{"id":4999,"date":"2016-04-04T10:47:50","date_gmt":"2016-04-04T15:47:50","guid":{"rendered":"https:\/\/content.findlaw-admin.com\/ability-law\/smallbusiness\/intellectual-property\/laws-governing-art-consignment.html"},"modified":"2024-05-22T02:59:09","modified_gmt":"2024-05-22T07:59:09","slug":"laws-governing-art-consignment","status":"publish","type":"page","link":"https:\/\/www.findlaw.com\/smallbusiness\/intellectual-property\/laws-governing-art-consignment.html","title":{"rendered":"Laws Governing Art Consignment"},"content":{"rendered":"\n
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Laws Governing Art Consignment<\/h1>\n
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\n By Taylar-Simone McCants, J.D.<\/a> | Legally reviewed by Amber Sheppard, Esq.<\/a>\n | Last updated\n
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The last updated date refers to the last time this article was reviewed by FindLaw or one of our contributing authors<\/a>. We make every effort to keep our articles updated. For information regarding a specific legal issue affecting you, please contact an attorney in your area<\/a>.<\/em><\/p>\n\n <\/div>\n <\/details>\n<\/section>\n

Are you an art business owner? Do you have valuable pieces of fine art you’d like to sell but need to figure out how? Perhaps you are a gallery owner and want to start accepting consignments. Either way, you’ll want to consider and know the laws around art consignment<\/a>.<\/p>\r\n

Art Consignment Overview<\/h2>\r\n

Art consignment<\/a> occurs when an artist (consignor) gives their work to an art dealer or gallery (consignee) to sell for them. In exchange for selling the art, the dealer or gallery receives a commission or percentage of the sale.<\/p>\r\n

When you consign art, you stand to make more money than you would by selling it outright. However, you only make money when your art sells. If it fails to sell, you don’t make any money. Depending on the agreement you have with the art dealer or gallery, you may have to pay them additional fees and incur a loss on your piece. The stronger the market, the better the chances the art will sell and the more viable the consignment becomes.<\/p>\r\n

Keep in mind art consignment comes with a lot of risks. Three types of laws protect consignors: the Uniform Commercial Code<\/a>, state consignment laws, and written art consignment agreements<\/a>.<\/p>\r\n

Uniform Commercial Code<\/h2>\r\n

The Uniform Commercial Code<\/a> (UCC) governs secured transactions of the sale of goods. The UCC is a set of acts that tries to harmonize state laws. The UCC states that if a gallery’s negligence<\/a> damages your artwork, the gallery must pay you for your loss.<\/p>\r\n

A common issue in the art world concerns who is financially responsible if the gallery goes bankrupt<\/a>. The UCC allows the gallery’s creditors<\/a> to seize your consigned goods to pay for the gallery’s debts. The gallery’s secured creditors stand in line to collect before you. If funds are left over after paying creditors, the judge in bankruptcy court<\/a> can award you compensation for your art. If the gallery has a lot of debts or there are too many artists to compensate, you may see little or no compensation for your art.<\/p>\r\n

The UCC protects artists in art consignment if the artists fulfill specific requirements. Artists must:<\/p>\r\n