Artistate Q & A

Relationship with Galleries

Galleries are the most common business partner of artists, and as a result, their most frequent co-contractor. The relationships between artists and galleries vary greatly in kind, duration and geography. Each type of relationship, whether formed orally or in writing, is accompanied by its own framework of rights and obligations.

1. How can I differentiate between the types of possible relationships with a gallery?

The simplest way to identify the type of relationship between an artist and a gallery is to identify its purpose.

If the purpose of the relationship is to sell one or more work(s) to a gallery on a one-off basis, regardless of whether the gallery subsequently re-sells the work(s), the purpose of the relationship is a sale. In this scenario, the one-off transaction should be recorded in a contract of sale or a sale and purchase agreement.

If the purpose of the relationship is to allow a gallery to hold and potentially exhibit one or more work(s) for dealing purposes (i.e. to pursue sales to third-party buyers), the work(s) can be held by the gallery in one of two manners. The work is either held on a ‘sale or return’ basis, in which case the gallery is likely to become the buyer of the work, but will only purchase the work once it has found a third-party buyer or will else return the work to the artist. Alternatively, the work is held by the gallery on a consignment basis, in which case the artist remains the owner of the work until it is sold to a third-party buyer by the gallery on behalf of the artist. The relationship should be recorded either in a sale or return agreement, or a consignment agreement.
If the purpose of the relationship is for the gallery to become a representative of the artist by promoting and selling the artist’s work, and increasing their institutional and market presence, the gallery will act as agent for the artist and the relationship will be an agency relationship recorded in an agency or representation agreement. The representation may be limited in scope to a country, region, or time period, allowing the artist to deal with other galleries simultaneously. Alternatively, the relationship may be one of exclusive representation, which will restrict the artist’s freedom to deal with other galleries. In both cases the gallery gains several prerogatives allowing it to exercise some discretionary powers in the interest of the artist which are accompanied by fiduciary duties. Generally, a representation agreement is accompanied by one or a series of consignment agreements.

2. Will I always need a written contract in order to conduct business with a gallery?

Informal oral contracts between galleries and artists are common although in practice, it is often possible to infer the terms of the contract from emails, letters and other records passing between artist and gallery over time. Some artists and galleries insist that their relationship is recorded in a written contract, either at the outset of, or during the relationship.

The relationship between a gallery and an artist can evolve gradually. For example, an artist may begin by consigning only a handful of works to a gallery for sale, and the gallery only later becomes the artist’s representative. In this context, the relationship between the artist and the gallery changes from one of a simple consignment of art for sale to one which significantly increases the gallery’s prerogatives and duties. It is important that artists pro-actively monitor these changes and the agreements which reflect them so that their bargaining power and interests are protected while their success grows.

3. What are the risks if I do not reflect my relationship with a gallery in writing?

In the absence of a written agreement, the terms of the agreement between the gallery and the artist will be deduced based on their oral or written communications. The risk in this situation is that such communications may be difficult to prove, and that the communications will only deal with the basic terms of the agreement. Without a written agreement, parties may omit to address ancillary terms. As a result, artworks may be sold at the wrong retail price, the gallery’s commission may not match the artist’s expectations, the artist may be charged for unforeseen costs incurred by the gallery for storage, insurance or transport, and disputes may arise if artworks are damaged or destroyed, or if unforeseen external circumstances put the gallery in a challenging financial position. In the absence of a written contract, neither party will be readily able to ascertain their rights or obligations in relation to these situations.

By Mona Yapova, Constantine Cannon LLP

The law varies from country to country. In this section of the website, we describe the law as it applies in England and Wales. Whilst similar principles apply in other European countries, and to a lesser extent, in the USA, please do not assume that the law is the same. For example, artists have stronger moral rights in countries applying the Napoleonic codes than in England and Wales. The information provided on this page is general and may not apply in a specific situation. In doubt, please seek legal advice. This information is not intended to create, nor does receipt of it constitute, a lawyer-client relationship. The authors accept no responsibility for the content of this page.

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