PAI’s The week in focus: Caveat emptor

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Frans Hals’s Portrait of a Gentleman.

Caveat emptor – the Latin words for ‘let the buyer beware’ were never truer than they appear to be in today’s unregulated art world. If you are spending millions to buy a piece of art, it is probably worth spending a little more to verify its authenticity. That, at least, is what might appear to be sound advice given recent media articles on the provenance and genuineness of art works.

Let’s start with an article in a recent edition of MutualArt on the advisability of using a reputed art advisor to perform due diligence in any transaction – whether it be buying at auction, from a gallery or in a private transaction. The advisor, let’s recall, is working for the client for a fee and the client’s interests are paramount – the independent expert advisor is neither an art dealer or a broker and should have no business relationship with the other party to the transaction.

Read: What it means to be an art advisor

If this all sounds too pedagogic, it is worth noting the article’s precise words: “The role primarily involves researching and obtaining as much information as possible about an art transaction, the artwork and the buyer or seller. It also includes due diligence on issues such as provenance and attribution, historical analyses, forensic examination, price research, collection management, insurance, storage, transportation, and so on.”

A protracted dispute

That being said, should a protracted dispute like the one just settled in London’s High Court of Justice have reached the stage of being argued before a judge? According to reports (indirectly from The New York Times) by Artsy and ARTnews, it has taken eight years for a dispute over the authenticity of a portrait purportedly by Frans Hals (he of The Laughing Cavalier) to be finalised. The case goes back to 2010 when Fairlight Art Ventures, headed by hedge fund manager David Kowitz, and British art dealer Mark Weiss bought the portrait from French art dealer Giuliano Ruffini for €3m or $3.3m. A year later, in 2011, Weiss sold the painting to EPC Nevada for $10.75m through a private sale at Sotheby’s.

Five years later the troubles really started with Ruffini — the subject of an arrest warrant — on allegations of selling forgeries. The purported Hals painting was examined by experts, found to be a forgery and EPC Nevada, understandably, wanted its money back. Sotheby’s refunded the $10.75m promptly and itself turned to Weiss and Fairlight to be reimbursed. Weiss repaid $4.2m and Fairlight ended up in the court which has now found in Sotheby’s favour.

Someone less respectable than Sotheby’s

So, there we are – would all of this have happened had the painting been verified at the outset by a trusted art advisor acting for EPC Nevada? And, a moot point, would EPC Nevada have recovered its money had it not dealt with someone less respectable than Sotheby’s?

It’s all grist to the journalists’ mills – journalists looking for possible scandals. On the other hand, there are more-straightforward art transactions that do not appear before a judge. Take the Damien Hirst artwork Bodies reported by Architectural Digest. The piece’s present owner, collector Robert Tibbles, took a fancy to the work in 1989 when Hirst was virtually unknown and bought it from Hirst’s art dealer for a nominal £600. Now Tibbles is selling 30 works from his collection through Phillips in London, and Bodies alone is slated to sell for between $1.5m and $2.5m. The work itself? It is a representation of the contents of a medicine cabinet. There’s no doubt about the work’s provenance – when Tibbles bought it Hirst himself came to the buyer’s apartment and hung it on the wall.

Well, while one can buy works modern from living artists without any question as to their authenticity, it’s somewhat different when it comes to works by artists who have been dead for a few centuries. Caveat emptor.

Meanwhile, click on links to read original media reports.