Florida’s Artist Consignment Act: What Does it Protect?
Surprising to many, Florida law provides some specific means for protecting artists’ rights and property. For instance, the Artist's Consignment Act, Fla. Stat. §§ 686.501 -686.506, contains a handful of laws that directly address, and govern, the relationship between an artist and the artist’s dealer.
Artist Consignment Act
Essentially, the Artist’s Consignment Act provides that whenever an artist (consignor) delivers a work of art to an art dealer (consignee) for the purpose of sale, or exhibition and sale, the delivery and acceptance thereof by the art dealer creates a “consignment contract." Any proceeds from the sale of the work of art are considered “held in trust" for the benefit of the artist and are to be applied to any payment due to the artist first. This means that the law will consider the dealer to have possession of the funds and the dealer will remain liable to the artist for those funds until they are paid to the artist. Importantly, these two rights cannot be waived in writing by the artist!
The Consignment Contract
The Act provides that the consignment contract must include the following terms:
· The proceeds of the sale of the art work are to be delivered to the artist at a schedule agreed upon by the artist and dealer;
· The art dealer is responsible for the stated value of the work if the work is damaged while in the art dealer’s possession;
· The art dealer cannot sell the work for less than what the artist and art dealer previously agreed to;
· The artist has a priority interest in the work, or in the proceeds of the work, over the claims of creditors of the art dealer.
A violations of these provisions is considered a misdemeanor of the second degree.
What Does the Act Not Protect?
In situations where the art dealer does not fall within the definition of “art dealer" under the statute, the Artist’s Consignment Act, requires that an artist delivering a work of art to such a dealer to attached a notation to the work stating: “This work of art is being sold subject to a contract of consignment." The purpose of this requirement is to protect the artist’s work from the art dealer’s potential creditors who claim a security interest in the dealer’s inventory. If an artist hands over his work to, let’s say, a proprietor of an antique store or a restaurant for display and sale without the notation, the artist might lose the work if that store or restaurant owner gets into trouble with his creditors as the creditors will have a claim over the artwork that will be given priority over the artist's own rights to that work. In an abundance of caution, that artist should still want to affix this annotation to the work, even if the art dealer is a prominent gallery. It is even suggested that the artist file a UCC-1 to perfect his security interest in the artwork.
Please note that the Act does not apply to works of art worth less than $100.00.
If you are an artist working with an “art dealer" or gallerist in Florida, be sure to include on all your pieces a notation stating “THIS WORK OF ART IS SUBJECT TO A CONTRACT OF CONSIGNMENT." Also, be sure to get your agreement with your dealer in writing and signed by both parties. The more specific your contract, the less confusion down the line and the easier it is to avoid an expensive legal proceeding to assert your rights under the law.