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Auctioneers’ Liability

French Court takes a radical approach to auctioneers’ liability.

RodinIn a recent decision (18 January 2013), the Paris Court of Appeal held that an auctioneer was strictly liable to the buyer of an artwork if he described it as authentic when it was not. Strict liability means that the auctioneer is liable irrespective of whether he was negligent in cataloguing the artwork. He is liable if he gets it wrong.

The facts were that in April 1987, Daniel Fisch bought at auction in Paris a bronze sculpture catalogued as La Faunesse à Genoux by Rodin, stamped Alexis Rudier, for a total price of FF 422,922. He bought the sculpture at auction house SCP Ader Picard Tajan, now known as SCP Tajan.

It appears that in 2006, Mr Fish asked Tajan if they would sell the sculpture on his behalf. Tajan expressed doubts on the authenticity of the sculpture. Independent experts were appointed. They concluded that the sculpture had not been made by Alexis Rudier, and that it was a posthumous unauthorised replica.

Mr Fish sued Tajan, the auction house. He lost in the court of first degree. On appeal, his claim was that Tajan was liable in tort (of negligence) and accordingly, it should compensate him for his loss. Tajan replied that Mr Fish had failed to show that it had been negligent in cataloguing the sculpture; there was no reason to believe in 1987 that the sculpture was an unauthorised replica.

The Court noted that the sculpture was not as described in the sale catalogue. The sculpture was catalogued as authentic when it was not. It then observed that as a matter of French law, the auction house who asserts that an artwork is authentic, without expressing any reservations, is liable to indemnify the buyer if the artwork is not authentic. There is no obligation on the buyer to show that the auction house was negligent in its cataloguing of the artwork. The fact that the artwork was mis-catalogued was sufficient to trigger liability.

This decision is not unique. Since 1995, French Courts have increasingly taken the view that if the auctioneer or expert cataloguing an artwork for sale gets it wrong, he is strictly liable to the buyer. The catalogue description amounts to a kind of warranty that the art is as described.

In some cases, however, French Courts appear reluctant to consider the expert at fault simply because she gets it wrong. In an earlier decision (23 March 2012), the Court of Appeal held that the experts were liable to compensate the buyer because they had acted negligently, not simply because their description of the item had been wrong. In that case, Mr and Mrs Deconinck bought from antique dealer César Hermanovits a chest of drawers described as having been made during the reign of Louis XIV. They paid 250,000 euros for it. At the time of the sale, they sought the opinion of three experts. All three experts concurred that the chest had been made during the reign of the Sun King.

After the sale, evidence became available that the chest had been heavily altered. Whilst the chest might have been made in the early years of the 18th century, the marquetry in the style of Boulle was more recent and had been applied using modern glue. Moreover, the bronze ornaments were not original. They were in the style of Louis XIV bronze ornaments.

The claimants asked the Court to cancel the sale. Their claim was not that the seller had been negligent but that he had misrepresented the nature of the chest to such an extent as to justify a cancellation of the sale.

The Court observed that the chest was not as described by the seller. The chest taken as a whole had clearly not been made during the reign of Louis XIV. The Court confirmed the decision of the court of first degree cancelling the sale and ordering Mr Hermanovits to pay to the claimants the original purchase price plus interest.

The difficulty for the claimants was that Mr Hermanovits was insolvent. The Court of first degree had not made the three experts jointly and severally liable with the seller, hence the appeal. The Court of Appeal held that the experts negligently misrepresented the essential qualities of the chest, thereby inducing the claimants to acquire the chest. Accordingly, they were liable to compensate the claimants for their loss being the price of the chest plus interest which they could not recover from the insolvent seller. The experts were not liable simply because they mis-described the chest as being Louis XIV, said the Court. They were liable because their inspection of the chest had been negligently superficial.

The English Courts approach these matters very differently. First, the attribution of an artwork to a particular artist or period is typically held a matter of opinion. Secondly, the English Courts are unlikely to attribute contractual force to an opinion. Thirdly, in order to establish negligence, the claimant must show that the defendant owed him/her a duty of care; that is rarely the case in a relationship between buyer and seller. For these and other reasons, it is generally more difficult to persuade a court to find against an auctioneer or expert in England than it is in France.

Articles published on this blog reflect the opinion of the stated author of the article only. The information they contain does not constitute legal advice.