Selling Your Art Through A New York Dealer? Collectors: Take Note!If, as a collector, you wish to sell your art in New York New York, state, United States New York, Middle Atlantic state of the United States. It is bordered by Vermont, Massachusetts, Connecticut, and the Atlantic Ocean (E), New Jersey and Pennsylvania (S), Lakes Erie and Ontario and the Canadian province of , you generally deliver it for that purpose to a private dealer. When the dealer takes custody of your art, the relationship that arises between you and the dealer is one of consignment: that is, you, the seller/consignor, retain ownership of the art, you may retrieve the art, and you participate with the dealer/consignee in setting the sale price for the art. When the art is then sold, the dealer receives a sales commission - but not the profits of the sale. But what happens to your ownership rights in the art if the dealer becomes insolvent or files for bankruptcy while the art is in his possession? Or if the dealer pledges your art as collateral for a loan? In New York, as indeed in practically all states of the United States United States, officially United States of America, republic (2005 est. pop. 295,734,000), 3,539,227 sq mi (9,166,598 sq km), North America. The United States is the world's third largest country in population and the fourth largest country in area. , consignments by collectors to art dealers are governed by the revised Uniform Commercial Code (UCC An abbreviation for the Uniform Commercial Code. ). Collectors often do not realize that under the UCC, the mere delivery of an artwork to a dealer may imbue im·bue tr.v. im·bued, im·bu·ing, im·bues 1. To inspire or influence thoroughly; pervade: work imbued with the revolutionary spirit. See Synonyms at charge. 2. the dealer's secured creditors One who holds some special monetary assurance of payment of a debt owed to him or her, such as a mortgage, collateral, or lien. with rights in the artwork superior to those of the collector himself. This priority of values favouring the creditor is in consonance con·so·nance n. 1. Agreement; harmony; accord. 2. a. Close correspondence of sounds. b. The repetition of consonants or of a consonant pattern, especially at the ends of words, as in blank with one of the purposes of the UCC: to enhance the reliability of commercial transactions by encouraging those with ownership interests in goods to proclaim such interests publicly, thereby protecting lenders against secret reservations of ownership interests in goods. How then, in view of the UCC, do you as a seller/consignor protect your ownership interests in your consigned art? The solution is to memorialize me·mo·ri·al·ize tr.v. me·mo·ri·al·ized, me·mo·ri·al·iz·ing, me·mo·ri·al·iz·es 1. To provide a memorial for; commemorate. 2. To present a memorial to; petition. your relationship with the dealer in a signed agreement setting forth the parameters of the consignment. This consignment agreement should address, among other provisions, the following terms: Establishment of the principal-agent relationship Principal-agent relationship Occurs when one person, an agent, acts on the behalf of another person, the principal. authorizing the dealer to complete the sale of the work(s) on your behalf within a specified time-frame and territory; The sales price of each work you consign consign v. 1) to deliver goods to a merchant to sell on behalf of the party delivering the items, as distinguished from transferring to a retailer at a wholesale price for re-sale. Example: leaving one's auto at a dealer to sell and split the profit. ; The amount of sales commission payable to the dealer; Warranties by you, the seller, of clear and marketable title Ownership and possession of real property that is readily transferable since it is free from valid claims by outside parties. The concept of marketability of title refers to ownership of real estate. Under law, titles are evidence of ownership. to the work; Allocation of expenses, between you and the dealer, for the art's shipment, packing, insurance, advertising, condition reports and related matters; Terms of payment from the buyer; and, most pertinently here, The granting by the dealer to you of a security interest in each of the artworks you consign to the dealer. Specifically, the consignment agreement should provide that the dealer grants you, the owner, a security interest in each work of art you consign (and any proceeds thereof) until the artwork is sold, at which point the resultant sale proceeds are held by the dealer on your behalf and delivered to you (minus the dealer's sale commission) as specified in the agreement. The consignment agreement should also provide that upon its execution, the dealer authorizes you to file a Form UCC-1 Financing Statement without the dealer's signature. Your filing of the Form UCC-1 serves to provide notice to the public of your security interest in your art, and in the event the dealer defaults under the consignment agreement, you will have all of the rights of a secured party under the UCC. Additionally, the consignment agreement should require the dealer to inform any other secured creditor as well as any purchaser of your art of the existence of your security interest in the art (and in the resultant proceeds). You, in turn, should agree to file a Form UCC-3 terminating your security interest in the art once you receive from the dealer your proceeds from the sale of the art. Finally, because the legal effect of the filing is only state-wide the consignment agreement should require the dealer not to remove your artwork(s) from the state in which it is filed without your prior written consent. Note also that the filing is made, as a rule, in the state where the debtor (dealer) is located. Both the Form UCC-1 and the Form UCC-3 are standardized. Law firms This list of the world's largest law firms by revenue is taken from The Lawyer and The American Lawyer and is ordered by 2006 revenue:[1]
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances. Ms Judith Bresler Withers withers the region over the backline where the neck joins the thorax and where the dorsal margins of the scapulae lie just below the skin. fistulous withers see fistulous withers. LLP LLP - Lower Layer Protocol 430 Park Avenue 10th Floor New York NY 10022-3505 UNITED STATES Click Here for related articles (c) Mondaq Ltd, 2008 - Tel. +44 (0)20 8544 8300 - http://www.mondaq.com |
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