It’s becoming increasingly clear that the business of loaning money against art work has more pitfalls on the client side than the market side. The now infamous Leibovitz case turned into a squabble over who had the right to dispose of Leibovitz’s work. This case in Europe involving Louis Reijtenbagh shows how art can end up being pledged in multiple agreements. JP Morgan made a loan agains Reijtenbagh’s art collection. But that didn’t stop Reijtenbagh from selling the picture to a museum:
The Dutch state, which owns the museum’s collection, “concluded an accord with JP Morgan a few weeks ago,” Taco Dibbits, the museum’s head of collections, told AFP. JP Morgan Chase “renounced its claim to the piece”, he added. “There is now nobody who claims the rights” to the work. “The bend in the Herengracht” (after a famous canal in Amsterdam), a 17th century work by Dutch painter Gerrit Adriaensz Berckheyde, was acquired by the Rijksmuseum from Louis Reijtenbagh, a wealthy art collector, last September. […]
Reijtenbagh is reported in the local media to have used the painting with other works of art as collateral for a 50-million-dollar (38 million euro) loan from JP Morgan in 2006 before selling it to the museum for several million dollars last year. Some 27 million dollars is said to be outstanding on that loan, which has run full term.