The Boarder Who Doesn’t Pay

 

Written by on January 11, 2017

Pasture

Probably one of the most common issues a boarding barn owner or manager will encounter is a client who does not pay board in a timely fashion, becomes behind on board payments, or even abandons the horse completely. While horse boarding stables are staffed by people whose primary concern is always caring for the animals, it is also a business, and boarding barns should not be responsible for paying for the care of boarded horses.

The options that a boarding barn owner or manager has when a client is behind on board is dependent upon the province they live in and what the boarding contract says. This blog is centered around the laws in the Province of Ontario only.

First off, a good contract can make this situation much easier for a barn owner or manager to deal with. It is best for a barn owner/manager to set out explicitly what the consequences are for a boarder who does not keep up with their board payments.

But if no contract exists, or it fails to cover a situation where a boarder does not pay, what are the rights of a barn owner? In Ontario, a law called the Inkeepers Act governs this situation.

Sections 3(1) and (2) specifically cover boarded horses. Essentially, a barn owner has a lien on any horse boarded with them, “for reasonable charges for boarding and caring for the horse.”

But how long does a barn owner need to wait before they take action? The Inkeepers Act says that if board is unpaid for two weeks, a barn owner can start proceedings to recoup their money. Unfortunately, the law also dictates that the horse must be sold through a public auction, and the owner of the horse must be given two weeks’ notice of the impending sale, through public advertisements in a newspaper.

That means that a barn owner cannot just sell the horse privately to recoup their expenses. It is also important to note that if the horse is sold for more than the amount of the outstanding debt, the excess funds must be given to the horse’s former owner.

There are many downsides to the requirements set out in the Inkeepers Act. While it does allow barn owners to take action after a relatively short period of time, it is more likely that a barn owner will give a non-paying client at least a month to catch up on board payments, since board is usually paid in monthly installments.

Secondly, the public auction requirement can be troubling. An auction does not allow the barn owner to control who ultimately purchases the horse. Most barn owners will not want to risk the animal’s safety to recoup lost board funds.

There is also the issue that the horse may not be worth the outstanding debt, or even anything at all: for example, an elderly horse, a horse with serious health issues or lameness, or an untrained horse. A barn owner may end up putting a lot of time and money into a horse to make it saleable, or may still end up stuck caring for horse like this, because of the public auction requirement. They cannot legally give this type of horse away to a suitable home, because they do not own it.

How can a barn owner prevent this issue? It is fairly simple: one can include provisions in the board contract that every client signs that “contracts out” of the Inkeepers Act statutes. Essentially, as long as both parties (the barn owner and the client) agree to the terms of a contract, the contract can have provisions that state different requirements from the Inkeepers Act.

This allows a barn owner to include a clause that states that after so many days of missed payments (generally 30 or 60 days) the barn owner or the barn itself (if it is a corporation) takes legal ownership of the horse. This allows the barn owner to sell the horse privately, or give it away.

Need a boarding contract for your stable? Have a contract but are concerned it does not adequately cover you in a situation where board payments are late? Have a boarder who owes back board fees? Contact us today and we will be happy to assist you.

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