About Me

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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, December 13, 2010

Reputation Isn't Anything, or Why You Can't Trust the Big Boys

At Equine Legal Solutions, we receive more calls about horse purchases gone wrong than any other equine legal issue.  In about half of the calls, the horse buyer was so impressed by who the seller was that they didn't exercise good judgment.  Because the horse seller was a well-known trainer and told the buyer the sale horse was sound and healthy, the buyer figured they didn't need a pre-purchase veterinary examination.  Because the seller was a leading breeder and told the buyer the horse was a top young prospect, the buyer bought the horse sight unseen.  Because the seller imports and sells hundreds of horses each year and had glowing testimonials on its website, the buyer didn't feel it was necessary to draw blood during the pre-purchase examination and test it for tranquilizers and pain medications.  In each case, the buyer thought that because the seller was well-known, they couldn't afford to sell the buyer a lame horse, a drugged horse or a horse with serious behavioral problems. 

In almost every case, the buyer contacted the seller to discuss the problem, expecting the seller to work with them to make it right because the seller was so well-known.  Instead, the seller didn't return the buyer's calls, or emails or text messages.  Or the seller did respond, but it was only to tell the buyer they had no idea what the buyer was talking about, that the horse was perfect when it left the seller's facility.  Sometimes, the seller even went so far as to imply (or even say in so many words!) that the buyer and the buyer's veterinarian, trainer, etc. simply didn't know a good/sound/healthy/well-trained horse when they saw one. 

How can well-known horse industry figures get away with selling lame, drugged and otherwise unsuitable horses to unsuspecting buyers?  Simple - there are generally no consequences.  Most of the time, the horse's price was low enough that it doesn't make economic sense for the buyer to sue the seller.  If the buyer takes the seller to small claims court, even if the seller loses the case and has to pay the buyer, the buyer is still generally stuck with the horse.  And, the buyer often has difficulty collecting a judgment from the seller and can't afford to hire a lawyer to help them.  Plus, small claims court cases aren't reported, so there's no easily accessible public record of the seller's loss.  Horse businesses generally aren't members of the Better Business Bureau, so filing a complaint with the BBB won't do any good.  And almost all "governing bodies" of horse sport, such as breed registries and the United States Equestrian Federation, will generally decline to intervene and typically aren't even willing to seriously entertain formal complaints against their members based on fraud and misconduct in horse sales.  So, the buyer has no recourse but to complain to anyone who will listen. However, unless the buyer is a well-known industry figure themselves, the buyer's complaints won't reach the ears of anyone the seller cares about (i.e., other customers).  The seller can easily brush off the few stories that might make their way onto Internet chat rooms as the isolated (and erroneous) complaints of one disgruntled (and clearly misguided) buyer. 

Horse buyers tend to think that well-known horse industry figures can't afford to sell inferior horses, but opposite is true.  Horse businesses can't afford not to sell their culls.  Not only are low quality horses and horses with problems not making any money for the sellers, they're actually costing the seller hundreds of dollars each month in feed, farrier bills, etc.  But, every horse sale puts money in the seller's pocket.  The math is pretty straightforward, and the incentive to cheat is just too big for a lot of horse sellers to resist.   

And, cheating is often pretty easy.  Certainly, it's easier than being honest.  Buyers make cheating even easier by not doing their homework before buying.  Most buyers won't knowingly purchase a lame horse, but if the seller gives the horse enough Banamine, the horse will test ride sound, and the sale will go through.  Most buyers aren't eager to buy a horse that cribs, but if the buyer never sees the horse in person before buying, they won't know the horse is a four-legged buzz saw until the seller has already cashed their check.  Most buyers won't buy a horse that flips over backward, but if the seller fixes the problem with a little Ace before the buyer's test ride, the buyer won't be any the wiser until they end up in the hospital. 


Deb said...

Here in NC there is an "Angie's List" in which people can post positive (or negative) comments about a business that provides services. Like eBay comments, people can be warned against businesses that do not stand up to their promises. Is there a list like this or site that allows buyers to post concerns about sellers who do this?

Corinna said...

Interesting post! This is why I always encourage people to use a lawyer before, and not after, a horse problem. Or at least take a horse on trial for 2 weeks with temp. insurance coverage prior to purchase. Any seller who won't agree is not a seller worth dealing with!

The most common complaint I hear is of cheating trainers: trainers who collaborate with other trainers to fraudulently increase a sale price, trainers who are not adequately training a horse (i.e., you are paying for 5 days a week of riding and the horse comes back still green).

There must be a way to balance out the cost-effectiveness of bringing suit....



p.s. I've been reading your blog for awhile now, and really enjoy it!

Rachel McCart, Equine Legal Solutions said...

I can understand why sellers won't agree to trial periods - even with a good contract, too much can happen. But, especially in this market, there's nothing to stop a potential buyer from trying out the horse thoroughly at the seller's place (several times if needed) and obtaining a thorough veterinary pre-purchase exam that includes a blood draw and any radiographs the veterinarian recommends.

Rachel McCart, Equine Legal Solutions said...

Hi, Deb. There's a new website called Rate My Horse Pro (www.ratemyhorsepro.com) that is intended to be sort of an "Angie's List" for the horse industry. I sure hope it catches on - we could use a good resource like that!

Corinna said...

You're right- if the seller has a product that you want, you're at their mercy. Unfortunately, when a sale barn is far away it can be unreasonable to travel multiple times to try a horse. And from my experience working in a sale barn, when the seller knew a client would come that day, the horse would receive "special prepping"- such as turnout, longeing, and a prior ride all before the client arrived! I've found that when leasing one of my horses, or sending a horse on trial, full mortality and major medical injury insurance coverage is the safest bet, despite the risks of "acts of God." I agree that a thorough pre-purchase is worth the cost to offset the risk of a potentially misrepresented sale horse.

-I also appreciated your BK post