Source: https://vlaa.org/artist-gallery-consignment-statutes/
Timestamp: 2019-04-26 02:52:47+00:00

Document:
More than 30 states have statutes governing the business relationship between artists and art galleries. Most of the laws dictate that the art dealer owes a fiduciary duty to the artist, meaning that the gallery cannot take actions that are inconsistent with the artist’s financial well-being. This state-by-state summary highlights the unique provisions of the statutes.
Alaska Stat. §§ 45.65.200–45.65.250 (2012).
An art dealer after receipt of a work of fine art for purposes of sale, or exhibition and sale, is the agent of the artist and must hold the artwork and proceeds from the sale of such artwork in trust, creating a fiduciary relationship. There are no specified civil penalties or liabilities for violation of these statutes. Dealer is strictly liable for any loss or damage while the work of art is in the dealer’s possession. Dealer must transmit proceeds of sale to artist within 30 days. If purchase is being paid to gallery in installments, the gallery must use the proceeds from the installment payment to pay the artist first, unless otherwise specified by the artist.
Ariz. Rev. Stat. Ann. §§ 44-1771 to 44-1778 (2012).
An art dealer after receipt of a work of fine art for purposes of sale or exhibition to the public is the agent of the artist and must hold the artwork and proceeds from the sale of such artwork in trust, creating a fiduciary relationship. An art dealer who violates these statutes is liable to the artist for five hundred dollars ($500.00), actual damages, including incidental and consequential damages, and reasonable attorney’s fees. An art dealer who sells a work of fine art which is on consignment but who fails to transmit all monies due the artist on a monthly basis is liable to the artist for three (3) times the amount due the artist. Dealer is strictly liable for loss or damage while the work of fine art is in the dealer’s possession. If any portion of the artist or dealer agreement waives a provision of the statute, that portion of the agreement is void.
Ark. Code Ann. §§ 4-73-201 to 4-73-207 (2012).
An art dealer after receipt of a work of fine art for purposes of sale or exhibition to the public on a fee or other compensation basis, is the agent of the artist and must hold the artwork and proceeds from the sale of such artwork in trust, creating a fiduciary relationship. An art dealer who violates these statutes is liable to the artist for fifty dollars and actual damages, including incidental and consequential damages. Reasonable attorney’s fees and court costs will be paid to the prevailing party. Any provision of artist-dealer agreement that waives a statute provision is void. Dealer liable for loss or damage caused by negligent acts only.
Cal. Civ. Code Ann. § 986 (2009); Cal Civ. Code Ann. §§ 1738, 1738.5-1738.7 (2012).
The California resale royalty law is unique in the United States, although it is a well-established legal right in some other countries. An artist has a right to receive five percent (5%) of the sale price (if greater than one thousand dollars [$1,000] for a work of fine art sold by a gallery or at auction. Signed into law in 1979, the state’s resale royalty law was held invalid by the U.S. District Court in Central California in 2012 for being in violation of the Commerce Clause of the U.S. Constitution. The case is in the appeals process.
A consignee of a work of fine art is the agent for the artist. The consignee holds the art in trust for the consignor and proceeds from the sale of such art will similarly be held in trust. The consignee is responsible for loss of or damage to the art.
Colo. Rev. Stat. §§ 6-15-101 – 6-15-104 (2012).
An art dealer after receipt of a work of fine art for the purpose of exhibition or sale is the agent of such artist, holds the art in trust for the benefit of the artist and holds funds received from the sale of such art in trust for the artist. An art dealer is strictly liable for the loss of or damage to a work of fine art, while in the dealer’s possession. A violation by an art dealer of any provision of this article renders the dealer liable for damages of fifty dollars ($50) plus actual damages, incidental and consequential damages and dealer is subject to reasonable attorney fees.
Conn. Gen. Stat. §§ 42-116k – 42-116m (2012).
An art dealer after receipt of a work of fine art for the purpose of exhibition or sale is the agent of the artist and must hold the artwork and proceeds from the sale of such artwork in trust. An art dealer is liable for the loss of or damage to a work of fine art, which it is in his possession. Dealer must inform public of sale or exhibition of work of fine art by acknowledging the artist in the display of the work of fine art.
D.C. ST. § 28:9-114 (2012).
If an art dealer accepts a work of art on consignment from the artist, the work of art is trust property and the art dealer is trustee for the benefit of the artist until the work of fine art is sold to a third party. The proceeds of the sale of the work of art are trust property and the art dealer is trustee for the benefit of the artist until the amount from the sale is paid to the artist. The work of art is not subject to the claims, liens, or security interests of the creditors of the art dealer.
Fla. Stat. §§686.502-503, 686.506 (2012).
An art dealer after receipt of a work of fine art for the purpose of exhibition or sale is the agent of the artist and must hold the artwork and proceeds from the sale of such artwork in trust. An art dealer is liable for the loss of or damage to a work of fine art while in the dealer’s possession. A violation of any of the applicable statutes is a misdemeanor in the second degree punishable by five hundred dollars ($500.00), an amount equal to double the pecuniary gain of the consignee or an amount equal to double the pecuniary loss of the consignor. When the consignor delivers a work of art to the art dealer, the consignor shall give notice to the public by affixing to the work of art a sign that states that the work is being sold subject to a consignment contract, or the art dealer shall post a sign giving notice that some works of art are being sold subject to a consignment contract.
Ga. Code Ann. §§ 10-1-520 to 10-1-529. (2012).
An art dealer after receipt of a work of fine art for the purpose of exhibition or sale is the agent of the artist and must hold the artwork and proceeds from the sale of such artwork in trust, creating a fiduciary relationship. An art dealer who violates these statutes is liable to the artist for fifty ($50.00) dollars, actual damages, including incidental and consequential damages, and reasonable attorney’s fees. If any other provision of these statutes is waived, it is void, except members of a cooperative may contract to waive liability for loss or damage to works of art consigned to the cooperative. Dealer and artist must enter into a written contract that states: 1) the value of the artwork; 2) applicable time table for the artwork to be sold; and 3) the minimum sale amount for the artwork.
I.C. § 28-11-101 et seq. (2012).
An art dealer after receipt of a work of fine art for the purpose of exhibition or sale is the agent of the artist and must hold the artwork and proceeds from the sale of such artwork in trust, creating a fiduciary relationship. If any provision of these statutes is waived, it is void.
815 ILCS § 320 et seq. (2012).
An art dealer after receipt of a work of fine art for the purpose of exhibition or sale is the agent of the artist and must hold the artwork and proceeds from the sale of such artwork in trust, creating a fiduciary relationship. Requires gallery to attribute artist for work displayed.Gallery is liable to the artist for fifty dollars ($50.00) and actual damages and attorneys’ fees for a violation of act.
Indiana’s general consignment statute applies to works of art sold on consignment. Consignment agreement between consignor and consignee creates a trust and a fiduciary relationship. Trust property cannot be used to pay consignee’s debts. Consignee must transmit proceeds of sale to consignor within 30 days. If purchase is being paid to consignee in installments, the consignee must use the proceeds from the installment payment to pay the consignor first, unless otherwise specified by the artist. If art is damaged while on consignment, consignee is strictly liable for the cost of the art unless damage occurs more than 30 days after the date by which the consignor has agreed to remove item. If consignee violates agreement, consignor can bring an action and recover an amount equal to $50, any damages sustained, and reasonable attorney’s fees.
IA Code § 556D.2 et seq. (2012).
Artist can require gallery to attribute artist for work displayed. A provision of a contract or agreement where the art dealer waives a provision of this chapter is void. The dealer is responsible for the loss of or damage to the artwork. Artist can waive this right, but the dealer has the burden to prove that the waiver is in good faith.
K.R.S. § 365.850 et seq. (2012).
An art dealer after receipt of a work of fine art for the purpose of exhibition or sale is the agent of the artist and must hold the artwork and proceeds from the sale of such artwork in trust, creating a fiduciary relationship. Any waiver of rights by artist is void. Dealer is responsible for loss or damage to the artwork.
Md. Code, Comm. L. § 11-8A-01 et seq. (2012).
No trust relationship, but artwork is “bailment property” until artist has been paid in full, and artwork is not subject to the claims of creditors.
Mass. General Laws ch. 104A et seq. (2012).
Artist must provide information about the artist and work to the gallery upon delivery of the work. Gallery must make books and records available to artist during business hours. An art dealer after receipt of a work of fine art for the purpose of exhibition or sale is the agent of the artist and must hold the artwork and proceeds from the sale of such artwork in trust. An art dealer is liable for the loss of or damage to a work of fine art when it is in his possession. If any provisions are waived, they are void. Dealer must make payment to artist for full amount within 90 days of sale. If dealer does not make full payment within 180 days of sale, he is liable to the artist for three times the amount owed.
M.C.L.A. § 442.311 et seq. (2012).
Included as part of the UCC article on sales as well as a separate sales of fine art chapter, works of fine art delivered to an art dealer are not subject to the claims of creditors. An art dealer after receipt of a work of fine art for purposes of exhibition or sale is the agent of the artist and must hold the artwork and proceeds from the sale of such artwork in trust, creating a fiduciary relationship.
M.S.A. § 324.01 et seq. (2012).
An art dealer after receipt of a work of fine art for purposes of exhibition or sale is the agent of the artist and must hold the artwork and proceeds from the sale of such artwork in trust, creating a fiduciary relationship. Art dealer cannot sell prints (including in catalog) without providing detailed information about the artist, number of prints made in the edition, whether plates/originals have been destroyed, etc.
Mo. Rev. Stat. §§ 407.900–407.910. (2012).
An art dealer after receipt of a work of fine art for purposes of exhibition or sale is the agent of the artist and must hold the artwork and proceeds from the sale of such artwork in trust, creating a fiduciary relationship. An art dealer who violates these statutes with the intent to injure can be assessed all related damages and costs, punitive damages and reasonable attorney’s fees.
MCA § 22-2-501 et seq. (2012).
Whenever an artist delivers a work of art to an art dealer for exhibition and sale, the delivery to and acceptance of such work of art by the art dealer constitutes a consignment. The art dealer is an agent of the artist for the purpose of sale or exhibition of the consigned work of fine art, and this relationship must be defined in writing and renewed at least every 3 years by the art dealer and the artist. The work of art constitutes property held in trust by the art dealer for the benefit of the artist and is not subject to claim by a creditor of the consignee. The art dealer is responsible for the loss of or damage to the work of art. Any provision of a contract or agreement by which the artist waives any provision of this part is void.
N.N. Rev. Stat. § 352:3 et seq. (2013).
Requires gallery to attribute artist for work displayed. Any waiver of rights by artist is void. Gallery liable to artist for attorneys’ fees and actual damages for violation. If Gallery violates chapter, the artist can void the gallery’s right to compensation.
N.J.S.A. § 12A:2-330 et seq. (2013).
Part of the UCC article on secured transactions applies; artwork not subject to claims of gallery’s creditors. Any waiver of rights under chapter must be clear, conspicuous, and in writing.
Artist has priority in artwork held by gallery over all other creditors.
McKinney’s Arts and Cultural Affairs Law § 12.01 et seq. (2012).
An art dealer after receipt of a work of fine art for purposes of exhibition or sale is the agent of the artist and must hold the artwork and proceeds from the sale of such artwork in trust, creating a fiduciary relationship. Any waiver of rights under chapter must be clear, conspicuous, and in writing, and does not apply to first twenty five hundred dollars ($2500.00) in proceeds from sales of artwork in the first 12 months of the agreement.
Effective Nov. 6, 2012, New York amended and strengthened its consignment law for artists. Galleries and art dealers (consignees) now must keep their own funds and funds in artist trusts completely separate. Funds in artist trusts cannot be used to pay the consignee’s debts. If a consignee is inter-mingling the funds, an artist or other beneficiary of the trust can bring a criminal action for violating the statute as well as a civil action to recover damages. The amended statute also expands the definition of an ‘heir’ to the trust and makes it easier for appointed beneficiaries to gain control of the trust and bring action on behalf of it.
N.C.G.S.A. § 25C-1 et seq. (2012).
No trust relationship, but artwork is “bailment property” until artist has been paid in full, and artwork is not subject to the claims of creditors. Bailment property is not subject to the claims of an art dealer’s creditors.
OH R.C. § 5815.42 et seq. (2012).
An art dealer after receipt of a work of fine art for purposes of exhibition or sale is the agent of the artist and must hold the artwork and proceeds from the sale of such artwork in trust, creating a fiduciary relationship. Requires gallery to attribute artist for work displayed. Any waiver of rights by artist is void. Gallery liable to artist for attorneys’ fees and actual damages for violation.
On written demand, gallery must provide names of customers purchasing artist’s work to artist. If gallery violates chapter, artist can collect damages up to three times amount of artist’s portion of retail value of artwork. Artist must be paid within thirty (30) days of sale. Requires gallery to attribute artist for work displayed. Any waiver of rights by artist is void.
73 P.S. § 2121 et seq. (2012).
An art dealer after receipt of a work of fine art for purposes of exhibition or sale is the agent of the artist and must hold the artwork and proceeds from the sale of such artwork in trust, creating a fiduciary relationship. Any waiver of rights by artist must be in writing.
R.I. Gen. Laws § 5-62-2 et seq. (2013).
An art dealer after receipt of a work of fine art for purposes of exhibition or sale is the agent of the artist and must hold the artwork and proceeds from the sale of such artwork in trust, creating a fiduciary relationship. Any waiver of rights by artist is void, except when a cooperative agrees with its members to waive rights.
V.T.C.A., Occupations Code § 2101.001 et seq. (2012).
Artist-gallery relationships are not considered consignment agreements in the state of Texas; however, artwork delivered to an art dealer is not subject to the claims of creditors until artist has been paid in full.
R.C.W.A. § 18.110.010 et seq. (2012).
An art dealer after receipt of a work of fine art for purposes of exhibition or sale is the agent of the artist and must hold the artwork and proceeds from the sale of such artwork in trust, creating a fiduciary relationship. Any waiver of rights by artist is void. If Gallery violates chapter, the artist can void the gallery’s right to compensation. Gallery liable to artist for attorneys’ fees and actual damages for violation.
W.S.A. Ch. 129.01 et seq. (2012).
An art dealer after receipt of a work of fine art for purposes of exhibition or sale is the agent of the artist and must hold the artwork and proceeds from the sale of such artwork in trust, creating a fiduciary relationship. If Gallery violates this chapter, the artist can void the gallery’s right to compensation. Requires gallery to attribute artist for work displayed. Any waiver of rights by artist is void. Gallery liable to artist for attorneys’ fees and actual damages for violation.
This compilation was researched and written in 2010 by Erin McGowan, a student volunteer attending St. Louis University School of Law. Her work was edited by VLAA volunteer attorney Keisa Johnson. Special thanks to Rebecca Stroder, co-founder of the Kansas City Lawyers and Accountants for the Arts. Ellen Eichner, a student volunteer attending Washington University School of Law, updated this info in 2013.

References: § 986
 § 28
 § 28
 § 320
 § 556
 § 365
 § 11
 § 442
 § 324
 § 22
 § 352
 § 12
 § 12
 § 25
 § 5815
 § 2121
 § 5
 § 2101
 § 18