Museums acquire artworks in a variety of ways, including through gifts and bequests from private collectors.  Though the legal considerations raised by a museum’s accessioning of artwork may vary based on the purpose and nature of the gift, in any case the parties should seek legal counsel and properly document the transaction by a comprehensive written agreement.

A 2011 case involving the sale of a Peter Doig painting illustrates the problems that can arise when an oral pledge is not properly memorialized by a written contract.  In that case, the Michael Werner Gallery had sold Peter Doig’s 2004 painting “Red Boat (Imaginary Boys)” to a private collector based on “the explicit agreement that the work is to be given as an eventual gift to the Carnegie Museum of Art.”  Other than a short one-page invoice, there was no other contract or written agreement in place documenting the terms of the gift.  In 2011, after the gallery learned that the collector had consigned the work to Christie’s for auction, the gallery sued the collector and Christie’s attempting to enjoin the sale.  In their defense, Christie’s and the collector argued, among other things, that the purported agreement was unenforceable for a number of reasons, including under the ancient doctrine of the rule against perpetuities, which prohibits remote vesting and requires generally for gifts to be made by a date certain.  The court did not have the occasion to resolve these issues, however, as the case was ultimately resolved prior to the preliminary-injunction hearing through a confidential settlement.

But problems can arise even where a thorough written agreement is in place, as highlighted by the recent complaint filed by Henry Kravis, co-chairman of the global investment firm, KKR & Co., against well-known art collector Donald L. Bryant, Jr. regarding the parties’ joint ownership of a trio of Jasper Johns works.  In 2008, Kravis and Bryant jointly purchased three Jasper Johns masterpieces—“Tantric Detail I,” “Tantric Detail II,” and “Tantric Detail III”—and agreed in writing that they would eventually transfer their respective interests in the works to the Museum of Modern Art, either as a gift during their lifetime or via a posthumous bequest.  Until such time as the gifts were made, the contract provided, the paintings would spend equal time in the parties’ respective residences, alternating on an annual basis.

For several years, the arrangement apparently operated as intended, with the works being shuttled at the end of each year from one home to the other.  Last month, however, Kravis claims that he learned (from his art-delivery service) that Mr. Bryant had canceled the scheduled delivery of the works and then demanded that the parties execute a new agreement, in the meantime holding the paintings “hostage.”  The proposed new agreement, however, deleted the provision concerning the parties’ pledge to gift the works to the MoMA, so Kravis sued, among other reasons, to enforce the pledge.

This recent legal battle may turn out to be much to do about nothing, as the New York Times has reported that Bryant denies the allegations in the complaint and claims that he still plans to donate his half-interest in the paintings to the MoMA, as provided in the parties’ original contract.  But at the very least, this case, like the Doig matter before it, highlights the contractual considerations involved in donating artwork to museums, and the need for parties to seek legal counsel whenever a gift of artwork is made.