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Jill Headford

Posted 3 November 2011
by Jill Headford

Disclaimers and horse sales

I have been known to blog about the statutory warranties of “satisfactory quality”, “fitness for purpose” and “correspondence with description” which are automatically given by a horse dealer, breeder or producer to a private buyer.  I am often asked if these can be excluded by a suitably worded a disclaimer.

There are three key points to appreciate here:

  • The statutory warranties as to quality etc only apply in the first place if the seller is a dealer (i.e. sells in the course of a business).
  • If the buyer is a consumer (i.e. buying a horse for personal or private use and not for a business purpose) then the seller cannot exclude the warranties and any attempt to do so will be unenforceable (legalese for “not worth the paper it’s written on”).
  • But, if the buyer is a business buyer (e.g. professional rider, dealer, stud buying in stock, racing yard, riding school, etc) then the seller can exclude the warranties to the extent that it is reasonable to do so.

So, when is it reasonable in a business to business sale for the seller to exclude the statutory warranties?  It depends on all the circumstances (naturally!) but the law does give some guidelines:

  • If there are unequal bargaining positions and no other source available, an exclusion is less likely to be reasonable.  This probably applies more to electricity or water utilities than sellers of horses.
  • Where there is some inducement to buy, which doesn’t apply to other similar goods on offer, it may be reasonable to exclude the warranties – e.g. if the horse comes with tack and rugs and free delivery, or there is a trial period, that may offset the warranty exclusion.
  • If the buyer was unaware of the exclusion, even though it was in the paperwork – perhaps it was buried in small print and not drawn to their attention – that might make it less reasonable.

The reasonableness of a condition that you can only reject if you do so within, say, 7 days might depend on how practical it would be to comply.  In the case of a horse, a week would be very short but, a month may not be.
Manufacture, adaptation or process to the buyer’s special order would be a relevant factor but unlikely to apply to horses.
Two other points –

  • The question of reasonableness is assessed as at the time of the sale, not later when things go wrong and
  • It is up to the seller to establish that their exclusion clause is reasonable.

So there you go:  private sellers – question doesn’t arise.  Business to consumer – no exclusions.  Business to business – reasonableness test.

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About the author

Jill Headford

Jill Headford

Partner

A partner in the firm since 1994 and an experienced Court and Tribunal advocate, Jill specialises in resolving disputes and is a member of the Property Litigation Association