Monday, 3 January 2011

Entrustment, insurance and top marks for Spencer

Art & Artifice has just been taking a peep at Spencer’s Art Law Journal, since vol.1, issue 3 (Winter 2011) is now available. As editor Ronald D. Spencer explains,
"This issue contains three essays, which will become available by posting on Artnet, starting December 2010.

... the legal structure we call art law (an amalgam of personal property law, contract, estate, tax and intellectual property law) supporting the acquisition, retention and disposition of fine art, often fits uneasily with art market custom and practice. The result is that 21st century art market participants are frequently unsure of their legal rights and obligations.

The goal of this Journal is to promote discussion of art law legal issues for lawyers and nonlawyers alike, so as to provide greater transparency, stability and predictability. ...

Three times a year issues of this Journal will address legal issues of practical significance to collectors, dealers, scholars and the general art-minded public."
Looks good to us.  The first article of 2011 is Elizabeth C. Black's "  Entrustment, The Hidden Title Risk of Leaving Your Artwork in the Care or Possession of Others -- Will Your Fine Art Insurance Cover Your Loss? Probably Not".  She concludes, following a review of US law and practice, that
" ... fine arts policy insurance claim for lost title due to an entrustment may result in a denial of coverage. You should be sure you always know the location of your artwork, who has possession of it, and whether or how it is being displayed (e.g., is it listed for sale?). Consignment agreements often run for years and artwork may be moved between various locations as a series of consignments from your dealer to other dealers (whose identity is not known to you) over the course of several years. The more informed you are about these re-consignments, the more likely you will be able to protect your interests".
This looks like sensible advice, regardless of the jurisdiction -- though it's not just a question of being informed in the first place, it's also a question of how to remember to stay policy-conscious as art works travel and change their functionality between display object, item for sale and goods in transit.

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