Private Horse
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Private Horse
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When the object of the contract is the sale of a horse, everything is open for negotiation–the identity of the horse, the purchase price, the terms of the sale, warranties, time and method of delivery, and the passing of the risk of loss.
Posted by Milt Toby, JD | Jul 12, 2007 | Article , Sales
A private sale is exactly what the term implies, a transaction between a buyer and seller, and possibly a bloodstock agent or trainer, outside the structure and confines of a public auction setting. A private sale represents one of the cornerstones of capitalism and free enterprise, the idea that parties should be free to contract without interference for what they want. Unless a contract is for an illegal purpose, there are few restrictions on the bargaining between the parties.
When the object of the contract is the sale of a horse, everything is open for negotiation–the identity of the horse, the purchase price, the terms of the sale, warranties, time and method of delivery, and the passing of the risk of loss.
Cash sales are common and quite simple–the parties agree on a price, then money and the horse change hands. The seller and buyer should execute a written bill of sale and/or a purchase agreement every time a horse is sold. There is no standard form for either document, but, at a minimum, the bill of sale and purchase agreement for a cash transaction should include:
1. Identity of the parties, contact information, and a complete description of the horse.
2. Demand from the seller that the horse undergo a complete and thorough physical inspection, including a pre-purchase examination by a veterinarian of the buyer’s choosing and acknowledgment by the buyer that an opportunity for such inspection was offered. A seller cannot force a buyer to have a horse examined by a veterinarian prior to purchase. If the opportunity for such an examination was offered and refused, however, the buyer
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Milt Toby is an author and attorney who has been writing about horses and legal issues affecting the equine industry for more than 40 years. Former Chair of the Kentucky Bar Association's Equine Law Section, Milt has written eight nonfiction books, including national award winners Dancer’s Image and Noor . He teaches Equine Commercial Law in the University of Louisville's Equine Industry Program.
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Sounds fancy, right? Not to worry. Private treaty is just another way of saying that the seller communicates and negotiates directly with the horse buyer .
Private treaty sales are those that happen directly between the buyer and the seller. The seller has more control over the price and the home the horse ends up in. The buyer gets to see the horse in its typical environment and doesn’t have to deal with bidding.
Private treaties are very common. You’ve probably seen lots of horses posted for sale on Facebook or other sites. Instead of posting a price, they may state “Private Treaty.”
Reaching out and communicating directly with the owner about the horse is the basis of a private treaty sale.
With private treaty sales, an owner chooses to deal with potential buyers directly. With auctions , there is a “middle man” between the buyer and the seller.
A lot of times, this will be the same thing. Ads are often how private treaty sales are advertised.
Private treaty sales give owners more control. They can choose the price and make sure the next owner will provide the best possible home.
Auctions act as a middle ground between buyer and seller. The owner typically consigns the horse to the auction, who then markets the horse and tries to maximize the bid prices.
Sometimes you can. A few auctions (usually online ones) will allow offers to be made before the auction begins. The horse is then marked as ‘sold through make an offer.’
When buying a horse via private treaty, the buyer can meet the owner and see the horse in their typical environment. Usually, the horse will be calmer than at an auction. Not having to deal with the stress of bidding also is a nice plus.
Many sellers are personally invested in the well-being of their horses. Meeting prospective buyers means making sure the horse will go to a good home and offers peace of mind. Plus, no commissions have to be paid to an auction house.
This usually means the stallion owner is selective about the mares they will allow the stallion to breed. Most look for a certain level of quality, a proven show record, or specific/proven bloodlines.
Owners will often use ‘private treaty’ in place of a price for one of two reasons. The first is that the horse is expensive (think high five to six figures).
The second is that the horse is being sold for free, or cheap, and they want to make sure people with genuine interest are reaching out.
Almost all horse sales use a standard sales contract. You can find them online, or ask your trainer if she has one.
The next time you see a horse or a stallion listed as ‘private treaty,’ don’t be intimidated. Instead, take comfort in the thought that you’ll be dealing with an owner who truly cares about their horse.
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