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Rachel Kosmal McCart is a lifelong horsewoman and the founder of Equine Legal Solutions, PC, an equine law firm based in the Portland, Oregon area. Rachel is a member of the New York, California, Oregon and Washington State bars and is admitted to practice before the U.S. District Court for the District of Oregon and the U.S. District Court for the Central District of California. Rachel currently competes in three-day eventing.

Monday, February 16, 2009

The Legal Import of Horse Registration Papers

In examining what being the registered owner of a horse means, it's helpful to consider what a horse registry does, and what its purposes are. There are really three basic types of equine registries: breed registries, discipline registries and color registries. Horse breed registries, such as the American Quarter Horse Association or the Arabian Horse Association, are open only to horses of certain specific parentage. Some horse breed registries, such as the Oldenburg Verbrand or the Hannoverian Verbrand, also require horses to meet certain conformation and performance standards. Equine discipline registries, such as the United States Hunter/Jumper Association or the United States Dressage Federation, are open to horses who compete (or plan to compete) in particular types of events. Equine color registries, such as the Pinto Horse Association of America, or the Palomino Horse Association, are open to horses (and, often, ponies) meeting certain color or marking requirements.

The main purpose of a horse breed registry is to promote horses of particular breeding, and the horses may engage in all sorts of different disciplines. The main purpose of a horse color registry is similar - to promote horses of particular colors and markings, regardless of what those horse do for a living. Conversely, the main purpose of an equine discipline registry is to promote a certain type of competition, which may be engaged in by horses and ponies of all different colors and breeding. Note that none of the horse registries have the purpose of acting as arbiters of legal ownership (as opposed to registered ownership).

Registration papers are not the functional equivalent of bearer bonds. Horse registries accept and record transfers of ownership based upon their own internal rules. They do not generally take sides in legal disputes over horses' ownership. Rather, when there is a dispute about a horse's legal ownership, the registries typically advise the warring factions that they won't deviate from the registry's rules without a court order.

Therefore, horse registry ownership records, no matter what type of registry, are not a very reliable indicator of the horse's legal ownership. Although each registry typically has rules requiring changes in ownership to be recorded with the registry, in reality, many ownership changes aren't recorded, for myriad reasons, few of which are sinister. For example, if a new owner doesn't plan to exhibit the horse in sanctioned competition or breed it, they may not bother to file the paperwork and pay the fee necessary to re-register the horse in their name. Or, they may plan to sell the horse and not want to wait on the transfer to come through, instead selling the horse with the signed transfer from the previous owner. The horse might be registered with more than one registry, such as both a breed and a discipline registry, and only one of those registries is important to a buyer, so they only file the transfer with one registry and not the other. A registered horse might be leased to a person who wants to show it, but the registry rules require the horse to be registered in the name of the person showing it, so the owner allows the lessee to transfer registration of the horse into the lessee's name. The reasons why a horse's registered owner might be different from a horse's legal owner are practically endless.

As a result, registration papers provide a presumption of who the legal owner of a horse is, but that presumption can be easily overcome. Here's a common horse ownership dispute fact pattern. Betty Buyer buys a horse from Sam Seller. The horse is registered with a breed association. The registration papers show Sally Salesman as the horse's owner but two years ago, Sally sold the horse to Sam. Sam fulfilled all of his obligations under the purchase agreement he had with Sally. At the time of sale, Sam explains to Betty that Sam purchased the horse from Sally, but never transferred the horse into Sam's name, and gives her the original registration papers and a transfer form signed by Sally. Before Betty sends in the transfer form, Sally (who is angry when she finds out Sam resold the horse to Betty) obtains duplicate papers from the breed registry and claims to be the owner of the horse, making Betty's life miserable and preventing her from registering the horse in her name. Frustrated because she can't show the horse at registry-sanctioned shows until she gets it registered in her name, Betty sues Sally, seeking a declaratory judgment that she owns the horse. Betty will almost certainly win her case, because even though the horse may be registered in Sally's name and Sally may have a set of original registration papers, Betty can show the purchase contracts and proof of payment evidencing her superior claim of legal ownership, which trumps Sally's registered ownership in this situation. Note that Betty could have avoided this legal hassle by immediately registering the horse in her name, however!

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