What are legal obligations to both parties in this case ? Please Explain

ABC Farms Ltd has lost one of its horses due to a broken fence which allowed the horse to escape. ABC decides to post a notice in the local newspaper offering a $200.00 return for the return of the lost horse. The horse is easily identifiable from any other due to unique marking in that its ears and head are black and the rest of it is white.John Smith shows up a few days later at ABC with the horse and claims the 200.00 reward. ABC accepts the horse but is going through some rough financial times and says they won't pay the reward because John Smith did not communicate with them beforehand that he was going to look for the horse and would accept the offer to return the horse.