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Hear Ye: The Case of the Suspicious Art Deal

Editor’s Note: Hear Ye! Hear Ye! explores a real court case. Read about it below and decide how you would rule. Then read the actual verdict and let us know if you agree.

In 1981, Lorette Jolles Shefner bought an unusual painting for $68,000 from a Paris gallery. The painting, Pièce de Boeuf (or Piece of Beef), depicts a sinuous beef carcass. It is one of a series of 10 painted by the expressionist artist Chaim Soutine in 1923. The paintings in the iconic beef series are among Soutine’s most recognizable and sought-after works.

Lorette and her husband, Daniel, shipped the Soutine to their home in Montreal and hung it in their living room. In 1986, they learned that two of the world’s foremost Soutine experts were creating a comprehensive catalog of the artist’s work that would include photographs of each piece, their size and condition and information on who has owned them. Such a record, called a catalogue raisonné, is the primary source for authenticating any artist’s work.

The Shefners sent the experts, Maurice Tuchman and Esti Dunow, a color transparency of their Soutine and papers documenting its provenance. Tuchman and Dunow included the painting in the catalog.

A painting in demand

After Daniel Shefner died that summer, Tuchman and Dunow continued to develop their relationship with Lorette Shefner, who enjoyed their attention. When the catalog was finished, Tuchman and Dunow presented a signed copy to Lorette and her daughter Ariela Braun.

In March 2004, Tuchman and Dunow sent a letter to Ariela, who along with her brother was helping her aging mother with business affairs. Tuchman and Dunow said a prospective buyer was offering $800,000 for the Soutine and they were acting on his behalf. The letter said the offer was “an exceptionally advantageous opportunity” and included a list they characterized as comparable sales.

Lorette, then 87, did not have experience in the art world, but she believed her Soutine was very valuable and had no intention of selling it. As Soutine experts, Tuchman and Dunow’s opinion meant a great deal to Lorette and her children, but the family did not accept the offer.

A month later, Tuchman and Dunow wrote saying that the offer was increased to $1 million. Lorette agreed to the sale. The sales contract said that Lontrel Trading in Geneva, Switzerland, was buying the painting. Half a year later, the National Gallery of Art in Washington bought the painting for $2 million.

Suspicions, and a lawsuit, arise

In 2007, at the age of 90, Lorette Shefner died. After looking at her papers and at the National Gallery of Art website, her children spotted a discrepancy. The National Gallery listed Tuchman as the Soutine’s previous owner. Suspecting that Tuchman and Dunow had defrauded Lorette Shefner, her children contacted an attorney.

Other important information was withheld, the estate claimed. According to documents filed in the lawsuit, almost as soon as the Shefner family’s sale of the painting was completed, Tuchman and Dunow received a commission for reselling the painting to the National Gallery at twice the price the Shefners received. The art agents had failed to disclose that they had this monetary interest when they arranged the Shefners’ sale of the Soutine, the estate claimed.

In their lawsuit, the Shefner children asked for the return of the painting and a damage award for fraud.

The other side

Tuchman and Dunow, who had never before been publicly accused of deceptive practices, denied the charges. They said that the Shefners did not rely solely on the scholars’ expertise when the sale was made. Before the sale, Lorette’s daughter Ariela consulted with one of the most prominent auction houses in the world to determine what the painting was worth. In May 2004, the $1 million sale was a record price for a Soutine still-life painting, the art experts said. Besides, as scholars of Soutine, they are not usually involved in sales and should not be expected to have comprehensive knowledge of prices. They were only helping out on this sale between the Swiss company and the Shefners. Lorette Shefner made a deal, they said, and her children should not be able to renege on it.

On May 14, 2009, the U.S. District Court for the Southern District of New York affirmed the legality of a stunning settlement reached by the estate of Lorette Jolles Shefner, Maurice Tuchman, Esti Dunow and the National Gallery of Art. For the first time in its history, the National Gallery agreed to a deaccession, or release, of a non-Holocaust painting from its permanent collection. Ownership of the painting returned to the Shefner estate.

In exchange, the Shefner family agreed to pay the National Gallery $1,325,000 in cash immediately and signed a seven-year promissory note for an additional $650,000. That’s $975,000 more than the family received for the painting in 2004. The Shefner family also agreed to let the Soutine stay with the museum for seven years—or until they decide to sell it. “The Shefner family is pleased to be welcoming this iconic Soutine back to their family,” said Karl Geercken, the Shefners’ attorney.

Soutine experts Tuchman and Dunow will pay the National Gallery $210,000 and must include the painting in their catalogue raisonné with the Shefner provenance clearly laid out. All told, the National Gallery will receive payments of $2,185,000 to compensate for the painting and the cost of defending the lawsuit. The National Gallery will not comment on the sale.

In February 2006, another painting in Soutine’s beef series, “Le Boeuf Ecorche,” sold for $13.8 million to an anonymous buyer. In February 2007, one of Soutine’s portraits, “The Man in the Red Scarf,” sold for $17.2 million.

What do you think of the verdict? Let us know in the Community Commentary below.  

Robin Gerber is a lawyer and the author of  Barbie and Ruth: The Story of the World’s Most Famous Doll and the Woman Who Created Her.

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