USA Law and Practice Contributed by: Jana Slavina Farmer, Adam Buchwalter and Dara Elpren, Wilson Elser Moskowitz Edelman & Dicker LLP
rights to an item found on private land, there are important exceptions for items of significant histori - cal, archaeological or cultural value. For example, if the item is of Native American origin, tribes may have rights to the item under federal or state law, particu - larly under the Native American Graves Protection and Repatriation Act (NAGPRA). Discovery of cultural arte - facts is required to be reported to the relevant federal or state agencies. 6. Sale of Art Objects Domestically and Abroad 6.1 Key Clauses in Art Sale Contracts Every contract, regardless of its subject matter, should include certain fundamental provisions to ensure it is valid, enforceable and clear. These essential provi - sions include identification of the parties, description of the subject matter, consideration (what each party is giving or receiving), a description of rights and obli - gations, term (duration of the contract), governing law, and signatures of the parties. For art sale contracts in particular, the following provi - sions are important to include in addition to the essen - tial terms of any contract: • Description of the artwork – This section usually includes the title, artist, medium, dimensions, date of creation, and any identifying marks or numbers associated with the piece. To further ensure clarity and authenticity, photographs or certificates of authenticity may be attached as exhibits to the contract. • Consideration – The contract must state the agreed-upon price for the artwork and outline the payment terms, such as a payment schedule. • Terms of transfer – The contract should specify the method, timing, and place of delivery of the artwork, as well as who is responsible for shipping, insurance, and the risk of loss during transit. It will also clarify when the transfer of title and ownership passes from the seller to the buyer. • Representations and warranties – The seller typically warrants that they have good title to the artwork and the right to sell it. There is often a war -
ranty of authenticity, confirming that the artwork is genuine and attributed to the stated artist. • Other disclosures – The contract should also disclose any liens, encumbrances, or third-party claims, as well as the condition of the artwork and any restoration or repairs that have been made. 6.2 Issues in Cross-Border Art Sales Compliance Compliance with export, import and cultural property laws is a key consideration when transferring artwork abroad. If these laws are violated, US Customs and Border Protection (CBP) and other federal agencies have the authority to seize the artwork. Submitting forged or altered documents, such as invoices or export permits, can result in seizure. Importers must also accurately declare the value and country of origin of the artwork. Under-reporting the value to reduce duties or misrepresenting the origin to avoid restric - tions or tariffs is a violation. Furthermore, artworks or artefacts that were stolen, whether from private col - lections, museums, or archaeological sites, are sub - ject to seizure under the National Stolen Property Act (NSPA) and other statutes. When artworks travel to other jurisdictions, collectors should be aware that the laws for determining whether a good title exists may be different in other countries. In the United States, a good faith purchaser for val - ue cannot acquire good title if there is a thief in the chain of title. As discussed in the previous sections, such stolen goods may be seized and repatriated to the original owner. As a result, when an artwork with potential gaps in provenance travels abroad, the owner or buyer may be at risk of losing title. This high - lights the importance of conducting due diligence in art transactions, including into title and provenance. Shipping Another key consideration for international transac - tions is shipping, as artworks are frequently damaged during transit. Working with experienced art shippers reduces the risk of damage to the artwork. Collectors may also want to consider reviewing their insurance policy to make certain that they have coverage for artworks during transit.
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