We recently spoke with Hetty Gleave, a partner at Fladgate LLP in London, about her practice and her experience dealing with art and luxury assets for her clients. Challenges arise for such assets in times of great personal upheaval, such as during situations involving debt, divorce and death. These issues will be explored further during a seminar in London run by IAL and Fladgate on 15th June call Art, Luxury Assets and the Three Ds – Debt, Divorce and Death. For more information about the event and to book a spot see here.

(Q) How have you come to practice in an area that can involve disputes over art and other luxury assets? 

Hetty Gleave: I practice in the fields of Matrimonial and cultural property law, both of which often involve art and luxury assets. Divorcing couples often need to agree how they value and divide their chattels as part of any financial settlement, which can include art, cars, jewellery and wine. Cultural property disputes may relate to title or ownership of art, antiquities or other luxury assets.

(Q) From your professional experience, what kind of meaning do art and luxury assets hold for people during moments of great upheaval in their lives (such as after an insolvency, a divorce, or a death in the family)?

Hetty Gleave: There can be a huge emotional attachment to chattels acquired by couples during a long relationship, particularly if they have formed part of the fabric of the family home and life. The distribution of chattels post divorce can therefore be highly contentious. Similarly the division of assets, such as a treasured family collection, on the death of a family member can cause divisions in families if not agreed.  Chattels often are worth more than their market value if they bring with them memories and associations of people or times past.

(Q) What are the legal issues that tend to arise during family disputes that involve art and other luxury assets?

Hetty Gleave: Valuing items is often the greatest challenge in family disputes as the parties need to feel they are getting either money, or monies worth, for any items in dispute.  Sometimes it is the sale of a collection, rather than the retention of it by a particular family member, which can cause a dispute, with one party wanting to retain a collection and the other wanting the monetary value.

(Q) Tell us how questions of valuation can arise in these instances. How can one obtain the ‘right’ valuation for art and other luxury assets in such situations?

Hetty Gleave: Valuations are always challenging as they depend on a variety of factors, such as market forces, condition, advertising, attribution and the economy. They can change overnight and valuers can, and often do, disagree on the same item, which then requires an agreement about what to do in the event of a dispute about valuations.

(Q) What sort of services do you and the team at Fladgate offer in this respect?

Our diverse private client base includes individuals and families with significant personal assets. In addition to focussing on high value residential real estate and art, our expertise extends to equestrian interests, cars, yachts, aircraft and other luxury assets. The way in which ownership of these assets is structured can be critical from a variety of perspectives and often needs to be tailored to the specific circumstances of the owners.

We advise clients on all aspects of the ownership of such assets to ensure an appropriate balance between commercial interests and family wealth planning. We deal with the negotiation of contracts, financing, structuring and other related matters. We can coordinate international legal advice, and advise on VAT, income, flag, jurisdictional and overall regulatory issues. Furthermore, we advise on any disputes that may arise over the provenance of luxury assets.