Buyers beware! …You may owe re-sale right royalties.
November 2018 is most certainly a good month for the auction house Christie’s. Last week, Christie’s recorded the highest sale for an artwork created by a living artist. ‘ Portrait of An Artist (Pool with Two Figures) ’ by David Hockney, sold for 90.3 million dollars, beating Jeff Koons’ ‘Balloon Dog’ (58.4 million dollars). Two weeks before the record sale, the auction house won a tortuous legal battle over which party has the burden of the re-sale right royalty, ruling in favour of the seller (Christie’s) and thereby overturning the position in place since 1920. At stake was the [rather fundamental] question: ‘who owes the re-sale right royalty: seller or buyer?’. This point of law had been agitating the French jurisprudence since 2012, despite a ruling of the CJEU in 2015, against which the French appeal judges subsequently resisted. The French Supreme Court (Cour de Cassation) put an end to all suspense and resistance, stating it was perfectly legal for a contract to stipulate...