Yesterday, the IAL held a successful afternoon seminar on art and insolvency at the London offices of Lipman Karas LLP. This area doesn’t get talked about often, so we felt the time was right to begin an examination of what can happen to works of art when the company or individual that owns them becomes insolvent/bankrupt.
The event was presided over by Jeremy Scott, principal of Lipman Karas, who introduced the topic of insolvency law and then regaled those in attendance with cases of insolvent dealers and businessmen and what they did with their art. This was followed by a talk on lending against art and the pitfalls of a borrower becoming insolvent by Rudy Capildeo, solicitor at Boodle Hatfield LLP, and a discussion of the change to some of the secured lending legislation in the UK led by Tim Maxwell, also of Boodle Hatfield.
We then had two case studies of well known insolvencies where art collections were involved. Harry Martin of 5 Stone Buildings covered the Wedgwood Company insolvency and the litigation that ensued (a matter on which he has written a case note in Art Antiquity and Law), while Geoffrey Bennett dealt with the bankruptcy of the City of Detroit and the outcome as it related to the world-class collection at the Detroit Institute of Art. Finally, IAL Senior Researcher Emily Gould presented a recent case involving an individual insolvency within a family context, where the question of ownership of a collection of valuable memorabilia arose.