When buying art, provenance holds risks for buyers, sellers and donors - Spear's Magazine

When buying art, provenance holds risks for buyers, sellers and donors

Provenance, provenance, provenance. A recent spat between Germany and Russia over a new exhibition at the Hermitage highlights its importance

Chancellor Merkel’s recent visit to St Petersburg, to attend the International Economic Forum, was overshadowed by a spat over artefacts that Germany wants returned.

Chancellor Merkel was invited to give a speech with President Putin at the opening of the new Bronze Age, Europe Without Borders exhibition at the Hermitage. The exhibition displays archaeological bronze items from across European history. It features some important pieces that were taken by the Soviet Army from Germany after the Second World War including the Treasure of Eberswalde, which many consider one of the finest artefacts from the Bronze Age in Europe. Reports vary as to what actually happened, but it seems that a number of pointed comments were made and the speech was called off at the last minute.

Provenance is not just a headache for presidents and chancellors of this world. Caveat emptor (buyer beware) should be your mantra when buying artwork or artefacts. But provenance is equally important if you're selling, lending or donating. So your mantra should actually be, 'Buyer, seller and generous donor beware!'

 

Buyer beware

When buying artwork, it is essential to establish good provenance. That is, the piece is what it claims to be and further, that it has not been stolen or looted. If this is the case, you may find yourself with a piece of art that is rendered worthless.

Take a recent example. Steven Brooks, an art collector, bought a painting entitled Allegorical Portrait of a Lady as Diana Wounded by Cupid by the 18th century French artist Louis-Michel van Loo at auction through Sotheby's in 2004. He later tried to sell it in 2010.

Sotheby's refused to sell it because, after some further research they had discovered that it was once owned by Herman Goering, a leading member of the Nazi Party who was convicted of war crimes. While there is no actual proof that the painting had been looted, there is uncertainty as to its provenance which makes the painting practically unsalable. Unsurprisingly Mr Brooks filed a lawsuit against the auction house earlier this year.

 

Seller beware

Mr Brooks’ experience shows why proof of provenance can be headache if you want to sell. If an auction house agrees to sell a piece without being sure about its provenance and it later transpires thatthere is a problem, it leaves itself open to claims by the buyer.  Any shadow of a doubt will raise alarm bells.

It is not all bad; good provenance can enhance a piece of work. Take Rothko's White Centre (Yellow, Pink and Lavender on Rose), which was put up for auction by David Rockefeller in 2007. It sold for over $70million, far in excess of its guide price.

It seems that this Rothko (such is the prestige of being owned by a Rockefeller, it is often called the Rockefeller Rothko) would not have achieved its record breaking figure had it not been owned by a member of one of America’s pre-eminent philanthropic and industrialist families. 

 

Generous donor beware

You may want to lend, donate or bequeath your artworks or antiques to a museum. One would think that museums would open their arms wide to take whatever you have to give them (particularly when their budgets are dwindling in these difficult economic times). Not quite.

Most large museums and galleries have rigorous systems in place to check the provenance of items before they accept (even on loan). You will have to demonstrate good provenance with full documentary evidence and subject the pieces to scrutiny by various experts and committees before they will accept. If your piece is found wanting you will not be able to offload it onto the museum no matter how extraordinary it is. The museum’s reputation is clearly worth more to it than the art you wish to donate.

So when you are contemplating your next dealing with an artwork or artefact, just remember the not so famous adage, provenance, provenance, provenance.

Hilesh Chavda works at private wealth law firm Maurice Turnor Gardner LLP

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