USA – CALIFORNIA Law and Practice Contributed by: Jennifer Jordan McCall, Matt Perotti, Drew Reitz and Ashley E. Huh, Pillsbury Winthrop Shaw Pittman LLP
utes can limit private acquisition. For example, the Archaeological Resources Protection Act (16 U.S.C. §§ 470aa–470mm) generally prohibits excavating or removing archaeological resources on public or Native American lands without a permit and authorises civil/ criminal enforcement. For Native American human remains and certain cultural items discovered on Fed - eral or tribal lands, NAGPRA provides an ownership/ control hierarchy (prioritising lineal descendants and affiliated tribes/Native Hawaiian organisations), which can vest ownership/control in those parties rather than the finder. Although on private land, ownership is typi - cally governed by state property law (including land - owner-versus-finder principles), the closer the object is to a protected cultural heritage item, the more likely there will be regulatory and ownership constraints. 6. Sale of Art Objects Domestically and Abroad 6.1 Key Clauses in Art Sale Contracts An art sale contract typically covers: • the parties and the transaction structure (ie, iden - tity of the seller and buyer and whether the sale is private, through a gallery or by auction); • a clear identification of the art (ie, the artist, title, medium, dimensions, date); and • the purchase price and payment mechanics (ie, deposit, timing, wire instructions, consequences of non-payment). Agreements may also cover condition and inspection procedures, provenance and authenticity documen - tation and the seller’s representations and warran - ties (such as good title and absence of liens). Finally, they may address intellectual property and permitted image use, as well as remedies if either party breaches the agreement. 6.2 Issues in Cross-Border Art Sales When art moves across borders, regulatory compli - ance is important, as misstatements can lead to the detention and seizure of art. US Customs and Border Protection has authority to impose penalties on any merchandise entered – or attempted to be entered – into the United States through materially false
statements, fraudulent documents or material omis - sions, including falsified invoices, altered provenance records or inaccurate entry data. Criminal exposure can also arise where someone knowingly uses false, forged, or fraudulent invoices or documents or oth - erwise imports goods “contrary to law.” A failure to properly declare the merchandise can result in penal - ties and/or forfeiture. In addition, art and antiquities taken unlawfully may be treated as stolen property, making them vulnerable to government seizure under the National Stolen Property Act (18 U.S.C. §§ 2314– 2315) and related laws. Title and provenance risks can compound once the object is abroad. In the United States, the baseline rule is that a buyer generally acquires only the title the seller had; if the seller’s title is void because the work was stolen, the buyer typically cannot improve on it by purchasing in good faith. Other jurisdictions may apply rules, which means an artwork with provenance gaps may become harder to sell, be detained or be claimed and recovered in a forum whose rules are less favourable to the current holder. Finally, logistics and risk allocation are central because many losses occur in transit. Practically, collectors and dealers often reduce exposure by using specialist art shippers (packing/crating, climate controls, secure handling) and by documenting condition before and after shipment (photos/condition reports) so any claim is provable. 6.3 Gallery and Auction House Liability for Fake Art Gallery owners and auction houses can face liability if they sell works that are inauthentic. When a gallery or auction house sells a work on consignment, a con - signment agreement may govern. The consignment agreement may include the consignor’s representa - tions and warranties about authenticity. A purchaser of an inauthentic work may have sev - eral remedies under contract and tort law, including under the Uniform Commercial Code. Under Uniform Commercial Code Section 2-313, a seller’s affirmation of fact, promise, or description regarding authorship or authenticity can create an express warranty if it becomes part of the basis of the bargain. If the work
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