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Legalities Of Contracts

written and submitted by Leo B. Siegel

As an attorney, I read on various email lists complaints that contracts for use in your dealings in the fancy are really only as good as the word of the people who sign them.  Theses individuals lament that a contract in the dog world is not really going to protect you, simply because the suit you would need to file to enforce it is too expensive to consider and you’ll often end up chasing after someone in another state.  The value of a contract for sale of your puppies or co-ownership of your dogs is then discounted.

Yes, lawsuits are expensive.  But I submit that is exactly the reason to have a contract for the sale of your puppies, and one written by an attorney who is familiar with the issues inherent in the canine fancy.  When the issue means so much that legal action is required, you surely don’t want to be found going to the gunfight with only a knife in your pocket.

As for collecting from someone in another state, that again, is exactly the reason to have a properly written contract — and by properly written, I mean one prepared by a competent attorney, familiar with the issues of the fancy.  It is only a matter of putting a proper venue provision in your contract, and any suit will be in your home jurisdiction, not some other state.  When it comes to the attorney’s fees, one need only insert an appropriate attorney’s fee provision in a contract and then be likely to obtain a judgment that includes most or all of the attorney’s fees incurred in the case as an element of the costs of suit that the winner is generally entitled to recover.

Better still, I insert provisions for what are known as liquidated damages in my contracts.  These clauses have the parties agree in advance what the damages are to be in the event one or the other of them breach the agreement.  It then doesn’t matter if the damages from a breach are only $500, the liquidated damages provisions of a contract will control how much is to be paid for that breach.  In that way, most people are unlikely to even think about breaching their duties under the contract’s terms for fear of having a judgment entered against them for many thousands of dollars that were agreed to in advance of the dispute arising.

The point here is that, as lay people, you can not possibly be aware of all the appropriate contractual provisions to insert in your contracts.  Even if the lay person knew the appropriate provisions, it is unlikely they would have the experience it takes to word them appropriately.  The importance of properly wording the various clauses is emphasized, for example, by the fact that a court will be unlikely to enforce a clause that is not drafted in accordance with the legal requirements for the concept the clause is intended to embody.  So, if it is not likely to be enforced, the clause a lay person drafts isn’t doing much good, other than providing the parties a false sense of security.  That is why the contracts I so often see that are “mix-and-match” documents constructed from various versions of friends’ agreements are really no solution at all.

Surely there is no certain outcome in any contract matter.  We rarely find complete certainty in any endeavour in life.  But what is the alternative? Just throwing up your hands and surrendering to the other party in your dealings because you are turned off by the thought of litigation.  You must face it, nearly everything we do in our everyday living involves a contract of one sort or another.  Usually they are oral, or at least without any formal written agreement (buying groceries, gas, etc., where you impliedly promise to pay for the items you have selected).  But what could be more important to you than protecting your interests in the dogs you breed and sell, or give away.

Sure, I have had several judges and many unknowing attorneys say to me during a case:  “Counsel, it’s just a dog.”  Then I tell them about how my client spent $150,000 last year campaigning that dog to “Top Twenty” status. They very quickly change their attitude–“Because it’s NOT just a dog.” It’s a business; it’s family. That, by the way, is the slogan in my “Dog News” advertisements.

If only all of my clients went to a knowledgeable attorney for the contracts they should be using in every facet of their activities in the fancy, I would have much less work.  It is really astounding how many ineffective contracts I run across.  Generally they are contracts lay people construct for themselves, thinking they are then protected.

An appropriate puppy contract might cost about the price of a good show quality puppy.  But you can prorate that cost over the many times you will be using it and then it comes out reasonably inexpensive and justifiable.

Furthermore, there is always the “parking meter” syndrome to deal with. By that I mean, how many time have you gone into the coffee shop or bank thinking you will be only a minute and decide not to put that quarter in the parking meter.  Maybe you get away with this 20 or 30 times.  Then on the 31st time you come out a minute or two later and find a $20.00 parking ticket on your windshield.  You could have parked at that meter 80 times with that $20.00.  The same is true for contracts, except that given the cost of attorney’s time, the stakes are magnified a thousand times. Maybe you will have no trouble for years without a contract, or with one you mix-and-match from other people’s agreements.  Then one day you have a problem with your former friend under an oral agreement, and it ends up costing you ten or fifteen thousand dollars to resolve.  Worse, is that you just lost perhaps a lifelong friend.  You could have saved the friendship and the money if you had an appropriate contract at the outset — one where everyone is fully aware of the rights and duties they have, and the likely outcome if they decide to breach its terms.

I like to tell my clients that there is nothing legally, morally, or ethically wrong with breaching a contract — that is, so long as if you breach the agreement, and that causes someone damage, you are prepared to pay them for it.  That is all people are entitled to in our everyday contractual relations — either the agreed upon performance, or to be awarded a judgment for monetary compensation covering the damages if they do not get it.  The trick is in having a contract that is effective in getting you one or the other, and your attorney’s fees if legal action is required.  Lay people generally can’t do it.  You must go to an attorney who is familiar with the issues of the fancy, and then be prepared to pay the parking meter.