Exam A
OUTCOME: IM-PERFECT STORM
lthough liability was clear, the stable mounted a vigorous defense. As it turned
out, the stable did not have any applicable insurance, either to pay Mrs. Diplomat’s claim or to cover its own attorney’s fees. The stable had to hire and pay for an attorney to defend it. Ironically, the stable most likely paid its attor- ney more than what Macho was worth. The stable’s defense rested on two claims.
First, it claimed that Macho’s hock injury was old, and that he had had his hocks treated in the past. Second, it claimed that Macho was not worth but a fraction of what Mrs. Diplomat claimed he was. The stable painted Macho as an old and chronically lame horse who was essentially worthless. This defense was in stark contrast to Mrs. Diplomat’s claim that Macho was a sound and valuable dressage horse. The trial was a battle of the experts. The stable also relied upon the boarding
agreement Mrs. Diplomat had signed which contained an “assumption of risk” clause. The stable argued that Mrs. Diplomat had assumed the risk of Macho injuring himself or “aggravat- ing” a pre-existing injury.
A jury awarded Mrs. Diplomat what it determined to be
Macho’s fair market value—a figure lower than what Mrs. Dip- lomat’s expert had estimated but higher than what the stable’s expert had opined. While the stable could (and should) have avoided liability
by running a tighter ship, it could have avoided this disaster by taking two simple steps. First, it could have carried liability and care, custody and control insurance. Second, it could have had a better (i.e. attorney-drafted) boarding agreement. As it was, the boarding agreement Mrs. Diplomat signed did not hold up in court because the “assumption of risk” language was legally insufficient and because the stable had agreed to care for the horse in accordance with “industry standard and owner’s instructions.” Mrs. Diplomat’s lawyers successfully argued that she did not expressly assume the risk of the stable defying her instructions and providing sub-standard care. Mrs. Diplomat, too, could have done a few things differently.
First, she could have insured Macho for his full value. Major medical coverage would have paid for the surgery, and because the horse could not be made pasture sound, mortality cover- age would have compensated Mrs. Diplomat for her loss. Some might quibble with Mrs. Diplomat’s decision to board Macho at the stable for even a day, but the practical difficulties of an international move left the door open to a regrettable stabling choice. The blizzard turned a moderately unfortunate situation into the ‘perfect storm.’ In summary, had both parties obtained appropriate insur-
ance coverage, the financial implications of Macho’s accident would have been avoided. Even without appropriate insurance coverage, if the stable had invested a few hundred dollars in hiring a lawyer to draft it a comprehensive boarding agree- ment—one that included a requirement that Mrs. Diplomat carry insurance coverage for Macho—then it might have avoided spending tens of thousands of dollars paying a lawyer to defend it in court. Mrs. Diplomat never did get her money from the stable. By the time the litigation was over, the stable had closed up shop and sold its property leaving no assets available to pay the judg- ment Mrs. Diplomat had obtained against it.
About the author: Krysia Carmel Nelson is an at- torney from Virginia who is a nationally-recognized expert in equine law. Attorney Nelson represents horse owners, train- ers, riders, breeders, equestrian facilities, farms, clubs and associa-
tions across all nationally and internationally recognized disciplines. As a lifelong equestrian, she currently rides and competes her Hanoverian Affirmed on Appeal in the amateur hunters. She can be reached at
eqlaw@aol.com.
50 July/August 2015
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