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Brandeis University's Community Newspaper — Waltham, Mass.

Univ. faces legal issues in Selling Rose Art

Published: January 30, 2009
Section: Front Page

The university’s Board of Trustees’ unilateral decision to close the Rose Art Museum and sell its 7,183 piece collection has sparked a state-wide controversy about the ethicality of selling a collection comprised mainly of donated works in order to ameliorate the university’s budget crisis.

This is not the first time that the university has faced controversy after deciding to sell the Rose’s art for profit.

In 1991 the Rose auctioned off 12 paintings for $3.72 million in order to add to the museum’s endowment. Many members of the art community, including the American Association of Museums (AAM), an umbrella organization that promulgates a voluntary code of ethics for museums across the country, decried the sale.

That decision, though controversial, was legal, because the profits went back to the Rose Art Museum’s endowment, and not the university’s.

However, the university itself cannot use any funds from the currently proposed art sale without closing the museum.

“Nothing can be sold for the university’s profit without closing the museum,” Rose Art Museum Registrar and collection manager Valerie Wright said.

Once the museum closes, which is scheduled to happen in the late summer, the university will be faced with even more legal concerns.

Wright said that the first step toward any attempt at selling the art would be for members of both the university and the Massachusetts state Attorney General’s office to go through the deeds of gifts and related documentation for each and every piece of art in the museum.

No member of either the Brandeis administration or the Attorney General’s office has contacted Wright about accessing the documents; however, in a statement e-mailed to The Hoot, the Attorney General’s office said that “the process of review has been started.”

“This is going to be a big, big, big project,” Wright explained. “I don’t know how much the university thought about the logistics of this when they gave us the timetable.”

“If the museum is liquidated and pieces of the collection need to be deaccessed,” she continued, “it all depends on the deed of gift.”

The gifts that the Rose Art Museum received can be classified as either restricted or unrestricted.

An unrestricted gift is one that was given to the museum without any requirements set by the donor in the deed of gift, which is signed by the donor, the museum, and the university.

In this case, the university is legally able to sell the artwork even if the donor does not approve of the sale. Furthermore, the university is not legally required to notify the donor of the sale.

Wright said that since the 1990s, museum practices across the country have trended towards only accepting unrestricted gifts.

“In the past couple years we’ve only had a few donors donate restricted gifts,” Wright said. “But some donors give multiple gifts.”

A restricted gift has some contractual obligations for the university.

A restriction may require that the university keep a piece on display in its permanent collection or that the university never sell a piece. In this case, the university would have to file a suit in court to change the conditions of the restriction.

If the university can prove that the restriction is either impossible or impractical to carry out (for example, if the museum is closing, that the piece can no longer be exhibited in a permanent collection), and if it can prove that the donor’s wishes would be fulfilled by selling the artwork to benefit the university, the court can change the restriction and permit the university to sell the piece.

The university faces additional issues with restricted gifts where the donor is deceased. If the restriction contained what is known as a “gift-over clause”—which requires the university to give the artwork to a designated recipient if it cannot fulfill the conditions of the gift—then the university may be obligated to send the artwork elsewhere instead of selling it.

In the event that the university would have to send the gift elsewhere, Wright said that the university would be responsible for paying all shipping and insuring costs.

However, if the donor has been deceased for over 21 years, the “gift-over clause” expires, and the university is free to do whatever it wants with the piece as long as there are no other restrictions.

The university also faces tax concerns with pieces that were donated less than two years ago. If those donors and the university intended that the piece would be kept in the museum and not sold, then those donors qualified for a higher tax deduction than they would have if the university’s intent were to sell the piece.

In these cases, the university is required to notify both the Internal Revenue Service and the donor. It is possible that the IRS would then investigate the university and the donor for potential tax fraud, to ensure that the donor and the university were not colluding to misrepresent the purpose of the gift in order to increase the donor’s tax benefits.

One way that the university could avoid this investigation is by simply waiting for the two-year period to expire before attempting to sell the piece.

One overarching concern, Wright, the Museum’s registrar said, is that the university is “in a legal gray area” due to the nature of the relationship between Brandeis and the Rose Art Museum.

Because the Rose Museum is not a separate entity from Brandeis University, the decision for the university to close the museum—as opposed to the museum choosing to close itself—is unprecedented in the art world.

“No one foresaw anything ever happening to the Rose,” she said. “What happens here will have huge ramifications nationwide for other university museums.”

Wright said that Jonathan Lee, Director of the museum’s Board of Overseers, is looking into possible methods of challenging the decision on those grounds.

However, Wright said that the Attorney General’s office has implied that they would only block the sale of art on the grounds that it was restricted, not because of any legal questions surrounding the university’s decision to sell.

In addition to all of these legal hurdles, Brandeis has once again angered the American Association of Museums.

The President of the AAM, Ford W. Bell, released a statement yesterday stating that:

“[The AAM] is alarmed and dismayed at the decision by Brandeis University to close the Rose Museum and sell the objects from its collection. Such a drastic action would be an irreparable loss to the university and its community…Museums hold collections in the public trust. These collections are a part of our common heritage and belong, in a moral sense, to all of us.”