Art and Negligence Update

The High Court handed down two highly anticipated judgments earlier this month involving claims of negligence arising out of high end sales of art or antiquities.

The first decision arose out of the relationship between John Eskanazi, a prominent and highly respected dealer and expert in Indian and South Asian works of art, and Sheikh Hamad, a senior member of the Qatari royal family, which led to the sale of seven objects between 2014 and 2015 and which, collectively, were valued at almost $5m.

The claims were brought by QIPCO, a company connected to the Sheikh, as well as the Sheikh personally, on the grounds the works were all fakes. They claimed breach of contract, negligence and misrepresentation. In relation to the most expensive work, the Hari Hara (acquired at $2.2m), they also claimed the sale had been effected fraudulently – that Mr Eskanazi and his gallery could not have believed the work was genuine when it was sold - but this claim did not succeed.  However the Court held that all seven works were indeed forgeries and ordered that the works were to be refunded and damages awarded.

The sales were evidenced by invoices which each included a declaration that to the best of the gallery's belief, the work was an antique and over 100 years of age.

The judgment is lengthy and set out in detail some of the unconventional commercial practices of Mr Eskanazi, including the export of the Hari Hara from Vietnam, which if authentic was most probably unlawful, by Mr Eskanazi's agent. Another piece, a gold serpent bracelet, was apparently later accepted by Mr Eskanazi as being a fake yet it was not refunded.

The Court made findings on points of principle in connection with the sales which occurred shortly after Mr Eskanazi made emphatic and unqualified verbal assurances about the authenticity of the works:

• Strong statements of opinion about authenticity do not convert into contractual promises even if the statement is relied upon. They do not become terms of the contract. Accordingly, there were no automatic breaches of implied terms by the Sale of Goods Act if the works were not found to be authentic; there needed to be an analysis of whether the dealer held an honest and reasonable belief in making the statement.
• When considering the reasonableness of expressing an unqualified opinion by an art professional, there is a staged process:
  • Firstly, whether it can be said that no reasonable leading specialist antique dealer would have concluded that these objects were ancient and expressed an unqualified opinion to that effect;
  • Secondly, if the dealer had a real rather than a fanciful doubt, then it would not be appropriate to give an unqualified opinion;
  • Thirdly, when considering the opinion, it is important to avoid the benefit of hindsight;
  • Fourthly, expert evidence is very important and in the context if this case, art historical expert evidence, knowledge of the historical or religious background and the archaeological record as well as the visual inspection are relevant;
  • Fifthly, it is not always easy to obtain the services of a well-qualified expert in a dispute either because they are not permitted to be involved by their museum or for other reasons (this will not be news to art lawyers across the land);
  • Sixthly, guidance from case law about steps that auction houses should take to meet their standard of care were not necessarily appropriate for dealers and galleries as circumstances can vary considerably;
  • It is possible for a Court to conclude that an object is inauthentic but that an opinion that it was authentic had a reasonable basis.

A significant proportion of the judgment analyses the substantial and various expert evidence but the Court noted the significance of the striking lack of provenance for such important works. There was an absence of photographs of the works in situ or documents to explain their source or, for example, documents which explained how the works were conserved which might explain the absence of weathering or their restoration history.

As the Court considered that a finding of inauthenticity was not sufficient to prove liability, the Judge then had to consider whether the opinions expressed by Mr Eskenazi were based on reasonable grounds. The Judge rejected the submission by Mr Eskanazi's counsel that it was necessary to hear expert evidence from antiquities dealers in 2014/15 on practices in the market. The Court was shown evidence which had been given by Mr Eskanazi in separate proceedings which explained that:

"There is no registry, database or catalogue of Indian antiquities in situ in India or those traded on the international art market. Indian law requires domestic Indian dealers to register their inventory but this registry is neither comprehensive nor reliable. To avoid trading in stolen or illegally exported antiquities, dealers such as Eskanazi, who desire to maintain a reputation in the trade for dealing only in objects that are lawfully on the market, are careful to (i) determine an object's "provenience" (i.e. country of origin or place of origin, discovery or find-spot) and "provenance" (i.e. history of ownership and chain of title) and (ii) obtain contractual representations from the seller as to lawful provenience and provenance when they purchase an object".

The Court did not regard Mr Eskanazi's sales to museums over many years in relation to other pieces as relevant to whether there were reasonable grounds for his unqualified opinion on the specific pieces sold in this claim.

The court considered the circumstances for each piece individually as follows:

• The Serpent Bracelet: Mr Eskanazi considered he had no expertise in jewellery yet changed the dating of the bracelet from 3^rd Century BC to 1^st Century CE. The dealer he bought it from was not an expert but was someone who handled jewellery over many years. A test to check the cadmium level in gold, which helps determine whether it is modern gold or not can be done easily but wasn’t. The Court found that there was no reasonable basis for the unqualified opinion expressed; "no leading specialist antique dealer would have expressed an unqualified opinion that the object was ancient."
• The Head of Goddess and Head of Dionysus: The art historical evidence weighed heavily against Mr Eskanazi being in a "position to give, reasonably, an unqualified opinion that they were ancient." The expert evidence from the Claimants' expert was that "…We don't have representations of Dionysus because…In Ghandar, we don’t have representations of God Dionysus, first, second we don't have sculptures of large size having anything to do with Dionysism in Ghandara. We don’t have marble sculpture altogether and we don’t have marble acroliths…We have many problems with this sculpture." Secondly, the provenance was that both pieces had passed from a father to son yet had never been exhibited or photographed as a collection and the provenance letter was backdated. Thirdly, the pieces were in an immaculate condition which required an explanation given that they were over estimated to be more than 2,000 years old. Accordingly, "there was nothing on which Mr Eskanazi could base, reasonable, an unqualified opinion as to authenticity." Mr Eskanazi's "eye" did not assist. The comparators which were used in Mr Eskanazi's research papers were based on items of unverified provenance or in private collections, including items which Mr Eskanazi's gallery owned. There was nothing in the research paper which evidenced Mr Eskanazi giving consideration to the question of whether these objects were or were not genuine despite the context of a market with a proliferation of fakes. There was no reasonable basis for the unqualified opinion, as to ancient origin and no reasonable leading specialist antique dealer would have expressed an unqualified opinion that the objects were ancient.
• The Hari Hara: The discussion as to whether Mr Eskanazi had a reasonable basis for an unqualified opinion was significant as there was a claim for fraud as well as negligence in relation to this item. Mr Eskanazi had no real idea where the piece came from as it was from an unknown dealer in Vietnam. During cross-examination, Mr Eskanazi indicated this Hindu work had come from a Buddhist monastery, but there was no evidence of this and it was odd (and not accepted by the Court). It had a false documentation, and no signs of weathering and was highly polished, yet was in pieces when it was acquired by Mr Eskanazi. It was similar to the Vishnu in Ho Chi Minh City Museum with the same parts missing. The Court held that no amount of "eye" could overcome the serious question marks raised by the piece and accordingly there was no reasonable basis for the unqualified opinion. There was no reasonable basis for the unqualified opinions and no reasonable leading specialist antique dealer would have expressed an unqualified opinion that the object was ancient.
• However, the work was acquired by Mr Eskanazi for at least $85,000 which provided evidence that Mr Eskanazi genuinely believed he was buying a genuine antiquity, in circumstances where he did not have a buyer in mind at the time and he would not have wanted to jeopardise the relationship with the Sheikh. The fraud claim was dismissed.
• The Frieze: The main subject matter was difficult to depict in the work and there was no explanation for how the work could have survived from antiquity in its current condition. Although Mr Eskanazi relied upon his "eye" and had produced a research paper, it did not explain why the work was authentic but discussed the story of Mayadevii – Prince Siddartha's mother. There were no reasonable grounds for the unqualified statement as to the piece's antiquity and no reasonable leading specialist antique dealer would have expressed an unqualified opinion that the object was ancient.
• Head of a Bodhisattva: There were numerous matters which indicated inauthenticity, including the exceptional condition of the piece; the difficulty in understanding its potential location; the dating of the piece to a time when pieces were generally being produces in stucco not stone; anomalies in the iconography, leading to the conclusion that the piece as a whole was extremely far-fetched…aimed at Western purchasers." Accordingly, there was no reasonable basis for an unqualified opinion and no leading specialist antique dealer would have expressed an unqualified opinion that the object was ancient.
• Head of Krodha: There were many indications of inauthenticity, such as an unfired clay object surviving 1500 years and there being no comparator. There was no provenance nor any religious context. Accordingly, there was no reasonable basis for an unqualified opinion either for Mr Eskanazi or any reasonable leading specialist antique dealer.

The Claimants were entitled to rescind the contracts for misrepresentation and recover the price paid as well as damages for breach of contract "based upon the admitted implied term that Mr Eskanazi's gallery (honestly) and reasonably held the opinion that the objects were of ancient origin" as well as damages for negligence.

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The second case arose out of the sale of a painting by 18^th century French painter, Jean-Baptiste-Siméon Chardin entitled “Le Bénédicité”. The sale was effected by experienced London dealer, Simon Dickinson, in 2014 on behalf of the Countess and Earl of Wemyss.

Mr Dickinson is an expert in Old Master paintings. In fact, Mr Dickinson had first seen the painting in 1990 when he was tasked with reviewing all the art of valuing the Wemyss collection at Gosford House when he was an employee of Christie's. He valued hundreds of paintings on a single day and in relation to the Chardin painting provided three possible valuations £80-£120,000, £2-£300,000 and £800,000-£1,200,000, noting that the painting could be worth more if it was accepted by everyone. The painting was eventually sold for £1,150,000. However, six months after this sale, the painting was said to be sold for $10.5m (at the time of the sale was the equivalent of £6.9m). This was comprised of $7.5m in cash and another painting, which the experts in the case considered had an inflated value.

The Court found that the leading living expert on Chardin is M. Pierre Rosenberg, a former Director of the Louvre.

Mr Dickinson considered that the painting was partially by Chardin but not fully (not autographed) and did not value the painting as a work entirely by Chardin. There were several reasons for his decision:

• The painting was included in a catalogue raisonne prepared by Mr Rosenberg, who had seen photographs of it and who noted it was "copie retouchée".
• He recalled that when Mr Rosenberg was briefly shown the painting (prior to its cleaning) he told Mr Dickinson that "it was no good" and was done by Chardin's studio.
• Mr Dickinson visited the best original version of the work on display at the Louvre and felt certain that there were elements of the painting which were definitely Chardin.
• He did not want to have the painting analysed by Mr Rosenberg as it risked the painting being valued at the lowest estimate permanently.

In a letter to the Countess and Earl of Wemyss and March in 2014, Mr Dickinson summarised his assessment of the painting as follows:

"Rosenberg claims that your picture has been in England since 1751 and describes it as being a reworked copy. My feeling is that the painting was probably painted by Chardin but it is difficult to tell in its present dirty state."

The work was given a light clean and Mr Dickinson finalised his analysis which included the visit to the Louvre (referred to above). The sale of the painting was in the context of other works which had been selected, analysed and valued by Mr Dickinson, including a Poussin, another French painter, which Mr Dickinson successfully convinced Mr Rosenberg was authentic and which was subsequently sold for $10m in 2010.

After the work was sold by Mr Dickinson and exported, it was given a deep clean and the signature of Chardin was discovered and it was then marketed as a major rediscovery. The buyer was an experienced art dealer who exercised his own judgment when he acquired the painting.

In contrast to the Eskanazi claim, the witness evidence from Mr Dickinson was more straightforward. The Court found that his track record suggested that he had a formidable "eye" and an extremely high level of confidence in his own ability to discern a painting but that he was not arrogant.

Again there was expert evidence led by the Claimants, Amanda Feilding, the Countess of Wemyss and March and one of the trustees, as well as evidence from Mr Dickinson's firm who were involved in the research and sale of the painting.

It was argued by the Claimants that since the painting was included in the catalogue the painting was quite obviously the work of Chardin and that the term "copie retouchee" was meaningless. This was resisted by Mr Dickinson's firm.

The Court heard expert evidence on market practice – the Claimants' expert's view was that further scientific evidence should have been obtained whereas Mr Dickinson's expert, Mr Agnew, a retired art dealer expressed a more holistic view in line with Mr Dickinson's approach.

The Court had to consider "what an ordinary skilled professional art dealer having Mr Dickinson's special skills would have done. Dickinson also owed fiduciary obligations as an agent but in this regard there is no difference between common law damages and equitable compensation."

The Court was against the suggestion by the Claimants that art dealers are under a "duty to check", such that any art professional may be putatively negligent if he acts on his own assessment of the quality of a work without checking with some expert or other.

The Court accepted that it was not negligent for Mr Dickinson to analyse a work and sell it according to his own discretion using his own skill and judgment to obtain the best price for the work instead of reverting to the client to explain the risks of obtaining further analysis and waiting for the clients to decide what to do.

The Court also considered that it was not negligent of Mr Dickinson to attribute the work as being by the artist and studio when that is what he genuinely believed was the most accurate description. Mr Dickinson did not accept that Mr Rosenberg had a significantly better eye than he did and he believed that if he had shown the painting to him then it stood a real risk of being devalued. It was not negligent for Mr Dickinson to not take a "spin of the roulette wheel". It was noted by the Court that the art dealer who sold the painting for $10.5m did not have the work analysed by Mr Rosenberg.

The Court also heard arguments of Mr Dickinson being negligent in selling the painting to an art dealer, who must have known that the painting was entirely Chardin but there was no evidence of such knowledge and the dealer indicated in a letter to Mr Dickinson that he was taking a risk when he acquired it. It was also argued that Mr Dickinson should have sold it to the eventual buyer instead of the dealer but Mr Dickinson explained that the buyer would not have been interested in the painting in circumstances where it was not an autographed work, since he considered it was only partially by Chardin.

The Court considered that if Mr Dickinson had been found negligent then it was necessary to determine what the sale price would have been and given a fully attributable Chardin would have attracted export restrictions, the value would have been affected and concluded the sale price would have been £4m.
 
Qatar Investments & Projects Development Holding Co & Anor v John Eskanazi Ltd & Anor [2022] EWHC (Comm) (29 November 2022)
Feilding v Simon C Dickinson Ltd [2022] EWHC 3091 (Ch)