A private sale is normally between one individual and another. Neither seller nor the buyer is engaged in a business of selling or buying horses.

If a horse behaves badly for the new owner, he or she can jump quickly to the conclusion that the horse is unsuitable and the seller must refund the price.  If only it were that simple: there are numerous obstacles to a successful refund claim.

We have all come across the expression “Buyer Beware” (in Latin, “Caveat Emptor”).  In private horse sales, which are unregulated by the Australian Consumer Law, this expression aptly describes the imbalance between what the seller knows about the horse compared to the buyer. Sure, the buyer can inspect the horse to evaluate suitability but we all know how difficult it is for a buyer to arrive at an accurate assessment in the course of a short inspection. Asking lots of questions in an attempt to capture a full and accurate history of the horse in hand and under saddle is another means of coming to an informed decision but this has its limitations: knowing what to ask and how to evaluate the responses is challenging, not to mention evasiveness and cunning on the part of some sellers, especially where the horse is dodgy. It should also be remembered that in private sales, there is no obligation on the seller to disclose anything or everything.

The bottom line is that, in absence of fault on the part of the seller, the buyer bears the risk that the horse is unsuited. So what kind of faults are sellers prone to commit in the area of private horse sales that can give rise to the right to claim a refund?  There are 2 principle varieties and each poses hurdles for the buyer.

Firstly, there is the breach of sale agreement kind. “I wanted a quiet, easy to ride horse and I was sold one that wouldn’t go forward but instead tossed its head before going backwards. I didn’t get what I paid for”.  Problem is, most horse sales are still word of mouth and there is no written agreement to rely on to prove the agreed terms of the sale including, in this example, that the horse was quiet and easy to ride. As the sale is devoid of written form, a disgruntled buyer cannot proceed confidently with a breach of sale agreement claim because there simply exists no evidence, aside from the buyer’s say so, of what the seller said.  The buyer must also prove that, even if the seller said what is alleged, it amounted to a legally binding statement, in other words, a warranty.  This is an area of law that draws distinctions between statements that are actionable (warranties) and ones that are not and the law has evolved various legal tests to determine the legal nature of pre-agreement statements.

Another difficulty associated with a breach of agreement claim concerns the requirement for the buyer to prove that the horse was at the time of sale, in breach of the alleged warranty that it was quiet and easy going. The fact that the horse behaves otherwise post sale does not prove ipso facto a breach of agreement. This is often a difficult thing for an unhappy buyer to grasp, but that is the law. The longer the interval between the sale and the behaviour giving rise to the complaint, the greater the difficulty of proving the quality of the horse at the time of sale given everything that intervenes such as the new home environment, rider’s skill and technique (or inexperience), feed and so on. The buyer also has to overcome, in this context, praise of the horse made by email, SMS or on social media.  Sometimes there is a lengthy engagement between buyer and seller about how well the horse is going.  It is difficult in such cases for the buyer turn around and prove that the horse is and was from the time of sale otherwise than as portrayed in these electronic exchanges.

Second, misrepresentation.  A statement of fact which is untrue is a misrepresentation. There are various hurdles to a successful claim on this ground.  If a statement of fact is not in writing, then once again the buyer is faced with a problem of proof.  It can be a case of ‘He said, she said’.  Without something in writing or a witness to corroborate the buyer’s evidence of what the seller is claimed to have said, the buyer’s case is uncertain. The law also classifies statements: not all words and expressions are statements of fact in the eyes of the law. Sometimes they are no more than hyperbole, such as “This horse has Olympic quality gaits”.  Advertisements of horses for sale often contain hyperbole.  Predictions are statements of fact only insofar as they explicitly or impliedly contain statements of fact on which the opinion or forecast is made.  Just because a prediction is unfulfilled, does not mean that it was a statement of fact or that it was untrue.  And often predictions cross over into hyperbole anyway.

If the making of a misrepresentation can be established (such as in a written communication), the buyer must then prove that he or she relied on the misrepresentation in deciding to buy the horse.  Reliance is often difficult to prove where there has been an inspection of the horse with the result that reliance is usually a highly contentious issue in a misrepresentation case. The seller can reasonably argue that the buyer relied on his or her own knowledge, skill or expertise in the decision making and not on anything that the seller said.  If the buyer involved a coach or another expert third party in the investigation and evaluation of the horse, reliance is further diminished.  Where a horse is bought sight unseen, the buyer often involves third parties in a review of images and video.

Social media attacks on the seller and making demands for a refund without recognising the difficulties associated with a legal claim are imprudent and often completely unjustified.  The buyer should prepare a chronology of events leading up to the sale and collate all written communications with the seller up to the time of payment for the horse and go to a lawyer for advice.

17 May 2018

© 2018 Michael Mackinnon, Solicitor & Independent Counsel