Ask H&H: pursuing unpaid livery fees

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Q: I run a livery business from my farm and have recently experienced difficulties with a horse owner being unable to pay their livery fees.

I am worried that the owner will simply leave the yard without settling their debts. I believe I can claim their horse in lieu of their debts; can I do this or what are the alternatives?
MB, Leicestershire

Under English law, the claiming of a horse as you describe is referred to as “a right of lien”, whereby you are at liberty to retain goods until a bad debt is settled.

However, according to Kerry Humble of Blake Lapthorn solicitors, in the absence of a livery agreement, the law does not imply the right of lien into any agreement you and the owner may have.

“Far better is to pre-empt the situation before large amounts of money start accruing, and have a livery agreement drawn up that includes a lien over owners, horses or goods kept at the yard,” Kerry said.

“It is advisable to include the ‘power of sale’ in an agreement, so you can unequivocally sell such items to settle debts.

“However, it is important that the agreement is specific as to the terms of credit and when payment is due; for example, is it monthly, weekly, etc.”

In these uncertain economic times, it is important to keep an eye on unpaid accounts, so that large debts — which in some cases could outweigh the value of the horse, especially in today’s falling market — do not accumulate.

“Within an agreement, you can clearly define your terms of business and state what is and isn’t included in the livery service,” said Kerry.

“I would also suggest you ask for one month’s payment in advance from your liveries, or even a returnable deposit should an owner decide to leave the yard.

“A clear agreement will not only benefit your business, but also your owners, as there should be no disagreement as to what the livery fee includes.”

Without an agreement, you may have to seek your livery’s debts (up to £5,000) through the county court small claims track.

“However, each party has to meet their own legal costs,” said Kerry. “Court fees and witness expenses are recoverable by the successful party.”

Information

Blake Lapthorn, tel: 02380 857108 www.bllaw.co.uk

www.moneyclaim.gov.uk

This article was first published in Horse & Hound (21 January, ’10)

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