Update on the Dunton Sale and Dealer/Appraiser Conflict of Interest

The following content is from appraiser Peter Eller, who was the appraiser/dealer and defendant involving the two Harold "Buck" Denton paintings. From Peter's statement, and how he explains the case evolved, shows how easily a contact for an appraisal, or even what turned out to be a consultation turned into a larger law suite. In any event, Peter gives some very good insight into what transpired and some of the conflicts he faced throughout the process. From an appraisal perspective, one we all wish to avoid, but in certain instances we dont have much control.

I recommend all appraisers and especially dealer/appraisers to read Peter Eller's statement to the AW Blog.

Peter Eller states

9.09.09 Eller on Hicks v Eller and the $600,000.00 Paintings

From an appraiser’s point of view I take a somewhat different approach, though the prior discussions on separation and clarification of dealer and appraiser functions as well as responsibilities under USPAP are highly appropriate. My situation should be proof that these points should be scrupulously heeded.

However, as my dear grandmother used to say, “If the devil wants it, in the short run it will be so.” Things can go awry despite the best intentions; intelligent, accomplished human beings can fall into a misunderstanding that makes one of them angry, and that can be the basis for a situation like mine, in an area of law known as “civil tort.”

Civil tort is an insidious, sophisticated animal, dangerous to any professional. The point here is that it is the plaintiff and their attorney who get to write the script. Defendant has no choice other than to defend against those particular charges or allegations. That the plaintiff controls the action is attested to in the law books themselves.

I was a member of ISA from 1984, starting out with their fine educational program that summer at Indiana University, until 2002; and I have been a member of AAA since 1997. Since 1986 when I started a gallery I have done my best of clarify and avoid the potential confusion between dealer and appraiser in the mind of the other party. I was successful until April of 2007.

This time I made the same effort, offered the same explanations, the ones I thought professionally and ethically appropriate to the situation as presented to me by the other party. And this time something went awry. It is not my part to lay the ground work for either party’s case here, but most people concede that it takes two parties to bring about confusion. And it takes two to work one out. This did not happen here, and so the allegations of one became the premise for a civil tort action that has cost me a lot of money and that in addition intentionally has set out to ruin my career through protracted management of the media.

It can slip right past you when it happens. You can be working with someone highly accomplished in a career. And you can be dealing with such a person whose very accomplishments have made them successful in security work in the defense industry and who has been used to dealing with others on a “need to know” basis. And so while you think you have made your areas clear, this individual may actually hear differently, and take up the things you say differently and without giving you a clue that a mis- communication is in progress.

For example I explained at the outset, during the first of what up to that time I took to be pro bono meetings, the main choices, respective focus and cost structure of an appraisal for estate purposes, and for insurance. Both were soundly and speedily rejected by the other party.

Scott Sandlin’s first article in the “Albuquerque Journal” is well written, factual and even handed. Her second article on the verdict less so. Though present for four days, Ms Sandlin never asked to speak to me. She had clearly and repeatedly talked to plaintiff’s side. Also Dunton, in a huff, resigned from the Taos Society of Artists in 1922, and so could not have been a member until his death in 1936. This was in fact a claim made by the opposition and their witnesses. Clearly noone consulted the notes of the Taos Society as edited by Robert White.

Together the articles present a synopsis, to which I wish to add the following points. I did ask right after the rejection of any appraisal work whether I would be welcome to make an offer on something I saw. I felt this was appropriate because the objective had initially also been presented to me as an estate sale of articles of which the family now wanted to dispose. I was told, Yes, that I was welcome to do so.

We walked from room to room, discussing various items that stood out or in which the other party showed an interest. The paintings were not hung. They were in a side room full of odds and ends, set on a day bed against the wall, with a chair and other items in the way. I spotted them, said the one signature looked like Dunton, and when asked who he was, said Taos Society of Artists. I told plaintiff then I wold be interested in buying them. We discussed the matter briefly, plaintiff telling me more about her father and his early New Mexico advertising business, and then we moved on.

At the end of that first session, I asked again whether I buy them, and I was told by plaintiff that, No, she wold like to think about it. For the time that ended the matter, though it left me with the impression, erroneous, that as executor and personal representative she would do some work to support any acceptance of an offer. I did come back a second time for discussions on other items, including the recommendation of a book dealer who later bought and a dealer in edged weapons. During this visit the conversation about the paintings then also took place pretty much as reported.

One thing generally neglected however was their condition. They had been put away for some forty years in a crawl space below the house that also contained the furnace and whose windows we later found out were not entirely tight against infiltration and weathering. The deleterious result to works on artist’s board can be imagined. They were desiccated; varnish under the grime was oxidizing; their general aspect was dark or muddy, both figures and background indistinct. All of this was apparent from a distance of about seven or eight feet, though on the first visit I did not pick them up or examine them more closely.

This raises at least two points. Regarding condition, after I had bought them I gave them a light cleaning with Winsor-Newton as refresher, and noticed that the cardboard support was also deteriorating and the canvas pulling away or bubbling in several places. It is also important to understand that along the chain of ownership the paintings then had two restorations on their way to final auction. The first, I am given to understand, was a thorough cleaning, which according to testimony brightened them remarkably, brightened colors considerably and separated figures from their background and made the former stand out and become viable.

The other was a much more radical and invasive make-over starting with removal of the finishing varnish that had just previously been applied and taking the canvases off their old boards and relining and restretching them, along with a final finish of in- and over- paint and new varnish. Thus the paintings that came up in Coeur d’Alene were very different from the ones that I bought. I suggest that they, using new techniques and materials, very different from the paintings submitted by Buck Dunton, and then put away by Mr. Hicks or his family.

The other point concerns price and/or value; inherent in the implication “he should have known.” It is not a point I wish to argue directly. Those familiar with the process of remaking paintings, as well as the philosophical debate between “restoration” and “conservation,” understand only too well that there are several views on how far such treatments should go, and whether it is best only to stabilize the piece and retard inevitable, progressive deterioration, or whether it should with new techniques and materials be presented better than new or at least so bright and glistening in a way that not have been possible or even thought desirable by the artist. And we know that some buyers, and some auctions, simply don’t care either way. Other points can be made, including that the entire chain is made up of dealers and art professionals. None really knew or were able to set a fixed value. And as we now know, judging among others by the prices realized at Heritage/Dallas recently for Dunton, the market has already drastically retreated again. With the economy already tanking, the price realized at Coeur d”Alene was lucky, perhaps irresponsible for the buyer, and the result of an anomalous and short lived counter trend.

Henry James: “We work in the dark, we do what we can,.... The rest is the madness of art.”

Perhaps my greatest disappointment throughout the process was the lack of support from AAA, for my attempts to frustrate the plaintiff’s request to see all of my appraisals. In view of the fact that she had not hired me to do an appraisal I did not think that was in any way appropriate and warranted.

Here is how I put it to my attorney, who had the good sense not to want to antagonize a judge new to the court on this issue, which nevertheless altogether caused me the most amount of personal and professional grief:

“I strongly inveigh against the overweening demand to produce ALL the documents since 1997 that meet the dollar criteria [individual, stipulated art values of $10,000, aggregate art values of $20,000or more]. As you now I have signed releases from seven clients, who were informed that their consent would warrant the possible use of their appraisals in a case of adversarial litigation against me, and have nevertheless agreed that their documents may be so used. These should suffice, . . . without forcing the issue of client confidentiality.

“Finally, I continue to maintain that appraisals, as presentations of separate and unique investigations into a set of value conclusions and the particular context that gives them relevance and probity, are a form of intellectual property, and thereby due some form of protection.

“I hereby state my strict professional responsibility to guard the confidentiality of these reports, and I ask the court they not be turned over to plaintiff or her counsel. She and her attorney have not shown good and proper cause why we should do so, and once released, their security is compromised and the privacy of their content can no longer be guaranteed.

I did not expect the association to defend me. That was my job alone.

However, I had hoped they would back more aggressively my stand that the entire body of my appraisals since 1997 should not come into play because, on this scale and for these reasons, plaintiff had no good and proper cause to force this request. My former appraisals were in no way at issue, nor did they in fact later figure into their case.

Finally, I suggest the matter of classifying and finding recognition for appraisals as a form intellectual property, due the legal protections of such, should be considered for implementation. Until that is done all of our appraisals, and the clients who actually trusted us, are at considerable and at times arbitrary risk.

(Comments to be personally may be addressed to Peter@PeterEllerArt.com)