An African mask that was sold for 150 euros fetched 4.2 million euros at an auction. Were the French sellers able to undo the sale? How would this case have ended in the Netherlands?
When an elderly French couple discovered that an African mask, which they had sold to a secondhand store for 150 euros, had fetched 4.2 million euros at auction, they felt cheated. They therefore asked the buyer to pay them this amount. The latter then offered to pay 300,000 euros, the lower limit of the auction’s target price, i.e. the mask’s appraised value. The couple did not agree to this and went to court requesting that the contract of sale be annulled on grounds of error. They did not want the mask back, but the money paid at the auction, including auction costs, a sum of 5.25 million euros.
The court in Alès rejected the application for annulment. Then, the sellers went to the court of appeal in Nîmes. This court has not yet rendered a final ruling, but it is already ruling that the request is sufficiently plausible to allow a prejudgment attachment of 3.1 million euros. How did the court reach this verdict?
It is clear to the court of appeal that the sellers erred in the sale, as they believed it was a traditional mask like many offered for sale at markets. However, it turned out to be an extremely rare 19th-century mask that had been used for purification rites of a secret African society. The sellers’ error thus concerned not only the value but also the essential characteristics of the mask sold. And the latter is necessary for there to be an error that can be a ground for voiding a contract. However, the attachment was limited to the amount that the dealer had received from the auction house, namely more than 3.1 million euros.
The judgment concerns the question of whether attachment may be granted. For that, the bar is lower than for the granting of the claim itself. For the claim to be allowed, it is necessary that the error should not be the seller’s responsibility. And that was the case, according to the court of appeal. The dealer allegedly misled the sellers by concealing information about the mask. He knew at the time of purchase that the mask was probably worth much more than the price he had paid, even though, by his own admission, he was not an expert.
To begin with, the dealer knew that the mask had been brought from Africa in the early 20th century. Secondly, he had not just put the mask up for sale, but first did extensive research on it. After two low valuations from well-known auction houses, he had requested another, third valuation from an auction house specializing in African art. Moreover, he had had two laboratory tests done to determine the age of the mask and had engaged an ethnologist to learn more about its function and origin.
Although it was not expressly stated in the judgment, it appears that the dealer had set up a scheme in cooperation with the couple’s gardener. The gardener had put the two parties in touch and informed the dealer of the family history. This revealed that the mask had been brought from Africa by the grandfather of the couple’s husband when he was a governor in Gabon. Thus, it had not been acquired through a market for tourists. Moreover, according to the dealer, the gardener was co-owner of the mask and had received a portion of the proceeds from the auction.
Would the case also have ended like that in the Netherlands? That remains to be seen, even though Dutch law is largely derived from French law. A contract can be annulled in the Netherlands for error if:
An error cannot lead to annulment if it is for the erring party’s account or if the error concerns a future circumstance.
In the Netherlands, the main rule is that if the seller errs about the characteristics of the sold property, this is for their own account. Unless one of the first two points applies. This is laid down in a Supreme Court ruling from 1959.
This case bears many similarities to the French case. It also involved an object that after examination by the buyer turned out to be worth much more than assumed at the time of the sale. It concerned a damaged silver drinking cup that had come to the surface during the dredging of the Meuse River near Stevensweert. One of the owners contacted the Gold and Silver Museum in Utrecht to learn more about the cup. The museum’s curator Van Baaren reported that the cup had little value beyond the value of the silver. However, an acquaintance of his, the goldsmith Leo Brom, was interested in the cup and bought it for 125 guilders.
Within 10 days of the purchase, Brom discovered a Greek and a Latin inscription on the base of the cup and immediately had research done on the cup by Professor of Archaeology Vollgraff. According to Vollgraff, the cup is Greco-Roman and concerns a so-called kantharos from around the beginning of the calendar. Thus the value of the cup is many times higher than its selling price. As Brom publishes the find in the Mededelingen van de Koninklijke Academie van Wetenschappen (Communications of the Royal Netherlands Academy of Arts and Sciences), which is reproduced in a Limburg newspaper, the sellers also become aware of it.
The sellers claim in court that the purchase agreement should be annulled on the grounds of fraud or mistake. They argue that Brom must have known before the purchase that the cup was worth much more, because he had had the cup under his care for four months. Also, Brom had already contacted Vollgraff very shortly after the purchase. The sellers were vindicated by the court, which ruled that there was a seller’s error and that this error was caused by the communication of the curator Van Baaren, who negotiated on Brom’s behalf. Fraud, the court finds, was not proven.
Brom disagrees with this ruling and appeals. With success. The court of appeal finds Van Baaren’s statements are consistent with the sellers knowledge, namely that the cup was damaged and of silver. It cannot be proven that Van Baaren or Brom had already known before the purchase that the cup was Greco-Roman.
At this, the sellers appeal in cassation. However, the Supreme Court upheld the court’s judgment. Error by the seller about essential characteristics of the item sold is not sufficient to nullify the contract. After all, whoever sells something thereby waives the chance that the object will later possess other characteristics that make it more valuable. This is especially true if those characteristics come to light through the buyer’s investigation, as in this case. However, the purchase can be voided if the buyer already knew during the purchase that the purchased item had other properties and should have reported this to the seller. However, this was not proven.
In principle, therefore, the seller is responsible for the seller’s error, unless the seller can prove that the buyer has misled or deceived them. This is often difficult to prove, as the case of the kantharos shows.
Although not explicitly stated in the law, error must concern the characteristics of the item sold and not just its value. This was reaffirmed in a ruling by the Amsterdam Court of Appeal from 2013.
A private individual offered two paintings, including one by Adrianus Eversen, to an art dealer for 4,000 euros. The dealer bought the paintings, had the Eversen restored and framed, and eventually offered it for sale for 50-70,000 euros. In this case, too, the seller felt cheated and went to court. An expert valued the painting in its grimy condition at 22,500 euros. The district court found that the dealer should have disclosed that the painting was worth 10 times the price for which it was offered and nullified the sales agreement. In addition, the dealer had to pay 20,000 euros in damages, the difference between the actual value of the painting and the price the dealer had paid.
The dealer appealed and was vindicated. According to the court of appeal, both parties agreed that it was an authentic painting by Adrianus Eversen. Thus, the error did not concern the intrinsic characteristics of the purchased object, but only the price. The buyer had only accepted the price set by the seller himself. Communications from the art dealer had had no influence on this. The fact that the price was too low was therefore the responsibility of the seller, who had not investigated the value of the painting beforehand.
Finally, the court ruled that the difference between the price paid and the value was not so significant that the dealer, as a professional party, was obliged to report it. This last consideration raises the question of when there is an obligation for the dealer to disclose the price, since the painting turned out to be worth 10 times as much.
Due to the increasing protection of consumers, there now seems to be more room for successful reliance on seller’s error when it comes to a consumer-seller and professional buyer. Thus, it seems defensible that under the duty of care, a professional buyer must conduct a thorough investigation even before purchasing a work of art and inform the consumer of the results of this investigation. This is certainly true in the case where the consumer has requested an appraisal prior to a possible sale. Even if the appraisal was not requested by the seller himself.
This can be seen from a recent case. The seller offered the painting “De hooiers” by Jan Altink for sale on an auction website with a minimum price of 30,000 euros. A potential buyer of the painting contacted an art dealer for an urgent valuation and was told by phone a few days later that an Altink would be worth a maximum of 15,000 euros. At this call, the seller was also present. Between the request and the conversation, however, the art dealer had already offered 27,000 euros anonymously himself. As this ultimately turned out to be the highest bid and was above the appraised value, the seller decided to accept this anonymous bid. The art dealer then offered it for sale itself for 80,000 euros.
When the seller found out that the art dealer had bought the painting and that it was worth much more, he went to court to have the sale set aside for error. With this he was successful in both the district court and the court of appeals. There was indeed an error and it was due to communications from the buyer, even though the art dealer had not made these communications directly to the seller. Without the undervaluation, the bid would never have been accepted. Moreover, there was deliberate deception by the buyer. Indeed, the art dealer reported being very knowledgeable about the recent prices for Altink’s paintings, since they had been the buyer in most cases.
All in all, it seems that despite the high requirements for seller’s error, the case in the Netherlands would probably end more or less the same way as in France. If the seller can prove deception, a claim for error can be successfully made and the sale annulled.
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