Running a Boarding Business: What You Need to Know


Whether you are running a large-scale horse boarding facility or just taking in a few boarders to help defray your horse expenses, there are a few business practices that will help minimize both the hassle and the risk.

Liability Releases

Boarding facilities should have a good quality boarder liability release agreement and everyone should sign it, including boarders and their families, show and clinic attendees and visitors to your property.  Not only do liability releases discourage people from suing you, they also help protect you in the event that you are actually sued.  Contrary to popular opinion, a good quality liability releases is usually enforceable if properly signed, even in states such as California.  Equine Legal Solutions’ horse boarding stable agreement package includes liability releases.

Insurance

In addition to your property insurance, you will need commercial liability insurance and care, custody and control insurance for your boarding facility.  The per-claim limit of your care, custody and control insurance should be sufficient to cover the most expensive horse in your barn, and the aggregate limit should be at least equivalent to the total value of all the horses on your property.  Equine Legal Solutions recommends that your commercial liability insurance have a per-claim limit of no less than $1M, and an aggregate limit of no less than $3M.  See our general advice about shopping for horse insurance. 

Horse Boarding Contracts

A good quality boarding contract helps set appropriate expectations with your boarders, and it also serves to limit your liability and provide you with recourse when a boarder doesn’t pay or otherwise breaches your boarding agreement. Equine Legal Solutions offers a horse boarding stable agreement package that includes a comprehensive horse boarding contract.

Screening Potential Boarders

You wouldn’t rent out an apartment to someone without having them fill out an application and checking their references and credit. Why should you run your boarding business any differently?  Every barn has problem boarders, but Equine Legal Solutions’ clients have found that taking these steps helps greatly reduce the number of deadbeats and other types of boarders you don’t want to have. Equine Legal Solutions’ horse boarding stable agreement package includes a complete boarding application and instructions for checking potential boarders’ credit and references.

Evicting Undesirable Boarders

Maybe you have a boarder who is not paying, or a boarder who just can’t seem to get along with anyone.  How can you legally get them off of your property?  Horse boarding relationships, unlike landlord/tenant relationships, are governed solely by the agreement between the parties and not by law.  This means that in your boarding contract, you can set your own policy for eviction.  Equine Legal Solutions recommends that you have two termination clauses in your boarding agreement – one that allows you and the boarder to terminate for any reason with 30 days’ advance notice, and one that allows you to terminate “for cause” with seven days’ advance notice.  Equine Legal Solutions’ horse boarding stable agreement package includes a comprehensive boarding agreement containing these clauses.

Non-paying Boarders

Careful screening will help you avoid non-paying boarders, but once in a while, you will have a boarder who does not pay you.  Most states have laws that give boarding stables a lien on horses for past due board.  However, those laws typically require you to follow a specific process before you can sell a horse to satisfy the debt, and the process is usually time-consuming and expensive.  For example, state livestock lien laws often require you to get a court order, which means that you would have to sue the owner and obtain a judgment against them before you could sell the horse.  This problem is often compounded by the fact that you cannot find the owner and/or the horse does not have much market value.  Meanwhile, you are continuing to feed and clean up after this horse.  What can you do to protect yourself from this type of situation?  The answer is fairly simple – your boarding contract can provide you with more rights than you would otherwise have under your state’s livestock lien laws.  For example, Equine Legal Solutions’ horse boarding stable agreement package form specifies that if you terminate the boarding agreement and the boarder’s horses and/or property are still on your property 90 days after termination, you will automatically own the horses and property and can sell them or give them away as you see fit.    

Incorporating Your Horse Boarding Business

When you are operating a boarding stable, which is a relatively high-risk business, you can’t afford not to incorporate.  Creating a corporation or limited liability company for your business is typically less than $2,000, and it can help protect your personal assets from the boarding business’ liabilities.  Equine Legal Solutions offers incorporation and LLC formation for a fixed price – just contact us for details.

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