Florida’s Chapter 686: The Fine Print That Can Rewrite Your Art Deals

If you are an art dealer or an art lawyer representing art dealers in Florida, it is imperative you have working knowledge of Chapter 686, particularly Section 686.501-506, which may contradict your typical understanding of express and implied warranties under Article 2 of the UCC. A few highlights:

686.502: When an art dealer receives artwork from a consignor for sale or exhibition, the dealer acts as the consignor’s agent, must notify the public that the artwork is on consignment, hold the sale proceeds in trust for the consignor, and any contract clause waiving these rights is invalid.

686.503: When consignee accepts artwork for sale or exhibition, a written contract must be made between the consignor and consignee, ensuring the consignor receives sale proceeds as agreed, the dealer is liable for any loss or damage, the artwork is sold at the agreed-upon reserve price, used only with the consignor’s consent and the artist’s acknowledgment of such use or display, and the artist’s share of the proceeds may take priority over the dealer’s creditors “notwithstanding any provisions of the Uniform Commercial Code.”

686.504: Significantly limits an art dealers’ ability to limit warranties going to a work of art’s authenticity and/or authorship. For instance, when an art dealer sells or exchanges a work of art and provides a written description identifying its authorship, this description creates an express warranty of authenticity.

686.505: Words creating an express warranty of a work of art’s authenticity and words negating or limiting this warranty must be reasonably consistent; any negation or limitation is invalid if it is unreasonable, inconspicuous, or if the artwork is counterfeit or falsely described.

686.506(3): ” An art dealer whose warranty of authenticity of authorship was made in good faith shall not be liable for damages beyond the return of the purchase price which he or she received, together with any attorney’s fees and costs incurred by reason of the art dealer’s refusal to comply with ss. 686.501-686.506.”