The Art Market

January 31, 2014 6:35 pm

The art market: Esmerian bankruptcy sale

Wood Santa Claus

Wood Santa Claus

The final chapter in the saga of museum chairman emeritus, Manhattan jeweller and embezzler extraordinaire Ralph Esmerian was written at Sotheby’s New York when a US bankruptcy court sold off his highly regarded folk art collection for $12.9m in its Americana Week.

Esmerian is serving a six-year jail sentence for fraud and concealing assets, having double-pledged millions in collateral to obtain $210m to prop up Fred Leighton, the Madison Avenue “jeweller to the stars” he bought in 2006.

He was a passionate collector of folk art, and generous donor to the American Folk Art Museum, of which he was once chairman. But there was a problem: 263 of the pieces he promised to the museum had also been pledged as collateral to lenders. A deal was hammered out whereby the museum kept 53 pieces; the rest went to auction.

Top lot was a ruddy-faced carved wood Santa Claus, which made $875,000, well over its $150,000-$250,000 estimate. A 19th-century weather vane from Connecticut sold for $449,000 (est. $200,000-$300,000).

Bankruptcy sales rarely do well, but the quality of the Esmerian carvings, portraits, weather vanes, painted furniture and ceramics was such that the sale easily beat its top estimate of $9.5m. Even so, creditors – who include Christie’s, Sotheby’s and Merrill Lynch – will not see much of the $140m they lost in Esmerian’s bankruptcy, according to liquidation trustee Jay Teitelbaum in New York. Still in New York, Keno Auctions scored the highest price of Americana Week with a faded and water-stained six-page letter, the text repeatedly crossed out and changed. Discovered in Manhattan’s oldest house, the Morris-Jumel Mansion, the “Letter from the Twelve United States Colonies, by their delegates in Congress to the Inhabitants of Great Britain”, dating from 1775, turned out to be a draft of the last plea of Congress to Britain before the Revolutionary war. It made $912,500, almost double its estimate, a sum that has secured the endowment of the mansion “for generations” according to its president, Carol Ward.

. . .

The Spanish art trade is breathing a huge sigh of relief after the government decided last week to slash sales tax on works of art to 10 per cent, down from the previous punishing rate of 21 per cent, introduced in 2012. The welcome news comes three weeks ahead of the opening of Arco, the country’s leading art fair.

The cut was welcomed by Arco director Carlos Urroz: “The 21 per cent tax was terribly hard for Spanish galleries, and it sapped confidence among buyers,” he said. “We hope this change will [give] collectors the will to spend again.”

Spanish deputy prime minister Soraya Sáenz de Santamaria said the government had recognised that the previous rate was a “brake on the competitiveness of the Spanish art market” – with the equivalent tax standing at 10 per cent in France, 6 per cent in Belgium and 7 per cent in Germany.

. . .

The covers still haven’t come off, but the Berlin National Library is about to reveal, after a bitter row over plagiarism, the huge checkerboard work that the German artist Tobias Rehberger had installed in its reading room but which has been under wraps for almost a year. “The scaffolding is going up,” a spokesman for the library said. “It will need a few organisational steps to unwrap it.”

The black-and-white Perspex “Clock/Object” is a form of timepiece, with backlighting moving through the hours, and is one of four works that the institution commissioned from Rehberger. Trade sources estimate it could have cost some €250,000. But shortly after the work was unveiled, Bridget Riley claimed that it was copied from her “Movement in Squares” (1961). Rehberger initially said he was unaware of that work, and then that the checkerboard pattern was too well-known to be copyrighted. After an expensive fight that was finally settled with each side paying their own costs, it was agreed that it could remain, but under a new title: “Clock/Object after ‘Movement in Squares’ by Bridget Riley”.

. . .

Watercolour by Jacob Maentel

Watercolour by Jacob Maentel (c1815), sold for $401,000

Bonhams is still trying to find a successful formula for selling contemporary art, having abandoned its “Contemporary One” and “Two” format in 2012. Competition is intense in this field, with Sotheby’s, Christie’s and Phillips all vying for consignments, but it is also the juiciest sector.

So Bonhams is trying a new approach by launching A Contemporary Edge on March 4 in London, which will include painting, sculpture, photography and design. The catalogue includes pieces consigned directly by eight “carefully selected” young artists who have never appeared at auction before, and at “come hither” prices from £1,500-£6,000.

Nevertheless this move flies in the face of the generally accepted principle that auction is for secondary, not for primary market works. The exception was of course Hirst’s sale of work directly from his studio at Sotheby’s in 2008, an experiment that has so far not been imitated by other artists. In the emerging markets, however, the auction route is often chosen by artists, particularly in China where hammer prices set the benchmark.

. . .

Phillips, the niche auction house which belongs to the Russian Mercury Group, has made a couple of new acquisitions – of specialists from Sotheby’s. David Georgiades and August Uribe have been appointed worldwide co-heads of Phillips’ contemporary art department, where they have already started.

Georgina Adam is art market editor-at-large of The Art Newspaper

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