I’ve sold many horses with a ROFR clause. I follow the horses, stay in touch with their owners. In all honesty, it’s an intimidation factor, I would never enforce it. I used it to weed out those who had the intention of flipping the horses I was selling. I no longer sell horses.
That being said, I would NEVER purchase a horse with a ROFR. Because life happens. And if I’m going to invest time and money into making a horse, I don’t want to be stuck in contract having to offer the horse back to it’s original owner. I would want to be able to let the open market determine sellability and fair market value; not have a previous owner argue over what I believe to be fair market value or be stuck offering the now made horse back to the previous owner at less than fair market value (original purchase price). Horses are far too expensive to not receive some sort of return in the event a sale is necessary.
Good to know how/why a seller would ask me to sign a FROR clause. I would not sigh up to be stalked or intimidated, thanks. But as someone who sees the benefits of otherwise having a “go to” place to sell my horse if I can’t use it anymore for some reason, I wouldn’t mind that clause.
A tad tangential to the topic, but kinda/sorta fits. I’m not a fan of the way previous HOs can/want to keep tabs on their sold horses (read: my horse) in the age of social media. I was taught as a kid that 1. If you care what happens to the horse such that you’ll need to keep tabs on him, you shouldn’t be selling him in the first place. 2. Your responsibility for a horse starts and ends with your ownership of him; that includes finding the best possible home for him when you sell. After that, you might as well not look because you have no basis for dictating what happens to him. You exchanged that right for money.
When I see a seller ask me about how the horse they sold me is doing, I feel a twinge of warning that I’ll be judged. But judged by someone who didn’t want to put in the time, money and effort that I am!
I hope I am in the minority, but this is how I feel about past owners looking over my shoulder as I do the best I can with a horse I bought from them.
Thank you all for your informative opinions! Wonderful to hear so many voices. I am rather surprised by how many have very set notions about this term and what those notions are. Very illuminating. I have purchased horses with ROFR before and was very happy about it, since I did indeed intend to keep the horse “forever” it was comforting to know that in worst case scenario, I had a ready buyer lined up. I have offered a safe spot to return a horse purchased from me on many horses, just in case life takes an unpredictable turn, informally/verbally, never in a “contract” form.
ROFR clauses do not have to stipulate the price. When they are used in various other business scenarios, they often don’t. Generally, they are written as: party B needs to negotiate in good faith with party A before party B can do X. Sometimes, B is actively looking for a change in business. Sometimes, B just gets approached by a third party.
So, the parties are generally negotiating over current market value, which may be evidenced by third party C and their offer. For an older horse, risk to the buyer is actually mitigated by stipulating that the original owner will buy back for the original purchase price. Because that protects buyer from loss in value of the horse. But for a horse likely to increase in value, it would make no sense for the buyer to agree to a price that it must first offer the original seller.
As I said, the clause on a marketable horse is often triggered by an available offer from a third party. You just can’t close a deal with someone else without giving original seller the opportunity to step in.
If if you want someone to put work into a horse with you retaining ownership so you can reap the benefit of the increase in value, find someone willing to lease with option to renew. Or send the horse out on consignment if you can still find a program willing to shoulder some of the costs. If you do care about the value of the horse, why sell it at a discount? If you want to do this because you like the buyer, then perhaps instead of a ROFR clause, put in a revenue sharing clause of horse is later sold above $Y. This is consideration for the originally discounted price.
MVP, wow, I had no idea my innocent inquiries on past sold horses would cause such anxiety!
Honestly, I usually hear of happy owners gushing about their lovely horses - that is what I expect and usually get. Those I have bought from and inquire get an honest answer back, and also usually very positive. I have never felt anyone was being sinister in their inquiries, just curious and wanting to hear good things.
Granted, I have enjoyed respect on both sides - sometimes people ask once or twice a year, sometimes less, and it gets less frequent over time. It is good to have peace of mind
You are wrong about it being “stolen” property. You are talking about a legit sale, yes? You want to legitimately sell, for market value, your horse to a third party, but still control what that third party does with the horse. That is a pretty ridiculous statement, honestly. I do not see a court upholding a contract like that since horses are legally considered livestock/property. You can’t constrain what someone can do with their legal property. Of course, on the other hand, parties are free to contract whatever agreement they like between each other. Balancing those two legal standards is where you are.
In any case, I assume what you want to do is in some fashion protect the horse from being sold on to a home you don’t approve of. But if the people you buy from sell the horse to a party who also pays market value for that animal, a judge is not going to take the horse away from those people and give it back to you. If the judge chooses to uphold a right of refusal contract, you may get monetary damages. Return of the horse would be what is known as “specific performance” and is pretty rare in contract breach cases.
Here is an example: say you want to sell your house, for market value, but you want stop the new owner from being able to paint the house blue when they own it. You put it in the contract. New owners paint the house blue. You sue them in court–you want them to have to return the house back to it’s original colour, grey (specific performance). Even if the judge decides to uphold the contract (which they likely wouldn’t as they would find it against public interest to constrain legally owned property in that way) you are NOT going to get an order to paint the house grey again. You might get monetary damages if the judge can quantify what your “loss” was.
My point being, you want specific performance (return of the horse) which is rare and NO contract can guarantee you. Because the horse could be dead, could be sold to parties who cannot be located, or could have been legitimately bought by people who have nothing to do with your contract. Even an iron-clad contract will most likely result in MONETARY damages only. If you want to make sure you get paid if your contract is breached, go for it. If you want to make sure the horse is safe, stop refusing to listen to educated and experienced people in the industry and lease the animal.
I know. That’s why I said and hoped that I was in the minority. But you only consider (or have been told) the “good news” cases.
Some background experience to this-- two cases that are different a bit, but both of them address a less-than-rosey picture and the positions of the owner and seller in both of those.
I buy a horse I plan to do big things with. She gets hurt in a stall accident. That’s hard enough for me to bear, and there’s a long, expensive rehab with an uncertain outcome. At best, her resume will have a big hole in it. I really don’t want to have to share that bad news or even if I make a “cut my losses” decision with her old owner… who bears none of the responsibility but would, understandably, perhaps have an opinion about what I should do or should have done.
I sell a not-sound-anymore broodmare (with good credentials and past babies). I have no use for her; I don’t own my own land, so I have no soft landing to offer her. Some day, I know those who bought her as a breeding animal will no longer have use for her either. Why torture myself with asking what will become of a mare I loved when there may or may not be a good answer? And if I won’t pay to retire her, on what basis can I hope or assume someone else will?
Those are the scenarios that make me understand that “Don’t ask, don’t tell after you sell” advice that I got as a kid.
How do the rest of you deal with hearing bad news about a horse you sold?
Interesting…I wonder if this is partly differences in human personality (ask vs guess culture). I’m open to communication with people who’ve bought my horses (never bought or sold one with ROFR, have nearly always bought green with intention selling in a few years to off-set some of the horse’s cost in order to keep doing this. actual retired horse is the exception). But I would not contact them first or follow them on social media, unless we were already friends. I’ve had them contact me and tell me how well the horse is doing or share pics. Sometimes I see them at a show or in the results, or hear horse has retired or for sale/been sold (so far to other good barns), but I don’t inquire – I let them offer the information, if they want. Also haven’t had experience of a horse ending up in a bad situation (that I know about), but these were horses I would’ve wanted to keep if I could.
Actually, you don’t have a guaranteed “ready buyer” lined up, Life happens. So does death, serious devastatingly expensive illness or life threatening injuries to anybody and their family members. Including you.
You are assuming a lot and that your life and the life of the other party signing the ROFR will contine exactly the same for years. You also seem to have unlimited finances, good for you, you know you absolutely, positively can buy a horse back via a ROFR fir years in the future, Most don’t have that kind of financial luxury or a crystal ball to see the future.
Those I personally have known, maybe 4 or 5 over the last 50 years, who entered into a ROFR contract on either side did not see it end as intended. When the time came the buyers needed to sell, the original sellers did not have the funds to buy it back. Buyers lost a ton in having to fire sale the horse, sellers could not afford to buy it back and lost track so all those neat little plans tanked and nobody was happy. Some were involved in very tragic circumstances others strictly financial, in one case, the buyer died without a will and the court got involved dispersing the estate.
It’s just not what people think as far as retaining control for the rest of the horses life. Lease it or keep it if that’s what you want.
EXACTLY!!! ROFR is exactly that!!! First in line to say NO! Never ceases to amaze me how people think they can sell a horse and still want so much contact/control over it after…would they go visit a house or car they sold to check up on how they were being maintained? Expect to be like “hey you buy this expensive jewelry from me, but I wanna be able to borrow it back if I have a fancy event”? I totally get horses are living beings we form emotional bonds with and life happens but a legal sale of property is the final transfer of rights to that property…that’s adult life on planet earth.
findeight, I get that “life” happens and is unpredictable, but I am willing to take steps that I can planning now. No one can predict the future, but I for one, am not going to just sit idly by waiting for it to end any moment.
Everyone should do that. However, ROFR just gets you first dibs. Now, if you stipulate that includes the horse to be sold at the price the buyer is spending that helps YOU the seller further. I just don’t know anyone who would agree to that if there is potential for the value of the horse to go up.
That being said, g-you can plan all you want but life does happen and there is no guarantee g-you will be able to afford to buy the horse back.
The more you describe what you would like the ROFR to be the more I think you should do a lease if you don’t want the horse on your feed bill right now.
It seems more like some puppy sales rather than houses or cars. Don’t some dog breeders have contracts about how puppy needs to be taken care of (eg, must be spayed/neutered) and not re-sold/ returned to breeder if home doesn’t work out? Horses are not the same, of course, and I think few people have them just as pets, especially when spending (tens or hundreds of) thousands and thousands on them; and even fewer potential buyers would go through an interview process and waitlist, when it’s not the norm in this industry and there are other horses from which to choose. And I have no idea about the legality or enforceability of those dog contracts, or how appealing (or not) they are to a dog buyer, but it seems like OP wants something like that?
Few buyers are going to agree that if they need to sell they need your permission or sell only to you at the contractually agreed upon price regardless of how long they have had it or much they might have put into the horse. That’s not much of an incentive to a buyer in a market saturated with sale horses that convey with full title and no de facto lien.
I have often used right of first refusal in sales contracts. Only once has a new owner honored that clause, and I’ve sold a fair number of horses, and plenty of them have been resold. I have never pursued legal action, though. I have never sold a horse under the circumstances you describe. In most cases I sold the horses for fair prices to reasonable homes and I was fine with the owners re-selling. IME, buyers are often a little embarrassed about re-selling–they feel badly that things either didn’t work out or they feel uncomfortable telling the previous owner how much more they are asking for the horse. They also might not want a prior owner attempting to complicate a sale via social media (it happens).
Personally, in your situation, I think that a lease would be a more appropriate option. Whatever your legal remedies are, I think that in general ROFR clauses are not respected by buyers. And I also speculate that pursuing the party that broke the ROFR clause might result in compensation of some monetary damages, but would be unlikely to get the horse back in your hands.
I also think that when you don’t own the horse, you would have no way of knowing if/when the person re-sold the animal–you might not find out until much later if at all. So if you are serious about designing an enforceable ROFR clause, you need to consider some manner by which you can “check in” on the horse/the new owner to make sure the horse hasn’t been sold. Many new owners would be uncomfortable with such a clause.
I did once sell an extremely nice young horse who was going beautifully under saddle but had a not-very-obvious flaw. I sold him at a lower price and that was a really tough sale as there were many interested parties who plainly intended to hide the flaw and quickly re-sell at an inflated price. The person I sold him do did in fact ignore the ROFR clause and did resell the horse for a higher price after sending me a few “happy updates.” I did not find out about this until much later, of course. By that time, the horse had changed hands again. I was disappointed as to how things turned out, but I did not pursue legal action.
I think that it’s better to decide whether or not you are willing to “let go” of a horse and then make a lease vs. sale decision based on that. If you want to control future options for resale, you should best retain ownership.
Im interested to know how many of the people here that have sold horses with FROR clauses have actually been asked to uptyake that clause, because life happens…both ways.
How many people have been in a position to buy back the horse if offered at a later date.
I think most of us that have sold horses always verbally offer, but thats more the short term safety net, if its not working out in the next few months ill take the horse back.
Ive moved country since I sold some horses, and did find one of mine up for sale and shipped him to my new country (so all up I paid 5x what he was sold for!) and that was because a mutual friend let me know. The seller was great, but it certainly wasnt their first thought to offer back to me when it was time to sell. Plus I cant take any others, I mean, I own horses, I have no money!
I mean this question goes both ways doesnt it, you sell a horse age 8 for 20k, with FROF at 20k, it does its suspensory twice and now is worth 2k as its not sound, are you shelling out the 20k to buy back? That would be a super safety net for a buyer in that case.
It seem fraught with uncertainties both ways really
I understand your thought. The world, however, is quite clever and the old military adage that “no plan of battle ever survives contact with the enemy” applies here, too.
I don’t think you really understand what a ROFL is. It’s the contractual right to say “no” after being informed of a bona fide offer to purchase the horse which is subject to the ROFL restriction. If they say “no” one time it’s likely that the right is gone. And anything other than a “yes” would be a “no.” There are lots of “moving parts” here and if the seller does not comply with the requirements of the ROFL then the holder of the right has the right to sue the seller for damages. What they won’t get is some sort of a judgement or writ of Specific Performance that will put the horse in their hands. The best they will ever get is money. How much will they get? One value would be the value of the horse at the time is was sold by the holder of the ROFL. Maybe they would get the price at which the horse was ultimately sold (and consider what happens of the offer was less than what the seller paid to the holder of the ROFL). If the price were significantly higher as a result of the seller’s increasing the value of the horse it’s likely they will claim “unjust enrichment” of the ROFL holder if they got a big number. In Contract you don’t have the emotional ebb and flow you have in Tort when it comes to damages.
And the seller might have a tale to tell, also. In the thread I referenced a person wants to transfer ownership, care, and custody of permanently lame horse to another. And wants a right of first refusal. If the seller were figure a way to make the horse more useful and valuable and then chose to sell in contravention of the ROFL if they got sued they might paint the holder as greedy and non-caring as they “passed off” this lame horse to another so they would not have to deal with the expense. The buyer might even claim they “rescued” the horse from an abusive home and saw the horse’s welfare as superior to a paper commitment. Or something else entirely.
Put another way, the seller will try and transfer the “black hat” to the ROFL holder. It might even work.
I have never purchased a horse subject to these sorts of restrictions and never will. Nor will I ever put them in a contract of sale to another. They are much more salve to ego and balm to feelings of the seller than practical ways of protecting a horse from an abusive new home. The seller does THAT by looking into the buyer and knowing who they are dealing with. In our 'Net connected world this can be done without all that much effort or cost. The seller who fails to do that is not doing right by the horse, no matter what they put in a sales contract. And if we are dealing with a seller that is functionally “dumping” an unserviceable horse they don’t get much moral or ethical credibility, either.
Life happens and sometimes sellers have to sell fast for economic reasons. I get that. But putting ROFL clauses into a “quick sale” contract is particularly questionable as we KNOW that it’s expensive to enforce these obligations and the horse is being sold precisely because the seller is broke and can’t keep the horse!
There’s nothing wrong with planning. There is something wrong with planning based upon fantasy, not reality.
Whether OP intends it or not, it casts a shadow when a seller no longer wants to or is able to support the horse and wants a check for it but wants to retain control of it’s future. It comes off as controlling or dumping it because it’s not convenient to keep it. Inrended or not. That’s reality.
My bill of sale for both sides whether in my own or acting through an agent has always stated seller has the unencumbered right to sell and I, as buyer, receive full ownership with no restrictions. don’t deal any other way and I’ve been in this for 50 years and seen what happens when there are restrictions. No thanks.
But is ROFL a variant of ROFR (right of first refusal)? Right of first look? The internet has trained me to see ROFL as “Rolling On (the) Floor Laughing”.
Sure, you can stalk people on the internet nowadays, but I don’t think that looking into buyers or even truly knowing who you are dealing with is particularly good protection for a horse, either. I’ve seen too many situations where a divorce or an illness or another personal catastrophe has put people who otherwise provide excellent equine homes into a position where they end up dumping horses into not-so-great situations.
Keep the horse healthy, make it useful through training, vet buyers as well as you can and it has a good shot at a happy life … but far from a guarantee of one.
