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Nomination Agreements - How to avoid disputes
If you are getting your mare covered,
ensure that you get a nomination agreement in writing
before making any commitment. There are a number of
areas of potential dispute between stud and mare owner,
and if you do not have written terms and conditions
to refer to it is extremely difficult to take action
if something goes wrong.
While
the bloodstock industry is not exactly renowned for
its use of written contracts, this is one area in which
there is a tried and tested agreement, that is widely
used. The Thoroughbred Breeders Association Standard
Terms cover all the key issues which both parties need
to be aware of. If disputes do arise, they are solved
by arbitration rather than going through the courts.
Not
surprisingly perhaps, nomination fees are the biggest
source of problems. These may range from as little as,
say, £100 for a pony to well over £100,000
for a top thoroughbred stallion. Whatever the amount
agreed, both sides need to be quite clear about when
it is payable and under what circumstances it can be
returned. Terms will vary from one stud to another.
Some may require either full or part-payment up front.
Others will work on an 'no foal, no fee' basis, or payment
on 1 October if the mare is in foal on that date.
Other
issues that need to be considered include:
1)
The Stallion - how many times must you make the mare
available for covering? Obviously, the later the foal
and (in the case of Thoroughbreds) the expected date
of birth can be very important.
2)
Refusal of Service - under certain conditions, the stud/stallion
owner may reserve the right to refuse to allow the stallion
to cover the mare. Be sure that you are aware what those
conditions are - and where you stand in terms of advance-paid
fees if that does happen to you.
3)
Substitution - if your mare dies before being served,
or is unfit for service for some other reason, will
you be able to substitute another mare?
4)
Death or sale of the mare - where do you stand on fees
if your mare dies after being served by the stallion,
but before the foal is born. Alternatively, who pays
the nomination if she is sold in foal?
5)
Disposal of the stallion - what compensation (if any)
will be offered if the stallion is sold or otherwise
disposed of by the owner before serving the mare? This
is particularly relevant to mare owners claiming a 'free
return' in successive years.
Many
stud/stallion owners will have their own agreements,
covering all of the issues raised above. Be sure you
understand the terms of the contract. If no agreement
is offered, don't be afraid to insist on something in
writing.
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