By Elizabeth Lash, Esq.
Who can say how much a piece of artwork is worth? Who owns public art? In one particular case, that of the Detroit Institute of Art (the “DIA”), these questions were not merely academic or philosophical.
Over the past year or so, the possible answers to these questions were argued in countless appraisal reports, legal briefs, journalistic commentary, and, since this past September, hearings presided over by a bankruptcy judge. At the heart of this debate lay the fate of the art museum in question--the DIA and its collection of more than 60,000 works, consisting of pieces from almost every continent and time period, from antiquity through today.
As one of the top six museums in the country, with an annual operating budget of about $32 million, situated in one of the most financially challenged municipalities in the country, the DIA looked like the answer to everyone’s prayers since the City of Detroit (the “City”) went into bankruptcy last year. Primarily, most parties involved wished to sell or collateralize the DIA’s collection to repay debts--either that of private creditors, or for City retiree pensions and capital projects. The City stood alone in attempting to use the value (without a sale) of the DIA as part of its proposed “grand bargain” to exit bankruptcy.
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