What is a Horse Lease Agreement?
A horse lease agreement is a written contract between a person who will be leasing out their horse (usually the owner) and a person who will be leasing the horse (the lessee). The lease agreement will set forth the terms upon which the horse may be used, as well as the associated terms and conditions.
Because horse ownership can be expensive and time-consuming, some people may find it beneficial to lease a horse rather than to buy a horse outright. For example, a child who wants to learn how to ride her mother’s horse may only be interested in riding occasionally. Instead of buying a horse, the mother and child can enter into a lease agreement in which the mother agrees to lease her horse to the child during the weekends. When the child’s friends come over, the mother can allow them to ride the horse.
A lease agreement can be beneficial to any horse owner. A lease agreement can help an owner defray some of the costs associated with owning a horse by charging a leasing fee or by spreading the costs over to another person . Some horse owners may want to lease their horses for a variety of reasons. Horse owners who do not have enough time to ride their horses can lease them out to other people who would enjoy riding them and who have time to do so.
If you are considering leasing your horse, both the lessee and the owner should have an understanding of each other’s expectations for the horse. It is important for both of them to know how long the lease will be in effect, when it can be terminated, whether the lease can be extended once it expires, what fees may be charged, and whether the owner may continue to use the horse during the lease period.
It is important to have a horse lease agreement in writing. If you lease your horse without a written contract, it could result in conflicts and misunderstandings. If you have a written contract, it can help to prevent conflicts from arising because you will have specific terms to which you can refer to. It is also very important to have a written horse lease agreement if you have specific provisions that you need to include.
Why You Need a Free Lease Agreement Template
In the context of horse leases, a free lease agreement template is important for several reasons, even if the mare or stallion you are leasing to another individual (or vice versa) is not worth a large sum of money. First and foremost, a free lease agreement template ensures that all parties clearly understand the rights, responsibilities, and limitations of their relationship. As you might imagine, and from what I have heard in an anecdotal sense, most horse leases are not written down and are therefore not well understood. This is a recipe for future conflict, so it is vitally important that you and the other lease party go through the strict, but necessary, process of filling out a template form so that you have something to refer back to if a disagreement does arise.
Additionally, having a written free lease agreement template can cut down on litigation expenses if it becomes necessary to establish the terms of the lease agreement in front of a judge or jury. A party that has a written agreement may be able to produce that document as prima facie evidence in Court to support its side of the story. Note that this does not guarantee that the document can be used in Court. A judge still has the discretion to exclude any evidence that he or she feels is not appropriate for the case. Thus, you should still make sure that the free lease agreement you are using is completed properly, with no blanks or ambiguities.
There are many free horse lease templates available on various free websites across the Internet that address the basic issues that would arise under any lease agreement. It is at your discretion to choose one that meets your needs—there is no magic or magic formula for finding the best template. Each template may cover slightly different information, but they are likely to cover the same or similar topics as part of the lease agreement.
Essential Elements to Include in a Horse Lease Agreement Template
There are various parts of a horse lease agreement template that are essential for a legally binding contract, and these include the following:
Parties to a Lease Agreement – Include the full names of the lessor and lessee, i.e. the name of the owner of the horse and the boarder (which must be an adult). It’s also possible to leave the name of the lessee blank if it is unknown at the time of signing, but lease should make provision that if needed, the name will be added.
Description of Horse to be Leased – Be as specific as possible in describing the horse; include size, color, markings, gender, pedigree; previous injuries or ailments; temperament and any medications required. If there is more than one horse to be leased, list each horse separately, or attach an addendum with additional information.
Dates of Lease – Clearly state when the start and end dates of the lease period are, or indicate the lease is open-ended with no termination date.
Amount – State the total amount for a short-term or long-term lease and how and when it’s paid. Specify the lease payments are in consideration of the care as well as use of the specified horse(s), not for transfer of title or ownership.
Board or Care – Describe what type of board (i.e. under tack, pasture, stall, blanketing, feeding, grooming, etc.) will be provided and make certain that a signature or initials are included where the parties agree to this section.
Liability – Include an indemnification clause that protects the parties in the event of accident or injury and states the responsibilities of both the lessor and the lessee should either party sustain damages to property or person. This may also include a provision that absolves the other party of liability for damages or illness resulting from actions or negligence of the horse, or the care or lack thereof of the horse.
Different Types of Horse Lease Agreements
The most common types of horse lease agreements are "full lease" agreements and "partial lease" agreements. A full lease is typically a 12-month lease for a single horse. The terms of the lease, including boarding arrangements, training and riding responsibilities, and any associated costs typically involved, are worked out between the lessee and the lessor based on how they wish to divide expenses, pursuit of lessons and competitive opportunities, etc. If the lease is negotiated to be a "no cost" lease, the lessee does not pay the lessor anything to ride/board the horse, and, in turn, the lessee cannot enter into an arrangement with a third party regarding the horse. The arrangement is strictly between the same two parties for the entirety of the term. In some cases, a portion of the lease is intended for use on a competitive basis only for which the lessee does the training and upkeep for those term dates and shows, for which the lessee is compensated for services. This is best documented in writing and both parties are advised to sign the agreement so its terms and who executes it is clear. However, all are viewed as a lease, which is a possession and use agreement with rights under the contract to use the horse.
A "partial lease" agreement gives the lessee only rights to use the horse for certain days of the week, or at certain times of day, etc. Perhaps the horse is in training for horse showing and the lessor wants to agree to allow a horse lease for non-training time. Or perhaps the lessor only wants to allow the horse to be used by the lessee on weekends. A partial lease allows each party ample opportunity for flexibility if necessary. A partial lease typically is charged at a lower monthly amount since the animal will not be exclusively used for riding only by the lessee.
A "free lease" is a full lease, which allows the lessee to use the horse with no compensation, for which the lessee is charged usual additional costs for full boarding. A free lease is a 12-month lease just like a regular full lease. When the lease is agreed to be a free lease, it’s important there is a clarification in writing as to which specific costs are associated with free lease.
Customize Your Free Template
If you have downloaded one of the horse lease templates from HorseLawyer.com, you may want to make changes to address the needs of you and/or the horse owner. Keep in mind that you will probably not have a problem with your lease if you follow the template as it is Worded. If you want to make changes, this section will provide guidance, but we cannot offer legal advice.
- Read through the entire template carefully.
- Decide where the lease does not match your situation. Check with the other party first to see if they agree that the template needs to be changed. This does not include the contact information , which should be changed to match your situation.
- Make your changes. You will want to read every line again to make sure that you did not change a Word or a phrase that the template used to address a particular situation.
- Either party should review once more, making further changes as needed.
- Both parties should print out the final version, and sign and date the bottom of the last page. Both parties should keep the final signed copy of the lease.
Common Pitfalls to Avoid
While it is likely that the vast majority of equine interactions occur without any disputes, we want to take a look at some of the more common legal issues that can arise in the context of a horse lease.
First, as mentioned above, it is essential to address the amount of time the agreement covers. While one year is a typical period for a short-term lease, it’s important to address whether the lease can be terminated by either party before the term expires and the date on which it would automatically terminate. Failure to specify a term can raise issues as to whether rent over a "reasonable" period of time applies (which is less than one year and probably not the Fair Market Value of the property provided in the agreement). See Bolmeier v. LaFever, 749 N.W.2d 666, 671 (Iowa 2008).
Second, being as clear as possible when it comes to damages in the event of default is always a good idea. If a lease is breached to the extent that the horse is dead or has been permanently altered, finding the value of the horse can be problematic and a real hardship for the lessor. In these situations, there is not a lot of leeway afforded a lessor where the lease fails to specify damages, so it’s better be on the safe side and think about how you will determine the value of the horse should the worst happen.
Third, another common point of contention with horse leases is whether the lessor or lessee is responsible for the upkeep and care of the horse. This is particularly true for lessors who may believe that the lessee is solely responsible for any injury suffered by the horse, while a lessee may believe that the lessor is responsible for any injury that occurs, especially if the horse already has a known health condition.
Third, watch out for automatic renewal provisions. Be sure you have an "End Date." Horse leases under this scenario are often automatically renewed unless either party provides notice of intent not to renew the lease.
Finally, be careful with any reference to "implied warranties." Under Iowa law, lease agreements for horses are "not subject to the implied warranty of merchantability or fitness for a particular purpose." Iowa Code Ann. § 554.2316. This law is specific to Iowa, but other states also have similar statutes. A warranty of fitness is when a "seller offers a product for a buyer’s foreseeable use and the buyer relies on the seller’s skill and judgment in recommending the product, an ‘implied warranty’ pops up." Bolmeier 749 N.W.2d at 669 (citing W. Page Keeton & Ronald E. Merrill, Protection of Consumers Against Breach of Warranty: A Study in Evolving Uniform State Law, 60 Colum. L. Rev. 789, 796-97 (1960)). Such language should be avoided as much as possible. If such a warranty is brought up, note that a disclaimer of the warranty must be in writing and conspicuous.
Completing and Signing the Agreement
Once you’ve thoroughly reviewed the horse lease agreement, making necessary edits and revisions, you’re ready to finalize and sign the contract. It is essential to have all parties sign the agreement in order for it to be legally binding. If the agreement is not signed by both the lessor and lessee , there is no contract even if the parties act as though the agreement is valid. In addition to executing the agreement, a notary public should be present in order to execute the notary’s section of the agreement. If allowed by the state, a lawyer may also keep a copy of the lease agreement with their files for safekeeping. Finally, ensure that both the lessor and lessee have a copy of the agreement for reference.
