On the cruise of a lifetime came the chance of a fortune. Cahal Milmo reports on a family who claim they were 'swindled' out of $400,000.
by Cahal Milmo
The Independent, UK
July 18, 2009
When Sharon Day decided to go on holiday two years ago to help her recuperate from a minor operation that went wrong and nearly killed her, the idea of sailing the seas with her family on board a luxurious cruise liner seemed the perfect answer.
The Adventure of the Seas, a 138,000-tonne floating pleasure palace owned by Royal Caribbean Cruises, occupies its 3,100 passengers with attractions such as a nine-hole golf course, a climbing wall and even a wedding chapel.
What caught the attention of Mrs Day, a London lawyer and mother-of-three, were the art auctions held in the vessel's public rooms by Park West Gallery, an American company which bills itself as the world's biggest seller of art. It sells 300,000 paintings and prints each year, half of them on cruise ships (it holds sales on more than 80 vessels), and has annual revenues of $300m (£182m).
Among the items on offer to passengers entering Park West's ocean liner auctions, where the sales patter of an expert auctioneer comes with complimentary champagne, are woodcuts by Rembrandt, Picasso lithographs and Salvador Dali prints.
Within a week, Mrs Day, 46, a long-standing art lover, and her husband Julian Howard, 48, a senior City lawyer, had spent nearly $98,000 (£60,000) and begun the $422,000 (£258,000) acquisition of a complete set of Dali's Divine Comedy – six-volumes of prints originally commissioned by the Italian government in the 1950s to mark the 700th anniversary of Dante's birth.
Park West's auctioneer described it as a "masterpiece and a part of history". What the couple did not know at the time was that their purchase would also be the departure point for a bitter transatlantic court case in which they, along with a number of other cruise-ship art buyers, claim in a legal summons they are victims of a carefully orchestrated fraud which has left them with pictures that are either valueless fakes, or genuine but commonly available works that are worth a fraction of their eye-watering sale price.
A journey intended to celebrate Sharon's recovery from life-threatening damage to her intestines has become part of a legal tussle that goes to the heart of the global cruise industry – which is worth an estimated £30bn a year and makes a substantial proportion of its profits from selling goods on board its "shopping malls with lifeboats". At stake is the reputation of the third-largest source of such revenues, namely the huge art trade conducted on the ocean waves.
Of the world's nine largest and most lucrative cruise lines, all but one has a contract with Park West to sell art on board their ships.
The Fine Art Registry (FAR), an American art registration company that has set up a website publicising what it says is Park West's penchant for sharp selling practices, insists that it has been approached by more than 200 former cruise-line passengers who believe they have been sold dud prints and pictures.
Donald L Payton, the American lawyer leading the court case, spelt out the scope of the legal claim: "Our clients believed they were buying an investment, when what they received was virtually worthless. The purpose of this litigation is not just to get well-deserved compensation for these victims, but to expose the self-proclaimed experts who have for years intentionally pawned off supposedly famous and valuable artworks on the unsuspecting public, including our clients."
Park West, which is run out of a vast exhibition space in Michigan, insists that it has "never sold a non-authentic work of art" in its 40-year history, and has launched a countersuit against the Britons, their co-claimants and FAR, whose articles about the gallery's sales techniques are described as a "smear campaign" aimed at destroying its reputation.
For Sharon and her husband, their ill-fated encounter began a day before New Year's Eve in 2007, when the family left their home in south-west London, and boarded the Adventure of the Seas for a seven-day tour of the Caribbean.
Intrigued by an offer to attend a masters art exhibition offering works by Picasso, Dali, Rembrandt, Chagall and Miro, the couple eventually bought a selection of what was on offer after being persuaded, they say, by the auctioneer, that their purchases were "rare" and represented an "excellent investment". Among their initial buys were 11 prints from Dali's Divine Comedy, apparently signed in pencil by the Spanish Surrealist. Park West insists that it never sells art on the basis of claims about its future value.
During the sales, Mr Howard, a lifelong fan of Dali, asked whether it was ever possible to buy a whole set of the Divine Comedy. He thought little more about his enquiry until the couple received a phone call after returning to London from Morris Shapiro, gallery director at Park West, who said he had managed to obtained an "exceedingly rare" example of the entire series. After much to-ing and fro-ing over 10 weeks in which Mr Shapiro went into detail about the provenance of the art, describing the date it was produced and the type of paper used, the couple agreed to pay a total of $422,601 for the collection of 100 prints in six books, complete with an appraisal valuing it at $510,000 and a certificate of authenticity.
Sharon, a US citizen who has lived in London for more than a decade, said: "We had gone on this cruise and had a wonderful time. When you are on holiday, you relax and make purchases that perhaps you wouldn't normally. That is precisely why a company like Park West sets up shop on cruise ships. The money we used for the Dali prints was set aside for our children – it was their inheritance. We were genuinely persuaded that this was a great investment which would grow in value. It was my family's investment for the future."
The couple were so sure of the impeccable credentials of their purchase that they took little notice of the apparently unusual arrangements put in place to pay for the prints. They were sent an invoice placing Mr Howard, who was in London at the time, on board another Royal Caribbean ship, the Legend of the Seas, complete, they claim, with a cabin number and bidder code for an auction he did not attend. The money for the prints was paid into a bank account held by Royal Caribbean, which receives a percentage of every sale made by Park West. Court documents show that the couple now believe the fabricated auction invoice was produced to ensure they paid a $67,000 buyer's premium and the sale was categorised as taking place in international waters, where American or British consumer law does not automatically apply. Park West insists that the invoice was generated to ensure Royal Caribbean received its commission for any "post-cruise" sale and did not include cabin or auction numbers.
It was not until Sharon and her husband decided a few months later that they unexpectedly needed to cash in their investment to pay for one of their daughters, a talented ice skater, to attend an American figure-skating academy, that their confidence in their acquisition began to take on a very different complexion.
An approach to Mr Shapiro to either buy back the prints or help with their sale was met with a polite but firm refusal to have anything more to do with the artwork he himself had described just nine months earlier as "an exceptional collecting opportunity".
When Sharon contacted a Sotheby's expert to find out the true value of the sale, the reply astonished her – the auction house had sold the Divine Comedy set many times and it normally raised $60,000 to $80,000. Her concerns deepened dramatically when she travelled to the New Jersey art repository holding the prints with two experts on Salvador Dali, including Nicolas Descharnes, the son of one of Dali's close associates.
The experts agreed that the prints were authentic but when it came to the artist's pencil signature on the bottom of each of the pictures they were equally certain that whoever had signed them, it was not Salvador Dali. The court claim filed on behalf of the couple said: "In fact these signatures were unanimously identified by the experts as forged and faked Salvador Dali signatures. These experts also concluded that the Divine Comedy series purchased by the plaintiffs is worthless."
Sharon said: "It was absolutely devastating news. I went through the whole gamut of emotions. I felt stupid that I had bought these artworks and invested so much in them only to find they were worthless. Now I'm angry. Angry that we have been treated in this way and that the only way to prove our case is to go through a very tough court case. We have had to put everything at risk. Park West is throwing everything at us."
Rather than being an isolated case, the British-based couple have eight co-claimants on their joint action who variously allege that they were sold fake or grossly over-valued art by Park West. One couple, Albert and Vivian Best, bought two Chagall lithographs which they kept in their frames until April last year, when they decided to check their condition ahead of a possible sale. Upon taking out the pictures, Before the Mirror and Man in House, they found that rather than being genuine prints they were in fact pages from a French art magazine and "essentially worth nothing", according to court documents.
Teri Franks, chief executive of FAR, said: "These people were not sophisticated buyers of art. They were told certain things about what they were buying and believed they were getting something special. We say the reality is quite the opposite."
A second, separate, class action was launched in April this year on behalf of two New York-based cruise art buyers making similar claims against Park West.
The response from Park West to the claims has been robust. The company has issued a succession of counter-claims for defamation against its former customers and FAR, which the gallery claims is acting out of malice because it turned down an approach to sign up to its art tagging service in 2007. The claim is strongly denied by FAR. The gallery said it can produce multiple examples of sales of Divine Comedy prints for prices comparable or higher than that paid by Mrs Day and her husband. It added that it had obtained further evidence to demonstrate the authenticity of the Dali signatures, which it would present in court.
In a statement, Park West said: "We are the largest at-sea gallery in the world and are proud of the relationships we have developed with more than 1.2 million clients over our 40 years in business. We stand behind the authenticity of every work of art we sell, including the works sold to Mrs Howard and Mr Day, and we are confident we will prevail in court."
Royal Caribbean, which made a profit of $703m in 2007 and this year launches a new class of vessel that can carry more than 6,000 passengers, said: "Royal Caribbean denies any allegation or suggestion that it has done anything wrong. We take very seriously the issues that have recently been raised regarding some of Park West's business practices."
In the meantime, Sharon Day awaits the beginning of the trial of her case later this year. "All we did was get on board a ship and buy some pictures," she said. "Now we are having to stand up and fight for our children's inheritance."
Copyright 2009 The Independent