Disclaimer – This article is intended as general discussion and information on the topic covered, and is not to be construed as rendering legal advice. If legal advice is needed, you should contact an attorney. This article may not be reprinted or reproduced in any manner without prior written permission of the author.
I have received many phone calls of late concerning boarding horses. In these challenging economic times many horse owners are looking for added income and if you have sufficient real estate and a barn, boarding horses may supply the added income to keep up with increased expenses.
However, boarding horses is not without risk and anyone who boards horses should be aware of the requirements to protect the individual and the individual’s property from lawsuits and legal liability.
The law provides that all individuals who charge board for a horse or horses must provide a reasonably safe environment and must use reasonable care in boarding the horse. Thus, the facility and its employees must be prudent in the degree of care rendered for a horse boarded at the facility. Stalls must be securely constructed and maintained and feed and water adequately provided at a minimum.
It is very important to have a written boarding agreement which clearly defines the responsibilities of the boarding facility and the owner of the horse. A boarding contract can limit your liability for loss and give you rights to sell a boarder’s horse and tack in the event of abandonment and non-payment.
A boarding agreement should contain a paragraph concerning risk of loss, a release and an indemnification or hold harmless agreement. These paragraphs restrict the liability of the boarding facility and essentially hold that the boarding facility shall not be liable for any sickness, disease, theft, death or injury which may be suffered by the horse and further protects the boarding facility from any claims resulting from damage or injury caused by the horse to guests or invitees on the boarding premises. Further, the boarder releases the boarding facility from any responsibility concerning damages which may occur to person or property as a result of boarding activity.
A boarding agreement should also contain and set forth all stable rules which the boarding facility wants to enforce. An example of some stable rules which I typically put into a boarding agreement involve the right of the boarding facility to sell the boarder’s horse and tack in the event of non-payment which also involves waiver of state agister lien laws which can take considerable time and expense. Abandoned horses and tack are a problem for boarding facilities and one way to prevent this problem is by specifying in the rules and regulations that any abandoned property, including horses will become the property of the boarding stable after a set period of time. At that point the boarding facility is free to sell the tack and horse to cover any unpaid boarding fees and expenses.
Another problem I typically address in the rules and regulations involve minor children. Under no circumstances should the boarding facility have unattended children on the premises. It is not uncommon for parents to drop off a 15 or 16-year-old at the boarding facility so the child can ride or groom his or her horse to be picked up later. This should not be an acceptable practice and the rules and regulations of the boarding facility should clearly state that anyone under 18 must be accompanied by a parent or responsible adult.
It is very important to screen potential boarders before entering into a written boarding agreement. I recommend that all potential boarders fill out a boarding application which will include information concerning the potential boarder’s credit and references. This is a very important step and should not be ignored prior to entering into an agreement.
The owner of a boarding facility should also check with his attorney and accountant to establish the proper legal entity to enter into a boarding business. There is no question that a boarding business can be risky and, as such, the owner does not want to risk his personal assets. As such, I recommend creating a corporation or limited liability company for the boarding business which will protect the owner’s personal assets from boarding business liability. Again, this is another important step before establishing a boarding business.
In addition to incorporating or establishing a limited liability company and having a written boarding agreement, I also recommend insurance coverage. Since boarding involves accepting a fee, a general farm liability policy or homeowner’s policy will not cover losses. Anytime a fee is accepted, a commercial general liability insurance policy is needed.
Since boarding stables are businesses, the boarding stable will need to purchase a commercial general liability policy to protect the owner from liabilities that arise out of the boarding operation. However, a general commercial liability insurance policy will not cover injury or death to an animal which is in your control and on your premises. In order for coverage to apply, the facility owner will need to purchase “care, custody and control” insurance as an endorsement to the commercial general liability insurance policy.
Care, custody and control insurance is specifically designed to cover situations where a horse is injured while in the care, custody and control of the boarding stable. For example, if a boarded horse is in a pasture and is kicked by another boarded horse who has a reputation for fighting and kicking other horses, care, custody and control insurance would cover the damages to the injured horse. However, without care, custody and control insurance, the general commercial liability policy would not cover such a situation. Thus, it is important to purchase a commercial general liability policy with a care, custody and control endorsement.
I have received many questions about the Equine Liability Acts which are now applicable in all but five of the United States. These Acts are definitely helpful but are not the total protection people think they are. For example, in the case above where a boarded horse was kicked by another horse the Equine Activity Liability Law would not apply as these laws are designed to apply to injuries and damages to people, not horses. It must be remembered that Equine Activity Statutes limit liability for a horse owner for injuries and death of people connected with horse-related activities. This protection applies to situations where a person, who must be an equine participant, is injured or killed.
Further, there are exclusions in all Equine Activity Statutes. For example, in Pennsylvania’s Equine Activity Statute it reads as follows, “Nothing … shall bar or limit the liability of an equine activity sponsor, equine professional or any other participant if (they were) grossly negligent or committed an act or omission which constitutes willful or reckless disregard for the safety of the participant and which caused the injury or death or intentionally injured the participant.” Thus, if an injured party alleges gross negligence or willful or reckless conduct, the Equine Activity Statute may not apply.
Although Equine Activity Statutes are certainly a help to horse owners and boarding facilities it is still highly recommended that a written boarding contract with a risk of loss, release and indemnification agreement be signed which will provide greater protection than the Equine Activity Law.
In summation, if you plan to operate a boarding facility, you should 1. incorporate or form a limited liability company for the boarding business; 2. screen potential boarders; 3. enter into a written boarding agreement which contains a liability release and rules and regulations; 4. purchase general commercial liability insurance with a care, custody and control endorsement; and 5. instruct all employees to act in a prudent and safe manner in their job duties.
Enough legal talk–it’s time to hitch horses!
Ken is a practicing attorney in Myerstown, PA, where a good bit of his practice involves negligence cases. Ken and his wife, Karen, own Sunny Hill Farm Belgians, and they have been exhibiting their six-horse hitch for the past few years at most major shows in the East.