THE BLOG

For Artists, Divorce Means Splitting Up the (Art) Assets

03/03/2015 03:33 pm ET | Updated May 03, 2015

How much more enjoyable it is to speak of love and marriage than of splitting up, but divorce happens, and it happens to artists at probably the same rate as for everyone else. Marital property -- everything acquired during the marriage -- needs to be divided in some way: the cars, the house, the bank account, the furniture. So, too, the artwork created by the artist-spouse, and along with the physical objects are current and future revenues from licensing as well as the copyright.

Does any of this come as a surprise? "Artists tend not to think of the artwork they create as property, marital or otherwise," said Barbara J. Gislason, a lawyer in Minneapolis who specializes in both family law and intellectual property. Artists often look at their unsold creations, which may be placed in storage, stacked somewhere in the studio, decorating the house or on consignment to a gallery, as theirs by right. The courts, however, view any artwork created during a marriage as community or marital property, to which the non-artist spouse has an equal claim. (That extends to copyright, which a 1987 ruling from the California Court of Appeals belongs not "only to the author" but "must be considered community property.")

Not everything is up for grabs. Artworks created prior to the marriage and those produced after the couple has separated or filed for divorce (depending upon the jurisdiction) are not counted as marital property. Payments agreed upon before the marriage, such as for an art commission or licensing agreement, that arrive after the wedding also are excluded from the marital assets.
The first requirement for an artist in the midst of a divorce is "to develop an inventory, a detailed list of all the artworks that have been made, which were made before the marriage, which were made during the marriage, which have been sold and at what price and which haven't been sold," said Raoul Felder, a divorce attorney in New York City. The location of unsold pieces created during the marriage needs to be identified, and hiding artworks or failure to disclose licensing documents could be a source of future lawsuits. "Half or even 100 percent of any undisclosed and unallocated assets may be awarded to the other spouse, depending upon if the failure to disclose is determined to be the result of fraud by the nondisclosing spouse," warned Valerie L. Patten, a family and art law practitioner in Palo Alto, California.

In addition, some value must be assigned these artworks. That evaluation might be done by a professional appraiser or even a gallery owner -- a dealer may be the only source of pricing information in the event that no secondary market exists for the artist's work. Preferably, the spouses will agree on a single appraiser or dealer to determine values, but both sides are entitled to pick their own experts, with final estimates negotiated by lawyers or by a judge in a court of law. Most states' divorce laws are based on what is called "equitable distribution," which refers to roughly comparable values for each partner on a marital balance sheet, and the goal of the judiciary is for the spouses to find ways to divvy up assets and property that each side finds acceptable.

More complicated is determining a value for artworks that have not been exhibited or even completed: What is the value of a clay model or maquette? When the piece is brought to a foundry, how many will be cast in an edition, and what will be the price of each? "Unsold works of art have a speculative value, but it is still a value," said Amy L. Beauchaine, a lawyer in Orlando, Florida whose practice includes both entertainment and family law. "I've seen agreements where an ex-spouse will be paid less than 50 percent, say 20 percent, if a work produced during a marriage is sold within three years' time after the divorce." Additionally, the non-artist spouse might agree to cede future earnings in exchange for being freed from responsibility for a current foundry bill, since debts accrued during the marriage also belong to both spouses.

Until the property division has been settled in a divorce decree, artwork may not be loaned, sold or destroyed without the consent of the other spouse. It is unlikely that the non-artist spouse would object to sales at a gallery exhibition, since that may lead to money that can be shared, although a sell-off of one or more artworks at below established prices might be objected to for depressing the market.

Divorce negotiations are a time of considerable horse-trading. Ward noted that "more established artists generally have a wealth of other assets, such as real estate and investments, which can be traded for works of art that the artists especially want to retain, while less established artists may only have the works of art." Emerging artists may view their artwork as more valuable than their spouses who hadn't seen it selling and are willing to trade their interest in it for something more immediate, such as the computer or the car.

The value of any licensing contracts or the creation of multiples and derivative works, known as copyright, similarly is a matter of negotiation, with money changing hands as part of the divorce settlement or by an agreement to share profits after the divorce. When Charles M. Schulz, creator of the long-running "Peanuts" comic strip, divorced his wife of 24 years, he agreed to share future revenues from his work at the initial rate of 27 percent, decreasing over a 10-year period to 15 percent. Similarly, when comedian Jerry Lewis divorced his wife, Patti, after 35 years, they agreed that he would retain ownership rights to the films he had made during that time, but she would have a half-interest in the royalties from them.

For the artist, but just as much for the spouse -- particularly if there are ongoing financial interests between the two or children who will need to be supported -- the goal must be to maintain the art career with as little interruption as possible.