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Attention Arts Organizations and Individual Artists      7.15.05

Consider including State Consignment articles in your newsletters and web sites  

Subject:  ARIZONA STATE CONSIGNMENT LAWS* for artists and craftspeople

ARIZONA STATE CONSIGNMENT ARTICLES * Ideally Artists and Galleries work well together to promote the arts, business, and artists.   Most galleries are sincerely interested in making a profit and promoting artists in a true win/win fashion. Most interactions work well for the benefit of both. ALTHOUGH The Arizona Consignment Articles:  require galleries to pay to the artist within 30 days after the sale of their work, holds galleries "STRICTLY LIABLE" for the art while in their possession and requires written contracts between artists and galleries adequately protects artists, these State Consignment Articles aren't well known or easily enforced. 

Since 1987 I've taught ďThatís Art Biz, a business workshop for visual artists.Ē Over the years students and other artists shared sad, bad stories about galleries who are either ignorant of the Arizona State Consignment laws or choose to disregard them. Artists report late or non-payment, damage, misuse, works displayed without identification and no contracts. Since 2003 the amount of artists calling me to discuss non-payment or late payment has sky rocketed. Since 2003 I personally have experienced galleries not paying on time or refusing to pay for missing or broken items, totaling over a fifth of my yearly income. I began searching for better gallery representation, but MOST galleries offered contracts that claim NO RESPONSIBILITY FOR LOSS OR DAMAGE, required exclusives but wouldn't put their promotional promises in writing or refused to use contracts at all. Whatís an artist to do?  Each of us canít afford the time, expense and misery of going to court for each and every infraction and many of us can no longer make a living accepting these business losses.  I've invested thirty years, my entire adult life, developing my art, living frugally, working hard long hours, continually minimizing the material quality of my life, making personal sacrifices and hoping--as my art improved, I developed good business procedures and found good ethical gallery representation--I'd have a little financial security and earn higher than the federal poverty standard. The current norm in gallery ethics destroys that hope, making a joke of my careful frugal life.  I can't find ethical gallery representation to maintain my previous minimalist livelihood.  Iím saddened when I hear another creative person say they gave up their art career because they couldnít make a living.  

ALL artists and gallery owners must be aware of the attached consignment laws!  For years I've brought these issues to artists' and art organizations' attention.  I've written letters, made phone calls and spoken to numerous art groups, educating artists and making them aware of their rights. Many galleries seem unaware of their legal obligations. When more artists demand fair treatment, citing the consignment laws, more outlets taking our work on consignment will treat us fairly.  Each individual artist faces losing gallery representation when requesting fair treatment under the law, without these consignment laws being common knowledge.  Although my efforts teaching "That's Art Biz'" have educated artists on a limited scale, I don't have the time OR resources to launch an extensive comprehensive STATEWIDE notification of artists and galleries.  If art organizations make the state consignment articles public knowledge for all ARIZONA artists and galleries, artists can go back to work in our studios doing what we do best. Please publish these articles in your newsletter and web site.

Major concerns
Some galleries donít pay within 30 days of a sale, sometimes not for months. Artists are not notified of sales so sold works can be replaced. (Without replacing sold art with new art, artists miss sales)
Art is displayed without price information or labels, thus limiting sales
Galleries refuse to accept responsibility for lost or damaged works.
Galleries use contracts that disregard state consignment articles.
Galleries refuse to use contracts or put promotional promises in writing.

If you are currently making art but donít require an income as an artist, PLEASE stand up for your rights, knowing your acts of solidarity protect other artists.  Thanks for your support. 
JOY L. HOLDREAD,  Instructor  ďThatís Art Biz, a business workshop for artistsĒ

  Joy L. Holdread Clay Objects Studio 2627 N. Geronimo Ave. Tucson, AZ 85705-4724
(520) 628-8180 E-mail mudnjoy@aol.com    Holdread instructs Ē Thatís Art BizĒ.


* AZ State Revised Statutes Title 44 Trade and Commerce

ARTICLE 12. CONSIGNMENTS OF WORKS OF FINE ART   

Current to the best of my knowledge but not inclusive.  Additional laws affect artists.
 
ARIZONA  ARTICLE 12.CONSIGNMENTS OF WORKS OF FINE ART Title 44 Trade and Commerce
Article 12, consisting of  44-1771 to 44-1778, was added by Laws 1983, Ch. 144, % 2, effective April 19th, 1983.Another article 12, consisting of 44-1771 to 44-1776, added by Laws 1983, Ch. 181,  1, effective July 1983, was renumbered as Article 13,  44-1791 to 44-1796.

 Laws 1983, Ch. 144, % 3 provides:
A. This act applies to a work of fine art accepted on consignment from and after the effective date of this act except as provided by subsection B.
B. If a work of art is accepted under a contract in existence prior to the effective date of this act, this act applies to the work of fine art, proceeds of sale and art dealer only to the extent it does not conflict with the contract. 

44-1771.  Definitions In this article, unless the context otherwise requires:

1.  "Art dealer" means a person engaged in the business of selling works of fine art, other than a person exclusively engaged in the business of selling goods at public auction.

2.  "Artist" means the creator of a work of fine art.

3.  "On consignment" means delivered to an art dealer for the purpose of sale or exhibition, or both, to the public by the art dealer other than at a public auction.

4.  "Work of fine art" means an original or multiple original artworks which is:

(a) A visual rendition, including a painting, drawing, sculpture, mosaic or photograph.

(b) A work of calligraphy.

(c) A work of graphic art, including an etching, lithograph, offset print or silkscreen.

(d) A craft work in material, including clay, textile, fiber, wood, metal, plastic or glass.

(e) A work in mixed media, including a collage or a work consisting of any combination of subdivisions a-d.

 

44-1772.  Art dealer and artists: relationship If an art dealer accepts a work of fine art, on a fee, commission or other compensation basis, on consignment from the artist who created the work of fine art:

1.  The art dealer is, with respect to that work of fine art, the agent of the artist.

2.  The work of fine art is trust property and the art dealer is trustee for the benefit of the artist until the work of fine art is sold to a bona fide third party or returned to the artist.

3.  The proceeds of the sale of the work of fine art are trust property and the art dealer is trustee for the benefit of the artist until the amount due the artist from the sale is paid.

4.  The art dealer is strictly liable for the loss of or damage to the work of fine art, while it is in the art dealer's possession.  The value of the work of fine art is, for the purpose of this section, the value established in a written agreement between the artist and art dealer prior to the loss of damage or, if no written agreement regarding the value of the work of fine art exists, the fair market value of the work of fine art.

 44-1773.  Purchase or resale of consigned fine art by art dealer
A.  If a work of fine art is trust property under % 44-1772 when initially received by the art dealer it remains trust property notwithstanding the subsequent purchase of the work of fine art by the art dealer directly or indirectly for the art dealer's own account until the purchase price is paid in full to the artist.
B.  If the art dealer resells a work of fine art to which subsection A of this section applies to a bona fide third party before the artist has been paid in full, the work of fine art ceases to be trust property and the proceeds of the resale are trust funds in the hands of the art dealer for the benefit of the artist to the extent necessary to pay any balance still due to the artist.  The trusteeship of the proceeds continue until the fiduciary obligation of the art dealer with respect to the transaction is discharged in full.
 

 44-1774.  Trust property exempt from claims of art dealer's creditors  Notwithstanding title 47, no property, which is trust property under % 44-1772 and % 44-1773, is subject to the claims, liens, or security interests of the creditors of the art dealer.

 

44-1775.  Art dealer required to obtain written contract
A.  An art dealer may accept a work of fine art, on a fee, commission or other compensation basis, on consignment from the artist who created the work fine art only if prior to or at the time of acceptance the art dealer enters into a written contract with the artist establishing:

1.  The value of the work of fine art.

2.  The time within which the proceeds of the sale are to be paid to the artist, if the work of fine art is sold.

3.  The minimum price for the sale of the work of fine art.

B.  If an art dealer violates this section a court may, at the request of the artist, void the obligation of the artist to that art dealer or to a person to whom the obligation is transferred, other than a holder in due course.

 

44-1776.  Art dealer; duties An art dealer who accepts a work of fine art, on a fee, commission or other compensation basis, on consignment from the artist who created the work of fine art may use or display the work of fine art or a photograph of the work of fine art only if:

1.  Notice is given to users or viewers that the work of fine art is the work of the artist.

2.  The artistís gives prior written consent to the particular use or display.

B. An art dealer who sells a work of fine art which is on consignment for the purpose of sale shall transmit all moneys due to the artist on a monthly basis.

 

44-1777. Waver Voided Any portion of an agreement, which waives any provision of this article, is void.

 

44-1778.  Civil Penalty

A.  Any art dealer who violates % 44-1775 or 44-1776 (contract & display) is liable to the artist in an amount equal to:

1.  Five hundred dollars ($500).

2.  The actual damages, if any, including the incidental and consequential damages, sustained by the artist by reason of the violation and reasonable attorney fees.
B.  An art dealer who violates section 44-1776, subsection B (payment within 30 days) is liable to the artist in an amount equal to the three times the amount due the artist.

Current to the best of my knowledge  AZ State Revised Statutes 

ARTICLE 2.1.   FRAUDULENT PRACTICES IN THE SALE OF INDIAN ARTS AND CRAFTS

44-1231. Definitions  In this article, unless the context otherwise requires:

1.  "Authentic Indian arts and crafts" means any product, which is Indian, hand-crafted and is not made by machine or from unnatural materials, except stabilized or treated turquoise.

2.  "Findings" means an ingredient part of the product which adapts the product for wearing or display, including silver beads, leather backing, binding material, bolo tie clips, tie bar clips, tie tack pins, earring pins, earring clips, earring screw backs, cuff link toggles, money clips, pin stems, combs or chains.

3.  "Imitation turquoise" means any compound of mineral, which is manufactured or treated so as to closely approximate turquoise in appearance.

4.  "Indian" means a person who is enrolled or who is a lineal descendant of one enrolled upon an enrollment listing of the Bureau of Indian Affairs, or upon the enrollment listing of a recognized Indian tribe domiciled within the United States border.

5.  "Indian hand-crafted" means the skillful and expert use of the hands in making products solely by Indians within the United States, including the use of findings, hand tools and equipment for buffing, polishing, grinding, drilling or sewing.

6.  "Made by machine" means the producing or reproducing of a product in mass production by mechanically stamping, casting, blanking or weaving.

7.  "Natural turquoise" means turquoise, exclusive of any backing material, whose composition has not been chemically or otherwise altered.

8.  "Nonauthentic Indian arts and crafts" means any product which is made to imitate or resemble authentic Indian arts and crafts and which is either:

(a) Not Indian handcrafted.

(b) Made by machine or from unnatural materials, except stabilized or treated turquoise.

9.  "Reconstituted turquoise" means dust and turquoise particles, which are mixed with plastic resins and are compressed into a solid form so as to resemble natural turquoise.

10.  "Stabilized turquoise" means turquoise, which has been chemically hardened, but not adulterated so as to change the color of the natural mineral.

11.  "Treated turquoise" means turquoise, which has been altered to produce a change in coloration of the natural mineral.

12.  "Turquoise" means a hydrous copper sulfate; containing aluminum salts, plus iron.

13.  "Unnatural turquoise" means any substance, which is not natural turquoise, including stabilized turquoise, treated turquoise, reconstituted turquoise or imitation turquoise.

 ARTICLE 2.1.   FRAUDULENT PRACTICES IN THE SALE OF INDIAN ARTS AND CRAFTS

 44-1231.01.  Unlawful Acts  It is unlawful for any person to knowingly do any of the following:
1.  Sell or offer for sale any products represented to be authentic Indian arts and crafts unless the products are in fact authentic Indian arts and crafts.
2.  Sell of offer for sale any authentic Indian arts and crafts represented to be of silver or nonauthentic Indian arts and crafts represented to be of silver unless the product are made of coin silver or sterling silver.
3.  Sell or offer for sale nonauthentic Indian arts and crafts unless the nonauthentic Indian arts and crafts are clearly labeled as to any characteristics, which make then nonauthentic.
4.  Sell or offer for sale any unnatural turquoise, mounted or unmounted, without a written disclosure of whether the turquoise is stabilized, treated, reconstituted or imitation.
5.  Sell or offer to sell reconstituted turquoise or imitation turquoise unless the turquoise is clearly labeled as  imitation turquoise.
44-1231.02.  Sale of nonauthentic Indian arts and crafts
A person who sells or offers to sell nonauthentic Indian arts and crafts shall post a sign bearing the words, in letters not less than three inches in height, "nonauthentic Indian arts and crafts" above or adjacent to the articles being sold.
44-1231.03.  Enforcement; civil penalty; injunctive relief; private right of action; damages
A.  In addition to the criminal penalties provided in this article, the attorney general or the county attorney shall enforce the provisions of this article.  In a civil action brought by the attorney general or the count attorney for a violation of this article, the court may order temporary or permanent injunctive relief.  In such an action the court may order restitution to the injured party, civil penalties of not to exceed five thousand dollars for each violation of this article and such other relief the court determines is appropriate.  Civil penalties collected pursuant to this section shall be deposited in the state general fund if the action is brought by the county attorney.
B.  Unless restitution is ordered in an action brought under subsection A, a person who suffers financial injury or damages by reason of any conduct which in violation of this article may sue in the superior court and recover actual damages sustained and the cost of the suite, including reasonable attorney fees.
44-1231.04.  Violations; classification
A person who violates the provisions of this article is guilty of a class 3 misdemeanor.  A person who commits a second violation of the provisions of this article is guilty of a class 2 misdemeanor.  A person who commits a third violation of the provisions of this article is guilty of a class 1 misdemeanor.