A recent dispute has arisen over the sale of artworks, pitting the relatives of two Jewish victims of the Nazis against a Swiss foundation that has been laying claim to assets once owned by the couple.
The convoluted saga has been recounted by the New York Times. It involves the extensive art collection of Berlin metals broker Norbert Levy, a collection which included Edgar Degas’s Danseuses. Before his death in 1928, Levy set up a foundation for his daughter, Margret, through a Swiss bank. Margret then married Ludwig Kainer and the two benefited from regular payments made by the foundation over the years. Being Jewish, the Kainers were forced to flee Germany to France, then eventually to Switzerland, as the Nazis came to power and swept mercilessly across Europe. The payments ended in 1944.
The Kainers died in the late 60s without having claimed the vast holdings taken from them by the Nazis. They also died without children. When in 1970 the West German government agreed to compensate the heirs of Nazi spoliation and brutality, a director of the Swiss bank (now UBS) decided to revive the foundation in order to get the payout. Because the Kainers had no children, it was thought that this was the only way to benefit from the compensation scheme. The foundation would then use the funds to help educate children, preferably those “of Jewish heritage”.
Over the years it was revealed that the Kainers had extensive assets, all of which then went to the Swiss foundation. When Degas’ Danseuses was sold by Christie’s in 2009 for $11 million, the proceeds had to be split with the foundation, which as the purported legal heir of the Kainers, had in exchange waived its rights in the piece.
It has since been claimed that the Swiss foundation, managed for the last 25 years by a UBS executive, failed to take into account the various children and grandchildren of the Kainers’ cousins. These descendants are now claiming to be the rightful Kainer heirs before both the New York and Swiss courts. Their argument revolves around the failure of the Swiss foundation, and its directors, to have adequately sought out these individuals when the foundation was revived in 1970.
The situation is shocking. The fact that a Swiss foundation run by Swiss bankers could benefit from the losses suffered by Nazi victims seems entirely iniquitous. However, just as the legal dispute will turn upon the foundation’s prior due diligence, the moral case may hinge upon the initial intentions of the bank executives in reviving the foundation. Was it truly for the cause alleged? And if so have any children, Jewish or otherwise, ultimately benefited?
Perhaps more central to the claimants’ interests is the obvious financial question: what happened to all the money that came from the recuperation of assets and sales of artworks? If it’s still around, perhaps the parties could agree upon a mediated outcome whereby the proceeds are split and the foundation – or a successor entity more akin to the the desires of the true heirs – continues to provide a public benefit to victims of persecution and violence.
If such an outcome cannot be reached consensually, however, this may turn out to be a very, very long affair.