Lord Spencer-Churchill v Faggionato Fine Arts Ltd (2012)
The court granted an interim injunction preventing the purchaser of a painting from selling it without first giving notice to the previous owner where the previous owner had an arguable case that the painting remained vested in him because the purported sale was unauthorised and therefore void.
The applicant (S) applied for an interim injunction restraining the third respondent company (J) from dealing with a painting until judgment in his claim.
S had instructed the second respondent (F), a director and shareholder in the first respondent art dealer, to find a purchaser for his painting. S claimed that he had specified that he did not want to sell to the fourth defendant (M). F later informed S that he had received an offer. S asked F to consult auction houses to deduce the reasonableness of the offer. F informed S that he had obtained estimates from auctions houses and advised S to accept the offer, which he did. It later transpired that the offer was actually from M and the invoice for the sale was addressed to J, which was a corporate vehicle used to hold art for M's benefit; F had received secret commission from M or J in connection with the sale; F had not consulted auction houses. S brought proceedings on the basis that the painting remained vested in him because the purported sale was unauthorised and therefore void. S accepted that his concern was to maximise the amount of money he received for the painting whilst seeking to restrain J from selling it. The issues were (i) whether there was a serious issue to be tried, and if so; (ii) where the balance of convenience lay.
J submitted that injunctive relief should not be granted because S wanted the painting to be sold and his claim was a money claim for its value.
(1) There was no doubt that S had a real prospect of success in his claim and that his point was an arguable one. Accordingly, there was a serious issue to be tried (see paras 25-26, 29 of judgment). (2) Whilst there was force in J's submission that S's claim was for the value of the painting and so its sale should not be prevented, a sale in the current climate would have been unlikely to be at the best price reasonably obtainable if there were no dispute as to ownership. Damages would not have been an adequate remedy because of the obvious difficulties in valuing works of art. Further, S had already been the victim of wrongful conduct by virtue of the secret commission given to F, Accidia Foundation v Simon C Dickinson Ltd  EWHC 3058 (Ch) considered. Accordingly, S was entitled to protection against further possible wrongdoing. However, it was not appropriate to grant an unqualified interim injunction: an injunction was granted restraining J from dealing with the painting without first giving S 28 days' notice of any proposed dealing. Unless J could satisfy S that the proposed dealing was beneficial, he would be able to return to court for an injunction preventing J from carrying the proposal into effect (paras 32-34).
Application granted in part
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