It can’t have escaped your notice that the price of horses and ponies has dramatically increased of late.
The reason for the surge is unclear but it may be in part due to people reviewing their lifestyle choices as a result of the pandemic. Whatever the reason for the price increase, more than ever before, buyers are looking to auctions including those overseas, to try and keep the costs down.
In this article, specialist equine lawyer Caroline Bowler outlines some key points to consider when buying a horse at auction from the perspective of the law of England and Wales, but also flags where the laws of other countries may be relevant.
Horse Auctions Generally
Buying and selling a horse at auction can be a great experience for both parties involved. From the buyers perspective, there can be significant costs savings and often there is a much broader range to choose from in one place rather than travelling all over to individual traders. From the seller’s perspective, the whole sale process is wrapped up quickly with minimal fuss and effort.
However, buyers, in particular, need to be aware that traditionally auctions have also been used to offload troublesome horses – so it is not a risk-free way to buy. The simple fact is that it’s those risks which bring the prices down. Risks can be minimised by taking the time in advance to prepare and being fully aware of what and how you are purchasing.
Deciding Which Lot You Might Be Interested In
If you are lucky enough to be able to attend the sale in person, it goes without saying that, you should carry out a physical inspection of the horse. You should also ask the vendor to see the horse run out or in the case of a horse that is backed you should request to see it ridden. It is becoming more commonplace for some vendors to have had the horse vetted prior to the sale. Some sales will also offer veterinary inspections on site.
An inspection by a vet is perhaps more important if you are buying online via telephone given that you will not have had the opportunity to inspect the horse in person. In the absence of a vet inspection, it is at least recommended that you ask someone present at the sale to look over the horse.
The auction catalogue will usually contain a basic description of the horse. If the vendor wishes to add and/or alter that description they will request that the auctioneer does this whilst the horse is in the sales ring.
Legal Issues with Horse Auctions
When the hammer falls a binding contract is created. Bearing in mind how quickly everything happens on auction day, it is imperative that you are aware of the terms you are signing up to before starting to bid.
Located within the catalogue and/or in clear view on the auctioneers’ website should be a full set of terms and conditions which will form part of the sale at auction. You may find that there are various exclusion clauses which limit the claims which you could bring against the seller, if there happened to be problems with your purchase and you need to factor in the risk there could be problems when deciding how much to bid.
It is also worth bearing in mind that second-hand goods sold at an auction you can attend are not covered by the usual consumer rights protections so a lot of implied protections available to a consumer do not apply including the fact that you do not have a “cooling off period” i.e. if you change your mind after the hammer has fallen you are unlikely to be able to pull out. Other common implied terms such as satisfactory quality and fitness for purpose may be modified by the auction contract (assuming it is reasonable for the auction house to do so) meaning that there could be no come back if the horse has issues you were not aware of.
It is not all doom and gloom. Consumers do have some rights when buying a horse at auction. These include that the horse should match the description in the catalogue and any description given pre-sale and although the contract for sale is with the seller, false statements made by the auctioneer can give rise to a claim in misrepresentation against the auction house as well. Some auction terms will also oblige the seller to take the horse back and provide a refund where there is a problem with the horse.
International Horse Auctions
It is becoming increasingly common for buyers to buy from auctions abroad. My colleagues quite quickly realised that when I say I am “going to Ireland” it is generally to an auction and I am generally going to come home with at least one horse.
Extra care should be taken when buying at international auctions as the “jurisdiction”, i.e. the law which applies to that particular contract, is likely to be the law of the country in which the auction house is based and the auction takes place. It is not possible to give you a rundown of the law applicable in every jurisdiction but the key point to note is that it may not be the same as other purchases you have made elsewhere. Know before you go!
You will often find a jurisdiction clause within the auction house terms and conditions, they are generally easy to spot and often are quite straight forward e.g. “The law of England and Wales applies to this auction”. If there is no jurisdiction clause then the law of the location of the auction house is likely to apply but there may be other jurisdictional issues to think about.
Online/ Telephone Only Horse Auctions
As a result of the pandemic, these have become more popular. Under the law of England and Wales at least, if you are not able to attend an auction in person then additional protections apply.
Other Horse Contracts
So you’ve “won” the auction for the horse you had your eye on, what next?
Unless you are able to take the horse away in your own transport there and then it is likely you are going to have to arrange transport. Again, prior research is key to make sure you know exactly what you are signing up for. Which law governs the contract? When does risk pass i.e. if the horse falls and injures itself in transit who is liable?
Checking the contract you might be entering into with the transport company is a good idea in addition to making sure that there is the appropriate insurance in place. Again, there can be jurisdictional issues if the horse is being transported from one country to another in terms of which law applies. With transportation contracts in particular there can be added complications in determining which law applies if there is not an express provision in the contract but thankfully if you use a reputable provider the contract should be complete.
In reality, a lot of transport companies will not have terms and conditions in place. In those circumstances, it is at least worth checking whether the transporter has insurance in place to cover any damage sustained to your precious cargo. If not, then it might be worth putting insurance in place yourself.
Top Tip For Buying a Horse At Auction
Aside from checking where you stand before getting bound by any agreement our top tip would be to make sure to keep a copy of all of the information you have been given until you are comfortable everything is ok. An example of this may be to record the horse whilst in the sales ring. This will record any declarations made by the auctioneer, or, as the case may be, any declarations that are not made. As above, it may be possible to bring a claim if a lot is not as described but first you would need to prove how it was described.
Summary – Buying a Horse at Auction
Buying at auction is a risky business but the benefits in terms of costs savings if you get it right can be beneficial. Preparation and research before you even think about bidding are key to minimising risk. In the unfortunate event that you realise that there is a problem with the lot that you have purchased we would encourage you to promptly seek advice.
Posted on September 23, 2021