Memorandum submitted by the Society of
London Art Dealers
The Society of London Art Dealers is the principal
British Trade Association for dealers in pictures and sculpture
and all forms of the visual arts. It has been in existence since
1932 and currently has 109 members. Its purpose is to promote
and protect the good name and interests of the art trade and to
enhance public confidence in responsible fine art dealing. All
members of the Society are vetted by its Executive Committee and
sign an undertaking to adhere to strict codes of conduct. The
great majority of the Society's members are in London, since that
is where the trade is concentrated. But the Society took a decision
in 2003 to open its doors to suitable dealers from anywhere in
the UK.
Some of the Society's members deal exclusively
in one or two categories of art, others cover a wider field. Taken
as a whole, the Society covers virtually the whole range of art,
from old masters to cutting edge contemporary. Currently 64 of
its members deal wholly or in part in contemporary art.
In talking of contemporary art it is important
to distinguish between the primary market, in which dealers either
buy direct from artists or take new works on consignment and the
secondary market in which they resell works which have already
been sold at least once. Most SLAD members who deal in contemporary
art deal in both these markets and the two markets are closely
linked and support each other. Few dealers could survive if they
dealt only in the primary market. New artists naturally depend
on the primary market but a thriving secondary market is also
vitally important for both artists and dealers. Auction houses
as a rule are involved only in the secondary market.
For most SLAD members dealing in contemporary
art, and certainly all who deal in the primary market, relations
with artists are of great importance. Many of these relationships
last over many years, and dealers take a great deal of trouble
to nurture artists: dealers can indeed take much of the credit
for launching many artists on successful careers. Most SLAD members
dealing in contemporary art have a large number of contemporary
artists on their books, but most are also on the look out for
new talent.
Agreements between dealers and artists can vary
enormously. Some are exclusive, others not. Some may last for
a limited period, or even a single exhibition. Others may last
for a year, a period of years or even a lifetime. Some may be
very general and take up no more than a few paragraphs.
Others can be extremely detailed and run to
many pages. In other cases artists and dealers may maintain successful
relations over many years purely on the basis of the word of mouth
agreements with nothing written down. Subjects which agreements
are likely to cover include gallery exhibitions, participation
in fairs, marketing, development of relations with museums, advertising
and public relations and of course financial arrangements, who
will cover which costs, how and how much the gallery will receive
in commission and arrangements for price setting and discounts
and the obligations of each side to the other.
Because of the wide variety of types of agreement
between artists and dealers, and the huge differences in their
detail and content, when the Society looked at this issue about
18 months ago we decided not to try to draft model agreements,
or a code of conduct, but instead to produce a checklist of the
points which dealers should keep in mind in drawing up agreements.
A copy of this checklist is attached. We also produced, in 1996,
in cooperation with the Fine Art Trade Guild, a booklet entitled
"Artists & Galleries—a Profitable Relationship"
designed to explain, primarily to artists, how they could best
go about establishing relationships with dealers. A copy of this
booklet is also attached. It is however now rather dated and does
not take proper account of recent developments such as increased
use of computers, digital photography and the internet. We are
currently engaged with the Fine Art Trade Guild in producing an
updated version, which will be published later this year.
Given the huge range of types of agreement between
artists and dealers and desirability of continuing flexibility
in this area, the Society of London Art Dealers believes that
it would be unhelpful to try to introduce increased regulation
or a code of conduct. Any code of conduct would be likely to be
either so general as to be anodyne and meaningless or else risk
undermining the flexibility and freedom of manoeuvre which both
sides want and which has served them so well. Artists are individuals
in the fullest sense of that word and do not want restrictive
agreements that tie them down excessively. Most dealer firms are
also very small, with the majority of SLAD members employing less
than four staff. As explained above, we have already been active
in doing what we can to help artists to understand better the
business side of their affairs. Neither party wants or needs greater
regulation or external monitoring. Dealers are already suffering
from the amount of time they have to spend on bureaucracy and
form filling, import VAT, export licence applications, money laundering
regulations etc not to mention the impending new regulations on
Droit de Suite which are casting a pall over the entire
industry (see below). All of these distract dealers from the time
they should be spending on more constructive matters such as encouraging
new artists. Indeed, if there is one single thing which the Committee
could do to help encourage the development of artists and new
art, it would be to try to reduce the bureaucratic burden on art
market professionals.
The Society of London Art Dealers is very concerned
about the impending introduction of Droit de Suite on the
work of living artists with effect from 1 January 2005. It believes
that this risks doing severe damage to the entire British art
market and that it will be of little, if any, benefit to the artists
whom it is designed to help, many of whom have signalled their
opposition to Droit de Suite. It also believes that those
who have canvassed its introduction have failed to understand
its full implications. But the case against Droit de Suite
is being set out in full in separate evidence by the British Art
Market Federation, of which the Society is a member and which
it fully supports.
ARTIST/GALLERY
AGREEMENTS
Checklist for SLAD members
Agreements between galleries and artists vary
considerably, thus it is not practicable to draw up a model contract
for use by SLAD members. However it is useful to ensure that any
necessary discussions are put in writing. The following is a checklist
of points to consider covering.
Exclusivity
— Set out the basis on which it is
agreed to represent and/or work with an artist, eg as exclusive
agent or on an ad hoc basis.
— Detail the territory involved, eg
the UK, Europe and/or rest of the World.
— Detail whether agreement relates
to all artwork leaving the studio or only those artworks with
which gallery is dealing directly.
— Point out whether the agreement covers
future sales and commissions, and if so, the conditions relating
to those.
Duration of Agreement
— Length of agreement and notice of
termination necessary from either side.
Warranties and Copyright
— Artist needs to warrant that he is
the owner of the work, that it is his original work, and that
he is and will remain the exclusive owner of the whole copyright
of the work; and the works do not violate the rights of any third
party (including without limitation, the rights and subject of
the work) in particular with regard to laws relating to trademark,
copyright, privacy, publicity and defamation within the UK, USA
or elsewhere.
— Artist should indemnify gallery against
any damage or costs incurred in respect of any claim where there
has been a breach of any representations of warranties in the
agreement.
— Gallery should point out that editorial
policies prevent a guarantee of photographic credits or return
of photographs.
Details of how gallery will represent/or work
for the Artist in respect of
— amount of promotion and advertising;
— involvement in art fairs;
— amount of liaison with curators,
museums and public institutions;
— positioning of work into important
collections;
— how it will raise artist's profile;
and
— licensing of all rights in the images.
ARTIST/GALLERY
AGREEMENT (2)
Consignment and Commission Details
— Details of discounts, amounts of
discounts, and whether shared with artist. It is useful to state
a maximum discount that can be offered without having to refer
to artist.
— Amount of commission, and whether
VAT will be charged on that commission.
— Whether or not commission payable
on all sales through the gallery; all sales from the artist's
studio; from other exhibitions; and from contacts relating to
gallery promotion etc.
— Amount of commission taken by gallery
when work sold via a third party, ie another gallery, consultant
etc.
Costs
— Point out who will pay for design,
printing, mailing of private view cards/exhibition announcements,
advertising and other promotional costs.
— If a catalogue is agreed upon, who
will pay costs of photography, design, production and printing?
— Who will install exhibition/s and
pay installation costs, and hire and/or purchase of any necessary
equipment for exhibition purposes?
— Point out who is responsible for,
and who will pay for, shipping of works to gallery and return
of any works to the artist.
— Who pays for fabrication, printing,
mounting and framing of artist's works?
— If gallery has incurred costs, will
it expect these to be reimbursed on return of works to the artist?
— Who pays for photography of works
for archival, exhibition, promotional, advertising or any other
purposes?
— Details regarding storage and payment
of storage bills.
— Details of insurance, and who assumes
liability for works lost, stolen or damaged.
Artists' Responsibilities
— To update gallery with all new information
regarding clients, interest in work/s or exhibition/s.
— To provide the gallery with updated
biography, statements and articles relating to his/her work.
— To provide gallery with photographs,
colour slides and/or colour transparencies for promotional and
sales purposes.
— To keep gallery informed of any interest
that is not directly affiliated to the gallery.
— To deliver the work of art in good
condition and be responsible for any repair that may be necessary,
as a result of any deterioration while in the gallery's care.
Exhibition/s
— If an exhibition is agreed upon,
the gallery should point out that it will collaborate in the curating
and mounting of the exhibition.
— Artist must adhere to timetable given
by gallery.
— Detail responsibilities regarding
installation of the exhibition.
— Details regarding production of a
catalogue.
ARTIST/GALLERY
AGREEMENT (3)
— Artist must notify gallery promptly
if work requires any special environmental controls or security
arrangements.
— If artist is in default of any of
his obligations or cancels the exhibition or does not comply in
all respects with the timetable, then the gallery can terminate
the agreement and can claim all expenses incurred in putting on
the exhibition.
— Preparation of invoice in respect
of each sale.
— Gallery shall have no obligation
to exhibit the artist's work at the gallery or elsewhere.
Accounting
— In respect of each sale, gallery
should send an invoice setting out title of work, date of sale,
sale price, amount due to gallery and to the artist, and details
of VAT.
— Amounts payable to artist should
be settled within 30 days of receipt of full payment by the gallery.
— Details of any advances to artist
in advance of future sales.
— If any such advances are made, gallery
can hold a lien in respect of all work belonging to artist up
to the amount of that loan and will exercise the lien in default
of payment.
— Gallery may deduct any such advance
from monies due to artist in respect of sale.
— Details of advances towards fabrication,
production, printing, and/or framing costs and how gallery expects
to be reimbursed.
— Artist must confirm whether registered
for VAT or not.
— Gallery may charge VAT only on gallery
commission if artist is not VAT registered.
Death
— Heirs to remain responsible in event
of death of artist.
Jurisdiction
— Governed by laws of England.
February 2005
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