Jan 16

Written by:
1/16/2012 12:31 PM 

Selling Art on Consignment: Illinois Law Protects the Artist

The Illinois Consignment of Art Act protects artists who sell their work via consignment relationships with art dealers.  The Act makes clear who owns the work and its proceeds, defines who is responsible for damage to the work, and gives the artist a court remedy.

The Rules of Consignment Art Sales

Artist-Dealer Relationship. The dealer is the artist's agent which means he acts on her behalf in exhibiting and selling the work.

Ownership of the work and its proceeds. The consigned art remains the artist's property which the dealer holds in trust until sold. The dealer then holds the sale proceeds in trust until paid to the artist.

Strict Liability. If the work is damaged while in the dealer's possession he must pay the artist its value: it does not matter whether the damage was the dealer's fault.

Artist's Remedy: If the dealer does not create a written contract the artist can sue him to avoid any obligation to the dealer, for a $50 penalty, and to recover any other damages plus her attorney's fees.

Contract: The dealer must prepare a written consignment contract that at minimum sets out i) the work's value, ii) the work's minimum price and any allowed discount, iii) the commission to be paid, and iv) by when the dealer must pay the artist her sale proceeds.

The Consignment Contract: Beefier is Better

Although the Act provides important protections, the artist can protect herself further with a consignment contract that goes beyond the minimum requirements to address a number of other issues including:

Insurance: The Act provides that the dealer is responsible for damage to the work while in his possession, but what if the dealer goes under? Insurance is an important backstop to the dealer with shallow pockets.  Be sure your work is covered under the dealer's policy or consider obtaining your own.

Exclusivity, Scope and Duration: Is the consignment exclusive or can the artist, or another agent, sell the work while in the dealer's possession? Can the artist place other works with a different dealer? Is the consignment limited in duration or to specific geography? Can the artist withdraw the work and on what conditions?

Assignment: Can the dealer assign the contract, and the work, to a different dealer?
 
Loaning out Work: Can the dealer loan the work out to a favored client?

Exhibiting and Marketing: Does the artist have any control over how the dealer exhibits the work? Is some minimum level of marketing effort required and how is that effort measured: by dollars spent or ads placed?

Buyer Identity: Does the artist learn who bought the work?

Crating and Shipping: Who is responsible for packing and delivering a sold or returned work? Who pays for it?

For more information about this topic, please contact the author, Brian D. Moore, by phone at 630-355-5577 or by email brian@moorelawpc.com.

This article is intended to provide friends and clients with general information regarding the subject matter covered.  This article is not, and does not contain, legal advice.  This article may be considered attorney advertising.

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