Lien and Mean

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The stable manager started with the best of intentions. It had been months since a customer paid his board, and the debt was large and growing by the day. Remembering something she had heard about stables putting “liens” on horses under similar situations, the manager unilaterally declared the stable to be the horse’s owner. Then, the stable found an interested buyer and sold the horse, never expecting the trouble that would follow. But it did.

The police lodged charges of conversion and theft against the stable for the illegal sale. The horse’s new owner sued the stable because the breed registry denied registration papers and because she failed to receive clear title. And the former owner, the one whose failure to pay board started the problem, filed a lawsuit of his own against the stable for theft and conversion.

Problems like this occur when stables, in an attempt to eliminate a few hundred dollars of unpaid board debt, take drastic action without following the laws of their state. These problems can be avoided if stable managers review the law before taking action and follow the law to the letter.

Stablemen’s Lien Laws

Almost all states have laws on the books that are specifically designed to give lien rights to horse boarding stables. Many of the laws also give special lien rights to people who provide certain services to horses, such as veterinarians or farriers. These laws are often referred to as “stablemen’s lien” or “agisters lien” laws and they differ widely across the country. They usually explain:

• whether a stable can have a lien on a boarded horse

• how the stable can secure a lien on a boarded horse

• how many months must pass without payment of board before a stable can enforce its lien rights by selling the horse or by sending notices announcing a sale

• whether the stablemen’s lien sale must take place through a public auction, “public sale,” private auction on the stable’s property, or through other means

• what procedures, if any, the stable must undertake before the horse can be sold to satisfy the debt. For example, in some states the stable must send special notice letters to the non-paying horse owner. Other states, such as Ohio, require the stable to advertise legal notices of the forthcoming sale in the local newspaper. A few others, such as California and Massachusetts, may require the stable to go to court and ask a judge to approve a lien sale before it takes place.

• who must conduct the sale. Some laws require a court officer to do this, and others may allow a public auction sale.

• whether the stable may insist on keeping the boarded horse in its possession before the sale occurs—which it can in Wisconsin, Michigan and many other states.

• what, if anything, the stable must do after the sale if the sale brings in more money than the amount of the debt. Some states, such as Texas, require the stable to refund any excess money to the horse owner.

How the Laws Differ

State laws differ significantly as to stables’ rights when board has not been paid. A few examples:

• Laws in some states give stables a lien automatically, with no obligation to file anything, until the stable is paid in full. These laws can also give the stable the right to insist on continued possession of the horse until the debt is paid. For example,

1) Michigan Compiled Laws Section 570.185, states, in part: “Whenever any person shall deliver to any ... person any horse ... to be kept or cared for, such ... person shall have a lien thereon for the just value of ... the keeping and care of such animals, and may retain possession of the same until such charges are paid.”

2) Nevada Statutes, title 9, Chapter 108.540, states, in part: “Any person furnishing feed, pasture or otherwise boarding any animal or animals, at the request or with the consent of the owner or his representative, has a lien upon the animal or animals, and may retain possession thereof until the sum due for the feed, pasture or board has been paid.”

• Some laws require stables to go to court before they can take action in selling off a horse due to unpaid board. For example,

1) Missouri Statutes, Title XXVII, Section 430.160, regarding enforcement of liens, requires stables that claim a lien to make a special filing in the circuit court within its county. The non-paying boarder is notified of the filing, and the matter is brought to trial. If the stable wins, it could receive the right to sell the boarded horse.

• Similarly, Arizona Statutes, Chapter 11, § 3-1295, states, in part: “If possession continues for twenty days after the charges accrue, and the charges have not been paid, the person retaining possession of the stock may perfect the amount of the lien by filing an action in either superior court or justice court, according to the amount in controversy, in the jurisdiction of the holder of the stock.... If the prevailing party does not receive payment due within ten days after the final judgment of the court, the prevailing party becomes the owner of the stock. The court shall award the prevailing party court costs and reasonable attorney’s fees.”

• Some laws allow stables to hold a horse when board has not been paid and then sell the horse without first going to court. For example, Connecticut Statutes, Ch. 847, § 49-70, states, in part: “When a special agreement has been made between the owner of any animals ... and any person who keeps and feeds such animals, regarding the price of such keeping, such animals shall be subject to a lien, for the price of such keeping, in favor of the person keeping the same; and such person so keeping such animals may detain the same until such debt is paid; and, if it is not paid within thirty days after it is due, he may sell such animals ... at public auction, upon giving written notice to the owner of the time and place of such sale at least six days before such sale, and apply the proceeds to the payment of such debts, returning the surplus, if any, to such owner.”

Because of these and many other differences among the laws, stables should read carefully the law that applies to them. Stables that follow what others have done—after learning over the Internet how they handle their own unpaid board problems, say—could be asking for trouble. Since stablemen’s lien laws are often complex, and since harsh penalties could potentially follow if stables violate them, it makes good sense to hire a lawyer to protect your rights.

Alternatives to a Lien Sale

When confronted with unpaid board, stables have alternatives to the stablemen’s lien laws. They can file a lawsuit against the non-paying horse owner. If a stable chooses this option, it bears the burden of proving the existence of the debt, who owes the money, and the exact amount due to the stable.

Stables can improve their chances for success by maintaining good records, such as copies of veterinary and farrier invoices that the stable may have paid for the horse.

If the stable wins a judgment against the non-paying horse owner, the state law may give many options to enforce it and collect the money. These options can include selling off the boarded horse, seizing certain bank funds, or having certain deductions made from the non-paying boarder’s paycheck. These options can also vary by state, so it’s wise to discuss them with a lawyer.

This article does not constitute legal advice. When questions arise based on specific situations, direct them to a knowledgeable attorney. Julie I. Fershtman is an attorney with over 21 years experience who serves the horse industry. For more information, visit www.equinelaw.net.