Calder Estate Fraud Claim Dismissed: Judge Finds Allegations “An Incoherent Stew of Irrelevance and Innuendo”
January 6, 2014
On December 23, 2013, Judge Shirley Werner Kornreich dismissed the Calder Estate suit against Alexander Calder‘s long-time dealer, Perls Galleries. Kornreich, shifting fault to the Calder Estate, wrote in her Decision and Order: “Rarely has the court encountered a better justification for the statute of limitations.” Bloomberg quoted her as saying: “All these allegations are so patiently inadequate that the court can only conclude that they were solely for the purpose of harassment or embarrassment.”
In 2010, the executors of the Calder Estate (Sandra Calder Davidson, Mary Calder Rower and Shawn Davidson), charged the Perls Gallery (a.k.a. Katherine Perls, the executrix of the Estates of Amelia and Klaus Perls) with breach of contract and claimed damages of $20 million for selling the Calder paintings and letters in their trust without rightful approval.
The Calder’s argued that a letter from Amelia (Dolly) Perls formed a binding contract between the two parties. The letter mentions her plan to return Calder materials remaining at the gallery in 1996 to the Calder Foundation (which is not a party in the lawsuit). She wrote: “I feel like the Calder Foundation is the right home for all our ‘stuff.'”
Judge Kornreich held that “[i]n their proposed amended complaint, plaintiffs seek to allege that the letter Dolly wrote in 1996 constitutes a binding contract which entitles them to possession of the Correspondence and the other items mentioned therein. However, on its face, the letter does not indicate any consideration for the promises made, and neither plaintiff’s proposed amendment nor Rower’s affidavits explain what Dolly gained or was to have gained. To the contrary, any fair reading of the letter reveals that it is at best an expression of an intent to give the Correspondence and the other items to the Calder Foundation as a gift, without consideration or compensation. Lacking consideration, the letter is not an enforceable contract (see Beitner v. Becker, 34 AD3d 406, 407 (2d Dept 2006) (“All contracts must be supported by consideration consisting of a benefit to the promisor or a detriment to the promisee.”)); see also McRay v. Citron, 270 AD2d 191 (1st Dept 2000) (holding that natural affection insufficient consideration to render agreement enforceable)). Moreover, even if Dolly’s letter were a contract, it would have been a contract between her and the Calder Foundation, which Dolly described as a proper repository for the archival materials, not the Calder Estate, which exists to distribute Calder’s assets to Calder’s beneficiaries. Plaintiffs therefore do not have standing to assert the Foundation’s purported claim.”
The court further concluded that the statute of limitations had lapsed and that the Calder estate had no recourse. Judge Kornreich stated that when the Calder’s switched their gallery representation to Knoedler Gallery in 1978, it was their responsibility to confirm that all items at Perls’s were accounted for and collected. She wrote in her decision: “Having taken affirmative steps to end the relationship in 1978, the estate cannot now, thirty-two years later, characterize the odds and ends left (or abandoned) in the Perls’s possession as the subjects of a continued bailment, however valuable or important those odds and ends now appear to be.”
Steven Wolfe of Eaton & Van Winkle, LLP, representing defendants commented on the decision: “We are gratified by the court’s ruling, which upholds the integrity of Klaus Perls and his family.”
Aaron Richard Golub, counsel for plaintiffs, stated: “We are definitively appealing– the defendants should not go to bed easily at night… The behaviour of the Perlses was so contorted that it’s very hard to describe it in straightforward terms.” The appeal, if filed, should be expected within the next 30 days.
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