Thank you for all the responses. Yes she is taking me to civil court for $200 which was my monthly board. Yes I have pictures of the moldy hay. No I did not give her a chance to rectify the problem. The building of the shelter was verbal not in the contract. I live in Maryland and in Maryland you are required to have a boarding license if you board five or more horses. The barn does not have a license and she is boarding about 20 horses. To me illegally boarding horses would make the contract void. Everyone else provided their own hay except my friend and I, the barn owner provided ours.
All this over $200?
Here is my GUESS. You will go to small claims court. The boarding license issue will come up and the judge will probably not care since it has little relation on the case. (You agreed to pay $200 then you left and didn't pay it.) The shelter being verbal will be your word against theirs - meaning it will not count for anything. Either way, it wasn't part of the contract so has no bearing on the $200 owed.
It all comes down to the moldy hay. You had a problem and broke the contract instead of trying to work it out. Judges usually don't like that. Most will feel that people should try to resolve their own disputes before wasting a judges time.
Again, its a guess, but I would bet it will end one of a few ways:
1. You will lose and pay the $200
2. You will lose and pay part of the $200
3. You will lose and pay the $200 PLUS their court costs.
Of course, I am not a lawyer or judge and have very little information to go on. This is just an educated guess.
My .02 - pay the $200, get a signed release saying you are paid in full and call it a bad experience.
If you want to roll the dice, hope that the "People's Court" (or similar) folks find and pick you. Then the producers pay the judgement and you get to be on TV. :)
The only thing you can do to "get even" is to report her to the correct authorities for not having a license. A small claims court has no real power to enforce that code or penalize someone for it. You need to go to the town/county/state and complain. That will get someone out there to do something and levy the appropriate fine.