on all items over $75
on all items over $75
For centuries, artists have been celebrated for pushing boundaries and shaping how society should view art. As members of the audience, we rely on artists to expose us to these unique dimensions of thought and we return the favor by placing value on their creations. For the past twenty years, one anonymous artist has continuously thrilled his audience by publicly displaying his work throughout the streets of major cities. Banksy, as the public knows him, has once again shocked his audience, this time at the Sotheby’s auction of one of his most famous graffiti pieces, “Girl with Balloon.”
However, the $1,037,000 record breaking bid price was not the cause for headlines after the sale. In pure avant-garde fashion, immediately upon the sounding of the auctioneer’s hammer, the frame securing the piece proceeded to shred the bottom half of, “Girl with Balloon.” The bidder, who remains anonymous, said that she is planning to keep the shredded piece, and “realized that [she] would end up with [her] own piece of art history.” However, what if the owner had not had such an optimistic outlook on the prank, could she have legally deemed the sale void?
Under the Uniform Commercial Code (“UCC”), “a sale by auction is complete when the auctioneer so announces by the fall of the hammer or in other customary manner.” While the sounding of the hammer indicates the transfer of ownership, this does not necessarily also indicate a transfer of liability. The UCC and Sotheby’s terms of sales state that the “risk of loss passes to the buyer upon her receipt of the property or on tender of delivery.” In sum, liability is imposed on the party who has physical possession of the artwork. If the buyer receives the goods in a condition that does not conform to the condition the buyer reasonably believed the goods to be in at the time of the sale, under the UCC, a buyer may revoke her acceptance of the goods.
As applied to, “Girl with Balloon” once the hammer struck, the ownership of the piece transferred from the hands of Banksy’s agent, Sotheby’s, to the anonymous bidder. However, since the piece immediately shred upon finalization of the sale, there was no actual physical transfer of the artwork. Between the time of the sale and the shredding, the piece was still mounted at the Sotheby’s auction house, therefore under the company’s liability. Since the art work was damaged while under the possession of Sotheby’s, under the UCC, it is likely that the anonymous buyer could have canceled the sale.
Moreover, there is also the issue of the price appraisal of the artwork. Buyers rely on auction houses like Sotheby’s to provide them with a guideline of establishing the value of pieces of art, in particular their reserve price (the minimum bid price for a piece). Sotheby’s set the reserve price for “Girl with Balloon” to reflect the piece in its original creation and it is unclear how the piece will be valuated post alteration. However, members of the art world seem to believe that this was not a destruction but rather a reincarnation of the piece. One art broker, Joey Syer, believes that Banksy’s prank contributed to art history, adding a “minimum 50% to its value.”
If Syer’s estimates are true, could Sotheby’s in return bring a claim against Banksy for transforming his piece without their knowledge, thus manipulating the reserve price? Banksy admits to orchestrating the prank, and even recently revealed that his initial intention was to shred the whole work, but a mechanical error stopped the shredder at the bottom half of the piece. It is unclear if, when Sotheby’s inspected the piece, they were aware of the shredder within the frame and if that was incorporated in their valuation of the piece. It is quite likely that Banksy did not disclose the shredder to Sotheby’s, who could potentially bring an action against Banksy for fraudulent concealment. Sotheby’s could make the claim that, by not disclosing the shredder, they misevaluated the piece and set the reserve price lower than its worth. Thus, had they set the reserve price higher, the piece could have sold for more, guaranteeing a greater commission for the auction house.
As of now, the parties and fans around the world view this as a positive occurrence. Sotheby’s head of contemporary art, Alex Branczik does not seem worried about the trick and views this as, “the first artwork in history to have been created live during an auction.” Once again, Banksy has played with his audience’s conception of art, and the future valuation of the newly named, “Love in in the Bin,” will reveal whether the joke is actually on us.