The Process and Legal Risks of Concluding a Sale or Purchase of a Horse Remotely
The Sale of Horses Through Online Platforms
The Gulf region provides one of the best places for those interested in equestrian sports. The region brings together the best riders, trainers and horses, which provides a perfect hub for equestrians. The flip side of high demand and competitiveness accompanied with the current circumstances resulting from the pandemic can give rise to contentious matters, disputes and fraudulent transactions. These issues have unfortunately become more prevalent since governments globally have tightened travel restrictions which prompted more customers to move to use remote methods and online platforms to buy and sell horses. In this article, we highlight the measures that buyers could adopt to minimize the risks associated with remote transactions and online sale platforms.
Those interested in purchasing a horse have two main online/ remote options; sale by private arrangement/agreement or sale by online auctions. Firstly, a sale by a private arrangement often begins with an advertisement on an online platform. While a vast majority of such advertisements are legitimate, an advertisement may not disclose all relevant facts which could lead to misrepresentations and in certain cases fraudulent transactions. It is important to be very cautious due to the lack of clear terms and conditions when entering into such transactions.
The second area is the selling of horses through online auctions. Auction organizers normally act as intermediaries between buyers and sellers. They provide a platform to facilitate transactions through bidding and allotment. Usually, an auction organizer appoints an auctioneer who is responsible to monitor the bidding process and issue an official report to confirm the allotment. Some auction organizers provide a vet report either from the seller or a third party to assist buyers in verifying the condition of the horse. However, online auction organizers exclude their liability in the event of any disputes arising from the sale as they clearly state their role as an intermediary.
We advise potential buyers to be vigilant when using online platforms or buying horses remotely. It is important for such buyers to be aware that there are disingenuous advertisements out there and to be cautious when completing any transactions without having seen the horse. Each jurisdiction has its own legal framework in relation to contractual arrangements. There are questions about which law would apply and whether it is the place of residence of the seller or buyer or the location of the horse. There are various factors that need to be taken into account. For example, sales originating from the UAE to other countries in the region are likely to be governed by UAE law, in the absence of a written agreement indicating a different governing law. In this regard, it is important to understand at what point discussions, negotiations and exchange of messages create a binding arrangement. Article 131 of the UAE Civil Transactions Code states that “Offer and acceptance is an expression of interest to enter into a contract. What is expressed first is an offer and the subsequent one is an acceptance”. It is advisable to be alert before making any offer as a buyer, whether through email, whatsapp messages or means of communication, which if accepted by the seller, will create a binding contract.
A safer approach with regards to auctions can often be for the buyer to appoint a representative in the city where the handover of the horse will take place after the allotment is announced. The handover process is really important in any sale as the condition of the horse can be checked at the time of handover.
It is important to verify the horse’s health by inquiring about the kind of veterinary checks prior to the auction. There are multiple checks which vary from basic to complex.
The applicable law in the event of any dispute between the buyer and the seller or the buyer and the auction organizer and the measures to resolve disputes before resorting to courts or arbitration are very important elements. Buyers should make themselves aware of applicable laws and dispute resolution mechanisms before registering themselves for online auctions.
By Maisa AlSaidi & Nicole Jeanine Petras