Erroneous attribution of a work of art and contract annulment due to defects in consent
False or erroneous attribution of a work of art can manifest in various ways, such as when the seller declares that the authorship of a work belongs to a well-known artist, but it later turns out to be false. Alternatively, it can happen when the buyer recognizes the value of the work, attributed to a much more famous artist than initially presented by the seller, after the sale. These situations carry legal implications, especially if they affect the value of the artwork. In such cases, buyers and sellers may explore legal recourse, initiating legal actions for fraud, misrepresentation, or breach of contract.
In the scenario where the buyer recognizes that the value of the artwork is significantly higher than the initially presented artist, there might be grounds for potential legal action, including the possibility of seeking to annul the contract or claim damages due to error. However, whether the contract can be annulled would depend on various factors and the applicable laws in the specific jurisdiction.
Understanding the specific laws applicable to the case is crucial in assessing the options available to the buyer. The annulment of a contract of a work of art can be subject to different considerations in civil law and common law jurisdictions, in fact, each legal system has distinct principles and approaches, which influence how errors in art attribution are addressed.
In civil law jurisdictions, such as Italy and Germany, the treatment of errors in contracts, including those related to art attribution, is often guided by principles rooted in the civil code. Article 1427 c.c. affirms that “errors, when combined with fraud or violence, can serve as grounds for the annulment of a contract due to defects in consent”. However, for an error to be a valid ground for annulment, it must be both essential and recognizable by the other party.
The concept of an “essential mistake” can be found in article 1429 c.c.: occurs when a contracting party has entered into a contract because of a fundamental misunderstanding about the nature of the contract or the essential qualities of the subject matter. So, it can be assumed that If the erroneous attribution is fundamental to the contract and the other party could have reasonably detected it, it might provide grounds for annulment.
The “Recognizable errors” are crucial, as they can be detected by a person of ordinary diligence in relation to the contract's content, circumstances, or the parties' qualities. The seriousness of the mistake and its impact on the agreement can influence whether the contract can be annulled or revoked.
In common law jurisdictions, such as UK, the annulment of a contract typically requires specific conditions to be met. The mistake must be on a “basic assumption” and must be “bilateral” (which occurs when both parties to a contract share a common misunderstanding about a material fact that is essential to the agreement, such as the authorship of the artwork). It’s important to consider that in the art market, one can never be completely sure of the authorship of art pieces, therefore, there is always a question of assumption of risk by the buyer. If the buyer is aware of the risks associated with art attributions, it could affect the possibility of annulment.
Let's delve deeper into this concept, examining it more specifically through the lens of a notable case law: “Edison Giudice, Giancarlo, Pietro e Maurizio Bartolomei Corsi vs. Ministry of Cultural and Environment Heritage, Civil Court of Cassation, 2 February 1998, n. 985”
This case illustrates the significance of essential and recognizable errors in contract annulment. The plaintiffs sued the Ministry of Cultural Heritage and Environment to seek the annulment, based on an essential and recognizable error, of a sales contract concluded in the early months of 1977. The legal dispute arises from the sale of two statues - one made of wood and the other of terracotta - which were mistakenly believed by the parties to be the work of the Masters of the Cappella Pellegrini from the 15th century. The plaintiffs discovered after signing the contract that the statues, sold at a specific price, were the work of the sculptor "Jacopo della Quercia" and, as a result of this revelation, had a significantly higher economic value than the contract price.
Article 1428 cc is pivotal in this context, stating that "The error is cause for cancellation of the contract when it is essential and is recognizable by the other contractor". On the basis of the essential and recognizable nature of the error required by the law, the lower courts denied the existence of the error thus not annulling the contract. In its decision, the Court of Appeal articulated specific grounds for its ruling. Firstly, it pointed out that the attribution of the work to Jacopo Della Quercia had already been hypothesized prior to the conclusion of the contract, it was however impossible to consider the authorship’s certain evidence acquired by the actors. Secondly, the court attributed any potential ignorance regarding the authorship of the work to a fault on the part of the sellers themselves. This perspective implies a lack of diligence on the part of the sellers in confirming the authenticity of the artworks, contributing to the overall assessment of the situation. Lastly, the Court of Appeal emphasized that it deemed it unnecessary to analyze whether or not the error was recognizable, and it justified this stance by highlighting that the actors failed to provide evidence substantiating the existence and relevance of the error. This omission influenced the court's decision-making process, underscoring the importance of evidentiary support in legal proceedings.
Despite that, the Court of Cassation reversed this decision, allowing the possibility of annulling the contract.
The Court noted, in particular, that "the essential error of one of the parties involved in the contract acts as the cause for its annulment, provided that it bears the characteristic of recognizability by the other contracting party, with the irrelevance, for the purposes considered, of the requirement of its excuse." This stand in line with the best doctrine, according to which "the current legal system has not attributed relevance to the possible negligence of the party that has fallen into error, that is, the excuseability or non-excuseability of the error. The justification for the legislative choice lies in the need not to create unnecessary obstacles in the market, where negotiations are often closely interdependent. Therefore, recognizable error is a cause for the annulment of the contract even if it is inexcusable.”
This can be explained by the fact that regardless of its excusability, a recognisable error is still inadequate to elicit the reliance of the other party regarding the seriousness and awareness of the contractual declaration.
Authors:
Francesca Simonetti,
Federica Maria Congedo,
Alessia di Giorgio,
Sara D’Amico.
