Sotheby's sues mainlander for failing to pay for art
Sotheby's is suing a mainland man for more than HK$27 million over Chinese paintings and scrolls that it says he bought in an April auction in Hong Kong but never paid for.
Sotheby's Hong Kong filed a claim at the High Court against Zhang Bo, of Jinshui district, Henan province, on Saturday.
The auction house says that during the April 3 auction, Zhang bid successfully for 20 lots, including more than a dozen scrolls, as well as works of ink on paper.
It says Zhang should have paid a total of HK$34.13 million for the 20 lots on the day of the auction, but he had not done so.
The sale of two lots has been terminated and Sotheby's is seeking to recover its commission on these and the successful bid price on the others, less a deposit paid by Zhang - a total of HK$27.36 million.
The legal action comes at a time when Chinese art continues to command great attention and auctions have regularly exceeded their predicted hammer prices. The April 3 auction, where 341 lots were offered, more than doubled its pre-sale estimate, bringing in HK$468 million.
The lots that Zhang successfully bid for were variously estimated to reach hammer prices of between HK$50,000 and HK$6 million.
The winning bids ranged from HK$100,000 to HK$7.8 million.
The lots included 13 hanging scrolls, among them three by modern Shanghai businessman and Buddhism follower Wang Zhen. One, titled Buddha, went for a hammer price of HK$137,500.
Sotheby's said that before the April auction it gave out a catalogue of the lots with a guide for prospective buyers and conditions stating that the successful bidder for a lot must pay the purchase price immediately after an auction.
It is not rare for an auction house to resort to legal action over a botched sale. In May last year, Sotheby's claimed close to HK$50 million from a Hong Kong man over Asian artworks he successfully bid for a year earlier. In March this year, the auction house sued a Shanxi man for failing to pay HK$6 million after making the winning bid on a Qing dynasty censer last October.
According to Sotheby's Hong Kong, a total of 13 non-payment cases have been filed to the court since 2006.
Sotheby's Hong Kong has introduced a deposit system to avoid defaulting buyers and to safeguard the vendors' interests. According to its policy, the auction house can ask prospective bidders to pay a minimum deposit of HK$200,000, and produce financial references or guarantees as security for the bid.
For those who wish to bid on 'premium lots', a minimum deposit of HK$1 million may be required. The amount will be refunded if the client is not successful on a lot.