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Boarding
stables, even very high-end ones, occasionally find
themselves with customers who run up large past due
balances and refuse to remove their horses. As a
result, the facility finds itself essentially feeding
and caring for someone else’s horses for free.
Meanwhile, the deadbeat customer’s horses occupy
facilities that could be filled with paying customers’
horses. How can a New York horse facility lawfully
sell a customer’s horses to satisfy a debt?
NY Lien Law Art. 8 §183
provides New York persons and businesses with an
automatic lien on their customers’ horses to satisfy
debts incurred in caring for or providing services to
those horses. This type of lien is sometimes called an
agister’s lien, and it means the facility can refuse
to allow a customer’s horses to leave until the bill
for those horses is paid in full.
While the
lien is automatic, the ability to sell the horses to
satisfy the debt is not. Here are the steps a
lienholder must take to be able to sell the horses:
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The lien
holder must provide the debtor with written notice
of the pending sale, and the notice must meet the
specific requirements of
NY Lien Law Art. 9 §201.
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If the
debtor objects to the lien sale, the debtor must
file suit in court within 10 days after the debtor
is served with the lien sale notice – see
NY Lien Law Art. 9 §201-a.
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If the
horses in question are worth $100 or more, the
lien sale must be a public auction in the city or
town where the debt was incurred (e.g., where the
boarding stable or other facility is located) –
see
NY Lien Law Art. 9 §202.
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Prior to
the sale, the lien holder must advertise the sale
in a specific manner – see
NY Lien Law Art. 9 §202
Frequently Asked Questions about Horse Lien
Foreclosure in New York
Q: The
horses aren’t worth anything. Can I give them away,
sell them for a dollar, take them to a rescue or
donate them to a therapeutic riding facility?
A:
If the horses are really worth less than $100 total,
you may be able to sell them for a small sum of money
in a private sale if you meet all the other notice and
sale requirements - see
NY Lien Law Art. 9 §202.
Otherwise, if you give away or donate the horses
without the debtor’s permission, the debtor could
later sue you for what is called conversion.
Conversion is essentially the civil form of theft.
Even if the debtor doesn’t ultimately win their case
against you, you will still have to pay a lawyer to
defend you, which is expensive.
Q: I
don’t know where the debtor lives. How can I meet the
notice requirements of the lien statutes if I don’t
know where they live?
A:
NY Lien Law Art. 9 §201
provides for notice by mail to the debtor’s last known
address in certain circumstances. Otherwise, to find
the debtor, you may want to use one of the many free
online people finder services, such as
WhitePages.com
(which also has a reverse phone directory search). In
extreme cases, you may need to hire a private
detective to track down the debtor for you.
Q:
The debtor has several horses,
and one is worth more than the others. Can I keep the
valuable one and let the debtor take the rest?
A: Yes,
but you can only assert a lien on the valuable horse
for the amount that is actually owed with respect to
that horse.
Q: Is
there any other way to sell the horses without going
through the lien foreclosure steps in the New York
statutes?
A:
Only two: Getting the debtor to sign the horses over
to you, or getting the debtor to waive their rights
under the lien statutes. Equine Legal Solutions’
horse boarding contract forms
contain a lien statute waiver provision.
Q: The
debtor already took the horses from my property. Can I
still file a lien?
A:
Because the horses aren’t on your property anymore,
you no longer have the automatic lien provided by the
agister’s lien statute -
NY Lien Law Art. 8 §183
specifically depends upon possession. However, you can
still sue the debtor to collect the amount owed, which
is often a more practical alternative to foreclosing
on an agister’s lien –
here’s why.
Q: Do I
have to keep feeding and caring for the horses that
are on my property, even though I’m not getting paid?
A: Yes,
or you run the risk of violating animal cruelty laws.
Q: I’m a
vet or business other than a boarding barn. Do I still
have lien rights?
A:
NY Lien Law Art. 8 §183
specifically applies to veterinarians.
NY Lien Law Art. 8 §183
is also fairly broad in its coverage, but if you are
unsure, Equine Legal Solutions strongly suggests
obtaining a legal opinion from an attorney before
taking action.
Q: Can
the debtor dispute the lien in small claims court?
A: No,
they will have to file suit in regular civil court.
Q: Can I
foreclose on my lien without having to hire an
attorney?
A:
Technically, yes, but you may find the statutory
requirements difficult to navigate on your own, and
errors will cause additional delay.
Q: If I
hire an attorney to represent me, can I recoup that
cost from the debtor?
A:
Only if you have an attorneys’ fees and costs
provision in your boarding contract, training
contract, or other contract covering your care of the
horses – there are no statutory provisions in the New
York agister’s lien law for recovery of attorneys’
fees and costs. All of Equine Legal Solutions’
equine form contracts
include provisions for recovery of attorneys’ fees and
costs in the event of a contract dispute.
Still have
questions?
Contact ELS
to schedule a
telephone consultation
with an equine attorney licensed in New York.
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