Appraiser Workshops

Results: Sotheby's Old Master Paintings and Sculpture

noreply@blogger.com (Todd W. Sigety, ISA CAPP) — Fri, 27 Jan 2012 21:10:00 +0000

Last week New York was busy with Americana, Silver and Export, this week the major houses were holding their important old master paintings and sculpture sales.

The Sotheby's sale totaled $62.1 million including buyers premiums. The sale offered 350 lots with 209 selling for a rather lackluster sell through rate of 59.7%. The sale did sell better by value at 69.8% but still I believe below expectations for this important sale. Of the top ten selling lots, one was listed as anonymous while the other nine were either US or European private buyers. The top selling lot at Sotheby's was a Canaletto, Venice, A View of the Churches of the Redentore and San Giacomo, with a Moored Man-Of-War, Gondolas and Barges, oil on canvas which brought $5.68 million including buyers premium against a pre sale estimate of $5 - $7 million (see image).

Sotheby's reported the following on the sale

26 January 2012 – Sotheby’s annual Old Masters Week auctions in New York have brought $67.7 million thus far, with today’s sale of Important Old Master Paintings & Sculpture totaling $62,081,477. The auction was highlighted by five remarkable pictures that achieved prices over $4 million, led by Canaletto’s View of the Churches of the Redentore and San Giacomo… from the Estate of Lady Forte that sold for $5,682,500 (pictured right, est. $5/7 million*), and Lucas Cranach the Elder’s portrait Lucretia that brought $5,122,500 (pictured below, est. $4/6 million). On Wednesday, the auction of Old Master Drawings achieved $5,640,813 – the highest result for an auction in this category at Sotheby’s New York since 1998. The sale featured an Italian Renaissance Portrait of a Young Man attributed to Piero del Pollaiuolo, which sold to the J. Paul Getty museum in California for $1,398,500 – well above its $400,000 high estimate.

George Wachter, Co-Chairman of Sotheby’s Old Master Paintings department, and Christopher Apostle, Head of Sotheby’s Old Master Paintings department in New York, commented: “We are pleased with the results of today’s sale, which again demonstrated that works of high quality and condition that are fresh to the market continue to bring exceptional prices – evidenced by each of the top ten works in our auction achieving over $2 million. In the days before the sale we saw broad geographical interest in our exhibition, which translated to bidding from Europe, North and South America, and Asia. We are particularly encouraged by the strong demand for Italian painting, with early pictures and gold grounds performing particularly well.”

Source: Sotheby's

Results: Christie's Americana

noreply@blogger.com (Todd W. Sigety, ISA CAPP) — Fri, 27 Jan 2012 00:19:00 +0000

I have been posting some of the results of last weeks Americana Week sales and so far the results have been rather positive. I now have the Christie's results from the Important American Furniture and Folk Art & The Collection of Mr. and Mrs. Joseph K. Ott sales. The two sales appear to have mixed results.

The Americana sale offered 164 lots with 134 selling for a rather impressive 81.7% sell through rate. The sale totaled $8.7 million including buyers premium which represented 82% by value. In the Ott sale, there were 51 lots offered with only 27 selling for a buy through rate at a disappointing 53%. The Ott single owner sale totaled $3.75 million including buyers premium, which was a rather poor 51% by value. I did not review the Ott sale, but I would think that perhaps the reserves were set a bit too high for a successful sale.

The top selling lot was a Rare And Important Chippendale Carved Mahogany Diminutive Block-and-Shell Document Cabinet with Drawers, signed by John Townsend, Newport, 1755-1765 which sold for $3.44 million including buyers premium and was consigned by the Chipstone Foundation (see image). Of the top ten lots, 5 were listed as anonymous, one by US private, one as US Trade, and three sales to PA dealer C.L. Prickett. Most of the top ten lots sold either within the estimate range or above.

Christie's reported on the sales

John Hays, Deputy Chairman, Christie’s Americas, comments: “Christie’s was honored to have been entrusted by the directors of the Chipstone Foundation with the sale of the block-and-shell document cabinet signed by John Townsend, which achieved $3.4 million — a record price of for a Townsend document cabinet. This remarkable object was signed twice by the renowned Colonial cabinet maker, John Townsend, and established the second highest price for the maker. While the market was selective, we are very honored to have represented the Ott family, and are pleased by the result of the marble top table by John Goddard, which set a record for the form at $2 million.”
Andrew Holter, Head of Department, said: “We are equally honored to have represented the Philadelphia Museum of Art with the sale of the Chippendale carved mahogany armchair attributed to Nicholas Bernard. This magnificent chair was highly sought after with competitive bidding from museums, private collectors and foundations, and produced a stellar result of $902,500.”
Margot Rosenberg, Head of Folk Art, adds: “Competitive bidding for the Federal grain-painted “Matteson” Vermont pine blanket chest resulted in the strong price of $255,500, which soared above the high estimate of $90,000. This chest was one of the treasures from a private New York collection, which had not been on the market for thirty years.”

Source: Christie's

Antique Roadshow News

noreply@blogger.com (Todd W. Sigety, ISA CAPP) — Wed, 25 Jan 2012 19:55:00 +0000

Fellow appraiser Soodie Beasley sent me a couple of interesting links about the Antiques Roadshow. Some of the issues being reported are concerns which a few on air appraisers have with promotional rules and restrictions set by the popular PBS Antiques Roadshow television program agreement.

It seems the agreement for on air appraisers can be very restrictive when dealing with the media beyond the show. Of course the agreement was developed in order to protect the brand of the popular show. The problem is the appraisers are not compensated or reimbursed for expenses, they only receive the benefit of occassionally being on the show and being associated with it. According to some reports the agreement does not allow the on air appraisers to appear on other media without first getting approval from the Roadshow, even if the Roadshow is not mentioned.

The American University School of Communications had a good online article in Current.org about the situation.

AU's Current.org reports

That contract, Sohmers told Current, “has evolved to be more illogically restrictive over the past several years.” It requires appraisers to inform series Executive Producer Marsha Bemko before they appear in other media, get her written permission to appraise on other shows, limit their public remarks to their areas of expertise, and never present themselves as Roadshow appraisers or let others present themselves as such.

The agreement also states that experts need prior permission to use the Roadshow’s logo or name in any materials and must promise not to use Roadshow videos or photographs “in any manner.”

Other appraisers on the show see no problem with the restrictions, given the invaluable publicity they get from the broadcasts. “For those hours you’re on that show, you do not work for yourself or your business,” said Kathleen Bailey of Issaquah, Wash., who’s been on since the first season. “You are there to support PBS and follow the rules. The rules are going to be different from your own business. The tradeoff is advertising. The rules aren’t that hard to follow.”

“Gary Sohmers wrote to us expressing his concerns about a number of matters,” Roadshow spokesperson Judy Matthews said in a statement to Current. “We have been in touch with him to fully understand his concerns, and out of respect, will not share further comment while our communication with him is still in process.”

No pay, much exposure

The nature of the relationship between appraisers and Roadshow predates even the 1996 debut of PBS’s American version of the show. Dan Farrell had been a fan of Britain’s original in the 1970s; he bought U.S. rights in 1981 and was instrumental in getting it on PBS. Farrell remains a consulting producer — “the appraiser wrangler,” as he says, scheduling and interacting with experts on all sorts of old stuff.

As WGBH was initially developing its version, Farrell told Current, “we knew right from the very get-go” that paying battalions of appraisers would be too expensive. So the producers treated appraisers as experts in their fields, “like an expert appearing on a news show,” Farrell said. “They don’t have to join a union and be paid a minimum” to appear, as the American Federation of Television and Radio Artists (AFTRA) typically requires for broadcast talent.

Source: Current.org, click HERE to read the full online post.

ACC Annual Furniture Index Published

noreply@blogger.com (Todd W. Sigety, ISA CAPP) — Tue, 24 Jan 2012 16:49:00 +0000

Is the decline in prices for brown furniture coming to an end? The Antiques Trade Gazette reports on the Annual Furniture Index (UK based) published by the Antiques Collector Club declined in total only by 2%. Take that news along with some of the positive furniture sales at the recent Americana sales in New York last week and perhaps we have hit bottom for brown furniture and possibly some stabilization in the various furniture markets. Not all categories in the index showed small declines, the Early Victorian sector fell by 8%, and the Victorian and Edwardian Index fell by 11%.

For more positive news early mahogany saw a gain of 1% and walnut was up by 5% (after falling by 7% in 2010). The article also noted there is anecdotal evidence from auction house floors that there does appear to be a little more interest in antique furniture than in the past few years, but it is far too early to consider it a trend.

In any event, the news for brown furniture is better than it has been in the past.

The ATG reports

Five of the seven constituent indices of the AFI registered falls in 2011. The categories most associated with the decline in formal dining, Late Mahogany (-3%) and Regency (-3%), show few signs of returning to form, while falling demand for dressers and a lack of good examples meant Oak (-2%) and Country (-4%) again showed the new-found vulnerability that marked them among the biggest losers in 2010.

Across 43 years, oak and country have been the strongest of all categories, but post-1770 mahogany furniture now carries the lowest of all index figures at 1803.

The Early Mahogany category saw a small gain (+1%) and Walnut, which fell 7% in 2010, was up by 5% in 2011, something Mr Andrews attributed to a very limited supply.
"There was a shortage of quality in the auction rooms, where routine antique furniture continued to be in poor demand," he said.

Early Victorian pieces were again the biggest loser at -8%.

Only items that were well above average in terms of design and quality, or those with an attractive provenance, maintained their values.

The separate Victorian & Edwardian Index, started in 1973 and once the recipient of spectacular gains, continues to nosedive, dropping a further 11%, mirroring double-digit falls in recent years. While some forms remain strong, such as the upholstered tub chairs popular with interior decorators, other standard late 19th and early 20th century pieces, such as the davenport, the work table and the credenza still languish among the unfashionable.

The Victorian & Edwardian Index, which stood at 2031 in 2003, has lost more than half of its value during the tailspin of the past decade. It now stands at 871, below the index figure it held in 1988.

Source: Antiques Trade Gazette

Results: Keno Americana Sale

noreply@blogger.com (Todd W. Sigety, ISA CAPP) — Mon, 23 Jan 2012 19:12:00 +0000

On January 17th Keno Auctions held its Americana Week sale in New York City. From the recent Keno press release they too, like Sotheby's were very pleased with the results of the sale. According to the press release the sale totaled more than $3.6 million and beat the pre sale high estimate by $300,000, and set three auction sales records. The pre sale estimate range was $1.9 million to $3.3 million. Keno Auctions had two main sales, the Americana sale and the single owner Peter Brams Important Woodlands Indian Art Sale, with both selling over 80% of their lots, which is rather strong for most Americana sales.

It is nice to see a little strength in the decorative arts sales, as well as in Americana and brown furniture.

Keno Auctions reported on the sale

New York – The combined morning and afternoon sessions of Keno Auctions’ Important Americana, Paintings, Furniture and Decorative Arts Sale and The Peter Brams Collection of Important Woodlands Indian Art with a combined pre-sale estimate of $1.9 million/$3.3 million exceeded its high estimate by $300,000, achieving more than $3.6 million. It became the most successful one-day sale in the young auction house’s history and set the tone for the upcoming May 15 and fall 2012 sales at Keno Auctions. The Important Americana sale fetched remarkable prices for star lots with 80% sold by lot and totaling $2,626,000; two new world auction records were established for a 17th century joined chest and a Federal painted table, which led the sale. The afternoon session was dedicated to the landmark auction of property from the iconic collection of Peter Brams. The single owner sale was a tribute to the discerning eye of this celebrated inveterate collector, with 81% sold by lot totaling
$889,900 and saw a world record set for a Native American efgy ladle.

Results: Sotheby's Americana Week

noreply@blogger.com (Todd W. Sigety, ISA CAPP) — Mon, 23 Jan 2012 18:49:00 +0000

Sotheby's appears to be very happy with the results of its American week sales. The group of sales totaled $17.9 million (including buyers premiums), and is the highest total for Americana Week at Sotheby's since 2007. Several auction records were set for American, including a Rhode Island John Townsend high chest which sold for $3.55 million including buyers premium (see image) and Colt revolver selling for $1.14 million including buyers premium.

The Landmark Collection of Betty Ring embroideries totaled a strong $4.39 million including buyers premium which was nicely above the pre sale estimate of $3.4 million. The collection offered 198 lots with 143 selling for a buy through rate of 72.2%. It sold an impressive 87.5% by value. The top selling lot was a needlework sampler estimated to sell for $80,000 to $120,000, which made $1.07 million including buyers premium. It appears all of the top ten lots were sold to dealers (all accept one lot to Finkel and Huber).

The Important Americana Sale totaled $13.5 million including buyers premium and offered 316 lots. Of the 316 lots 202 sold for a fair 63.9% sell through rate. The sale sold a good 81.8% by value, showing that the items which did sell, typically sold well. The top selling lot was the high chest noted earlier in this post. It appears about half of the top ten lots sold to dealers and the other half to private collectors.

Overall a good Americana Week for Sotheby's.

Sotheby's reported on the sale

22 January 2012 – Sotheby’s Americana Week auctions concluded today in New York with a combined total of $17,900,261 – Sotheby’s highest total for this annual week of sales since 2007. The Important Americana auction on Friday and Saturday was led by two record-setting results: the previously undocumented Exceptional Lieutenant Colonel Oliver Arnold Shell-Carved and Figured Mahogany High Chest of Drawers with Open Talons made by John Townsend in 1756, which set an auction record for any high chest of drawers in selling for $3,554,500 (est. $2/3 million*), and An Extremely Rare and Highly Important Gold-Inlaid and Deep Relief Engraved Colt Model 1849 Pocket Revolver, Samuel Colt, Hartford, Connecticut, circa 1853 that brought $1,142,500 and set a record for any single firearm at auction (est. $800,000/1.2 million). On Sunday, Important American Schoolgirl Embroideries: The Landmark Collection of Betty Ring totaled $4,389,503 – exceeding its pre-sale high estimate of $3.4 million – and set a new auction record for any needlework sampler at auction when a Rare and Important Needlework Sampler, Mary Antrim, Burlington Country, New Jersey, Dated 1807 achieved $1,070,500, more than ten times its high estimate of $120,000.

Important Americana – 20 & 21 January 2012

The first day of the Important Americana sale saw top prices for American silver, featuring an exceptional group of 17th, 18th and 19th century pieces from First Parish Church in Dorchester, Massachusetts that brought a total of $1,721,313, led by The Governor Stoughton Cups: A Rare Pair of American Silver Standing Cups that achieved $1,082,500 (est. $1/2 million). The Church will use the proceeds from the sale of this historical group to move its mission in the Dorchester community into the 21st century – not only by updating the physical building and its systems, but also becoming a resource and active center for its multi-faceted community.

In addition to strong prices for American furniture and decorative arts, Saturday’s session saw several remarkable results for American folk art: Ammi Phillips’s Portrait of a Winsome Young Girl in Red with Green Slippers, Dog and Bird, circa 1840 – one of only 11 portraits in red by the artist – well exceeded its $500,000 high estimate in selling for $806,500, while a View of the John Hancock House, Beacon Hill, Boston (Fireboard / Overmantel) painted circa 1780 achieved $614,500 above a high estimate of $250,000. The work is one of the earliest and most complete views of the famous Hancock residence.

Important American Schoolgirl Embroideries:

The Landmark Collection of Betty Ring – 22 January 2012 In addition to the record-setting result for the Mary Antrim sampler (pictured left), Sunday’s auction dedicated to the celebrated collection of Betty Ring was highlighted by several pieces that greatly exceeded pre-sale expectations: a Fine and Rare Needlework Sampler, Susannah Saunders, Sarah Stivours School, Salem, Massachusetts, Dated 1766 nearly quadrupled its high estimate of $80,000 in achieving $314,500; a Fine and Rare Needlework Sampler, Betsy Gail, Marblehead, Massachusetts, circa 1790 brought $170,500 above a high estimate of $60,000; and a Rare Needlework Sampler, Sarah Cooper, attributed to Ann Marsh’s School, Philadelphia, Pennsylvania, Dated 1792 sold for $170,500 above a high estimate of $80,000

Chinese Auction Scafflaws

noreply@blogger.com (Todd W. Sigety, ISA CAPP) — Sat, 21 Jan 2012 18:00:00 +0000

We have all heard of some of the issues the major auction houses have been having collecting payments on major purchases by Chinese buyers. The Financial Times has a very interesting, although short article on Chinese collectors who are not paying auction houses and are failing to live up to contractual agreements for the purchase of art. Sotheby's has started to name the bidders who have failed to pay. The art community loves gossip and scandal, so releasing names of those who fail to pay for purchases could have an impact.

The FT reports

Several cases of non-payment in recent years have involved Chinese buyers. In 2009, the winning bidder refused to pay $40m for two antique bronze animal heads at the Yves Saint Laurent sale.

Christie’s and Sotheby’s have both tried to discourage non-payment in Hong Kong by requiring bidders to put down deposits of HK$1m (US$129,000) before making offers for the more expensive pieces.

Two people, who both paid deposits, are now being sued by Sotheby’s, which has decided to publicise the writs.

Ma Dong, a man from the Daxing district in Beijing, won three paintings by bidding just under HK$50m in total on October 4 – including one by Zhang Daqian, one of the most respected 20th century Chinese artists. He has yet to pay for any of them, according to the auction house.

On October 3, Ren Chunxia, a woman with an address in Jinan, eastern China, won two oil paintings by the Chinese master Wu Guanzhong with bids of HK$18.6m and HK$26.4m respectively. These were paid for within the standard 30-day limit. However, she has yet to pay for a painting by the abstract artist Zao Wou-ki, which she bid HK$69m for on the same day. That price was a new auction record for the artist and nearly double the high-end of Sotheby’s pre-sale estimate.

Source: Financial Times

Update: NY Americana Week

noreply@blogger.com (Todd W. Sigety, ISA CAPP) — Fri, 20 Jan 2012 22:14:00 +0000

The Americana sales are continuing, and according to Bloomberg, Christie's has sold a complete first edition of Audubon's The Birds of America. The lot sold for $7.92 million including buyers premium which was just over the low estimate of $7 million and far below the pre sale estimate of $10 million. Bloomberg notes the record for a previous set was set in 2010 for $11.5 million.

The Christie's main sale for furniture is over with the sale totaling $8.72 million including buyers premiums. More analysis on the sales when the results are posted.

Bloomberg reports on the sale

A complete first edition of John James Audubon’s “The Birds of America” fetched $7.9 million at Christie’s (CHRS) today, just above the low presale estimate and far shy of a record.

A single telephone bid took the prize. The highest auction price paid for one of the first editions was $11.5 million in a 2010 sale at Sotheby’s.

The giant four-volume set (1827-1838) stands more than 3 feet tall and features 435 hand-colored engravings. It was estimated to bring $7 million to $10 million.

The set originally belonged to William Henry Cavendish, the fourth Duke of Portland, a British politician who bought it after 1838, according to Christie’s catalog.

Of approximately 200 copies that were printed, 107 are in institutions and 13 are in private hands. The whereabouts of the rest are unknown.

Source: Bloomberg

Washington's Wine Cooler

noreply@blogger.com (Todd W. Sigety, ISA CAPP) — Thu, 19 Jan 2012 22:24:00 +0000

Bloomberg has a nice short post about a four bottle Sheffield plate wine cooler designed to specifications for George Washington. The cooler carried a $400,000 to $600,000 pre sale estimate at Christie's Americana sale for silver being held on Thursday, January 19.

I just checked the Christie's site and the silver portion of the sale has been completed and the cooler sold for a cool $782,500 including buyers premium. I will have more on the Americana sales at both Christie's and Sotheby's once the consolidated reports are released.

Bloomberg reports on the Washington wine cooler

A four-bottle wine cooler whose provenance includes the first U.S. president and his treasury secretary could fetch as much as $600,000 this week.

The Sheffield-plate bowl, designed to the specifications of George Washington, is coming to the auction block on Jan. 19 as part of Christie’s (CHRS) Americana week in New York.

Washington ordered four wine coolers in 1789, the year he was sworn into office and moved into his first official residence on Cherry Street in Manhattan.

“They had just thrown out England and they had to entertain,” said Jeanne Sloane, Christie’s deputy chairman and head of silver. “But they didn’t want to be regal.”

The wine cooler was decorated only with lion’s masks and ring handles on the sides. Instead of using solid silver, a layered combination of silver and copper, known as Sheffield plate, was chosen.
“Extravagance would not comport with my own inclination, nor with the example which ought to be set,” Washington wrote to Gouverneur Morris in a letter asking his help with supplying the coolers.
‘As a Token’

In 1797, as Washington left office and moved to Mount Vernon, he gave one of the wine coolers to Alexander Hamilton, his friend and the first treasury secretary.

He writes in a letter to Hamilton that the gift is “not for any intrinsic value the thing possesses, but as a token of my sincere regard and friendship for you, and as a remembrance of me.” The passage is part of a long inscription that Hamilton’s descendants had engraved on the cooler, while the letter itself is in the collection of the Library of Congress.

The cooler has remained until now with Hamilton’s descendants.

Another highlight of the Americana sales is a full-size, complete first edition of John James Audubon’s “The Birds of America” (1827-1838). The four-volume set features 435 hand- colored engravings. It’s offered on Jan. 20 with an estimate range of $7 million to $10 million.

Source: Bloomberg

UK Regional Houses Have Positive 2011

noreply@blogger.com (Todd W. Sigety, ISA CAPP) — Wed, 18 Jan 2012 22:45:00 +0000

The Antiques Trade Gazette has a good article on the success of regional auction houses in the UK. Despite poor economic condition, many of the regional have seen their sales increase, although 2010 was a very good year and hard to follow in some instances. Many regional salesrooms did well with Asian sales as well.

Overall I think this is good news, but I do wonder if the strong sales are based upon the quantity of sales as opposed to increasing values and quality sales.

The ATG reports

Commenting on the wider marketplace in his capacity as chairman of the Society of Fine Art Auctioneers, Mr Viney said: "Auctioneers often do quite well in times of financial recession and I have been getting pretty positive reports in 2011 from our members. Obviously, all of us have been cashing in on the boom in Asian art, though I thought it was notable in the November sales (both in London and the regions) that the Chinese were a little more circumspect and selective in their bidding.

"Another aspect I have noticed in the last few months is that English furniture has become more sought after, though whether this is merely a blip or represents an encouraging emergence from the doldrums of the last few years, it's difficult to say.

"However, in the coming year we may well be entering uncharted territory and I think it would be a very brave – or foolish – man to start making bullish predictions about 2012. Certainly at Woolley & Wallis we have no great expansion plans and will be aiming to contain our costs while maintaining a first-rate service to our clients."

Helped by the underlying strength of gold and silver prices, hammer sales at Fellows of Birmingham were a fraction over £10m, a 27 per cent growth on the previous year. Director Stephen Whittaker told ATG that much of the growth had come from the watch department, although all aspects of the business had showed increases on the previous 12 months. The firm has already scheduled a calendar of 65 sales for 2012.

At Tennants of Leyburn, sales were an impressive £12m, matching the record numbers of the previous year and an increase of £2m on equivalent figures in 2007 and 2009, while Sworders posted total sales of £8.4m, up from £7.2m in 2010.

Source: The Antiques Trade Gazette

Knoedler Sued Over Sale of $17 m Pollock

noreply@blogger.com (Todd W. Sigety, ISA CAPP) — Tue, 17 Jan 2012 23:02:00 +0000

The Art Newspaper has a good update on the continuing saga of the Knoedler Gallery in NYC. The issues of Knoedler are growing with the recent suit and accusation of another fake, this time a Jackson Pollock painting purchased from Knoedler in 2007 for $17 million. Not only is the scandal growing, but it now appears to be impacting other large galleries.

The Art Newspaper reports

Legal papers and testimonies also suggest a number of leading art galleries have unwittingly been caught up in the scandals. Timothy Taylor Gallery and art dealer Jaime Frankfurt are named in the Lagrange papers as intermediaries in the sale of the Pollock. Court papers filed by the Dedalus Foundation state that Haunch of Venison opened its New York space in 2008 with a show that “put [a] supposed Newman painting from the so-called David Herbert collection [see box] in place of honour”. The current whereabouts of this work is unclear.

Authentication

Both cases and the Beltracchi investigation lay bare the inherent problems of authenticating works of art in an industry reliant on reputation and trust—and the apparent ease with which determined forgers can pass works through the system.

“This is very scary stuff,” says one prominent New York collector. “These are all people we know, and have been dealing with for years.” Blondeau, who was also a victim of Beltracchi, says that: “We are facing a very serious problem, especially because markets are so overheated—historically, when markets are strong, forgeries appear.” He adds of his own involvement: “I was fooled—the works were an incredible quality.”

He is not the only person to have been caught out. “This should act as an alarm for dealers working in the post-war field,” says prominent New York dealer Richard Feigen, who acted as an agent in the sale of a faked Max Ernst work produced by the Beltracchi gang. He has subsequently repaid his client, and was reimbursed himself, but is “still struggling to retrieve the sales tax from the state of New York, which is over $250,000”. Feigen says that his gallery is “very careful about who we deal with and always have been. I know Ernst’s work intimately, and the leading Ernst expert [Werner Spies] said it was the best fake he ever saw.”

Source: The Art Newspaper

Luxury Goods Remain Strong

noreply@blogger.com (Todd W. Sigety, ISA CAPP) — Mon, 16 Jan 2012 16:42:00 +0000

The Wall Street Journal has a very good video on luxury goods sales in general and the holiday season returns at Swill luxury conglomerate Richmont. Richmont, owner of the following luxury brands, Cartier, Van Cleef & Arpels, Piaget, Vacheron Constantin, Jaeger-LeCoultre, IWC, Panerai and Montblanc saw its holiday sales rise by 24% over the 2010 holiday season.

The wealthy continue to spend on high end goods without much concern over economic issues. This dovetails very nicely with art as an asset class and the recent reports of strength from the art market in 2011.

See the video below or click HERE to watch the WSJ video.

The Art Market in 2012

noreply@blogger.com (Todd W. Sigety, ISA CAPP) — Mon, 16 Jan 2012 00:12:00 +0000

The Art Newspaper has a good article on the art market and art an an asset class. It looks back at some of the sales which took place in 2011 and looks forward to 2012 with some concern, especially in the middle markets and outside of the major cities such as New York and London. The article starts out be noting much of the global economic turmoil but rather defiantly many sectors of the fine art market has performed well.

The question is for 2012, can the resilience continue?

The Art Newspaper reports

But as the results came in, it was clear that some sectors of the art market were almost miraculously walking on water. Sotheby’s 8 November sale in New York fetched extraordinary prices for a group of Clyfford Stills and for works by Gerhard Richter, and its total of $315.8m was its third highest for such a sale, with just $100,000 separating it from its second (the record is still held by Christie’s $384.6m sale in May 2007). The autumn fairs and many other auctions also turned in more than respectable results. Based on almost complete data for 2011, the French site Artprice reported that the year was the best ever for sales of art at auction: $10.7bn, compared with $9.5bn in 2010. This extraordinary result shows that the market was still growing last year, boosted by Chinese buyers.

Art has certainly benefited from being considered by some as a “tangible asset”. “Investors were disappointed in financial assets following the economic crisis and there is growing demand for ‘real assets’ that offer a long-term store of value,” says Randall Willette of Fine Art Wealth Management.

An illustration was the extraordinary results of the New York sales of Elizabeth Taylor’s jewels and memorabilia (total $156.7m) last month, which showed that there is still a massive amount of money available to be splurged on luxury goods—an area into which art is, rightly or wrongly, assimilated by many financial analysts.

The major questions, as we go into this year, are how resilient is the market, and can it continue to operate in an apparently parallel dimension?

Source: The Art Newspaper, click HERE to read the complete article.

2011 French Auction House Results

noreply@blogger.com (Todd W. Sigety, ISA CAPP) — Sat, 14 Jan 2012 19:00:00 +0000

Just a quick post from a paragraph from an art update article in the Financial Times regarding 2011 year end results for auction houses in France.

The FT reports

Still in France, the line-up of auction house results for last year saw Christie’s leading the field with turnover of €199m (up 13 per cent) while Sotheby’s was close behind with €190m. But the “best in show” prize goes to Artcurial. It reported its highest total ever, making sales of €127m, a 23 per cent increase over 2010. Co-chairman Francis Briest picked out the €5.8m made for a De Staël and €7m for a Feininger as particularly satisfying and noted: “Our firm has reached a critical mass and now we can rival the salerooms of London or New York.”

Source: The Financial Times

Chinese Collectors of Contemporary Art

noreply@blogger.com (Todd W. Sigety, ISA CAPP) — Fri, 13 Jan 2012 21:48:00 +0000

The Wall Street Journal just ran a good article on collectors of contemporary Chinese art. The article touches on not only the art, but the collectors and the mind set of these new collectors.

The article points out that three of the top ten selling items at auction in 2011 were Chinese art. The collectors are looking for transformative art, and as most appraisers are aware, they are willing to pay for it. The WSJ article notes that Christie's saw Chinese buyers account for 1/5 of worldwide sales in the first half of 2011, and Sotheby's noted Asian sales were up 47% from 2010, at $960 million. Although there is concern that the growth will slow due to concerns over the global economy, as well as potential slowing growth in China.

The Wall Street Journal reports

Alan Lee, who runs Beijing gallery Asia Art Center, says one of his clients, a fitness-equipment manufacturer named Chang Chiu Dun, calls himself the "Cover Killer" because he "likes to buy artworks that have been on the covers of auction catalogs."

The downside, Mr. Lee says, is that this influx of newly wealthy collectors is fueling risky speculation on art, leading to price swings and heavy trading volumes for younger artists like the eyeball painter, Ji Dachun, whose lasting significance is still uncertain. Art advisory firm Artvest says Chinese investors have recently started at least eight art funds, which buy artworks with the aim of reselling them at a profit later. There are only about 20 similar funds elsewhere in the world.

China's gallery scene is similarly freewheeling, with collectors such as Mr. Yang sometimes serving as stakeholders or co-owners of galleries where they also shop. Such arrangements can spark potential conflicts of interest because the stakeholders might be able to leverage their position to claim the gallery's choicest pieces. Seven years ago Mr. Yang paid to help his wife open her contemporary art gallery, Aye, but he says he doesn't manage her artists or get first dibs on any work she shows there. He recently stepped back as a financing partner in another contemporary art gallery he founded three years ago, Eastation, in order to focus on his wine venture. He continues to buy art from both galleries.

Dealers and artists say it's unclear whether Mr. Yang is trying to build a museum-worthy collection or angling for the right moment to cash out. "China's market is still so new—it's hard for us to tell who's a collector and who's a speculator," says artist Zhang Xiaogang.

Mr. Yang isn't troubled by such ambiguity. "I can't say if investing in art is good or bad," he says, "but I know that without money, you can't make a market grow."

Within China's contemporary art circles, Mr. Yang is hard to miss. He's tall, with a square face and thick head of black hair. He shows acquaintances cellphone images of his art the way others pull up snapshots of their children. More often than not, he turns up at black-tie dinners dressed in a polo shirt, black corduroys, and sneakers.

Source Wall Street Journal: To read the full WSJ article, click HERE.

USPAP 2014 - 2015

noreply@blogger.com (Todd W. Sigety, ISA CAPP) — Thu, 12 Jan 2012 18:40:00 +0000

The Appraisal Foundation's Appraisal Standards Board (ASB) has just released a request for public comment on the 2014-2015 edition of USPAP. Written comments are being accepted until March 12, 2012.

Although still early in the cycle, appraisers can see from the recent document release the areas of interest and change the ASB is focusing on for the next two year cycle of USPAP.

According to the document release, the below listed bullet points are being reviewed for possible alterations and updates for the 2014 - 2015 version of USPAP. As you can see form the points the ASB is requesting comment on, there is perhaps going to be a movement away from the current three types of reports, Self-Contained, Summary and Restricted, and possibly to be replaced with a report written and defined by the intended use and scope of work.

The ASB document states

• At what point does a Summary Appraisal Report format become a Self-contained Appraisal Report format?

• Why is one of the three report options entitled Restricted Use Appraisal Report when every appraisal has a defined intended use?

• If the client no longer has access to an appraiser’s workfile for a Restricted Use Appraisal Report, is pubic trust protected when the report must warn “that the appraiser’s opinions and conclusions set forth in the report may not be understood properly without additional information in the appraiser’s workfile”?

• Currently the SCOPE OF WORK RULE includes the development side of an assignment but excludes consideration for the communication side of the assignment results. As assignments include both development and reporting work, should the SCOPE OF WORK RULE be expanded to include both development and communication of the assignment results?

• There is a single set of minimum development Standards. If USPAP sets the minimum appraisal report requirements, should there be a single set of appraisal report requirements rather than the current multiple set of report format options in STANDARDS 2, 8, and 10?

• When are the appraisal report requirements mandatory?

• Can appraiser independence be better protected through improvements to USPAP?

• Defining what an appraiser’s peers’ actions would be in the same or similar circumstances and what market participants would expect is extremely difficult to enforce. Can anything be done to improve this?

Source, The Appraisal Foundation, Foundation News: Click HERE to read the full ASB document.

Monuments Men Movie with George Clooney

noreply@blogger.com (Todd W. Sigety, ISA CAPP) — Wed, 11 Jan 2012 16:40:00 +0000

Fellow appraiser Aloysia Hamalainen sent me an article on a new Hollywood movie project based upon the book Monuments Men. According to Reuters, George Clooney will write, direct and star in a major movie production of the book. The Monuments Men is a book and a documentary about a group of American art experts tasked with locating looted art from Nazi Germany.

Reuters reports on the movie production

George Clooney has started to work on his next project, writing, directing and starring in a big-budget movie about the men who chased down the stolen art of Europe during World War II, he told TheWrap on Saturday.

“The Monuments Men,” which Clooney is co-writing with his producing partner Grant Heslov, will tell the story of a hand-picked group of art experts chosen by the U.S. government to retrieve artwork stolen by the Nazis.

“I’m excited about it,” Clooney told TheWrap at the Palm Springs Film Festival on Saturday. “It’s a fun movie because it could be big entertainment. It’s a big budget, you can’t do it small -- it’s landing in Normandy.”

The movie will be based on the book “The Monuments Men: Allied Heroes, Nazi Thieves, and the Greatest Treasure Hunt in History,” by Robert M. Edsel.

Clooney said he will co-write, direct and star in the movie, which has been set up at Sony. It will have several meaty roles for actors, though Clooney said it was too early to think about who might fill those roles.

“Grant and I have been trying to find a project,” Clooney said.

“I’m not opposed to doing a commercial film, I’m just opposed to doing a commercial film that doesn’t feel organic to me. So if we’re going to do a commercial film we thought, 'Let’s do something that seems fun and actually have something to say.'”

"Monuments” is an intrigue-filled tale of art theft and espionage in Europe during World War Two. (Photo of U.S. soldiers retrieving artwork in Austria in 1945, Getty Images.) Hitler systematically emptied the museums and private collections of Europe during World War II.

The book tells the tale of a special force of American and British museum directors, curators, art historians – called the Monuments Men – who risked their lives scouring Europe to prevent the destruction of this culture.

The book specifically follows the 11-month period between D-Day and V-E Day. The group worked behind enemy lines and were often unarmed.

Source: Reuters

Mei Moses in the Financial Times

noreply@blogger.com (Todd W. Sigety, ISA CAPP) — Tue, 10 Jan 2012 21:08:00 +0000

Click Chart for Larger Image

I have long been a proponent of quantative analysis of art market prices, art as an asset and an advocate for the Mei Moses arrt index. I posted the positive year end results from several of the Mei Moses art indexes and noted how the average for all art was above 10% and outpaced the Standard and Poors 500 for 2011 (click HERE for that post).

The Financial Times has picked up on the results and carried them along with an interview with co-founder Mike Moses. The Financial Times, a leading international financial newspaper called the Mei Moses All Art index, the "leading barometer of art returns" which certainly adds to the reputation of the published returns of the index. Although the 2011 results are very encouraging, the article does note the future of the art market and financial returns are still rather unpredictable based upon the potential of slowing global economic growth.

A very good article to have for an an appraiser.

The FT reports

The Mei Moses has beaten the S&P 500 in six of the last 10 years, with an average annual return of 7.8 per cent compared with 2.7 per cent for the benchmark US index. The Mei Moses tracks the prices at which individual works of art sell over time using repeat sales data, in a methodology similar to the S&P Case-Shiller property index.

“Art prices are not correlated to sudden swings in stock markets but their prices tend to match changes in wealth creation and destruction. I’m not surprised by this growth as we are not seeing the wealth damage of 2008-2009,” said Michael Moses, creator of the index.
The performance of the index was led by a strong contribution from traditional Chinese works, which rose 20.6 per cent during 2011, as Chinese investors sought to repatriate cultural assets that had been sold to western investors.

“With China there is massive wealth. And the new wealthy want to show off their prized works to friends. It doesn’t take many to cause a surge in prices,” said Philip Hoffman, chief executive of the Fine Art Fund Group, an investment manager specialising in art with about $100m under management.

Elsewhere, there were record auctions for paintings such Roy Lichtenstein’s I Can See the Whole Room . . . and There’s Nobody in It! which sold at Christie’s in November, making gains in excess of $40m for its seller, who bought it for $2m in 1988. Andy Warhol’s Dollar Sign also made big returns when it sold for twice its estimate at $698,500 in 2011, having been bought for $27,000 23 years earlier.

Source: The Financial Times, click HERE to read the complete article.

Decline in Formal Dining Rooms

noreply@blogger.com (Todd W. Sigety, ISA CAPP) — Mon, 09 Jan 2012 16:45:00 +0000

The Antiques Trade Gazette has an interesting post on the move away from formal dining and formal dining rooms. The ATG reports on a survey which found that the number of kitchen/diners has grown by 50% over the past 20 years and that now three in ten households no longer have formal dining rooms.

Not surprisingly, with the decline of formal dining rooms, the interest in formal furnishing and other dec arts and silver declines as well. This was supported at the November AAA conference where a Chrisite's specialist state that formal "period" rooms are continuing with a decrease in popularity.

The ATG post is short, and very good documentation to support the decline in values in many areas of the decorative arts, such as middle market brown furniture.

The ATG report

Modern living is continuing its migration away from formal dining, according to a new survey of 2000 UK households.

Lloyds TSB Home Insurance, who conducted the poll, found that the number of kitchen/diners has grown by 50 per cent in the past 20 years, to the point where three in ten households no longer have a separate dining room. In fact, creating an open-plan kitchen/diner accounted for around a third of all work undertaken.

And the trend is continuing. In the antiques world, the changes have been reflected in falling demand for dining room furniture and silver flatware, such as canteens of cutlery.

The survey, which also assessed planning applications across eight district councils from Scotland to the south coast, showed how domestic life is changing across the board, pointing to further areas in which the demand for antiques may be changing. Today, for example, 40 per cent of homes have a utility room and one in 50 a gym. Nearly 20 per cent have converted garages into extra rooms, while just over 20 per cent have added ensuite bathrooms.

Ten per cent of homeowners have spent more than £35,000 adapting their properties, and five per cent more than £50,000, generally with a view to more open-plan, informal living.

The survey is one of several that are published by different property-related businesses each year.

Source: Antiques Trade Gazette

VIP Online Art Fair Set to Grow

noreply@blogger.com (Todd W. Sigety, ISA CAPP) — Mon, 09 Jan 2012 02:13:00 +0000

Bloomberg is reporting that the exclusive VIP online art fair is set to hold the original art fair plus three separate events during 2012. This is up from a single online fair from early in 2011. I have reported on the VIP online fair in the past on the AW Blog, click HERE for background.

Bloomberg reports last years show had some server issues, and the next show is down to 110 dealers from about 130. About 25% of the first fairs dealers did not sign up for the second fair, kicking off on February 2. After the online art show, VIP plans an online works on paper fair followed by a photography fair and a September fair which is smaller, and limited to about 50 dealers. Click HERE to visit the VIP site.

Bloomberg reports on the VIP fairs

The world’s first online contemporary-art fair is set to expand with three new events in 2012, following the hiring of a new chief executive officer, director and technical team.

The first edition of the VIP Art Fair, held last January, was billed as an unprecedented event where collectors were able to access 2,000 works and connect with more than 130 dealers from 30 countries. The debut suffered from teething problems such as a jammed chat system.

After that, 25 percent of the first-time participants -- including Michael Werner Gallery and L&M Arts from New York -- haven’t returned. Big names such as Gagosian, White Cube and Hauser & Wirth remain among about 115 dealers signed up for VIP 2.0, which previews on Feb. 2.

“We’ve now hired our own in-house technical team and have completely re-architected the site,” Lisa Kennedy, the fair’s new chief executive, said in a telephone interview. “It will now be able to handle a lot more traffic and many more simultaneous queries.”

VIP will also be holding events devoted to works on paper and photography running from April 20-22 and July 13-15 respectively. A three-day “Vernissage” (preview) will be held from Sept. 7-9, the fair said today in an e-mailed statement.

“The Vernissage will be a smaller, shorter event in which dealers spread the word about what’s new and fresh before the Fall season starts,” said Kennedy. VIP is hoping for about 50 dealers at this weekend event, she said.

The fair has received angel funding from two international art collectors. Selmo Nissenbaum, based in Brazil, and the Australian Philip Keir, have invested a total of $1 million, VIP said in the statement.

Kennedy, 43, was hired in October from Quidsi Inc., a subsidiary of Amazon.com Inc., where she had been executive vice-president of e-commerce. Liz Parks, a former head of sales at Artnet, has been appointed director of the fair.

VIP 2.0 will be open online through Feb 8.

Source: Bloomberg

Rhode Island Furniture Database

noreply@blogger.com (Todd W. Sigety, ISA CAPP) — Fri, 06 Jan 2012 17:16:00 +0000

With Americana week fast approaching the NY Times has an interesting post in Arts Beat about Yale University American decorative arts curator Patrica Kane and her online database of Rhode Island cabinet makers and their known pieces. The database tries to track the items and currently lists 1,800 artisans and 2,000 objects.

Both Sotheby's and Christie's have quality Rhode Island furniture in the upcoming Americana sales. Scroll back over the past week or two of AW Blog posts as I have posted on both of the main auction houses sales. Other auction houses, galleries and fairs will also be offered throughout Americana Week in New York.

Click HERE to visit the Rhode Island Furniture Archive

The NY Times reports on the Rhode Island Furniture Archive

Furniture made in Rhode Island before 1800 would sound like a manageable topic for a thorough Web site. After all, “Rhode Island is not that big a state,” said Patricia E. Kane, lead curator of American decorative arts at the Yale University Art Gallery.

A decade ago she started collecting data for Yale’s online Rhode Island Furniture Archive, intending to cover all the state’s cabinetmakers and their surviving products in private and museum collections. But the site, rifa.art.yale.edu, soon ballooned past her expectations.

Scheduled for completion in a few years, the site already lists 1,800 artisans and 2,000 objects, searchable by the names of workshops, hometowns and owners, among other terms. Making the unfinished site accessible now can draw out more information and insights from other scholars.

If Yale relied only on its own digging, Ms. Kane said, “I could be 110 before the thing was perfect.” Americana sales in New York on Jan. 20 and 21 are bringing out yet more Rhode Island material for Yale to track. (And on Jan. 15 and 16, Christie’s is devoting a symposium to the topic.) Sotheby’s is offering new discoveries: a mahogany dresser and highboy by the Newport woodworker John Townsend (each with seven-figure estimates). The top lots at Christie’s include Townsend armchairs (each with $120,000 high estimates) and a marble-topped table with an original bill of sale from his furniture-maker cousin, John Goddard (up to $3 million).

Source: NY Times

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Artprice Enters the Online Auction Business

noreply@blogger.com (Todd W. Sigety, ISA CAPP) — Thu, 05 Jan 2012 22:25:00 +0000

Artprice has just announced a new international online auction site. The site will allow collectors to buy and sell on the auction site with guarantees of secure payments through Escrow.com and participation with INTERPOL for sellers to access the Stolen Works of Art database. The site will also encourage auction houses to use the new service which will compete with Artfact and Liveauctioneers auction platforms. Artprice and their auction strategy also seems to be following the lead of other major houses with a focus on China.

For individuals looking to sell art, antiques and design, there are two options, either by auction, (see the second block quote) or through a free classified system. The auction system lets the seller select the final purchaser from the three highest bidders. The auction will be active in selling fine art, antiques and design.

I wonder if this might be a method for appraisers to broker pieces directly. It will be interesting to see if this concept takes off.

E-Commerce Bytes reports on the new Artprice auction site

Artprice, a leading publisher of art market information, will launch an online auction service this month thanks to restrictions recently lifted on French auction houses. Artfire founder and CEO Thierry Ehrmann said, "It took twelve years and lots of patience and conviction to pursue a legal battle against a 500 year-old monopoly that is today demolished." Artfire is working with Escrow.com to provide a tailored solution that offers a 100% guarantee of security and payment for buyers and sellers. Artprice also has an agreement with INTERPOL, allowing buyers to access its international Stolen Works of Art database to check if a work being offered for sale is subject to any legal dispute or search warrant. Artprice is setting up white labels for auction houses that will use Artprice and its Standardised Marketplace as their technical host for online auctions, thereby providing Artprice - which is not an auctioneer - with another source of income. Artprice said its figures for 2011 have already confirmed China's domination of the global art market for the second consecutive year. Artprice said it was preparing for the opening of its subsidiary and clean rooms in Hong Kong that will be a testing ground for the People's Republic of China and an entry point for Asia. Artprice is increasing its editorial partnership with Art Stage Singapore, Asia's largest Contemporary Art Fair and will become a strategic partner with Art HK (Hong Kong).

Source: E Commerce Bytes

Artprice reports on the new auction site

Put up a lot for online auction Your transaction 100% secure : the payment of your item guaranteed by Escrow.com, the world leader of online escrow services. Your transaction 100% under control: you determine the parameters of your online auction (start price, dates the auction starts and ends) and you get to choose who you sell your item to, among the best 3 bidders. With artprice's online auctions, your secured payment is released faster than on any other sales channel. The most competitive commission rates on the market, ranging from 5% to 9% only. Watch the price of your artwork soar! You really know the real value of an artwork after it has been put up for auction! You remain anonymous during the whole duration of the auction. Artprice.com's Standardised Market Place® is your chance to make our client file of 1,300,000 members your core business. As they can all list their favorite artists, you are sure that your auction will be followed worldwide by the very art lovers, collectors, professionals and institutions that seek to buy the artist's artworks.

Source: Artprice, click HERE for more info

ISA Launches New Website

noreply@blogger.com (Todd W. Sigety, ISA CAPP) — Wed, 04 Jan 2012 18:28:00 +0000

(Click the image to visit the new ISA site)

The International Society of Appraisers just launched their new website. For full disclosure, I am an ISA member and the President of ISA's Board of Directors. I am very excited about the potential of this new site to promote ISA, ISA members, the Foundation for Appraisal Education and to inform and educate the public about personal property appraising.

The new site has been developed with many great features for personal property appraisers. Not only is the look fresh and clean, it is also extremely functional and intuitive. The home page is split into several sections, with a header, a large cycling carousel with a series of images and links, and a footer with a member spotlight and links to our forum, foundation and social media connections to Facebook, LinkedIn Twitter, and RSS feeds.

The site easy to navigate and allows for customizable membership pages, easy search to locate members right from the home page, a new ISA Forum, Education pages, e-commerce applications and ISA/Member news pages to name only a few.

Member Spotlight on ISA Home Page

The site was developed to both promote and increase the profile of ISA and our members. Some of the more interesting features of the site which benefits individual members is member spotlight and members news feeds. On the home page (lower left corner) and some of the subsidiary pages is an area for the member to post news with their image. This cycles through for those members who have selected this option. The members news feed page will posts links and posts from member blogs.

The search function can be location based with returned results based upon 50 miles in proximity. In addition all returns searches can be filtered by the number of miles, appraiser designation or specialty. The member profile page is really exciting and attractive with an image field, hot links, member profile, mapping option, specialties, services and expertise areas. The profile page can easily be updated for news and information the member wishes to share with the public. The site was also developed with e-commerce functionality for registration of courses, conference and membership renewal.

I believe the site is very unique in that it was developed to not only promote ISA as an organization, but also to promote the individual members with features such as enhanced member profiles, selective searches, member news feeds, member spotlight, and member updates. All of these features were designed to promote the individual member and enhance their marketability and brand.

The new new website should be a benefit to all members of ISA. It will greatly increase the exposure of ISA and its members when compared to the previous static site. It is my expectations that the number of site visits, and searches for personal property appraisers will be greatly enhanced on this new dynamic website.

Click HERE to visit the new ISA website.

ISA reported on the website launch

On behalf of the Board of Directors and the Website Task Force, we are excited to announce that the new ISA website is now live!

We want to thank you for your patience throughout this process as we developed a new, user friendly, technologically robust, and esthetically pleasing website. We believe that after just a few clicks on the new site, you will realize the wait was worth it! The new ISA website strengthens the International Society of Appraisers' place as the most relevant and influential personal property appraisal association in the marketplace. We invite you to visit the website today, to:

Complete your member profile and verify your contact information

Search the new Find-an-Appraiser Directory that includes proximity searches, maps, keywords, and more!

Register for the Annual Meeting and 2012 Courses

Visit the new and improved online Forum

Turning Up The Heat: Assets 2012
ISA Annual Conference
April 20–23, 2012
Tempe Mission Palms Resort
Tempe, AZ
Click HERE for more info.

Can Charitable Gifts Be Enforced?

noreply@blogger.com (Todd W. Sigety, ISA CAPP) — Tue, 03 Jan 2012 19:23:00 +0000

Fellow appraiser Monica Fidel spotted an interesting article in the Miami Herald about broken charitable gift promises. The article discusses the four main legal theories involved in gift promises, such as they are not enforceable, to non enforceable with exceptions, charitable reliance, or made with some form of consideration.

The Miami Herald reports

Concerned Charity Charities have a big problem with broken gift promises, commonly known as donor’s remorse. Whether a donor’s gift pledge is legally enforceable is an unsettled area of state contract law. There are four legal theories argued in the cases.

The traditional view is that these gift promises aren’t legally enforceable because they lack legally sufficient consideration. Required mutual exchanges of benefit and detriment are missing, where both parties receive and give up something of value in the exchange. The donee receives a benefit but suffers no detriment. Wording that there is “good and valuable consideration” is insufficient.

The modern view makes charitable pledges legally enforceable as an exception to the general rules of non-enforceability. The exception is based on the public policy that charitable giving is to be encouraged. It is stated in Restatement of Contracts, Section 90(2): “A charitable subscription . . . is binding . . . without proof that the promise induced action or forbearance.”

The middle view allows enforcement if there is specific wording that “this gift is made in consideration of gifts of other donors.” This satisfies the requirement of mutual consideration flowing between the donors.

The promissory estoppel theory upholds the gift if the facts of the case clearly show that the charity changed its position in detrimental reliance upon the promise being honored. If this occurs, the donor is legally estopped to deny enforceability. This is stated in Section 90(1) of the Restatement of Contracts.

No matter what state law applied, charities were usually reluctant to sue to enforce defaulted gift promises. They didn’t want to create a negative litigious image. And most of the time donors honored their gift pledges. But this all changed with the 2008 economic downturn, financial scandals, and investment rip-offs.

You want to know where you stand. The Florida Supreme Court case of Mt. Sinai Hospital v. Jordan, 290 So.2d 484 (1974) suggests you can’t enforce the gift pledges unless you actually relied on them. Your question doesn’t mention that detail.

In Jordan, a case of 1st impression, the donor signed pledges totaling $100,000, payable in equal annual installments of $5,000, “in consideration of and to induce the subscriptions of others.” After paying $20,000 he died and his estate refused to pay the balance. The trial court ruled for the charity.

On appeal the decision was reversed because there was no claim or evidence of detrimental reliance (promissory estoppel) by the charity. The Florida Supreme Court then affirmed. It said the gift promise was unenforceable without (1) reciting the specific purpose for using the funds and (2) a showing of actual reliance.

Source: Miami Herald

Correction on Mei Moses All Art Index

noreply@blogger.com (Todd W. Sigety, ISA CAPP) — Tue, 03 Jan 2012 13:50:00 +0000

In yesterdays posted I stated the Mei Moses All Art Index was up over 20% for 2011. That was a typo, and the index is actually over 10%. I appologize for the error.

Also, Mei Moses continues to over their premium subscription at a 50% discount for appraisers. Click the banner below for more information on this savings for appraisers.