INTRODUCTION :: At least forty percent of valuable artwork circulating in the marketplace is either forged or misattributed. Apart from this significant problem of art authenticity, the chains of title showing current ownership of many genuine and properly attributed objects are defective. These defects are due to incompleteness of the historical records, innocent error, lapse of time, fraudulent manipulation, or theft. This Article explores the dual complexities of properly establishing a valuable art object’s correct provenance-that is to say, determining both the authenticity as well as the chain of legal ownership of the work. This Article also examines the six principal legal doctrines that human society has designed to resolve competing ownership claims and the significant moral shortcomings of each doctrine. Most significantly, this Article presents a proposal for a much- needed reform in the law of art provenance.
The proposed reform is modeled on the Torrens land-title registration system in effect in Australia, parts of the United Kingdom, and a handful of states in the United States. The reform would offer the following: (1) a legal system for conclusively registering both the ownership and authenticity of any valuable piece of artwork; (2) fundamental fairness to all parties claiming an interest in the artwork; (3) assured financial compensation to any innocent party whose claim to the artwork has been injured or lost by operation of the Torrens-like system; (4) permanent and visible public records of art ownership; and (5) enhanced market stability because of the certitude and transparency afforded to art consumers by such a title registration system.
First, Part II of this Article will outline the overall scope of the problem, contrasting the present regime dealing with art provenance to that of modern land titles. Then, using a case study of the various known versions of English landscape painter John Constable’s priceless work The White Horse, Part III of this Article will explore the range of provenance problems which typically arise in establishing both the authenticity of a particular historic work and its correct ownership chain. Next, Part IV will briefly examine the tragic compounding of current provenance problems which our time has inherited from the looting, extortion, and systematic art forgery rampant during the Nazi era. Then, Part V of this Article will examine the current, morally unsatisfactory mix of legal doctrines addressing the classic dilemma of competing and plausible ownership claims to the same artwork and will pinpoint the moral failures inherent in each doctrine.
Finally, Part VI of this Article will propose a new and more just system of artwork titles parallel to the modern system of Torrens registration of land titles. This proposal is intended to accomplish two reforms: (1) assure a more lasting marketplace stability for valuable artwork regarding the twin provenance issues of authenticity and title; and (2) resolve, with maximum justice for each interested party, the classic moral dilemma which arises when rightful ownership claims collide.
November 2014, Vol. 66, No. 6
Lily Kahng, The Taxation of Intellectual Capital