The case of the fake 18th-century furniture from the palace of Versailles : a judgment too favorable to the state ans risks for the Art market
If the case of the fake 18th-century furniture from the Palace of Versailles has been widely publicised in its criminal aspect, the civil dimension of the case has, by contrast, been overlooked. Yet it presents major interest for art market professionals. The purpose of this article is therefore not to recount a well-known saga, but to analyse its legal consequences, particularly in terms of civil liability of auction houses and their experts.
Nearly ten years after it was revealed, the scandal of the fake 18th-century furniture sold to the Palace of Versailles continues to have repercussions. A recent judgment illustrates this : it annuls the sale of a fake Bergère armchair, pre-empted by the State. On this occasion, the judges recall the limitation rules applicable to the annulment of the sale as well as to the liability of auction houses and their experts. However, by considering the State’s error to be excusable, they render a decision that entails risks for the art market…
THE FACTS
During an auction sale on 9 June 2011, the Palace of Versailles pre-empted, on behalf of the French State, a “Bergère with a flat back in the Queen style in beech very finely carved and gilded”, of “Louis XVI period”. It was described without reservation in the purchase slip as “Delivered in 1789” to furnish the reception room of Élisabeth de France at the palace, stamped Jean-Baptiste-Claude Sené. It was purchased for €247,840 (hammer price of €200,000, and €47,840 in fees).
In 2016, the Central Office for the Fight against Trafficking in Cultural Property (OCBC) opened a criminal investigation concerning a network involved in the fencing and fabrication of fake 18th-century furniture. The French State was informed of doubts regarding the authenticity of the Bergère, and joined the criminal proceedings as a civil party.
In parallel, in 2017, the Palace of Versailles and the State brought proceedings before the civil courts seeking annulment of the sale. They summoned the seller, the auction house, and the expert involved in the sale. However, since the company of the latter had been struck off, they withdrew their claims against him. This withdrawal does not detract from the interest of the decision, since it indirectly recalls the conditions of civil liability of the expert and its consequences.
In 2019, the judicial expert report conducted in the criminal proceedings confirmed that the Bergère was not authentic. Worse still, it results from the judgment that “the inauthenticity of the Bergère […] is not disputed by the parties, […] the seller, moreover not contesting having made it himself”.
In the civil proceedings, the Palace and the State argue that their consent was vitiated by an error concerning the qualities of the piece of furniture; and alternatively, that they were deceived by fraud. They request the annulment of the sale: the object must be returned, in exchange for reimbursement of its price and costs.
In response, the defendants advance two main arguments. First, limitation. Second, the seller argues that the defects of consent relied upon by the buyers are not established.
The Paris Judicial Court pronounces the annulment of the sale. To this end, it strictly distinguishes the limitation period applicable to the annulment of the sale from that applicable to the liability of the auction house and its expert (I). However, it shows surprising flexibility in holding the error of the Palace and the State to be excusable (II).
I. THE DISTINCTION BETWEEN THE LIMITATION PERIOD FOR THE ACTION FOR ANNULMENT OF THE SALE AND THAT FOR THE ACTION IN LIABILITY AGAINST THE AUCTION HOUSE AND THE EXPERT
In an action for annulment of an auction sale, two limitation regimes must be distinguished.
On the one hand, the action for annulment of the sale on the grounds of error or fraud, between buyer and seller, is subject to the ordinary limitation period and is subject to a double time limit: it may be brought within five years from the day on which the claimant knew or ought to have known the facts giving rise to the action (the “rolling” period under Article 2224 of the Civil Code), within a maximum limit of twenty years from the sale (the “long-stop” period under Article 2232 of the Civil Code).
In order to avoid annulment of the sale, the seller argues in this case that the time limit for bringing an action for nullity has expired and that the claim against him is therefore inadmissible. However, the court finds that doubt as to the authenticity of the disputed Bergère arose on 7 June 2016, during the questioning of the seller and the notification to the Palace and the State of the opening of criminal proceedings. The summons was issued in 2017, i.e. less than five years after the discovery of this doubt. The action for annulment of the sale is therefore admissible against the seller.
On the other hand, the civil liability action brought in connection with public auction sales, against the auction operator and its expert, is subject to a short and derogating limitation period: the time limit is five years from the auction (Article L.321-17 of the Commercial Code). It is obviously very favourable. The auction house therefore argues that its liability – and consequently that of its expert – can no longer be engaged. It is followed on this point by the court.
However, this limitation does not apply to fees. The court considers that the annulment of the sale renders the sale fees undue. The same would apply to the remuneration received by the expert, had he been a party to the proceedings. In the event of annulment, the expert’s fees attached to the cancelled sale would no longer have cause. They must therefore, like the sale fees, be refunded. Thus, in the case of an auction sale, the auctioneer and the expert must reimburse to the purchaser and the seller their commissions and fees. The ordinary limitation period applies to this claim. In this case, the court holds that the auction house’s fees must therefore be reimbursed. This is standard, but this reminder is useful.
Although the limitation period applicable to the liability of the auction house and the expert is indeed acquired (the sale took place in 2011 and the action was brought in 2017, i.e. more than five years later), it has no impact on the claim for annulment of the sale. The court notes that only annulment of the sale is sought, and applies a consistent solution: “Article L.321-17 of the Commercial Code, specific to voluntary sales, derogates from the general provision on limitation in Article 2224 of the Civil Code specifically in matters of civil liability. However, it does not apply in the context of a claim for annulment of a contract”. The limitation rules governing actions for nullity therefore apply. The limitation period thus runs from the discovery of the error or fraud, both against the seller and the auction house and its expert.
II. DOES THE STATE’S ERROR REALLY BECOME INEXCUSABLE BECAUSE OF THE INTERVENTION OF AN EXPERT IN THE SALE?
By law, error constitutes a ground for annulment of a contract only if it is excusable (Article 1132 of the Civil Code). It is therefore not sanctioned when it results from imprudence, lack of diligence, or even negligence or fault on the part of the person invoking it. The excusable nature of the error is assessed according to the claimant’s abilities and shortcomings. The error of a professional or specialist acting within their field of competence is thus assessed more strictly than that of a layperson. Thus, for example, an inexcusable error not capable of leading to annulment of the sale is committed by a specialist in Russian art who purchases a painting by a Russian artist in a catalogued sale, with a notice written by a painting expert (Cass. Civ. 1st, 9 April 2015, RG no. 13-24.772).
Conversely, an error induced by fraud, i.e. by fraudulent maneuvers intended to deceive, is always excusable (Article 1139 of the Civil Code). The circumstances in which the fraud occurs, or the knowledge of the victim, are irrelevant.
The Palace and the State invoke their error, as they acquired the Bergère with the belief that it was authentic, from the 18th century period, and that its provenance was prestigious. They would not have pre-empted it had they known that these qualities did not exist. In the alternative, they argue that they were subjected to fraud, i.e. deceived by the seller’s maneuvers and the description of the Bergère.
With no small confidence, the seller responds that the error of the Palace and the State is inexcusable, as the judicial expertise reveals that the poor quality of the object was “visible to the naked eye”; and that the professionals and experts whom the buyers had surrounded themselves with should have identified its inauthenticity. He also argues that he did not participate in the sale, nor give any indication to the auction house or its expert, and therefore committed no fraudulent maneuvers.
The court responds to this argument in a terse manner: “notwithstanding the quality of the claimants, the inexcusable nature of the error cannot be retained insofar as they acted as buyers in the context of an auction sale in which the authenticity of the bergère was certified by an expert and was not contradicted by any element at the time of the sale”. Consequently, the court considers that the error is established and annuls the sale. The Palace and the State must return the Bergère. In return, the seller is ordered to refund the price; and the auction house to refund the sale fees.
This decision protects the interests of the State. But it is not without general consequences for the market. Concretely, it amounts to considering that the buyer’s error would be excusable as soon as an expert has intervened in the sale and validated the authenticity of the disputed object. This would therefore always be the case of an error committed during an auction sale with an expert. Thus, it would no longer be necessary to take into account the competence of the purchasing professional, specialist or knowledgeable party.
At the very least, it would then be necessary to reach a very high degree of competence since this expertise could no longer be opposed to the State, to the Ministry of Culture, to one of the most prestigious museums in the world, or to their battalion of curators, with unmatched resources. The risk is that the case law thus sidelines a legal provision requiring an excusable error (Article 1132 of the Civil Code), in a somewhat automatic manner.
Yet there was, in this case, a way to avoid this pitfall while still protecting the interests of the State. The fraud ground appeared indeed entirely appropriate to pronounce annulment. The seller did not contest having entirely fabricated the Bergère. He had refrained from informing the auction house and, presumably, the expert of the sale, and the buyers. His manoeuvres and silence would have made it possible to characterise fraud, thus rendering the error of the Palace and the State excusable.
We do not know whether the proceedings are subject to appeal. One would then hope for less terse reasoning, this time based on fraud. Failing that, this judgment could constitute a dangerous precedent: claimants seeking annulment of a sale will have every reason to invoke it in order to exclude the inexcusable nature of their error, as soon as an expert has intervened in the sale… The criminal aspect was judged a few weeks ago. The verdict is expected at the beginning of June 2025. It will probably provide useful clarifications on the seller’s conduct.
Article published in L’Objet d’art
