Institutions and collectors now have a new form of Uncle Sam looking over their art transactions: royalty seekers. If you’re planning to sell works by California artists, or works created in our state, you need to know the provisions of a statute currently on the books, as it could impact your pocketbook or those of any auction house or gallery selling works on your behalf.

As the Los Angeles Times and other news outlets have recently reported, the Sam Francis Foundation and other artists or their estates are suing for repeat sale royalties under the California Resale Royalties Act. This legislation, apparently honored more in the breach than in actuality, returns a 5% royalty to artists upon profitable reselling of works at values above $1000. The California law applies to artists living in the state, estates of artists going back 20 years, and/or to sales taking place in the state.

Galleries, major auction houses, and even Ebay are being targeted in lawsuits seeking payment of royalties by well known artists such as Chuck Close, Laddie John Dill and Robert Graham Estate . Similar to “droit de suite” resale royalties laws on the books in many European countries, artists are hopeful that such suits, if successful, will lead to adoption of a national law. The royalty is based on the retail sale price of the artwork, less whatever was originally paid for the work by the current seller. So works purchased years ago and held during decades of appreciation, as often occurred with the top tier of artists, can result in some whopping assessments.

The royalty can apply even if the artist lived in California for as little as two years, and also applies to barter or exchange of works as well as outright sale. Yikes. The fine print can be found in the California Commercial Code, section 986, always our first stop for a rousing read.

Betsy Dorfman

FINE ART SHIPPING welcomes a granddaughter!!  

Emery Dorfman, born July 11 in Seattle WA

  As you can see, the packaging for this product has been designed with  great attention to safety, style, and utility for re-use. The most vulnerable points of the object are wrapped in suitably soft and archival material, then further bundled into an appropriate shape to  secure the item within the selected vehicle of conveyance. Where appropriate, additional measures have been taken to mitigate environmental exposures, particularly in the top or “head” region.

As is recommended, a minimum of  2″ of foam padding is employed  at the sides, top, and bottom of the enclosure to further protect the shipment in transit. Also included but not seen, certain moisture barrier strategies have been incorporated into the interior packaging where prudent, and based on long established guidelines for care of  such commodities.

Further updates will follow as the shipment is expected to increase in size and weight over time.

Betsy Dorfman

The NY Times review today of the 2010 Whitney Biennial features a photo of the Thomas Houseago work “Baby.” Nice to see it in it’s NYC resting place. For awhile there, we had our doubts.

As one of the packing & crating suppliers for the Biennial, FINE ART SHIPPING had the challenge of figuring out how to deal with this artwork, which was originating at the artist’s studio here in Los Angeles.

Among the challenges:

• too big to fit in our local trucks
• too large for normal handling via the Whitney elevators
• a piece that was both delicate AND heavy
• and most fun of all, changing dimensions as the artist continued to work on the piece

After much back and forth with the studio and the Whitney curators, it was decided to prebuild a slat crate structure for the piece, rather than fabricate a full museum standard crate. The slat or “skeleton” crate would save crucial inches off the height and width, and every whisker of an inch counted.

OK, so we will deliver the prebuilt crate to the studio, and pack the work there and then…but wait. Once crated it turns out the packed crate will be too large to exit out of the studio doorway. And if packed outside, it won’t fit back in. “Baby” can’t be left in the street!  More phone calls and emails.

In the end we used the studio lift (thank goodness for their help!) to get the piece into the base of the slat crate, then finished packing the crate outside the studio, on the pavement beyond the studio doors. Luckily, a quiet street. Luckily, not raining. Only a bit of sawing and repositioning of braces was required due to the artist adding a couple of hundred pounds of concrete to the thing since we had last seen it… All in a day’s work. Then on a preplanned “just in time” basis the Whitney’s climate controlled trailer, with larger clearances than our local trucks, stopped by and we loaded “Baby” into the trailer. Very carefully.

In the best possible way, we were happy to see him go. That’s one big baby.

Betsy Dorfman

Some customers, including industry insiders, mistakenly believe that booking a service or shipment with a fine art provider means, by default, that the shipment or goods being handled are automatically insured. Or, if not insured per se, that the provider nonetheless must have liability in case of damage, especially damage caused in the course of their care and custody. Not the case. In fact if it were the case, art handlers could not function; having open ended liability for potentially millions of dollars of stored and in-transit property would be an untenable business proposition day to day. We have enough gray hair as it is.

So the reality is that fine art handlers necessarily have limited liability, typically capped at 60 cents per pound per article, for uninsured items. That is barely salvage value and completely useless in the realm of fine art coverage, where values range from hundreds into the millions of dollars. Beyond that point, unless a value is declared and a premium paid, there is no coverage. Zero. No matter what the circumstances of the loss. Even if we knock it off a shelf and run a forklift over it. We really try not to do that, by the way.

Every customer who calls to book a service or receive an estimate is asked if they wish to take or decline the insurance we provide, and every transaction processed – estimate, bill of lading, invoice – shows the status of the account or shipment as insured for a specified value or insurance declined. If you are working with a carrier or fine art shipper and there is no notice of insurance status on the document, get that fixed. If there is no value declared and shown in writing then chances are 99.9% that you are not insured with that provider.

Despite this clarity, some customers remain confused or subject to wishful thinking, typically after a loss has occurred. To banish this “gray area” insurance underwriters, including ours, have introduced an additional step into the process: customers declining insurance must sign and return an OPT OUT form, a sample of which is below.

The form is kept on file and applies to all transactions for that customer or account, unless or until rescinded in writing. In some cases a museum, collector or gallery will have their own all risk policy in place, and sending us proof of such coverage will serve the same purpose as the OPT OUT form.

Asking our customers to return this form has been instructive. It has turned up some who thought they were insured, despite receiving in some cases years of notices to the contrary, and others who realized their own independent coverage had lapsed and/or that they need to update their appraised values and coverage. Many clients had questions, which served to show that the waters were murky indeed. A few interpreted this to be an entirely new policy limiting our liability and were concerned that we were now cutting them off from some delectable free coverage they had enjoyed in the past– not the case. As I hastened to explain. And a few others thought the document somehow related to their own independent insurance policies, which it does not.

And so, unaccustomed as I am to praising insurance companies, my chapeau is off to the folks at Lloyd’s of London and our agent at Willis Fine Art & Specie for adding this document into the mix. Nobody likes more paperwork, but where irreplaceable art and artifacts are concerned the fewer twilight zones the better.

Betsy Dorfman

Sample notice:

NOTICE OF OPT OUT of insurance offered

This will confirm that I/We have been offered purchase of “Customers’ All Risk Fine Art Insurance” by Fine Art Shipping/Bilton Arts Inc. and that I/We OPT OUT and decline to accept this coverage.

By opting out and signing below I understand that Fine Art Shipping/Bilton Arts Inc. has limited liability for any loss or damage, as specified in their documents and waybills, as do their agents and affiliated providers.

( ) I/We decline to accept coverage as noted above and this relates to ALL SERVICES performed by Fine Art Shipping/Bilton Arts Inc. I/We further understand that this OPT OUT declination can only be rescinded by myself or an authorized representative and requires a statement of acceptance in writing from Fine Art Shipping/Bilton Arts Inc. to take effect.<

COMPANY or INDIVIDUAL NAME: _____________________

ADDRESS__________________________________________________________

SIGNATURE of individual or COMPANY authorized representative __________________________

DATE ______//_______//______

NOTE: Failure to return this document to Fine Art Shipping/Bilton Arts prior to performing the requested service will constitute acceptance of “Customers’ All Risk Insurance” together with any related fees and expenses for same.<

Or, tales of the gravy boat …

Our company name is helpful insofar as it is descriptive: Fine Art Shipping – doesn’t leave much doubt. But the truth is we ship, and store, a wide variety of objects, not just art. And not all the art is “fine” art. The not so secret secret is that most fine art handlers will pack and ship a wide variety of goods including art, antiques, household furnishings, architectural models, musical instruments and just about anything else requiring expert and careful handling. For example, your Thanksgiving platter and gravy boat. The one grandma expects to see every year….

In some ways the community of art handlers has replaced what used to be a commonplace: the full service storage facility. In our era of self storage and van line storages using wood vaults, the idea of a warehouse where goods are commonly held and curated by the staff has largely disappeared from view. But this is precisely what we do. And not just for artworks, although this is the heart of our business. If it’s fragile, temperature sensitive, special in any way, or just needs to be properly stored under secure, clean & organized conditions– this is what we do.

So you can store your “stuff” (virtually anything except toxic substances or live plants and animals) in a full service facility such as ours for a reasonable fee. You’ll receive a computerized photo inventory from which you can select items to be delivered or shipped virtually anywhere. Similarly, we can pick up or receive incoming shipments for your account, inspect, assemble as needed, and place into storage while you’re busy having your life somewhere else – not running to the self storage.

And you won’t be paying a three hour minimum for a van line dude to forklift down your wood vault, crowbar it open, and paw through your entire stack of possessions to try and locate one box. You know the box: the one with your turkey platter and gravy boat that you’re going to need real soon… Which you hope they didn’t put at the bottom of the pile.

Oh, and did you need insurance on that?

BEST BUY stores recently retracted an errant ad offering big screen TV’s for $9.99. Hey, stuff happens.  And so, with apologies for any inconvenience, we take this opportunity to issue a few clarifications of our own:

FINE ART SHIPPING is not offering for $500 or best offer “your choice of any stored artwork belonging to someone who has not paid their bill.” This offer was posted in error on a now deleted blog. We are sorry for any confusion.

Nor are we prepared to “tie any such painting or artwork onto the top of your car for transport at no cost, provided you haul it away same day.” This was printed in error as well.

FINE ART SHIPPING assumes no responsibility for artworks tied or bungeed to the tops of vehicles, nor will we lend you any rope or string for that purpose. It has always been our policy that high value artwork should be transported inside vehicles wherever possible.

In addition FINE ART SHIPPING is not offering an alliterative “painting-plus-pet” discounted storage option. Somehow this language slipped into a recent email marketing campaign by way of a search and replace glitch. We do store paintings; we do not store pets. Whoever dropped off the Baldessari and the beagle,  the Georganne Deen and the gecko, and especially the Thiebaud and the tarantula, please be advised that the pet portion of your storage account will be available for pickup behind our warehouse weekdays between noon and 4 PM. We will return any unused puppy, reptile, or spider chow at that time.

Thank you.

Retractions & Clarifications, 29^th floor

Painted crates enjoy a couple of benefits besides a modest aesthetic bump. Any given shipment of them is instantly recognizable in large warehouses of unrelated crates and pallets. Larger museums tend to have their own proprietary color, and for the purposes of this you would have to ask your friendly neighborhood registrar. But I imagine that one benefit is revealing at a glance which stored crates were commissioned by the museum and which may belong to some one else. Likewise when the crates travel in large exhibitions.

Last but not least, there is a technical element. The crates shown here are covered with a coat of primer, three coats of paint and two coats of clear lacquer. This adds up to a bit of a moisture barrier. Should the crates fall into the ocean, the MDO walls will do most of the work in keeping the contents dry for a spell, but the paint helps slow down serious damage to the solid pine battens and subsequent seepage at the corners. In less catastrophic conditions however – say, a heavy rain – the water won’t get past the paint and Neoprene lid gasket.

Here is a snapshot of the same crates recently spotted in the wild, along with one from another company in the same shipment. Labels and documentation accompany all such shipments, but there is never any question where each of these crates will eventually be returned.

-Chris