THERE ARE ALWAYS RISKS AND I WAS AWARE OF THAT TOO!!
WHEN I SHIPPED MY PROPERTY TO HONG KONG, I HAD A GOOD IDEA THAT THERE WERE SERIOUS RISKS:
A. DAMAGE DURING TRANSPORT
B. GOOD BE BELOW ASSUMED QUALITY
C. CHANGE OF MIND OF BUYER
D. COSTS OF RETURNING THE ITEMS TO BASE
I KNEW ALL THE ABOVE BUT DID I HAVE AN ALTERNATIVE? THAT IS HOW BUSINESS WORKS.
I WAS BIDDING BU YOU DID NOT SEE ME!!!
7th February 1994, North London
(British (1807-1874) Mid-nineteenth century English artist who painted exquisite, figurative paintings and portraits. Auction price range £2000 – 8000)
An auction I had not heard of before was advertising a mixed sale that included some good Victorian painters in the Antiques Gazette. It happened to be close to my residence so there was nothing to lose if I viewed the sale. Although not expecting much, as I was very aware that names meant nothing when advertised by small, nearly unknown auctions, I set off to indulge my passion.
On entering the viewing room it was clear to me that the one owner sale was a shouting case of ‘from riches to rags’. It was a bankruptcy sale. The room was full of tasteless, expensive furniture and pottery, carpets I wouldn’t look at twice and bric-a-brac of no mention. However, there were a few Victorian paintings, especially two large canvases that merited closer inspection and checking.
One was a figurative painting by John Lucas and the other a landscape by Edward Williams. I was drawn to the former entitled ‘The Forsaken’. A large, impressive, early Victorian painting in a beautiful ornate frame and in good condition, it portrayed two seated angelic-looking sisters staring straight out of the canvas drawing the viewer in. They were the personification of youth and loveliness. I liked it, even though I had fallen out with Victorian art long ago. Research through my bank of catalogues and Art Reference Indexes at home revealed that the painting was a worthwhile investment at its estimate of £2000-3000.
The auction took place in an industrial estate. Few people were present and no familiar faces. There was an eerie silence and apprehension before the auction and nerves, plenty of nerves! The bidding on the Lucas started sluggishly. Hundred by hundred it reached two thousand. With a little interest from a couple of other bidders to my great satisfaction the Lucas was knocked down to me at £2500 pounds, or was it?
Suddenly and out of nowhere, a gentleman put up his hand and said, “ I was bidding and the auctioneer did not see me.” To my horror and dismay the auctioneer re-opened the bidding. Auctioneers are the masters of the auction and it is up to them to open the bidding again, to cancel a sale or re-offer a lot. I was at his mercy.
What was I supposed to do? Re-opening bidding had never happened to me before. Such an event was manna for the auctioneer and the vendors. I could do nothing but either stop bidding at that point or obey the rules of the game. I had seen this before with auctioneers milking more and more out of the bidders, but I never expected this to happen to me. Nevertheless, I accepted it stoically, remaining outwardly calm although seething inside. I hadn’t seen the man bidding or noticed his hand up, even though he was sitting a few seats away in front of me.
Foolishly, I carried on with my bidding, which in the end reached £4500. What on earth possessed me to go over my top limit by three thousand pounds! I was absolutely livid. I was furious with the auctioneer who could have refused this intervention, but I was far angrier with myself for bidding on something way above my limit and far more than warranted.
To overpay at auction on any item is common, but to overpay by such an amount and after the bidding had been re-opened was madness! I had blown away £2300 in a minute! That was my profit gone! I was convinced. I valued the painting close to six thousand pounds and on a good day eight thousand. By paying five thousand at that auction, I had kissed goodbye any possible profits. All of a sudden I was on the other side of the fence, the loss making one!
It was unforgivable for an experienced investor. It was unwise and stupid to carry on bidding as if it were the boom times of 1988-1990. I had failed myself. My iron will of those years had melted away in that auction. The pressure of being so much in the red at the bank had affected my decision-making to such a degree that I became reckless. It was a terrible state of mind. Two terrible investments in the Knight and the Lucas threatened to derail the work done with third-rated artists of £300-500 each.
The strict maths applied over the past four years were thrown away on a painting that I bought on sentiment rather than on cool mathematical calculations. Auction adrenalin and passion for paintings had overridden the wisdom of investing sensibly and buying cleverly. There were no excuses. I had made a regrettable mistake. My experience in bidding secretly and discreetly at auction was thrown out of the window that day. I had to remind myself:
• Never let auction events derail your plans and bidding targets.
• Stick to your plans and, if unable to do so, never get involved in bidding wars that ultimately end in tears.
• Victorian art ought to be avoided at any cost as it is neither trendy nor profitable.
Desperate times, desperate measures and ventures
Surviving any financial crisis points to persons with some ability to handle the worst of situations, emerge stronger and move on. That I had managed to do in the meltdown of the 1987 stock exchanges crash. However the recession of the 1990s was a harder test than anything I had ever experienced before. I was fighting the storms of unknown financial oceans rudderless, being rich in assets but extremely close to cash poverty. It was a meltdown threatening to sweep me into the abyss.
Putting guns down, announcing surrender and negotiating terms is unknown to me and does not represent me in the slightest. I was born a survivor and I remained one in spite of adversities during my life. I had been protected from disasters before. I felt blessed by the powers of the heavens, and with just enough effort on my part I knew I would be safe. I felt it and knew it.
Positive thinking? Call it that! Hope for the best? Call it that!
Even though the recession was biting, even though I was short of cash, I still kept buying small items, which brought in those essential sums required to keep the wolves at bay. Making less money than before was fine as long as I could service the various loans and overdrafts. Small introductory commissions kept coming in, teaching kept everything going and the combination of all my activities kept the business afloat.
Survival was the word and idea! I kept looking for new opportunities, new avenues and new connections. The opening appeared unexpectedly and I grabbed it immediately. “Important paintings required.” The advertisement by the American Company was in one of the best art/ house magazines. The examples they showed fitted well with one painting I had, ‘The Forsaken’ by John Lucas.
In 1995 the use of emails and the Internet was still rare. The phone was my tool, the mail and photos my ammunition. I wasted no time. It was a matter of desperate new measures in desperate times. I had to explore new ways and new venues. Before long I received a phone call from the female manager of the American company in New York.
“We would like to see this painting you own. Would you send it to us to New York to inspect and perhaps buy?” It sounded like the Economou sale and of course I hoped for a similar scenario. That was an invitation that whetted my appetite and sent me into overdrive. Confirming a couple of things with this new connection, I got on to working out the pros and cons of shipping the painting to New York. At best I was going to sell the painting for $18,000, thus making 150% on my money and within a year. At worst I was losing £1000 on shipping costs. What could I do? What alternative was there since auctions were not sending out the right vibes yet?
The few formalities were discussed over the phone and within three days FEDEX had the well-packed painting transported to New York. Working with FEDEX was great. They were inexpensive, reliable and fast. Naturally, I was apprehensive and worried about this new way of doing business, but I needed to go through this. It was a new experience. It was knowledge I needed on my CV, I suppose.
Anxious and uneasy, I managed to wait for two days for news from New York, but no more. On the third day I called the company. My anxiety, worry and fear were increasing and mounting with every passing second. By the time the lady in charge came on the line and she started speaking to me many panic buttons were ringing. Instinct!
She came straight to the point. “Unfortunately we are not interested in this work Mr Constant.”
Cool and cold, indifferent and completely unsympathetic, she sent me to a place called despair. That was it! I was shocked by the news. I was completely shaken by the manner in which she told me that the painting she so much wanted to see a few days earlier was undesirable now. Her justification for such action was feeble and convenient. I found everything I was told fictional.
“My consultants say that the work is weak.” “My consultants say that it does not fit the needs of our clients.” “The work is over-restored in spite of its attractiveness.”
There was no way I could defend the work from London. I could not grab her by the throat. I listened to her explanations and registered my disappointment fuming with anger. In just a few minutes I had learned important, significant lessons, albeit at a serious cost.
• Never trust what is promised. Get guarantees before sending out any piece of art and demand a down payment unless you know the buyers well, very well.
• Never send large frames abroad as they weigh too much and cost so much to pack.
• Make arrangements with the receiver to return the items back themselves and at their expense otherwise you do not send them anything.
If the above minimum conditions are not met, forget the whole issue!
The immediate problem I had to deal with was how to transport the painting back to London. My shippers in New York could not handle the painting, as it was too big. The next shipper required me to dispatch the money first before they sent me the painting and that was $950. The painting had to be boxed first and then be picked up by the shippers. All these new lessons were taken in, but the expense was unpalatable.
In 1995 I could do with a lucky break not with these enormously expensive headaches! The exercise of sending this painting to New York had been such a test on my nerves and my resilience. In addition it proved to be a major expense exceeding the thousand pounds I thought it might cost if the sale did not materialize. I got all aspects of this attempted sale wrong. The Lucas was a serious problem the moment I bought it. An additional £1200 with this unfortunate attempt to sell in New York added to my worries and dislike of the painting. After such terrible experiences I did not want to see it any more. I literally wanted it out of the house no matter what. I felt like slashing it to pieces in spite of the admiration I always had for it.
THE PAINTING WAS BACK AT A COLOSSAL LOSS OF MONEY AND THE MISTAKES I MADE IMMENSE. I HAD TO AVOID THEM IN THE FUTURE BUT COULD I? HERE IS THE NEW REALITY OF A PAINTING BEING DAMAGED DURING TRANSPORT AND THE CLIENTS REASONABLY INFORM ME OF THE NEW SITUATION. WHAT SHOULD I DO IN THIS CASE? RESTORE THE ITEM AND PAY THROUGH THE NOSE OR BRING IT BACK AND RESTORE IT HERE IN BRITAIN WHERE THE COST WILL BE LESS?
MORE TO FOLLOW IN THE COMING WEEKS!!