112 SIDELINES SEPTEMBER 2013
FOR HORSE PEOPLE • ABOUT HORSE PEOPLE
e
Equine Law
By Lisa Hollister, Esq.
When you purchase a horse you rely on statements made by
the seller and the seller’s agent. If those statements are untrue
then you may have recourse not only to rescind the purchase
but also collect additional damages. But what if the statements
regarding the horse are made after the contract to purchase it
has already been entered into? That was the situation in the case
Texas of Dixon v. Herman, No. 05-09-00544-CV.
Facts
In 2002, Ashli Herman purchased a horse named Paramour.
After purchasing the horse she kept and showed Paramour with
trainer Matt Cyphert. In 2005, Herman asked Cyphert to market
and sell the horse for her. The arrangement they made was that
Cyphert would take over the cost and expenses as well as all
sales strategies associated with the marketing of the horse while
Herman retained the right to accept or reject an offer which was
lower than the original asking price of $125,000.
When another trainer approached Cyphert saying that he was
looking for consignment horses to take and sell at the Indio horse
show in California, Cyphert agreed to place Paramour with this
trainer in exchange for a commission from any sale which might
occur during the time the horse was in this second trainer’s care.
Approximately a month later a third trainer approached either
Adrienne Dixon or one of her trainers and asked if Dixon would
ride the horse in competition to help market the horse to potential
buyers at the Indio horse show. At the end of the show, Herman
agreed to allow Dixon to take the horse to Northern California
to be ridden and shown by Dixon. It was also agreed that Dixon
would then take over the board bills while Paramour was being
ridden and shown by Dixon.
When Cyphert decided that the hose should be returned to
Texas to continue marketing it for sale, the Dixons asked if the
owners would be willing to sell the horse for a reduced price
of $100,000 to which Herman agreed. At that time Dixon wire
transferred the purchase price. The ensuing Bill of Sale listed
the horse’s “Approximate Age” as 11 but when the new owner
received the USEF certificate it listed the horse as being 13 years
old. When the Buyer contacted Cyphert about the discrepancy,
Cyphert stated that USEF had made a mistake. As a result,
Dixon retained the horse and showed it several months until she
received verification from the Warmblood
Association that the horse was in fact 13.
Upon learning the true age of the horse,
Dixon demanded return of the $100,000
purchase price and when the demand
was refused she filed this lawsuit.
Issues raised by Dixon at Trial
Dixon filed a lawsuit against the seller and seller’s agents
based on claims of Breach of Implied Warranty, Violation of
the Deceptive Trade Protection Act, Breach of Contract, Fraud,
Fraudulent Misrepresentation and Rescission. The Defendants
asked the court to dismiss the case based on summary judgment
(summary judgment is granted when the requesting party is able
to show that there is no genuine issue of material fact and as
a result the requesting party is entitled to a judgment in their
favor.) The trial court dismissed the case based on the fact that
any representations as to the horse’s age were made after the
contract was completed.
Appeals Court Decision
Formation of the Contract:
The appeals court stated that
the evidence showed that the seller and seller’s agents did not
make any representations regarding the horse’s age prior to
the sale. The court further stated that a valid contract requires
“a meeting of the minds, an offer and acceptance.” Because all
of these elements had already been completed at the time the
Buyer inquired as to the age of the horse, it could not have been a
condition of the formation of the contract.
Fraud or Fraudulent Misrepresentation:
On appeal,
the appeals court stated that in order for fraud or fraudulent
misrepresentation to be present there must be a material
representation. The Court reviewed the elements necessary for
a successful claim under the Deceptive Trade Protection Act: “1.
The plaintiff is a consumer; 2. The defendant engaged in false
misleading or deceptive acts; and 3. These acts constituted a
producing cause of the consumer’s damages.” Looking at the
facts, the Court determined that the representations made in the
bill of sale, which admittedly took place several weeks after the
contract had been formed, were never part of the contract. As a
result the court did not find that fraud, fraudulent misrepresentation
or a violation of the deceptive trade protection act had occurred.
Breach of Warranty:
The final issue to be resolved was whether
or not the trial court properly dismissed on summary judgment the
plaintiff’s claim of breach of warranty. While Dixon argued that
there was a warranty even though the horse was sold “as is” the
court found that any representations made regarding the age of
the horse were made after the contract was concluded and as
a result Herman could not have violated any warranty issues on
this sale and affirmed the trial court’s judgment in favor of the
Defendant.
Conclusion
Before you purchase a horse make sure it is what you want.
If you are looking for a horse of a certain age category, breed or
show record you need to ask the seller or seller’s agent about
those qualities before entering a contract to purchase the horse.
Courts will not hold the seller accountable for representations
made after the contract has been entered into.
Lisa Hollister is an attorney practicing
in Cincinnati, Ohio. Questions for Ms.
Hollister’s column can be addressed to
.
Buyer Beware On Statements
Made After Purchasing a Horse
