Simpsons Solicitors

McBride v Christie’s Australia Pty Ltd [2014] NSWSC 1729

August 31st 2015

The NSW Supreme Court’s decision of McBride v Christie’s Australia sheds light on the dark underbelly of Australia’s art fraud market. This case involved the sale of a forgery of a work purportedly by famous Australian artist Albert Tucker to an unsuspecting purchaser in 2000.

Background

When revered artist Albert Tucker died in 1999, his works were in high demand, in Australia’s art auction market. In May 2000, Louise McBride purchased what was labeled as a Tucker work entitled ‘Faun and Parrot’ from the auction house Christie’s Australia for $85,000. Christie’s represented both in the auction catalogue and at the auction itself that the work had been painted by Tucker in 1967. Ms McBride was advised and represented by her art dealer Vivienne Sharpe, who encouraged her to buy the work.

Unbeknownst to the parties at the time, the work was, in fact, a forgery. In the months following the auction in 2000, Christie’s were advised by a group of art experts that they had concerns about the authenticity of the painting. Christie’s however opted to stay silent and did not inform either Ms McBride or Ms Sharpe that the work was very likely a fake. Ms McBride only discovered it was a forgery when she prepared to sell the painting in 2010. She then swiftly brought proceedings against Christie’s, Ms Sharpe and the vendor. The expert evidence given at the hearing confirmed that the work was indeed a forgery.

Chief Justice Bergin’s decision considered, among other things, whether each or all of the parties had engaged in misleading and deceptive conduct, unconscionable conduct (and in Ms Sharpe’s case, negligence).

The decision

Ms McBride was awarded damages of $118,788.71 split between Christie’s having to pay 85%, the seller 10% and Ms Sharpe 5%.

The court found that:

  • The seller and Christie’s had an obligation to make sure the representations about the origin and authenticity of the work were correct, as potential buyers (including Ms McBride) would be relying on those representations.
  • The auction house was not a “mere conduit” for the sale, as it made its own representations regarding the painting in the catalogue and at the auction.
  • The Christie’s Conditions of Business entitled Ms McBride to seek a refund if the painting was discovered to be a forgery within five years of purchase. It was misleading and deceptive for them to remain silent and deprive Ms McBride of the opportunity to seek a refund, to which she was entitled. This conduct was also unconscionable.
  • Ms Sharpe had made false, misleading and deceptive representations to Ms McBride about the painting being a “Tucker” and a “good buy”. However, she wasn’t found to be negligent, as she took the steps that a reasonably competent and diligent art dealer would be expected to take in the circumstances.

What can we learn? 

The court heard evidence that up to 30% of the country’s secondary art market is comprised of forged works, and that “one in 10 works cannot be securely provenanced”. Commentary on the case has also highlighted that there is a market for forged Australian works in Asia, and that many artworks are being transported overseas where forgers study the brush strokes to produce hard-to-detect fakes.

Art dealers, auctioneers and sellers must have proper provenance procedures in place and take more active steps before auction – it is not enough to merely rely on a physical examination of a work. Rather, they should also try to establish a paper trail confirming the authenticity of works for sale, or hire an expert to analyse the painting (for example – the construction, application and handwriting might be tell-tale signs the work is a fake).

Sellers of art should also be careful about how works are described in galleries, catalogues, at auctions or online advertisements. Don’t say a painting is “by” a certain artist if you can’t be sure: alternative language may be necessary if a work cannot be authenticated (for example, some dealers and auctioneers use formulations such as “attributed to”, “with signature” and “in the circle of”).

Art agents must also consider whether they need to take steps to assess the authenticity of works, and not represent to their clients that works are by certain artists if they haven’t independently checked this.

Bergin CJ also commented on the practice of “secret sellers” in art auctions in Australia (that is, when the seller of the work is not known to possible bidders): “In an industry where provenance of artworks is so important, keeping secret the identity of the person or entity who is selling the artwork and with whom the buyer is contracting to purchase it may have the tendency of protecting rather than exposing forgeries by preventing buyers from having access to all of the relevant information about the background to the artwork.”

If you would like us to review your terms of business, if you think you may have sold or purchased a forged painting, or if you require help with provenance procedures, please contact our arts lawyers Adam Simpson or Ian McDonald at Simpsons Solicitors.