Whose Shelf It Sits On

A gallery’s stockroom contains very little the gallery owns. Work arrives from a studio, sits on a rack for a while, and leaves either with a buyer or back to the person who made it. The name on the door belongs to somebody who, for the entire time the paintings are on the premises, does not own them.

This works until the company fails. The Art Newspaper ran a piece on 24 August on what artists and collectors can actually do when their gallery goes into liquidation, pegged to a run of British insolvencies — Stephen Friedman Gallery, Arusha Gallery, Simon Lee Gallery. The advice is practical and quietly awful. Petra Warrington of Wedlake Bell says consignors should “contact the liquidators as soon as possible, assert their ownership rights and provide evidence of title”, and observes that “insolvency practitioners are rarely familiar with art market practice and will typically look for documentary evidence”. A consignment agreement, she says, should “clearly identify the works and state that title remains with the consignor, with the gallery acting as agent”. If no such agreement exists: studio records, dated photographs, emails, WhatsApp messages, transport documents, insurance policies.

Look at what that second list is. It is what you assemble when nobody has settled the question in advance and you must now prove, after the fact and against a professional whose job is to convert the room into cash, that the object on the shelf was yours the whole time.

New York settled the question in advance, and it is worth knowing how long that took. Article 12 arrived in 1966. In 1969 it was extended past the paintings to the money, so that both the work and the proceeds of its sale were held in trust. In 1975 it was amended to say outright that the dealer’s creditors could not reach either. Then it sat, largely untested, until the collapse of Salander O’Reilly Galleries, after which the 2012 amendments went back and supplied the enforcement nobody had thought to write down the first three times: attorney’s fees for an artist who wins, a private right of action, a burden that shifts to the gallery once delivery and demand are established, and — the clause that does the actual work — a protection the parties are not permitted to waive by agreement. (Center for Art Law; the current text is here.)

Forty-six years from the first version to the version with teeth. Every one of those amendments is a sentence added after somebody lost something, and the last one exists because a large gallery went down with other people’s inventory inside it and the statute turned out to be a statement of principle with no way to make anybody pay. The rule of thumb underneath all of it is unglamorous and, I think, general: the paperwork of custody is drafted by whoever is holding the thing, and gets rewritten in the maker’s favour at roughly the speed at which the maker’s losses become tedious to litigate.

Which brings me to a set of terms published this month. TechCrunch reported on 24 August on Instinct, a personal assistant from Spear Street Technology, backed by Kleiner Perkins and Conviction, which you reach by text message and which connects to your email, your messaging apps, your calendar, your location, your device audio, your screen, your cursor movements and your keystrokes. Its terms grant the company a “perpetual and irrevocable” licence to “access, use, host, cache, store, reproduce, transmit, display, publish, distribute, and modify” your materials, including for training, and permit it to enter “agreements, commitments, or transactions” on your behalf. In the same week, users reported Gmail records retained after a deletion request, an inbox summarised three hours after access had been disconnected, an email sent without approval, and a security researcher demonstrating that the thing could be phished by sending it instructions.

That is a consignment. You hand over material, somebody else holds it, and a document decides what may be done with it while it is in their keeping. What is different is who drafted it, and it reads the way a document reads when nothing on the other side of the clause is expected to have a view.

Eleven verbs in that licence. None of them is return.

I once knew a dealer who kept his consignment notes in a shoebox under the desk, which everyone found charming until his accountant did not. So I am biased: I think the dull documentary habits are most of the protection, and I have watched people who make things treat them as an insult to a friendship. But New York’s statute is not a story about anybody becoming more scrupulous. It is a legislature returning to one paragraph four times across half a century because the informal version kept producing the same loss, and the fix, when it came, was a sentence saying you cannot sign this away.

Nothing of that kind exists for the second case, and my guess is that the first serious rewriting of these terms will not come from a regulator. It will come from an insolvency — the morning one of these companies fails and a liquidator has to decide whether the cache is an asset of the estate. Until somebody has to answer that in front of a court, the position is where the art trade’s was in 1965: whatever you can produce afterwards. A dated photograph. A delivery note. Your own records, kept by you, showing the thing was yours before it went into somebody else’s room.