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30.11.11

Your Horse column - Rent arrears

Q At my local DIY yard there is a woman who keeps her horses stabled 24/7 and they are knee-deep in muck. If it wasn’t for the yard owner, I dread to think what condition they would actually be in. The woman got in debt and the yard owner offered to write it off in exchange for the horses, but she got a lot of abuse in return. The woman has handed in her notice but there’s no actual contract in place. Can the yard owner hold on to the horses until the debt is settled, or even sell the horses on to recover her costs? Neither party has the money to take this to court.

A Sadly in the absence of a livery agreement there is no automatic right to claim the horse or legally speaking no “right of lien”.

Even were there an agreement in place a sale of lien clause would not automatically enable the yard owner to sell the horse without taking the case through the courts and proving breach of contract. The lien would simply allow the horse to be retained until payment is made but said lien would only be in force whilst the horse remained on the yard. If the owner removed it from the yard the lien would no longer be enforceable. If the yard owner were to proceed in selling the horse without following the correct procedure through the courts she could be exposing herself to criminal charges including theft. This is because English law does not transfer ownership merely because someone falls behind on payments. There should always be an agreement in place including the ‘power of sale’ before such steps are taken.

The yard owner would be entitled to make a claim through the small claims court if the amount owed is less than £5,000. If the amount owed exceeds this the yard owner could seek to instruct a solicitor to recover the money owed under a Conditional Fee Agreement (CFA). This means that should she loose she pays nothing and should she win the solicitors costs would be taken from the other side. As such there would be no cost risk to her. Should it become necessary to commence court proceedings an insurance policy should be taken out by her solicitors to protect her from the Defendants costs should she loose.

Most solicitors will act under a CFA providing there are above 50% prospects of success. However if the woman in question does not have the money or assets to cover the arrears and the Claimant’s legal costs this approach may not be a viable one.

The best way to avoid such situations arising again would be to ensure that an agreement is signed with each owner. Said agreement should insist upon rent being paid in advance.


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