association, the most common issue brought to my attention was, the disappointment of new horse buyers arising from unmet promises reportedly made by horse sellers.
Before you even consider purchasinge a horse, you should familiarize yourself with the owner responsibilities and housekeeping needs of caring for a horse. To learn about the basic requirements, and the recommended best practises, click here for the National Farm Animal Care Council's Code of Practice for the Care and Handling of Equines (PDF file)
No matter the breed of horse, there are always a few unscrupulous people who take advantage of the heady enthusiasm and perhaps limited knowledge, of people wanting to buy a horse. There are two types of sellers you need to guard against: i) the truly unscrupulous who outright do something illegal, like drugging a horse, or totally misrepresenting it. ii) the "basically honest" seller who knows a horse has a defect/problem, but just does not disclose it, if the buyer is not knowledgeable enough to notice. Your first line of defense is Caveat Emptor, which is latin for, "Let the buyer beware". According to Wikipedia (the online encyclopedia):
"Caveat emptor is the contract law principle that controls the sale of real property after the date of closing, but may also apply to sales of other goods" (including livestock). The phrase caveat emptor arises from the fact that buyers often have less information about the" good or service they are purchasing, while the seller has more information. Defects in the good or service may be hidden from the buyer, and only known to the seller. Thus, the buyer should beware."
Want to know how to protect your significant emotional and financial investment while buying a new horse?
• DO SOME RESEARCH FIRST. Look on-line, there are numerous resources such as the American Quarter Horse Association's Stud Book and Registry records. If the seller is showing you the horse’s "papers" be sure to compare them to the actual physical animal standing before you - does the data (i.e. written and/or photographic description/markings) match up? Ask for a photocopy of those papers to take home while you decide. Then you can check with AQHA that this horse is actually recorded in their database and registered to the very person offering to sell you this horse.
• Ask the seller to physically demonstrate the horse is suitable for your intended purpose (i.e. if the seller says it's broke to ride, ask him/her to ride the horse and show you). Ask the seller if the horse is SERVICEABLY SOUND for your intended purpose, (i.e. may not be sound for riding, but would still be suitable as a breeding prospect).
• Ask the seller why he/she is selling the horse. How they answer, may raise a red flag with you.
• Unless you are an experienced horse person, you should get a second opinion from either your own, or an independent veterinarian not associated with the seller (highly recommended). And, you should ask another independant, knowledgeable horseperson to assess the horse. If using a veterinarian, there will be a fee for a pre-purchase exam (click link below to article) depending on the distance travelled to examine the horse, x-rays needed or requested, or other diagnostic tests performed. If you are buying a mare which is supposed to be pregnant, get a veterinary pregnancy test done. If you ask a horse trainer or other knowledgeable horseman to assess the horse, ensure you confirm what fee that he/she will charge - their knowledge and time is also valuable. Either way, a smaller investment up front may save you from a much bigger loss later, should you purchase an unsuitable horse which will prove difficult to resell afterwards. Click here for Canadian Horse Journal's online article, The pre-purchase exam.
• Ask for a written bill of sale stating the following items;
o horse's full name as stated on the registration papers
o breed registration number
o date foaled
o length of trial period, if any
o full price (or amounts and dates of installment payments, if agreed to) and whether paying by cheque or cash
o if buying a mare with a foal is at side, indicate whether offspring is included in the price and/or is registerable, as of the date of the sale
o any other terms and conditions verbally offered by the seller
o if the seller wants first right to repurchase, should the buyer decide to resell the horse in the future, and at what price
• Deal maker or deal breaker? - the AQHA Transfer of Ownership Form. Click here to download a printable version of the AQHA Transfer form.
This document must accompany the bill of sale and be given to the buyer in exchange for payment of the horse. The seller is responsible for completing the top half of the transfer form including the new owner's information on the bottom half of the form. The seller is responsible for paying the transfer free, and submitting it along with the original breed registration papers so that AQHA can record the transaction and official change of ownership. Ask the seller to give you photocopies of these two documents to keep on hand until the AQHA transfer of ownership has been completed and the revised registration papers are returned to you by AQHA. Our best advise is to ensure you are buying from a reputable person - possibly a long time breeder or top trainer. Consider it a red flag, if the seller cannot produce the original registration papers and/or the transfer of ownership form, or promises to provide them later. DO NOT PAY until and unless these two documents are produced.
Not buying a live animal? Are you ordering shipped semen or embryos for transplant? Obviously, you’re not a brand new horse owner. However, you’d be surprised at the number of “fixes” people find themselves in with these genetic transactions, especially where there are no signed contracts between buyers and sellers. For example, who will be responsible when a live shipment loses its viability because of incomplete paperwork at the shipper’s end, or an unforseen hold up at Canada Border Services, or the courier company is late with delivey at the receivers end? What happens if you don’t achieve a live foal from this year’s shipment(s). Will you be able to follow through and obtain another shipment next year? GET IT IN WRITING before trouble breaks out – it’s not IF it will happen, but WHEN it will happen!
Conversely, there are always a few unscrupulous people who are willing to take advantage of an honest horse seller as well.
Want to know how to protect your significant emotional and financial investment while selling a valuable animal to a new owner?
• DO SOME RESEARCH FIRST. Do you know this potential buyer? If not, ask for references. Look for them on-line to ensure they live/work/bank where they say they do.
• Ask the buyer about their intended use of the horse, to increase the chances of a successful match of horse and buyer.
• If you agree to a “trial period” before finalizing the sale of the horse, insure your horse during the trial period, if not already covered, until actually sold.
• Don't insist on using your own veterinarian for a pre-purchase exam as you will be putting him/her in a position of conflict of interest (yours versus the buyers)
• Do provide a written bill of sale with all terms spelled out (such as above) and a signed AQHA Transfer of Ownership Form, but only on receipt of payment. Unless the buyer is known to the seller, we suggest payment by either a bank draft, certified cheque or cash.
• Don’t let the horse leave your property without being paid. (If a trial period is granted, request a cheque and hold it until the trial period is over and the buyer confirms the deal, and/or the horse is safely returned to your property.)
• Ask the location where the horse will be kept after the sale, in the event that the buyer's cheque doesn't clear and you must retrieve the horse.
Some final thoughts:
Even between the best of friends, complete a bill of sale or other written contract, because it provides legal protection for BOTH parties, it is NOT a declaration of lack of trust by either party. In fact, a contract can actually protect a friendship rather than risk ruining it. Consider it a red flag if the buyer or the seller balks or refuses to put it in writing.
What you need to know is, neither AQHA, nor CQHA, will intervene on behalf of disgruntled buyers or sellers of Quarter Horses, as such transactions are considered civil matters. Should disagreement occur between two parties, the matter must be referred to civil court. Civil court will be hard pressed to find in favour of parties who lack the appropriate written documentation.
In spite of all the foregoing, most buying and selling transactions happen as they should. We want to provide you with this information to increase the percentages of satisfactory puchases and to ensure we welcome newcomers into our industry, not turn them off forever.
Make the most of owning an American Quarter Horse - transfer your horse today!
We all know that owning an American Quarter Horse is one of the best experiences in life. There's nothing better than being able to say, "That one's mine!"
One of the most important steps in making the most of that experience is transferring your American Quarter Horse into your name. Transferring your horse into your name is quick and easy!
- You just need a few things to make the transfer happen.
• A signed AQHA Transfer form from the seller
• Original registration certificate
• $20 transfer fee
To make the process even easier, AQHA created a short video to help ensure your transfer paperwork is filled out correctly and you are able to transfer your horse as quickly as possible.
The most fulfilling part of completing your transfer is receiving your horse's new registration certificate in the mail with your name on it. Start your transfer today.
If you have any questions about transferring your horse, AQHA's registration department is are always there to help. Just call them at 806-376-4811.