An Ounce of Prevention is Worth a Pound of Cure
Over the past several years, AOA members have increasingly involved AOA in legal disputes concerning their alpacas. These include boarding fee and breeding fee disputes, bankruptcies, and divorce and partnership disagreements. Because AOA’s role is to track an animal’s registration with AOA and not to determine legal ownership of the animal, the AOA members involved often become frustrated when they request that AOA make a determination about legal ownership. Quite simply, AOA cannot make a determination about legal ownership and must remain neutral. If a conflict arises, a member’s AOA account(s) must be frozen until AOA receives legal documentation that identifies who the legal owners are, or which directs AOA as to what action to take.
In addition to being frustrating for the members and the AOA staff, involving AOA in members’ legal disputes can also be expensive for our members and the organization because we are forced to work with our legal counsel to review each situation. For this reason, any legal dispute between AOA members that is submitted to AOA will require payment of a legal fee of at least $150. Additional fees may be charged if AOA’s counsel is required to spend more than one hour reviewing the matter. Additionally, AOA’s attorney may need to involve the member’s attorney in reaching a resolution, which could add additional charges. Considering this, it is obvious that members should make every effort to resolve disputes regarding the legal ownership of their alpacas without involving AOA.
Following are some of the types of disputes which arise over the ownership of alpacas and some tips to consider about each.
Boarding Fees Disputes: These disputes usually arise from non-payment of boarding fees or abandonment of alpacas.
- Before agreeing to board animals for someone else, please be sure you have thoroughly explained your expectations of the relationship.
- We strongly recommend involving an attorney to develop a contract which fully explains what you are providing and what you expect in return.
- If a legal process is used to seize alpacas for which boarding fees were not paid, AOA will require a legal opinion from your attorney stating that the required legal process was followed and that you now have legal ownership of the alpacas.
Ownership Disputes: These disputes arise from a variety of situations. They might be partnership disputes or disputes over sales of animals or sales of breedings.
- We strongly recommend involving an attorney to develop a contract which fully explains all rights and obligations between the buyer and seller, or among the partners when co-ownership is a factor.
- When buying and selling at auctions, be sure that you fully understand the auction house’s rules with regard to payment and possession of alpacas, as well as the conditions for releasing or obtaining the AOA certificate for the alpaca. Be aware that the alpaca seller’s conditions of sale may modify the conditions of the auction sale.
Bankruptcy: Although fairly uncommon, bankruptcy does occur in our industry, as it does in all other industries.
- AOA will provide information to the bankruptcy trustee only if given permission by the AOA members associated with the applicable account or upon proper documentation from a court of the trustee’s appointment.
Divorce: Married owners of alpacas usually include both names on their AOA certificates, indicating alpacas are jointly owned by the couple.
- Every effort should be made to reach a compromise about how you wish to deal with your AOA registered alpacas without involving AOA.
- Unfortunately, if the divorcing spouses cannot cooperate with regard to their alpacas, AOA often has no choice but to lock both parties out of an account in order to prevent any registrations or transfers from taking place. When this happens, AOA can only take action upon receipt of a clear order from the divorce court, or after receiving an agreement signed by both of the divorcing spouses.
- If an order from the divorce court is provided to AOA, the document must clearly identify each alpaca with its name and AOA number, and who will own it.
Breeding Fee Disputes
- Before selling or buying a breeding, AOA strongly recommends involving an attorney to develop a contract which fully explains the expectations of both parties. This should include a full understanding of how breedings are sold, where the money goes, and who is responsible for signing off on them. It should also include cost and payment structure, proving the pregnancy, remedies if the pregnancy is lost, and live birth guarantees.
- If there is a dispute, every effort should be made to reach an agreement without involving AOA.
- If AOA becomes involved, AOA will require an agreement signed by all parties, or a court document clearly stating how AOA is to proceed with the matter.