Right of first refusal and other ways to keep a SOLD horse "safe"

[mzm_farm]

For the sake of argument, this is not a defective animal, it is a “high $” horse. Lets get the free lease, keep it, and euthanasia options dropped. Once again, money available to enforce contract.

Is “right of first refusal” clause in contract enforceable in court? Can amount be stipulated and enforced? Any other ways to keep a “lifetime” home from being a quick flip home? Please do not share the wisdom of “do not sell/euthanize” those are not options to be discussed here, I am well aware of them. Thank you.

[KBC]

Well, I am breaking your rules right out the box, the only way to keep a horse safe is to keep it or euth it…once you sell it is no longer yours, you no longer can have any control, and to the best of my knowledge there is no way of enforcing the ‘first right of refusal’ If you are worried about a quick flip this sounds like a horse with some sort of issue that you are selling cheap, and are worried a less honest person will try and sell without disclosure…yup it happens.

Makes me laugh a little, when someone is concerned that the horse they no longer want to keep, for whatever reason, gets a life time home with someone else…

[khall]

Not easily enforceable. Some people would honor some could care less.

[Simkie]

Once you sell a horse, there is ZERO way to guarantee that it will not be sold again or be SAFE. Zero.

You stack the deck in your favor–the horse’s favor, really–by training it, vetting your buyers, having a contact…but none of that is a guarantee. A right of first refusal clause or no slaughter clause doesn’t mean much at all. Sure, you can sue for breach of contract, but that doesn’t get the horse back.

If you want to ensure 100% that the horse has a life that you would like, you have to keep it. Full stop.

[scrbear11]

Once the horse is out of your care, unless you want to pay $$$$$ in legal fees, there is no enforcement. And even then, paying tons in legal fees may result in the exact same out come - nothing you can do.

This seems to be the theme of COTH recently… “I really love this horse but I want to make it someone else’s feed bill.”

[Scribbler]

The way you do this is by putting the horse out in a full free lease close enough that you can visit monthly, take him back if they don’t want him or if their care deteriorates.

Lots of people are happy to have an indefinite free lease of a rideable horse.

Obviously the catch is that you don’t get any cash from the sale. But that’s the trade off. You sell the horse for cash and relinquish ownership. Or you retain ownership and rehome to unload your feed costs.

You can’t have it both ways.

Obviously if the horse is not rideable no one will want him as lease or purchase.

On the other hand if this is a high dollar horse and you really need that $20,000 cash then trust to his value to protect him, until he breaks down in competition at least.

[mzm_farm]

Thank you for opinions so far, but if you want to be helpful, stay on track. If you have a need to make your voice heard on a different topic, start one, by all means!

For the sake of argument, this is not a defective animal in question, it is a “high $” horse with potential to increase in value rapidly. Lets get the free lease, keep, and euthanasia options dropped. Assume for this discussion money is available to enforce contract.

[IPEsq]

If the horse is not recoverable when you go to enforce the clause, the best you can hope for is some money damages rather than specific performance (return of the horse), so even when you can enforce the clause, the outcome may not be what you ultimately want.

If it’s a high dollar horse that you 100% want back, send it out on paid lease, require insurance, etc.

[Simkie]

@mzm farm

For the sake of argument, this is not a defective animal in question, it is a “high $” horse with potential to increase in value rapidly. Lets get the free lease, keep, and euthanasia options dropped. Assume for this discussion money is available to enforce contract.

Sounds like a good candidate for a paid lease.

There is NO contract that will do what you want, assuming what you want is the horse to go to a home that you specify and never be sold on without consulting you first. That’s not how selling a horse works. You want control, you maintain ownership.

[bt1]

Even if $ is available to enforce the contract that does not mean you will be able to or even if you can do it before horse winds up somewhere else. The only way to ensure you have any control over the horse’s fate is to maintain legal ownership and lease to someone else…so if no issues and he is big money charge an appropriate lease fee.

[MissAriel]

@mzm farm

For the sake of argument, this is not a defective animal, it is a “high $” horse. Lets get the free lease, keep it, and euthanasia options dropped. Once again, money available to enforce contract.

Is “right of first refusal” clause in contract enforceable in court?
No

Can amount be stipulated and enforced?
You can stipulate it all you want, but there is no way to enforce it

Any other ways to keep a “lifetime” home from being a quick flip home?
[B]Other than the answers you don’t like, I don’t know of anyway to guarantee it. Scribbler and Simke have it right - you can improve the odds by giving the horse good training and being careful who you sell it to, but at the end of the day, the buyer owns the horse and can do what he/she wants.

A paid lease is probably the closest you will get and might be possible if this is a “high $” horse with potential, but even that carries risks (because - horses and horse people)[/B]

Please do not share the wisdom of “do not sell/euthanize” those are not options to be discussed here, I am well aware of them. Thank you.

[Scribbler]

If it’s a high dollar horse that you don’t want to lose ownership rights over then do a yearly lease for one third his value like the hunter folks do.

If you seriously want to know if a buy back contract is enforceable in your jurisdiction then consult with a local lawyer in equine or contract law.

No one can promise a lifetime home to a horse. The buyer might be killed, injured, bankrupt, or divorced in 6 months.

The horse may not be suitable.

Or the new owner may be successful with the horse and then offer him for sale for double what she paid you, and give you first refusal, but you can’t afford it.

Frankly as a buyer I would never pay money for a horse with this kind of contract attached, especially high dollar money. I would take a horse on extended free lease, but I wouldn’t pay market value on a good horse that I didn’t own.

Besides, resale to a good home is not a bad ending. Flipping a horse is not evil. Let’s say trainer buys nice young horse, puts 3 months schooling on, then sells for twice the purchase price to a junior who adores him and does very well. Later when junior goes to college she sells him to another junior and he lives out his life in their pasture, finally half leased to a middle aged returning rider. Nothing in there is remotely bad for the horse.

Ok an idealized story, but selling a horse does not mean his life gets worse. In many cases it improves.

If you are trying to vet buyers, in general trainers flip horses and ammies keep them if they are a suitable match.

[warriorhorse]

Wouldn’t buy a horse with your stipulations in a contract. Once I buy a horse it’s mine to do as I please. If said horse doesn’t meet my needs wants after say 3 years I’ll move him on. If previous owner doesn’t like that then shouldn’t of sold horse.

Horse’s get bought sold some endup in forever homes most don’t. It’s just the way it is, if you don’t want you’re horse to endup in a bad situation ,DON’T SELL HIM/HER.

I won’t be tied to a contract for a horse I bought…there livestock…that get sold an bought. They get slaughtered for human consumption so that in my eyes, qualifies them as livestock.

[Libby2563]

I think if you are truly willing/able to sue the buyer if necessary, the contract could be written so as to disincentivize a quick flip or disregard for a ROFR (i.e., liquidated damages high enough to give the buyer pause but not so high that a court would regard them as punitive or contrary to public policy). It may weed out some unsavory buyers ahead of time if you are really upfront about your contract and willingness to enforce it. It may also reduce the price you can get for the horse.

However, even an aggressive contract would not necessarily get your horse back. State laws vary but, in general, if the horse has already been sold to a bona fide purchaser, that sale will be upheld regardless of the contract violation between you and your buyer. Also you would have to expend effort keeping track of the horse, forever I guess.

If this is more than a hypothetical, I’d advise you to consult a good contracts attorney in your state, equine experience a plus. (Or keep the horse. Or let go of the idea that you can keep a horse “safe” once it’s out of your control.)

[retiredhorse]

So, this is a situation I’ve only seen happen once and I don’t know the full details: trainer sells beloved $$$ horse in barn to a junior rider, who stays for a few years, then moves to another trainer. First trainer follows “her” horse’s progress and when junior ages out and wants to sell the horse, trainer buys him back for $$$asking price, no vetting or anything. I do not know if there was a right of first refusal in the sales contract; it’s possible also that no one else would’ve paid $$$ for horse at that time, as he was getting older and not getting the ribbons he used to. Everyone is happy, except trainer’s accountant. But I could imagine this not working out if trainer could not afford the purchase price or if she was outbid by someone else, or if she paid a lot of money to essentially retire the horse (I think horse was leased in-barn after this, and that probably off-set at least some of his purchase price, if not all of it).

I’ve also known of someone who refused to sell a horse for any figure because they didn’t want the horse to end up in a less than ideal situation, and they didn’t need the money. Horse was leased in-barn for a while to some of the juniors until he retired, still at the same barn (for something like 15+ years). I’m thinking his lease fees would’ve made up for whatever he could have sold for, as this was a really really nice horse in a fancy high dollar barn. Trainer is also good with the horses and doesn’t just use them up, has fairly low turn-over of horses and clients, and you see the same horses in the barn aisle for years. If your horse gets in a barn like this, and is beloved by the owner and trainer, and fits their program, it would have a forever home. If it doesn’t perform or stay sound or client is unhappy with trainer, or if any one for whatever reason had money issues, then maybe not. And you never know what can happen, unless you retain ownership rights.

[mmeqcenter]

A lawyer told me that really the only way to enforce a First-Right-of-Refusal or No-Slaughter-Clause in court are to put penalties in the contract for non-adherence. As people always say, it’s really hard to track down a horse that passes through several hands in either situation, and even if you track it down, what do you expect the judge to do, take the horses away from a person who legit bought it? Ressurect it? They can’t do either. So give them a way to enforce the clause. $1000 penalty if horse is sold without first offering horse at reasonable current-market-value to original seller. Or $2000 penalty. Or whatever.

[Lord_Helpus]

A “high dollar horse” is worth 1/3rd of his value for a yearly lease. That means the owner should/could get $20,000 - $50,000 (or more for a winner at WEF). The lease should stipulate that the Lessor takes out insurance for the value of the horse, and also that the Lessee has the right to have the horse inspected by a vet at Lessee’s discretion. It should also specify who the trainer will be and the allowed use of the horse.

At any time these stipulations are not met, then the Lessor has the right to take the horse back.

If the cost of the lease is not paid up front, then the Lessor should get 1/3rd to 1/2 of the money up front, and that balance to be paid at XXX date.

If the OP wants to make sure that the horse is kept in good condition and is returned to her, then it is within her rights to get a refundable deposit before the horse leaves her control.

If the Lessor is worried that the Lessee might not live up to the terms of the lease, then she should not be leasing the horse to that person.

[mzm_farm]

mmeqcenter
as far as what I’d expect a judge to do is an interesting question. I think as far as property goes, if you buy “stolen” property you have to return it? What would you expect a judge to do if you sold something that was not yours to sell?

[KBC]

@mzm farm

mmeqcenter
as far as what I’d expect a judge to do is an interesting question. I think as far as property goes, if you buy “stolen” property you have to return it? What would you expect a judge to do if you sold something that was not yours to sell?

Is there any other good that we would accept this condition on? If I buy an item it’s mine…that’s what buying is, transfer of ownership.

[Denali6298]

@mzm farm

For the sake of argument, this is not a defective animal, it is a “high $” horse. Lets get the free lease, keep it, and euthanasia options dropped. Once again, money available to enforce contract.

Is “right of first refusal” clause in contract enforceable in court? Can amount be stipulated and enforced? Any other ways to keep a “lifetime” home from being a quick flip home? Please do not share the wisdom of “do not sell/euthanize” those are not options to be discussed here, I am well aware of them. Thank you.

Aside from the options you will not consider no, not really. Honestly if I went to buy a horse and was presented with a contract that had a monetary penalty for violating a ROFR I would decline the horse all together. Not because I would violate such a thing, but because I wouldn’t trust that you wouldn’t constantly call, email, text whatever for updates and eventually annoy me.

Maybe I am wrong but you are coming off as the type of seller that would try to manage the horse AFTER I owned it.