Q: Can I sue an art dealer for not doing due diligence to realize the commercial value of my art work?
I entered into a contract with an art dealer (over 100 pieces of art) for a 13 month termination date. I met the dealer during an "art road show" that came to our village church. I took him at face value and looked at his website. I later found out that his "building" was actually in honor of the Astor Family in NYC and not his own building and his mailing address was actually a PO Box. I also found out from a friend who owns an auction house that this dealer approached him and he was a "very shifty guy with dubious practices".
I just received an email from him as the "termination" date in mow due and he'll be contacting me in 45 days with the results. He informed me that the market had been "very low and not moving" and therefore to expect a very low income from the sale. My heart sank at this news although I have been expecting it since finding out his true identity. I know for a fact a few of my paintings should have reached the $100,000 mark as I've been looking at the auction.
A: It will depend upon the terms of the agreements that you signed. If your work will be given to the highest bidder, and you want to stop it, you are going to have to go into court with an order to show cause ASAP.
Glenn B. Manishin agrees with this answer
A: Typically, the so-called "economic loss rule" prevents a plaintiff from recovering tort damages in connection with a breach of contract. An exception in most states, including NY I believe, is for fraudulent misrepresentation in contract formation. Such a claim requires an affirmative misstatement of material fact, intended to mislead, that the other party relies on to its detriment. You may have the factual basis for such a "fraudulent inducement" claim.
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A: My first question is how you know as a fact that "(your) paintings should have reached the $100,000 mark." My next question is what were the "dubious practices" that your friend had mentioned. Notwithstanding the potential fraud claim (which is very difficult to prove, especially in NY where it must be "plead with particularity") the question concerning his "due diligence" is difficult to answer without a better understanding of the terms by which you contracted with him. Under New York law, unless a contract specifically states that the party to be charged will use his / her / their "BEST EFFORTS" (emphasis added) then he / she / they are only charged with using "COMMERCIALLY REASONABLE EFFORTS" which is a fairly low standard which has been described as "toward the bottom of the scale and is generally perceived as limiting both the effort required to be exerted in the process as well as what a party may ultimately be obligated to do in order to obtain the desired end."
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- New York
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A: My first question is how you know as a fact that "(your) paintings should have reached the $100,000 mark." My next question is what were the "dubious practices" that your friend had mentioned. Notwithstanding the potential fraud claim (which is very difficult to prove, especially in NY where it must be "plead with particularity") the question concerning his "due diligence" is difficult to answer without a better understanding of the terms by which you contracted with him. Under New York law, unless a contract specifically states that the party to be charged will use his / her / their "BEST EFFORTS" (emphasis added) then he / she / they are only charged with using "COMMERCIALLY REASONABLE EFFORTS" which is a fairly low standard which has been described as "toward the bottom of the scale and is generally perceived as limiting both the effort required to be exerted in the process as well as what a party may ultimately be obligated to do in order to obtain the desired end."
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