Unfortunately, the days of handshake agreements and taking someone’s word are long over. While you may encounter many who honor those types of agreements, as we progress into the world of documenting everything we do (pointing a finger at us, social media users), contracts are a part of that too. This applies to all types of contracts, and those involving livestock and cattle are no different.
Along with the times changing concerning the need for and nature of contracts, so has the ownership and operation of cattle. We no longer have simple things, such as commercial cow-calf operators or seedstock suppliers, but more and more hybrid operations that tie in a bit of everything. These hybrid operations give rise to the need for specialized contracts and agreements documenting the nature of the unique transactions taking place.
So, what exactly am I saying? If you borrow your neighbor’s bull to cover your herd, get a contract. If you let your long-time best friend’s daughter exhibit your top heifer at the junior livestock shows, get a contract. If you graze someone else’s land or have someone managing or caretaking your cattle, get a contract. If you split any responsibility or expenses in relation to one or more head of cattle, get a contract.
Clear from the start
Most of the time, people say they don’t need anything in writing because it is just a simple deal and done. And maybe that is true. But what if it’s not? For example, when you buy a replacement heifer from the seedstock producer’s annual sale, what terms are you buying her on? A simple contract included with the bill of sale or other sale documentation can reflect the terms and conditions of the sale, any guarantees, things done to void the guarantee and so on. This may be relevant in a situation when a heifer turns out to be a non-breeder. Is the seller responsible? Did the buyer do anything to contribute to the heifer’s issues? Making it clear from the start can avoid a lot of problems and prevent a lawsuit.
Now, say this seedstock producer’s annual sale took consignments from other same-breed producers. Did that breeder have a consignment agreement in place? The consignor should be consenting to the terms and conditions of the sale, so that the seller can look to the consignor to honor anything concerning that particular animal, such as a breeding guarantee. And even more, who is getting the money and how much? Listing the fees and sales commissions is vital to avoiding conflict down the road.
What could happen?
The question that always seems to follow the statement, “Yes, you need a contract,” is, “What could happen if I don’t?” The short answer – a lot. You could go forward and never have a problem, or at least not one that you are aware of. But what about your family and the future of your operation? The first question I return is, “What if something happens to you?”
If you, the person that made the agreement, were unavailable for whatever reason and your spouse or children had to step in without a contract in place, you could be setting them up to be taken advantage of or to have a conflict with the other party. The spouse and children don’t know what you agreed to and they either listen to the other party or have to fight about it. Even worse, you may end up in court over a breach of contract suit. When you are fighting over any alleged contract that is not in writing, you find yourself in a "he said, she said" type of argument in front of a judge. No one wins in these situations. At least if there is a written agreement in place, you have support for the "he said" or "she said" part of the agreement. Now, if contract interpretation is at issue, that is where a professional experienced and knowledgeable of the subject matter is beneficial. You may not want an attorney who doesn’t know the difference between a bull and a steer writing your contract about cattle.
Remember, a contractual agreement between two or more parties can take any shape and form so long as the basics are present to make it a valid, and binding, contract. Almost all lawyers and even most individuals understand the very basics of a contract. All you need to do is find a professional that has knowledge of your unique transaction, and you can get an agreement to suit your needs. To be valid and enforceable, every contract should, at the very minimum, include:
- Offer: A party is to do or refrain from doing something, such as providing a product or service.
- Acceptance: The party takes some action to demonstrate acceptance of the offer, such as depositing fees or using the product.
- Consideration: There must be something of value given in exchange for the offer. This can include monetary fees or promises of performance.
- Mutuality or mutual assent: Sufficient proof that the parties have agreed to the terms of the deal and intend to be bound by them. This can be as simple as signatures.
This information is made for educational purposes only and is not intended to be legal advice for any particular reader. Reading this article does not create an attorney-client relationship. Readers are encouraged to consult a licensed attorney for their legal needs.
