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122 SIDELINES FEBRUARY 2011 FOR HORSE PEOPLE • ABOUT HORSE PEOPLE

the sale and or transaction of goods. Goods are anything that is movable at the time of identifcation; as a result animals are considered goods and thus governed by the UCC. The Court frst had to determine whether the express and implied warranty provisions of the UCC apply to sales that are made at auction. The Court found that they did and as a result was able to move to the next issue and determine whether the disclaimer made in the auction catalog precluded the buyer from successfully raising a claim that an express warranty had been made as to the colt. The Court found that specifcally the section of the UCC concerning express warranties holds that if the fact fnder (the party determining the facts of the case but not necessarily the law) determines that a seller’s statement created an express warranty, a disclaimer will have no effect if the disclaiming language would be inherently inconsistent with the warranty. As a result, a seller who explicitly “warrants” or “guarantees” that the goods being sold are without defects then that party can not set up a disclaimer claiming that the express warranty should be barred once they have been sued because the goods sold did not live up to the warranty. The Court in this case found that it would be unreasonable to allow a disclaimer for the express warranty, which was made by both the auction house and the farm selling the colt.

In the decision the Court stated that when a seller discusses with the purchaser the item being purchased they make the qualities discussed a part of the contract. Therefore it is presumed that the purchaser does not intend to waive any warranties (those claims of performance, condition or suitability of the goods being sold) made by the seller and thus the disclaimer should not be part of what has been agreed upon by the two parties.

Conclusion

If you are a purchaser, listen carefully to the statements the seller is making about the horse you are buying during the negotiation process. If you are the seller, be careful of how you represent the horse that you are selling. Do not make broad sweeping statements which are not true and then expect to be exonerated

from having to live up to those statements merely because you have a disclaimer in your written contract.

E Q U I N E L A W

Lisa Hollister is an attorney practicing in Cincinnati, Ohio. Questions for Ms. Hollister’s column can be addressed to twinbridgefarm@aol.com

Be Careful How You Represent A Horse: Some Sellers Find No

Protection Under Express Warranty

By Lisa Hollister, Esq.

Often a sales contract or bill of sale will contain language disclaiming any warranties either implied (those for ftness of purpose) or express (those made with a specifc guarantee). Courts have upheld such disclaimers, which often come in language such as “No Warranties” or “As Is”, but not under all circumstances. Minimally, to uphold such language the disclaimer must not be obscure. Rather, it must be prominent, giving the buyer notifcation that the sale has some conditions attached to it limiting buyers from making claims against seller after the purchase. However, if the seller has made an express warranty (either verbally or in writing) during the negation process or in the contract between the parties, the disclaimer will not waive the warranty.

Travis v. Washington Horse Breeders Association, Inc., 759 P. 2d 418

Facts

Robert Travis became familiar with a racehorse auction through advertisements which promoted horses offered for sale and advertised them as being “truly outstanding” and “born to run.” The advertisements promoting the horses were run on television, in the Washington Horse Magazine and the Daily Racing Form . Four days prior to the sale, Travis visited the auction grounds and met with Dale Leach, an agent of Northwest Farms. Leach told Travis that Hip No. 2, the horse which Travis was interested in, was a “fne athlete” and “in very good condition.”

During the sale Travis purchased the colt for $25,000. One week after purchasing the colt, Travis had the colt examined by a veterinarian who detected a loud heart murmur. Travis immediately contacted the sellers and requested rescission of the sale (the annulling or unmaking of the contract for the sale of goods), and was refused. The sellers alleged that because of the language in the auction catalog, the sale could not be rescinded once the horse was removed from the grounds. Travis then obtained a more extensive vet check, which found that the horse was unsound and should not carry a rider. Both the seller and the auction house based their position that the sale was fnal on the Disclaimers of Warranty contained in the sales catalog.

Travis fled a lawsuit against the auction house and seller for implied warranty of merchantability, implied warranty of ftness for a particular purpose, express warranty, mutual mistake and the Consumer Protection Act. The jury returned a verdict for Travis in favor on each of the fve claims. To simplify matters, this article will only deal with the claim for a breach of express warranty.

Express Warranties & the Appeals Court’s Decision

Uniform Commercial Code Article 2 (UCC) governs