The challenges of managing artworks in estate plans can be complicated and financially – and emotionally – draining. This is the third article in a series looking at how such issues can be addressed.

This is the third article in a three-part series that examines how the human and emotional realities of steering an estate through ugly, litigious waters are not well understood. This article examines the strategic options and considerations that an executor must understand to administer an estate when valuable assets are involved be they artworks, antiques, or vintage cars. The author is Phillippa Cranston Baran (pictured below), president, Toller International. See her first article here and the second article here. (More on the author below this article.)

Phillippa Cranston Baran

Executor survival: Navigating an estate with artworks – strategic options
Any executor will routinely deal with deeds, property, investments, taxes, insurance, bank accounts, named beneficiaries and so on, and every estate is based on values and respect for a particular human life. When the decedent was an artist or a collector of fine art or other valuables, there is a wealth of additional considerations. When my brother, Toller Cranston (two-time Olympian and international artist) passed away at his estate property in Mexico, he left behind more than 400 original works of art.

For artists, creating is as necessary as breathing 
Artists create and collectors collect because they must. It is their oxygen, their reason for being. Their motivation is rarely money or sales – they are driven by passion. Such cases carry special challenges for an executor. Where to start? What to do? 

An executor may know nothing about the art or the collection, have no interest in or appreciation of the works, but will nevertheless have to make decisions about dispersal strategies, pricing, marketing, promotion, intellectual property, and legacy. There is no obvious roadmap to provide guidance. One can’t just look up the price of a 48” x 48” oil painting the way one can look up the price on a five-year old Honda Civic or explore internet sites to see what a blue velour sectional is going for these days. 

This is about art and valuables, and the stakes for an executor are high. Contrary to popular belief, the value of an artist’s work rarely increases after their death. In fact, in more than 80 per cent of cases, the value drops, especially if there is no one working to protect the brand. The decisions taken and the strategies employed can have a significant impact on the estate – on the artist’s brand, on both the short-term and long-term value of the work, as well as on the artist’s legacy and reputation. Plus, if an executor gets it wrong, they will end up with significant egg on their face and a bunch of angry heirs.

Locate and inventory the work
The first step is to locate the works and create an inventory. It is highly unlikely that an executor will stumble across an orderly listing of all the pieces. Take my brother for instance. Toller Cranston was a well-known international artist, but he never kept records. He kept track of who owed what by scribbling on the wall of the studio. Periodically, his studio would be repainted and then, oops…oh well.

There were paintings on exhibit at multiple galleries across Canada and in Mexico. There were paintings out on loan. There were commissions that had not been fulfilled. There were paintings that had been delivered but not paid for.

There were artworks that been paid for but not delivered including a pony-sized hand-painted wooden horse that was to be shipped to a winery in the Okanagan (see below). It had been languishing in a warehouse in Mexico for months because Toller had spent the money that had been sent from BC for the shipping. 

Executors begin by getting a handle on what they must deal with. How much? How many? How big? Where are they? A digital inventory would include a unique reference number, photo, media (i.e. oil, watercolour, wood), measurements (with and without frame), whether it is signed, and any known information about the piece. 

Establishing value
There is a significant and practical difference between a known artist like Toller, who has a rolodex of collectors and a proven track record of sales, commissions, and gallery shows versuss. an unproven artist who creates for passion. Most of the works of “lesser known” artists end up just like any other of the deceased’s belongings – in estate sales, garage sales, or sadly, in the trash. 

Determining value is not a job for an amateur and an executor is well-advised to seek expert help. A professional appraiser can reliably assign value and will stand by the figures in the case of disputes. One common method of pricing, especially when a whole collection is involved, is to take the measurements of the piece (without the frame), compute the area and multiply the number of square inches by a specific dollar figure. 

That dollar figure, in effect a per square inch price, is determined by taking an average based on recent documented sales. It means that all canvases of the same size: i.e. 36” x 48” or 16” by 20” for example, would be priced the same. The formula has no regard for what the painting looks like, it is just about size. This is a page from the inventory that was created for Toller’s work.

My executor process with Toller’s artworks
I spent considerable effort exploring options for dealing with Toller’s artworks in a way that would not negatively impact either existing or potential future value. I tracked auction prices and compiled a record of what every Toller piece had sold for at auction for the past 20 years. I spoke with a variety of arts professionals including gallerists, auction houses, curators, and appraisers and explored the pros and cons of various options for dispersing Toller’s collection. It boiled down to a few possibilities.

• Offer the pieces for direct sale 
Making the pieces available for private sale to interested collectors was an obvious first step. Some pieces of the more than 400 available, found new homes in that way but that still left more than 350 pieces to deal with.

•  Going, going, gone
Dumping everything into one massive auction sale was universally viewed as a very bad idea for obvious reasons – low hammer prices per piece; greatly diminished value on future sales; and a catastrophically negative effect on the brand, the legacy, and the reputation of the artist. 

• Organize an estate-controlled release over time
Entering into an agreement with a gallery whereby the artworks would be retained by the estate and released slowly over time either by direct sale or through exhibitions was an option that could work only if the beneficiaries were all in agreement and prepared to take a long-term view. That was not the case with Toller’s estate and that option was promptly eliminated.

• Find a single purchaser for the collection
The only realistic option to wind up Toller’s estate in a timely fashion was to seek a private buyer for the whole collection. 

I undertook a search for a buyer for the collection of artworks by inviting offers from a variety of national art dealers, appraisers, auction houses, and of course the galleries who had the most history and experience with Toller’s work. Some of the parties couldn’t consider an offer either because it wasn’t a good fit for their circumstances, they did not have adequate storage capacity, they were unwilling to tie up funds for what would be a period of years, or they did not have available cash. I received regrets and good wishes but only one offer for the balance of the collection. It was a fair offer and in my capacity as estate administrator, it was accepted.

Making judgements 
Administering an artist’s estate is about more than monetizing and dispersing a body of artworks. It is about value, reputation and brand. It is about making decisions based on common sense, efficiency, and what makes sense under unique circumstances. At the end of the day, an executor who navigates this strange and colourful minefield has a well-earned right to pat themselves on the back.

About the author
Phillippa Cranston Baran is the sister of Toller Cranston (picture of Cranston below), a two-time Olympian, international artist, Order of Canada, Honorary Doctorate, and member of multiple Halls of Fame.

Toller Cranston