Published: April 22, 2008
Claiming that he was intentionally misled by the Art Loss Register (ALR) while performing due diligence in regard to two paintings, then set up during a sting operation after he had purchased them and ultimately sued regarding ownership, a London dealer says the experience has cost him his business and reputation. ALR is a global private database of lost and stolen art, antiques and collectibles.
For the antiques and art trade, the development raises serious concerns about placing confidence in the organization that was created in 1991 as a recovery service to return works of art to their rightful owners.
The particulars of the case and its many players are set out in a 29-page judgment handed down by the High Court of Justice Queen’s Bench division on February 27.
Michael Marks, a Kent dealer, said he purchased two paintings in good faith in 2006 after being informed by ALR that they were of free title. Both paintings were by Francis Newton Souza (1924′002) and valued at more than $500,000 †”Head of a Portuguese Navigator,” 1961, and “Still Life with Chalice with Host,” 1953.
Like many antiques dealers, auctioneers and collectors these days, Marks had decided to check with the ALR to make sure there was no question about the paintings’ ownership, paying the customary search fee with a credit card. He received assurances from the firm that there was no problem with either painting, but, according to court documents, the falsified assurances were part of an intentionally contrived deception by ALR’s chairman, Julian Radcliffe, to keep Marks on the hook.
Court documents show that in contacting ALR, Marks was indeed misled by Radcliffe, who assured Marks that there was no outstanding claim on the Souzas. “Mr Radcliffe accepts that he misled Mr Marks,” wrote Justice Tugendhat in the judgment. “He explained in court his reasons for doing this, but I do not set them out. They are not material to the issues I have to decide.”
As a result of the “sting” and subsequent court action, the paintings were judged to be the property of Aziz Kurtha, an Indian lawyer and art dealer based in London and Dubai. Kurtha claimed the paintings, which he had purchased from the artist in the early 1980s, had been stolen from his London apartment that had been rented to a tenant or from a storage warehouse in the 1990s. He had registered the two paintings as missing with the ALR in 2005.
In upholding Kurtha’s claim to the two paintings, the judge acknowledged that they exhibit murky provenance between the time they disappeared in the 1990s and 2006. However, he faulted Marks more for keeping poor records as a factor in his judgment.
Milton Silverman, the lawyer who represented Marks in the case, said the action taken by ALR in this case creates a “potentially nightmare scenario for a dealer. He could buy works of art, certain in his own mind that they are free of any problems, only to find himself landed with a dispute on their title.”
Silverman further opined, “The judge showed a disturbing distrust of the trade, requiring a level of documentation which many, if not most, in the trade would find completely unrealistic.
“It should be pointed out that it remained murky throughout as to what precisely happened to the two pictures in issue. The judge accepted that Mr Kurtha’s evidence was inconsistent on this.
“All that could be said with any certainty was that the pictures appeared to be lost, according to Mr Kurtha. The Art Loss Register accepted them for registration in these circumstances. This is a very important point. It means that an unscrupulous individual could notify the Art Loss Register that pictures have been ‘lost’ or ‘stolen’ or whatever, and use that notification to taint and devalue pictures in the market, to his or her own advantage.”
As for Marks, he is not contesting the ruling, but is both resigned and bitter about the outcome. In an open letter to Antiques Trade Gazette, a London-based trade journal, he wrote, “It seems to me that the moral of my story is not so much that one should keep detailed paperwork, but rather that checking with the ALR in no way shows due diligence, especially as their reply may well be a blatant attempt to entrap an honest dealer. . .
“Yes, this has been a very painful and expensive experience, which will probably cost me my business, and a reputation which has taken 30 years of hard work to build up, and the laughable thing is that if I hadn’t contacted the ALR at all, and simply bought and sold these paintings, that I would now be blissfully ignorant of the workings of the great British ‘justice’ system, and sitting counting my profits.”
In a statement to the London antiques trade journal, ALR chairman Radcliffe defended the firm’s tactics, saying it was the “extraordinary circumstances” of the case †only the second time in 15 years and five million provenance searches †that led him to mislead Marks over the ownership of the paintings.
Yet in his open letter to ATG, Marks wrote, “To explain the fact that he clearly lied to me, Mr Radcliff explained in court that it was necessary in exceptional circumstances to do so, to keep lines of communication open. It would seem that ‘exceptional circumstances’ means that it is someone’s first contact with the ALR, and that, that someone is not a member of a recognized trade organization. Had Mr Radcliff bothered to ask, I would happily have told him that I had let my membership of LAPADA [one of Britain’s trade associations of art and antiques dealers] lapse many years before the ALR was dreamed up, and if he had asked me for references, I would have been happy to provide them, apart from the fact that they had every detail of my business before they were asked to do the search, so any idea that I was going to run away and hide if he had told me the truth, was absolutely ridiculous.”
Asked whether there would be any future legal action by Marks to recoup business losses stemming from the misinformation provided by ALR, Silverman declined to comment.
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