Equine Law Blog

Papers, Papers - Who has the Papers? Part I – Legal Rights in Registration Paper Disputes

Two months ago you bought the mare you always wanted.  Your goal was to win championships in breed-recognized horse shows and then retire the mare for breeding.  A terrible problem has derailed your plans:  The seller will not transfer the horse's registration papers into your name.  Your arsenal of weapons is limited -- there is no written sales contract, but you recall the seller promising to send you the horse's papers "right away" the day you gave him your money (a promise he now denies ever making).

What are the buyer's options in these types of situations?  Here are a few of them:

• Sue the seller to fulfill (or to "specifically perform") his promise of transferring the horse's papers into your name.  This option, although it seems easy, can be very complex.  Courts may be unwilling to grant this remedy, known as "specific performance," unless you can convincingly prove: (1) the horse is unique, and only with its registration papers in your name will it have value; and (2) there is no other legal remedy, aside from getting the registration papers in your name, that will adequately compensate you in this situation. The sad fact is, if the seller lacks registration papers and cannot convey them to you, you are left to pursue other legal options.
• Sue the seller to nullify ("rescind") the sale, take back the horse, and compensate you.  In a case of this type, you would assert that the seller sold the horse to you through a fraudulent deception - he represented the horse had transferable registration papers, when, in reality, he had none.  A lawsuit of this type tries to restore everyone's position as though there had never been a sale.  That is, you would demand, at a minimum, that the seller take back the horse, refund your full purchase price, and reimburse you for all expenses you incurred in keeping the horse.  In most states, small claims courts cannot handle these disputes.
• Sue the seller to recover the difference between the horse's value with papers (which you thought you bought) and the horse's value without the papers (which you actually bought).  This option makes sense if you want to keep the horse, and you would seek to recover the overpayment.
• Other options.  Other options against the seller might include a lawsuit alleging a violation of an applicable state's consumer protection/deceptive trade practice law, violation of provisions in a state Uniform Commercial Code, and more.  Because of complexities in the law and variations among states, your lawyer can help you explore your options.

Part II of this series explores how to avoid these disputes.  Keep in mind that a knowledgeable lawyer can help you avoid or respond to a sales dispute.

Categories: Sales/Disputes