13 November 2014

Warburg confirms independence

My daily walks between station and office take me past the Warburg Institute, housed in a drab 1950s building in Woburn Square.  My knowledge of the Institute was until now limited to a vague recollection that the disgraced art historian and Soviet spy Sir Anthony Blunt had the title of Warburg Institute Professor. I could not find that on the Institute’s website, but perhaps it would prefer to be known for other things.  That should now be helped, at least in the English legal world, by the judgment in University of London v John Prag and HM Attorney General [2014] EWHC 3564 (Ch).
The first defendant, John Prag, is Professor Emeritus at Manchester University, a member of the Advisory Council of the Warburg Institute and a descendant of its founder, Professor Aby Warburg.  In effect, the case was a dispute between the University of London and the Institute, and it was about how the 1944 trust deed, which founded the Institute, should be construed.  Ten years earlier, Aby had moved, with his art research institute and its material, to London from Hamburg, after the Nazis came to power.
The 1944 trust deed was entered into between the Warburg family, who were known for banking, and the University.  The deed related to a library of books and photographs which was given to the University.  In return, the University was required to house the library, which now has 350,000 volumes, in a suitable building and “keep it adequately equipped and staffed as an independent unit”.  The background to the recent dispute was that the Institute believed that the University wished to integrate it into its other library services.
The court held that the trust was designed to secure the future of the Institute and did not just apply to the 1944 collection, but also subsequent additions and intellectual property rights.  It had to continue as an independent and living institution and could not be integrated into the University.  The building was not part of the trust, but had to be funded by the University.  Also, the Institute could not be debited by way of a share of the costs of University-wide services, but only for actual cost.
The case illustrates what often happens.  What was done long ago with the best of intentions, and most welcome at the time, can become unsuitable or a cause of friction for future generations whose priorities and motives are inevitably different.


21 July 2014

Hirst's Bombay Mix-up

There was an interesting article in The Telegraph last week about a work called Bombay Mix, by Damien Hirst, and the dispute between his certification company, Science Ltd, and a Mr and Mrs Simpson who possess the work.

According to the article, in 1988, Hirst was commissioned to paint Bombay Mix, an early spot painting, on some wallpaper in a house owned by Mr and Mrs Ritblat.  Science claims that, before the house was sold, it was agreed with the Ritblats that in return for the painting being destroyed they would be given an alternative portable painting.  The wall painting was not destroyed and was still on the wall when the house was bought by the Simpsons in 2005.  In 2007, the Simpsons employed specialists to have the painting removed from the wall and mounted on backing board.  The Simpsons now want to sell it.

In the circumstances, Science has refused to issue a certificate of authentication, has claimed ownership and demanded the painting’s return for destruction.

This case raises several issues but, before commenting, I must make two assumptions: that the facts in the article are correct and there are no other relevant facts.  As a lawyer who has had cases reported in the press, I know just how big those assumptions are.
 
The first issue is whether the painting became part of the building, which is part of the land.  If so, it lost its separate identity and any possible separate ownership.  The first consideration is how easily the item could be removed, for example compare a light shade that could be detached and the light fitting fastened to the ceiling.  For art, one can also consider whether it is decoration or enhancement of the building, for example compare a hung tapestry to a plaster frieze.  Wallpaper forms part of the building, and the fact that specialists were required to remove it intact proves the point.  If Science’s agreement with the Ritblats gave it some right over part of the house, it could have protected its interest by registering it at the Land Registry, which would warn any purchasers of the house.  Failing to do that would result in house purchasers acquiring ownership of the painting.  So I think the Simpsons must now own the painting.  They were free to take the painting from the wall and create a separate item capable of future separate ownership.

Can Science refuse to issue a certificate of authentication, when it knows that the work was by Hirst?  Yes it can, because it is under no duty to the Simpsons.

However, I do not agree with the suggestion in the article that the Simpsons cannot say that the painting is by Hirst, cannot own it and cannot sell it without a certificate from Science.  It is typical of artists and their foundations or estates to try to impose a regime to give them control over the marketing of the artist’s works.  However, they can only base such restrictions on agreements, and cannot bind strangers.  In this case, with all the publicity, and the claims made by Science, no one can question the authenticity and provenance of the work.  That said, whilst there remains a dispute as to ownership, whatever the merits, buyers will be discouraged, and that might be the only advantage Science has, until the matter is settled or comes to court.

20 May 2014

Mediation of art disputes

Earlier this year, my firm co-hosted a seminar with the Chartered Institute of Arbitrators, on the resolution of art disputes.  I shared the platform with Henry Legge QC, a leading art barrister, and Sarah Charles of Christie’s. It was a great success and there was clearly a lot of interest in the mediation of art disputes, both from the professionals and the market players in the audience. 

Mediation is a process to achieve a settlement of a dispute, as an alternative to bringing court proceedings or to continuing them.  It usually involves a day with an independent mediator who meets with the parties, sometimes together, sometimes separately, and applies all sorts of skilful means to get the parties into negotiation, usually via the mediator, with a view to getting them to reach a settlement.  Success rates are remarkably high for parties who have a will to settle, even if they begin the day a long way apart and would not otherwise be expected to reach agreement. 

The mediation process is confidential and, in my experience, confidentiality is particularly important to most parties to art disputes.  For example, professionals are concerned about reputation, and collectors or investors would rather not advertise their art dealing, which might invite unwelcome attention.  Also, known disputes about attribution and provenance will seriously damage the goods, whatever the outcome.  On the other hand, there will always be some parties who crave the publicity of a trial for tactical or principled reasons, which might also encourage the other party to settle. 

There are some good mediators who have experience of art disputes, and Charles Middleton-Smith is a leading example.  Having an understanding of art law, the art world and the particular priorities of the disputing parties is a great advantage in gaining the parties’ trust and drawing them together. 

Mediation processes can also be useful for disputes between institutions, and the International Committee of Museums has a mediation scheme.  International Nazi looted or forced sale claims and cultural heritage claims can also be better resolved through mediation because of its greater flexibility. 

What I learnt from the seminar is how much good work the big auction houses do in mediating when claims arise between innocent sellers or buyers of art and the victims of earlier theft of that art, where sadly the the latter have less rights than they expect.

24 February 2014

Rubbish

From time to time there are stories of cleaners mistakenly clearing and throwing out modern art work.  One would have to be particularly dedicated to modern art, and po-faced, (or the artist!) not to snigger.
The latest report comes from Bari in Italy where a cleaner has thrown out a work by Sala Murat.  Given that the work is described as “newspaper and cardboard and cookie pieces scattered across the floor”, it sounds like a cleaner-magnet.  Apparently it is valued at €10,000.
The apologetic cleaning firm, which presumably wants to maintain its relationship with the gallery, has said that its insurance would cover the matter.  I wonder if that is right.  If I were acting for the insurers, I would require the insured to defend any claim by the gallery on the basis that the loss was caused by its negligence.  It should have anticipated the potential loss and left a sign for the cleaners saying “Not to be removed”. Normally such a sign might say “Not rubbish”, but perhaps that wouldn’t be true in this case.

19 February 2014

Nazi appropriated art

The Gurlitt story continues to fascinate the art world.

My earlier post Nazi looted art reflected the view at the time that any stash of Nazi art must have been looted, and that Cornelius Gurlitt and the art seized from his flat would not be reunited.  I suppose we should have known that no one who has secretly kept a €1.4bn collection for 45 years would give it up without a fight.

Gurlitt’s account of events and his lawyers’ arguments are now set out in a website that he or his lawyers have just set up Gurlitt.info.  However, whether Gurlitt still has his mental faculties seems to be open to question. As the site explains, at the behest of Gurlitt’s doctors, the Munich court has appointed a guardian, and yet it does not deprive him of the legal capacity to enter into contracts. In the cryptic words of the Q&A section of the website, “You can draw your own conclusions from this information”.

The website paints a picture that had already emerged in outline since November.  In particular, part of the art was owned by Cornelius’s father, Hildebrand Gurlitt, before the Nazi era and a lot of the rest had then been removed from public galleries and institutions, as so called “degenerate art”, and sold to Hildebrand.  It is said that only 3% of the works (35 of 1,280 items) have been claimed as “looted art” by the heirs of four Jewish owners, which Gurlitt is willing to consider.  Yet the identities of the works have only recently been revealed, so that number seems set to rise.

The website makes the point that the German limitation period is 30 years from any theft, which has long since expired.  However, the Bundesrat is presently working on a new law to extend that period.

This is a story that will run and run, and I will revisit it.

16 January 2014

Getting good title to art

Prompted by the “flea market Renoir” art case in the US, I’ve done an article for The Times about making sure that you get to own and keep the art you buy: Getting good title to art

06 November 2013

Nazi looted art

The amazing discovery of over 1,400 pieces of Nazi era looted or forced-sale art, worth perhaps €1bn, in the flat of Cornelius Gurlitt in Munich, will probably be the art story of the year, and perhaps the decade.  Interest has naturally focused on the pieces themselves, although the German authorities seem slow and reluctant to release full details.
 
Also of interest is the potential for a bumper crop of restitution claims from the descendants of the original owners.  Usually, restitution claims present a difficult moral question as to whether the art should be returned to the original family, who suffered at the hands of the Nazis, or to the current owner who innocently and in good faith bought the art from an intermediate owner, who was probably also innocent.  US law is generally more ‘pro-original owner’, whereas in Europe we tend to be more ‘pro-current innocent purchaser’, which is why so many claims are brought in New York, where the courts take a rather liberal view of their jurisdiction.
 
However, it seems unlikely that claims to the Gurlitt art will be resisted by anyone claiming to be the current owner.  The most likely disputes will be between competing claimants.  For example, in 1930s Germany, a Jewish owner, needing to raise money in a hurry before fleeing, could have sold a piece, on what might arguably have been a ‘forced-sale’ basis, to a Jewish dealer or friend, who in turn lost the art in a forced sale or through confiscation.  Also, the passing of time leads to patchy evidence, which can cause all sorts of provenance disputes.
 
Here in London, there has recently been an issue about the Portrait of Amalie Zuckerkandl by Klimt, which is on loan from the Austrian Government to the National Gallery for its Facing the Modern exhibition.  That work was also subject to competing family claims. Although neither succeeded in an Austrian arbitration, there are still calls for the painting to be seized.  In this regard, my Boston art-lawyer friend Nicholas O’Donnell has just written a very interesting and informative article about the claims to the painting.  It is on his blog Art Law Report which I highly recommend.