Skip links

Trustee in Bankruptcy Turns Art Detective

In a case which vividly reveals the extent of detective work sometimes carried out by bankruptcy trustees in recovering debts on behalf of creditors, a court has found that 12 sketches that were believed to be the work of celebrated artist, Francis Bacon, were in fact fakes.

A man who had known the artist during his lifetime had sold the sketches – along with photographs, lithographs and other items connected to Bacon – to two sets of buyers for a total of £1.3 million. However, the buyers later showed the drawings to a panel of Bacon experts who said that their style was inconsistent with his work and that they were not authentic.

The buyers launched proceedings to recover their money from the seller. He denied their breach of contract claims, insisting that he had never told them that the works were by Bacon and that the buyers had relied upon their own valuations. However, default judgments were subsequently entered against him and the seller was ultimately declared bankrupt.

The seller had almost no funds; however his trustee in bankruptcy discovered that, subsequent to the sales, he had paid his long-term partner a total of £425,000 in two instalments. The trustee accordingly issued proceedings under section 339 of the Insolvency Act 1986 to recover those sums for distribution to the seller’s creditors.

The partner resisted the trustee’s claim on the basis that most of the money he had received from the seller reflected repayment of loans that he had made to the seller over many years to fund his ‘champagne lifestyle’. However, those arguments failed before the county court and the trustee was granted the order sought. The county court also found as a fact that the drawings were ‘fakes’.

The partner challenged that decision at the Court of Appeal, seeking to rely on ‘fresh’ expert evidence that, it was submitted, pointed towards the drawings’ authenticity. However, in refusing permission to appeal, the Court found that the relevant evidence had been available for him to present at the county court hearing and that it would have been reasonable to expect him to have done so.