By Meghan Murphy
Divorce cases involving equine owners often come with unique complexities compared to the typical divorce case. A big concern for the parties involved revolves around how to split a horse in a divorce agreement. One of the best ways to learn about how to divide a horse in an equestrian divorce is to seek guidance from a professional. KoonsFuller Family Law Firm in Denton, Texas fully understands that horses are extremely unique and valuable assets. Charla Bradshaw, the Managing Attorney for KoonsFuller Family Law, owns a horse and cattle farm with her husband, Rick Hagen, in Denton and has a strong background in the horse and cattle industry.
Bradshaw’s family has been involved in the horse industry for many years. Daughter, Erin, is an accomplished APHA exhibitor, husband, Rick, competes in amateur roping events, and Bradshaw herself owns multiple World Champion APHA stallion, John Simon. Bradshaw understands horse ownership, the industry, and the complexities involved in an equestrian divorce. Her knowledge ensures that the interests of her clients are well-protected in a divorce of this kind, whether it is resolved through settlement or litigation. Bradshaw emphasizes that due to the unique complexities of an equestrian divorce, it is extremely important to seek an attorney that is board-certified in family law and has knowledge about horses and the equine industry.
Bradshaw explains that, much like a business, the rights to a horse must be carefully addressed in fine detail as to fairly determine how to divide the animal or asset. One of the first important steps involves determining the value of a horse. She says, “great subjectivity regarding value comes with assets such as horses, and outside experts are often needed to value the animals.” According to Bradshaw, evaluating a horse can be extremely difficult because of variables unique to that specific animal, such as level of training, winnings, and earnings. Bradshaw explains that the appraiser should take into consideration what the horse is trained to do and the level at which it is able to perform when determining value, and not necessarily base value solely on what the horse has won in past performance. It can be a challenge to find the right equine appraiser for each case, because the right appraiser is dependent on the type of horse that needs to be appraised, including the breed and use of the horse. There are a couple of different routes to take when seeking a third party expert to determine the value of a horse. Both parties can agree on an appraiser or each party can hire a consulting expert. Consulting experts are available in most states, and, at the client’s request, a consulting expert can become a testifying expert for the value of a horse.
Once the value of a horse is determined, the decision of how to split the horse is addressed. There are multiple ways for parties to split a horse in an equestrian divorce. The parties may choose to sell a horse entirely and split the money, one party may choose to buy the other party out, or the parties may choose to become joint owners of a horse. Bradshaw explains that if the parties choose joint ownership, it is extremely important to make sure the exact rights of each party are stated. This is one of the reasons why it is important to have an attorney who regularly practices divorce law and understands horse ownership. Bradshaw warns people choosing to partake in joint ownership to be very careful about leaving any details unaddressed. It is crucial to make sure both parties agree on every aspect of the ownership of the horse, including who is responsible for things such as the horse’s board, routine maintenance, insurance costs, breeding rights, showing rights, cash earnings from breed organizations, DNA rights, and other such issues as applicable. Additionally, Bradshaw states that frozen semen is often very valuable and must be addressed in a divorce agreement along with rights to any offspring.
DNA and cloning are big topics in the equine industry right now and, in turn, are big issues when dividing a horse. The recent court decision allowing cloned horses to be registered with the American Quarter Horse Association adds an entirely new element to equestrian divorces. It is no longer an issue of awarding just the rights to a horse but also the rights to the horse’s DNA, and the rights to any cloning of the horse must be addressed. According to Bradshaw, it is not uncommon for an agreement to allow one party to own the horse and the other party the right to have a set number of breedings per year in future years or the right to flush an embryo, whichever is applicable.
In some divorce cases, there is a chance for a party to prove that property, such as a horse, is separate property and thus cannot be divided by the court. Separate property rules vary by state. KoonsFuller Family Law is well-versed in Texas regulations. Texas is a community property state, which means that every asset, such as a horse, that a husband and wife have at the time of divorce is divisible by the court. However, if a party can prove that a horse is separate property, then it cannot be divided.
According to Bradshaw, in the State of Texas, “separate property is property, such as a horse, that was owned on the date of marriage, or obtained by gift, devise, or decent.”
Bradshaw states that once a horse is established as separate property or community property, there are special rules that must be followed when coming to an agreement. In a divorce case involving horses that are established as separate property, classifying the offspring, semen and/or embryos of a horse as separate or community property must be addressed.
The complexities involved when splitting a horse in an equestrian divorce certainly make divorces involving equine assets different than typical divorce cases. It is evident that these divorces require a distinct sense of knowledge and special expertise. Bradshaw recommends that anyone involved in an equestrian divorce should find a lawyer that is board-certified in family law and understands horse ownership. Bradshaw suggests that if a person involved in an equine divorce is unable to find the right lawyer for this type of work in his or her area, he or she should call a lawyer in another area that is experienced in equestrian divorces. It is also helpful to ask for a list of what needs to be addressed in order to ensure everyone’s interests are well-protected.
Click here to read the complete article from the Equine Chronicle January/February 2014 Issue, Vol. 17 Number 1.