Equine Law Basics - Evaluating the Strength of Releases of Liability

 

Injuries to horse and rider often occur on a third party’s property. It is becoming more commonplace for horse trainers and stables to have the rider and/or horse owner sign a release of liability before any riding or boarding can take place. There are many factors to consider in determining whether a release of liability will be enforceable when an accident does occur. While it is wise to consult an attorney when an accident happens, a few of the things to consider are discussed below.


Equine Activity Statute


The vast majority of states have adopted equine activity statutes. Apart from any written waiver or release of liability, these statutes also serve to protect the party providing equine activity providers. Oftentimes the language of the statute is mirrored in the release of liability document, which is a recommended practice. Equine activity statutes vary from state to state, so it should be independently consulted in connection with reviewing the enforceability of a waiver document.


Is the Release Language Clear?


It should be determined if the language of release is clear and unambiguous. Is it broad enough to release everyone involved in the accident? Does the waiver or release clearly describe the potential harm that the signatory is releasing? Or is it confusing and hard to understand? These are important factors to consider when evaluating the strength of a release. For example, if a rider releases a farm from liability for personal injury to the rider, but later the rider’s horse steps in a hole and ultimately must be euthanized, the release will likely not apply to protect the farm from a property damage claim. Further, if that same rider is injured due to the negligent acts of her trainer, but she has only released the farm from liability, she may still have a claim against the trainer.


Gross Negligence or Intentional Acts


Most jurisdictions hold that in instances of gross negligence or intentional acts, a release of liability will not apply. Gross negligence is a conscious and voluntary disregard of the need to use reasonable care, which is likely to cause foreseeable grave injury or harm to persons, property, or both. It is considered to be extreme when compared with ordinary negligence. Intentional acts likewise cannot be released. The intent is referring to an intent to do harm. Additionally, oftentimes liability or care, custody and control (CCC) insurance will not cover a policyholder’s intentional acts that cause harm.


Conclusion


Reviewing your jurisdiction’s Equine Activity Statute is a starting point for evaluating potential liability in the face of an accident. The release itself should then be carefully reviewed while considering the specific facts of the accident, and a determination can be made regarding whether the document will release the potential target of a liability claim.
 

Horse Trailer Accidents-Theories of Recovery

It’s every horseman’s nightmare—a trailer accident. There are many causes of these accidents, but in the chaos of attempting to remove the horses and tend to their wounds (or worse), questions that could pave the way for a subrogation opportunity often go unanswered. This post will discuss some of the primary reasons for trailer accidents, and subrogation opportunities that can be explored.

Interstate Hauling-ICC Termination Act
Often driver error is the cause of a trailer accident. When horses are being hauled over state lines, the ICC Termination Act (formerly known as the Carmack Amendment) provides the sole and exclusive remedy to shippers against a carrier for loss or damage to their horses in transit. The horse owner/insurer should be familiar with the strict notice requirements and other limitations of the Act.

Intrastate Hauling-Distracted Driving
When the planned route is within one state, the ICC Termination Act does not apply. Depending on the relationship between the owner and the hauler, claims for negligence, breach of warranty, bailment, or breach of contract may arise. There are new theories of negligence supported by recent events. In January, the United States Department of Transportation issued a nationwide ban on texting by drivers of commercial vehicles. After NTHSA reported almost 6,000 distracted driving deaths in 2008, this is an issue that is getting increasingly more attention. Not coincidentally, distracted driving in equine and livestock hauling is also becoming more prevalent. Mark Cole, managing member of USRider, a large national equine transportation company, has said “From our trailer accident study, we found that distracted driving was one of the primary reasons for trailer incidents.” When a commercial horse hauler is being used, it should be determined whether the driver was talking or texting on his phone while driving. Another area to explore is whether the driver is following company protocol. For example, had he logged more hours than allowed in order to make deadlines? Given the current political climate, such actions may give rise to a negligence claim.

Loading Problems
Injuries often occur due to failure to properly load or secure horses in the trailer. Consideration should be given to weight distribution, how the horses were secured/wrapped, and whether the horses were protected from sharp edges. If the injury occurred due to human error, the ICC Termination Act will still apply to interstate hauling, but intrastate routes may provide a common law avenue for recovery. The hauler should be asked if a they use a safety checklist and whether a safety check was performed.  An expert witness on the standard of care for loading and securing horses be consulted, as expert testimony will be critical if your case reaches the litigation stage.  If the injury is due to some problem with the truck or trailer itself, consideration should be given to a products liability claim.

Defective Truck or Trailer—Products Liability 
There have been several defects identified in horse truck and trailers, not always resulting in a product recall. Recently the Horse Transportation Safety Act of 2009 (H.R. 305) was introduced following the overturn of a double-deck truck carrying 59 Belgian draft horses. The accident resulted in the death of 18 of those horses. The bill would prohibit the interstate transport of any horse in a double-deck truck. It could be argued that the double-deck truck has a defective design which makes it unreasonably dangerous for the transport of horses.

Product defects resulting in accidents or fires typically cannot be fully evaluated at the scene of the accident. To protect your claim, take care to adequately document and photograph the accident scene, including the truck and trailer and the area of suspected defect.  Preserve the truck and trailer and immediately place the potentially responsible third parties on notice of your claim. As part of your investigation, research product recalls, find out if the truck or trailer is under warranty, determine the maintenance history for the truck and trailer, and request a copy of all maintenance records. If the damage is only to the truck or trailer itself, you may be faced with the economic loss doctrine. The economic loss doctrine is a principle of law that bars tort claims brought to recover purely economic losses – such as lost profits or the cost to repair or replace a defective product.  However, if horses or livestock are injured, the economic loss doctrine often will not apply to “other property” aside from the truck or trailer itself. 

Practice Tips
While the scene of a trailer accident is devastating and chaotic, early documentation of the evidence is critical. Ask questions to find out the who/what/when/where/why surrounding the accident and gather all of the shipping documents, maintenance records and recall information. Once you complete this initial fact gathering, determine if there are legal bars or limitations to recovery. A bit of effort at the outset gives your the best chance for recovery down the road.

Equine Law Theories of Subrogation Part 3: Damages Issues

Measure of Damages

A critical part of any subrogation analysis is the determination of what damages are legally recoverable from a potentially liable third party. Unique to equine claims, the owner of the horse will often choose to insure the horse for less than its fair market value to avoid higher premiums. For this reason, the insured value rarely, if ever, equates to what is legally recoverable. In most jurisdictions, the fair market value of the horse is the proper measure of damages. To prove fair market value at trial, there must be a well supported opinion given by a qualified expert in the field. Although a third party may be liable for injuring the horse and rendering it incapable of performing its intended purpose, the horse may still have a significant residual value as a breeding horse or performing a new purpose. That residual value will likely be subtracted from the overall damages recoverable through litigation. In today’s climate of frequent expert challenges, choosing the right expert who can properly evaluate these issues is essential.

In addition to seeking the fair market value of the horse, an owner often asks whether he or she may seek pain and suffering or emotional distress damages for their loss. In the vast majority of jurisdictions, these types of damages are not recoverable because there is no physical manifestation of an injury to the policy holder. The owner will be limited to economic damages, which may include a claim for business interruption, loss of future breeding rights or loss of future value. 

First Dollar Out

SaddleWith many horses being underinsured, first dollar out questions often arise in equine subrogation claims. It is important to be aware of the policy language and any first dollar out rules in your jurisdiction. In addition, there is no penalty for underinsuring a horse.   A proration agreement is one way to effectively handle what could be a sticky situation with the insured after litigation begins.  Such an agreement also provides a platform for the carrier and the policy holder to discuss the actual recoverable damages before litigation ensues. Having these discussions up front helps to manage the sometimes unreasonable expectations of the policy holder who is devastated by the loss of their equine companion. 

 

Equine Law Theories of Subrogation: Part 2 Hiring the Right Experts and Avoiding Spoliation

 Just like property damage claims, it is vital to hire the right experts and conduct a thorough and timely investigation. But unlike a typical property damage claim, with equine mortality claims it is often impractical and difficult to maintain the deceased horse for days or weeks to allow for all interested parties to retain experts and examine the horse. Many times, the board of health will not allow the horse to be retained. Nonetheless, immediate notice should be given in writing to any potentially responsible third parties. DNA samples should be collected and preserved to prove that the deceased horse is in fact the insured horse. If it is believed that a third party caused the death, it is also recommended that a full post mortem examination be conducted at either a university or a diagnostic laboratory in order to conclusively establish the cause of death. Photographic documentation and the appropriate records from an equine veterinarian are also helpful in combating any claims of spoliation.

In an equine injury situation, a veterinary expert will be necessary to causally connect the potential defendant’s conduct to the injury. Similar to a personal injury case, the right medical experts and records are needed to support such a claim. Notice to responsible third parties should be given immediately, and the injury should be properly documented with photographs, x-rays, blood tests, or the like. Taking things a step further, the subrogation professional may wish to consult with the veterinarian before a report is finalized to make sure the report is thorough, admissible at trial, and easily understood by an opposing adjuster, judge or jury.

Consideration should also be given to whether the treating veterinarian is qualified to serve as a litigation consultant and testify at trial. Many veterinarians, like medical doctors, may be hesitant to testify against others in their industry. When there is a potential malpractice claim against a veterinarian, this issue should be addressed up front with the treating veterinarian. If a new expert is needed, it is best to give him or her an opportunity to examine the horse in question as close as possible to the time of the injury. Often times the insurance company will hire a separate veterinarian to avoid any conflict of interest for the insured’s veterinarian, which gives the subrogation professional a choice of experts.

Equine Law Theories of Subrogation: Part I

The recent tragedy in Florida involving the sudden and untimely death of twenty-one polo ponies raises issues about equine subrogation possibilities. In that matter, a supplement is suspected in the death of polo horses. Because a horse cannot be “preserved” for inspection as with typical property losses, particular attention must be paid up front to protect any subrogation claim. This thread will routinely provide helpful tips for the adjuster and subrogation professional with regard to equine claims.

Theories of Equine Law Recovery

There are many potential third parties to look to for a recovery in an equine loss. If the horse is injured or killed, the question is what caused the injury or death. Assuming the stable owner is not the owner of the horse, the stable owner may be a potential target. If the barn or the grounds presented a dangerous condition that caused the injury or death, a premises liability case may exist. Before going too far down this road, the boarding agreement must be obtained and examined for any waivers of liability or waivers of subrogation. The stable will often carry a care, custody and control policy, or “CCC policy,” that covers any horses that are injured while in the care of the stable. Be sure to check policy limits, however, because some policies only pay a limited amount per horse and may have a low aggregated limit.

Another potential target is the treating veterinarian. If the treating veterinarian fails to properly treat or diagnose a condition that leads to the deterioration of that condition and permanent lameness or injury, a subrogation claim may be viable. Likewise, trainers may also be potential targets for failing to recognize a problem or failing to timely seek veterinary assistance. If the trainer does not address an injury, or disregards a veterinarian’s advice, the horse could suffer additional injury or permanent lameness if pushed to exercise and work. This is properly the subject of expert testimony—thus it is critical to have an consulting veterinarian or trainer to advise whether treating veterinarian and/or the trainer failed to meet the standard of care which was the proximate cause of the injury. 

Product manufacturers, including drug companies, are another potential target. There can be any number of ways a defective product could kill or injure a horse - from a defective heater causing a barn fire, to a horse-trailer tire blowing out and causing an accident. In a fire situation, local codes should be reviewed to determine whether any fire suppression system should have been installed and maintained by the stable manager. Thinking creatively about possible theories of recovery in the early stages is invaluable to know what parties to place on notice and what evidence and documentation should be retained.