Risk Management Essential for Horse Businesses

Risk Management Essential for Horse Businesses

Photo: Megan Arszman

Horses and riders have a propensity for getting hurt at competitions and at home. Event sponsors and boarding farm owners cannot prevent all injuries, but there are steps that can be taken to minimize liability. Several speakers addressed the topic of effective risk management at the 25th Annual Equine Law Conference, held in Lexington, Ky., on April 27-28. Sponsored by the University of Kentucky College of Law, the conference attracts many of the country’s leading practitioners of equine law.

Sonja Keating, senior vice-president and general counsel for the United States Equestrian Federation (USEF), explained that the organization's risk management strategy includes a "comprehensive and standard" set of rules that are enforced at all sanctioned competitions, the required use of liability waivers for all participants at USEF events, and a hearing process to resolve disputes in an equitable way.

USEF rules include standards for officials, medical personnel (including a safety coordinator), and site preparation. The USEF drugs and medication program "protects the welfare of the equine athletes," Keating added, and the licensing requirements for officials, including continuing education and peer review, help ensure that events are conducted in a safe manner.

Liability is not limited to physical injuries suffered by horses and riders, Keating said. The hearing process under which protests, charges, and grievances are adjudicated by volunteer USEF members establishes a level playing field for everyone, reducing the possibility of a lawsuit by a disgruntled competitor.

Michigan attorney Julie Fershtman is a prolific writer and speaker, and a frequent presenter at the Equine Law Conference. From the law firm of Zausmer, Kaufman, August, Caldwell & Tayler, P.C., Fershtman listed a number of effective risk management strategies for event sponsors:

  • Insurance covering claims by both participants and spectators;
  • Compliance with state equine liability laws;
  • Establishment and enforcement of rules;
  • A safety committee that is "proactive and looking for potential problems;" and
  • The use of well-drafted liability waivers and releases.

Krysia Carmel Nelson and Tamara L. Tucker, attorneys from Nelson & Tucker, PLC, in Charlottesville, Va., suggested ways to avoid liability problems at the farm.

For training barns, Nelson and Tucker recommended contracts that include a "training disclaimer" stating that the trainer makes no promises about the success of the horse in shows or other competitions. The contract also should state that the only recourse for a dissatisfied horse owner is termination of the contract. They also suggested that the contract spell out in detail any financial obligations for the horse owner beyond the usual board charges, including any show-related expenses that will be billed to the client.

Effective boarding contracts also should include "assumption of the risk," "hold harmless," and indemnification provisions; a veterinary power of attorney giving the boarding farm owner the authority to call a veterinarian if the owner cannot be contacted; and an "abandonment" clause transferring ownership of the horse to the farm owner or trainer under certain circumstances, including non-payment of board or training bills.

About the Author

Milt Toby, JD

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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