What rights do I have as a buyer? What does warranty exclusion or transfer of risk mean? Is the horse in the horse purchase contract really the right one? We have summarised for you in this guide what you have to expect and what you have to pay attention to in a horse purchase contract. Including a sample purchase contract for download (in German only)!
Table of Contents
Everyone who buys and sells horses has already dealt with the topic of a horse purchase contract. You will learn from us what you as a rider or the breeder must consider. In addition, you may learn what else should be considered before purchasing a horse in this guide.
Essential components of a horse purchase contract – Tips
Contracting parties & disclaimer of warranty
First, the contracting parties, i.e. buyer and seller, are defined in the purchase contract.
As a buyer I should then ask myself 2 questions:
- Is the seller also the real owner of the horse?
To do this, you can ask to see the horse passport, because the owner is usually indicated there.
- Is the seller a private person or a company?
Seller: Company + Buyer: Private = Commercial contract
Seller: Private + Buyer: Private = Private contract
If the seller is a company, a commercial contract is concluded. This means that the buyer has warranty claims. Warranty claims are rights for defects according to § 437 BGB (german civil code). We have summarised them here.
437 No. 1: Subsequent fulfilment
The rectification of the defect by the seller, as long as it does not involve disproportionately high costs for the seller.
437 No. 2: Withdrawal
A buyer may withdraw from the contract if the defect is not insignificant.
437 No. 3: Reduction
Reduction of purchase price: Instead of withdrawing from the contract, the purchase price can be reduced or a part of the purchase price can be refunded by the seller.
437 No. 4: Damages
Damages: The buyer can claim damages in addition to the other claims.
These rights apply, for instance, if a chronic illness in the horse is diagnosed after the sale but was unknown at the time of purchase. However, the rights for defects may be excluded if the seller is a private individual. Then it is referred to as a warranty exclusion.
Object of purchase – the horse
The object of purchase is the horse. It does not matter to which horse breed the animal belongs, whether it is a pony or whether you want to buy your riding partner – The object of purchase remains the same.
Here is a checklist, which data of the horse are needed:
- Name
- 15-digit life number
- Sex
- Pedigree
- Markings
To make sure that the correct horse is indicated here, the implanted chip of the horse can be read, which indicates the life number. The implantation of a chip is mandatory for all horses born after July 01, 2009.
A purchase contract is an essential part of buying a horse.
What must be included in a horse purchase contract?
A horse purchase contract should contain the name and address of the buyer as well as the details of the object of purchase (the horse), payment information and other important information.
Purchase price and payment terms
The purchase price and the time and method of payment must also be specified in the purchase agreement. If payment is made by bank transfer, the seller’s bank details should be included. A cash payment or payment in instalments can also be agreed upon and must be recorded in the purchase contract.
Transfer of ownership and risk
Sellers are often very keen on retaining the ownership. The seller is the owner until the full purchase price has been paid by the buyer.
However, in the seller’s interest, the transfer of risk should take place as early as possible, i.e. preferably as soon as the contract is concluded. This way the buyer immediately bears the full risk should the horse get injured or even die (deterioration & loss). Logically, the buyer takes a risk with this. So it makes sense to specify in the purchase contract that the transfer of risk is the time when the horse is picked up by the buyer or arrives at a new home.
Further agreements in the horse purchase contract
- Warranty rights / warranty exclusions
As already explained at the beginning, private persons are allowed to exclude warranty claims.
- Agreements on quality
Was a certain level of schooling promised? (farrier, loading, etc.)
Does the horse have competition experience or even successes?
Is it suitable for breeding?
What is the health status?
Important to know – The written form clause
The written form clause states that only what has been recorded in writing is legally binding. You should never neglect this clause, as it is essential in the event of a dispute.
Horse purchase contract – What documents must be handed over?
All important documents must be handed over to the buyer.
The horse passport and ownership certificate are especially important, yet the breeding certificate or the stud certificate can also be included if necessary.
Form of the horse purchase contract
Yes, handshakes and verbal agreements are also legally valid means of concluding a purchase contract. However, the risk is very high with these methods, because what happens if one of the contracting parties suddenly no longer adheres to the deal? In that case, there is not much you can do about it. A written purchase agreement is therefore a clear must when buying a horse.
Procedure of a horse purchase
How does a horse purchase actually proceed? Of course, this is always a little different, but a standard horse purchase looks like this:
- Viewing
First you have to find a horse that meets your criteria. Which horse suits you depends solely on you. You have to decide beforehand how old, how tall and how well trained the horse should be. Then you start your search and look for your dream horse, for example, on the large horse market of ehorses.
- Trial (depending on the level of training of the horse)
In most cases the horse is ridden 1 to 2 times and then you have to make a decision. In some cases, however, a trial period is also allowed.
- Pre-purchase examination (vet check)
The results of the examination should be included in the purchase contract. The results of the examination should therefore be written down in the purchase contract.
Let your trainer, a breeder or a veterinarian accompany you during the pre-purchase examination. It is always important to have an experienced person who can give you good advice and tips when making difficult decisions.
How long after the purchase of the horse may I withdraw the contract?
The buyer has the right to withdraw from the purchase contract, only if a defect has been present at the time of delivery. As a rule, the buyer must assert his rights within two years.
What has to be done after the horse purchase?
The change of ownership of horses must be declared to the German Equestrian Federation. It is the buyer’s responsibility to send the necessary form and horse passport to the Federation.
Sample horse purchase contract
You have already found your dream horse? Create your individual purchase contract now! CLICK HERE (only in German).
What has to be taken into account in a horse purchase contract?
It must be ensured that all important points are included in the horse purchase contract to safeguard the buyer and seller.
Important questions regarding the horse purchase – Interview with an expert
In recent years, our buying habits have generally changed a lot, and so has the purchase of a horse. Attorney Andreas Ackenheil specialises in the topic of equine purchase law and has answered the most important (legal) questions on this topic:
- What should buyers or sellers pay attention to before the purchase is closed?
Usually a viewing session is arranged, during which the buyer can examine the horse in more detail and also test ride it. It is not uncommon for buyers to decide on a different horse during the viewing session.
2. What qualities should my horse have?
Usually the horse is bought for a special purpose. Is it only to be used for recreational riding or do you want to participate in competitions with it? Should it be unbroken, broken in or already have a certain level of training? These so-called characteristics of the horse can be made the subject of the purchase contract, for which the seller is liable if the horse does not actually have these characteristics. The inclusion of these terms facilitates the presentation of evidence in the event of a dispute.
3. Why is a written purchase contract required?
A horse purchase contract concluded verbally also has validity. Nowadays, more and more “sales talks” are conducted via WhatsApp or Facebook chats. However, this is not advisable from a legal point of view, as it is often no longer possible to retrace which specific provisions the contracting parties agreed upon. Which characteristics of the horse were agreed upon in the sales talk, what happens if the horse has a genetic disease, for example, what purchase price was agreed upon, etc.? Verbal agreements or even chat conversations usually lead to difficulties in providing evidence.
4. What data should be included in a purchase contract?
In addition to the data of the contracting parties, important information about the horse to be sold should also be included in the purchase contract. This ensures that the horse can be identified in the event of a dispute. In any case, the life number and the breeding association should be included. It is also advisable to include special characteristics of the horse, such as the coloring or whether it has markings. This data should be controlled with collection of the horse also, advises Attorney Ackenheil. In case of dispute, the horse can be accurately identified.
5. If you want to buy a horse privately, does the private buyer have special rights?
If you have bought a horse as a private buyer, the important legal regulations concerning the purchase of consumer goods apply. These have a significant impact on the purchase contract or the further steps in case of a problem. With the purchase of consumer goods, a commercial seller, such as a horse dealer, sells a horse to a private buyer. In this case, the seller cannot completely exclude the warranty, for example. During the first 6 months, there is also a change in who holds the burden of proof. If the horse has a sickness for which the seller is responsible, then this applies. In this situation, the seller must provide evidence that he sold a sound horse. “The private buyer thereby gets a specific protection of his rights toward the seller,” says Attorney Ackenheil.
6. How can the seller prove the health of the horse?
In case of any health problems of the sold horse later on, especially if the contract for the sale of the horse has only been concluded verbally, there is always the difficulty of proof. For instance, the seller is well aware that he has mentioned this health problem of the horse, but the buyer swears that the seller has not mentioned anything of this kind.
Particularly with high-priced horses a recent veterinary investigation (vet check) should be necessarily done, says horse law expert Ackenheil.Among other things, the veterinarian can evaluate the horse on the basis of the X-ray results which provides the purchaser a veterinary evidence to facilitate his purchase decision.The veterinarian is usually also liable for the assessment he or she has carried out, and therefore has an interest of his or her own in a valid veterinary judgement. If a veterinary examination has been carried out, this should also be included in the contract.
7. Is there an exclusion of liability for the horse seller?
Between private persons, liability for defects can usually be excluded. Therefore, special attention should be paid when purchasing a horse from a private person. The commercial seller (usually the horse dealer), on the other hand, cannot completely exclude liability; he is liable for a “used” horse (older than 6 months) for at least one year, which provides the buyer with some preliminary security. When buying a foal, the legal warranty period of two years usually comes into effect, since according to the case law of the Federal Court of Justice, a foal is considered a “new object” to which the two-year warranty period applies. Therefore, special caution is advised when reading conditions in the contract such as “the horse is purchased as seen and test ridden”. Horse law expert Ackenheil: “Whether the seller is operating as an entrepreneur when selling a horse is often the subject of legal disputes.”
8. Can the limitation period in a horse purchase contract be shortened at will?
We often read in contracts that the limitation period is shortened to 3 or 6 months. However, this is not legally possible, especially when selling a horse to a consumer, such a clause is therefore invalid. The seller is usually liable for a period of 2 years from the delivery of the horse. Therefore, such a claim must also be asserted to the day within 2 years from the delivery of the horse.
Attorney Ackenheil mentioned: “However, if the seller has fraudulently misled the buyer about the terms of the purchase contract and the deal has been done, the limitation period is extended to 3 years from the end of the year in which the purchase contract was signed. As a result, particular caution is required while making claims.”
9. Ineffective contract terms
A purchase contract may have many general terms and conditions. These are pre-formulated agreements in the contract, which is why the principles on general terms and conditions apply to them. Nevertheless, the actual legal effectiveness of these agreements is not always ensured. In my almost 20 years as a lawyer, I have had to read many nonsensical terms in a horse purchase contract. Often such contracts are simply signed, without the particular regulations being read exactly, says Attorney Ackenheil.
However, in accordance with the general terms and conditions, such rules are ineffectual, for instance, if they significantly disadvantage one contractual partner over the other or are so unexpected to him that he does not need to account for them in the contract. For the buyer, these regulations can represent a ” rescue anchor “, on which one should not rely, however, the inefficacy of particular contract regulations is often only determined by the court in a quite lengthy and cost-intensive process.
10. I want to buy a horse from abroad, what do I have to consider?
Particular caution is advisable when a horse is purchased from abroad. If a defect occurs in the horse within the warranty period, the buyer’s claims must usually be asserted abroad. The relevant European regulations only provide for a few exceptional cases in which claims can also be asserted in the buyer’s country of residence. For example, if the seller has focused his business only on that particular country and therefore sells horses almost exclusively to that country. This is ultimately a question of proof, which can often only be clarified in court, according to lawyer Ackenheil.
11. Data protection and social media – what can be published?
Nowadays, social media is taking up more and more space in our lives. It is not uncommon for a prospective buyer to post about the purchase of a horse, for example. If you have only test ridden a horse but not yet bought it, you are not allowed to use a photo of the horse on your social media channels without the owner’s consent. The owner can claim injunctive relief against the buyer and this can quickly become quite expensive. This also applies in principle to photos that the seller uses himself on a sales platform on the Internet to make the prospective buyer aware of the horse. The rights to use the photo belong to the seller who created the photo. After the purchase of the horse, no obstacles stand in the way of publication.
12. What are the arguments against a horse purchase contract downloaded from the Internet?
Many purchase contracts offered for download on the Internet are unfortunately outdated, contain legally invalid terms and are therefore not recommended.
On the other hand, the increasingly popular legal assistance tools for creating contracts can be a cost-effective alternative. Together with TripliQ and Ackenheil Law Firm, we provide an individualised horse purchase contract as a reliable and affordable safeguard. Quickly and easily, by answering individual questions step-by-step, according to your specifications and taking into account case law, you can create a horse purchase contract that regulates the most important problem points in horse purchases. Unfortunately it is only available in German language.
P.S.: For all further legal questions and special regulations, however, you should not be afraid to seek the advice of a lawyer specialising in horse purchase law.
