MANHATTAN (CN) – Accusing Christie’s of bad faith, a South Korean gallery claims in a pair of lawsuits that the storied auction house sold a Francis Bacon painting at a “bargain-basement price.”
The Seoul-based One and J art gallery redacted the title of the Bacon painting from its filings to avoid diminishing the painting’s value, saying in the Jan. 2 petition that its private agreement with Christie’s specified that the work would not sell for less than the $10 million.
Represented by attorney Judd Grossman, the gallery claims that Christie’s was supposed to sell the Bacon painting to the highest bidder but instead negotaited a “sweetheart deal” that would give the painting to two high-profile clients who planned to participate in Christie’s fall art auctions, Christophe Van de Weghe and David Rogathat.
“Here, Christie’s discretion does not permit it to sell the gallery’s collateral at a bargain-basement price as a ‘sweetener’ for a more favored client doing other business with Christie’s, thereby frustrating the gallery’s rights under the contract,” the petition states. “As the gallery’s exclusive agent, and therefore fiduciary, Christie’s of course was obligated to seek to realize the maximum sale price for the gallery’s benefit.”
On Jan. 4, One and J brought separate claims against Van de Weghe and David Rogathat in a summons with notice. Both cases are filed in Manhattan Supreme Court.
The Korean gallery claims that Christies’ conservative appraisal for painting in October 2017 was $10 million. It also says that multiple Bacon works of comparable size have sold recently at auction for prices ranging from just under $20 million to just under $50 million.
At the same time that the auction house agreed to arrange the private sale of the Francis Bacon painting, Christie’s allegedly agreed to make a loan of approximately $4.9 million to One and J with the painting serving as loan collateral.
Christie’s wrote to the gallery in September 2018 to allege that it had defaulted on the loan, and that Christie’s was therefore entitled to sell the Bacon painting “under any terms, at any time, as we see fit.”
One and J reportedly offered to pay $6.8 million for the return of the Bacon painting, but Christie’s rejected the bid as too “low.”
One and J says it also tried to consign agreed an Andy Warhol painting to Christie’s with the sale proceeds to be used to repay the loan, but Christie’s withdrew it from the sale on the eve of the scheduled auction based on a purported lack of interest.
“Especially given Christie’s role under the private sale agreement to act as the Gallery’s exclusive agent with regard to the painting until 2019, it was certainly reasonable for the gallery to expect that Christie’s would not actively negotiate against the gallery to help the Unknown Buyer reap a significant windfall on the painting at the gallery’s expense,” the petition states.
In a statement Monday afternoon, a representative for Christie’s said the auction house believes it has acted in accordance with our obligations under New York’s Uniform Commercial Code and its agreements with One and J.
“Christie’s sale of the collateralized painting (Bacon) at fair market value was an appropriate remedy after years of non-payment, defaults, and months-late payments on interest-bearing advance agreements,” Christie’s spokeswoman Lara Messerlian said.
Originally from Belgium, Van de Weghe was a former sales representative at the Gagosian Gallery in New York City from 1992 to 2000 who later opened the Van de Weghe Fine, specializing in top-quality, secondary-market works by post-war and contemporary artists.
Rogath is a seasoned collector and principal of the Greenwich, Connecticut-based contemporary fine art publisher Chalk & Vermilion Fine Arts.
Representatives for Van de Weghe did not immediately respond to request for comment Monday afternoon.