Jan 21 2019

What To Do Now: The Cancellation of Art Stage Singapore

by Ryan Su

Installation view of Art Stage Singapore 2017. Courtesy Art Stage Singapore.

The collapse of an art fair

The folding of an art fair is a complicated situation, one made even more complex when it collapses just nine days before it is due to open. Art fairs are usually cancelled far in advance. This would be the sensible thing to do in order to recuperate expenses. There would also be less wasted expenditure, as exhibitors would not have to make unnecessary preparations, venues wouldn’t be booked, staff need not be engaged, and marketing and publicity costs would not be incurred.  

The case of Art Stage Singapore is peculiar. As someone watching the events closely put it: it is a case of deciding to not marry only at the altar. While in a marriage situation this would mean awkwardness and embarrassment, in an art fair context, the blowback is even greater. In Singapore, it is said that accident and randomness are excluded, so this comes as a shock to the system.

Let me state at the outset that I acknowledge and respect the good that Art Stage Singapore has brought to our city. Art Stage Singapore’s first edition was launched in 2011, at a time when there was no Singapore Art Week, no community of art collectors, no Gillman Barracks and far fewer opportunities for selfies with internationally recognized contemporary artworks. The fair brought life and sparkle to what were largely artistic backwaters where art did not reach the masses on the intensity and scale only an art fair can.

When it is nine days to show time and the fair gets the axe, things get messy. For ease of explanation, I have divided the affected persons into five categories: (1) participating galleries, artists and collectors; (2) logistics and other service providers; (3) stakeholders and sponsors; (4) the public; and (5) the art fair itself. Here’s a look at some of the legal and logistical issues facing each of these groups.

1. Participating galleries, artists and collectors

The closure of an art fair definitely impacts participating galleries, artists and collectors. While it is galleries that are most obviously affected, artists and collectors may have been commissioned or invited to showcase artworks by the art fair. For this year’s iteration, Art Stage had commissioned artworks and also invited 28 private collectors from Southeast Asia to present self-curated showcases. While none of this will come to fruition, there are numerous costs flowing from the abortive endeavors, considering that preparations would have been almost complete at the time of cancellation.

For everyone in this group, the priority is to immediately stop all shipments in transit to Singapore and cancel all travel plans and accommodations, in so far as they could be cancelled or refunded. Under the law, they must first try to mitigate their losses, as losses that could have been reasonably mitigated would not be claimable. With that said, the duty to mitigate is not a high one and it should be sufficient if they take the above steps and not just sit back. Shippers would be particularly empathetic, considering that they too would suffer unhappy clients and the risk of non-payment for shipments that serve no purpose. 

Participating galleries, artists and collectors should have a contract that contains terms that define their relationship with the art fair. Even if there is no written contract, they should be able to rely on an oral agreement whereby certain acts were performed pursuant to it. The next step is to review these agreements—and many people will probably wish that they had paid more attention to them from the start. 

In the case of a participating gallery, look at the application form and its terms. What law governs disputes arising from the contract? Is the art fair allowed to cancel for commercial reasons, such as the presence of a competing fair, or only when there is a natural disaster or catastrophe? In the “Application Form: General Booth” form (still available on the Art Stage website), it appears that Singapore law applies, and that commercial reasons do not entitle Art Stage to cancel the fair. It is only after they identify that there has been a breach of contract that they can proceed to the next stage.

Installation view of GERALDINE JAVIER’s Hysteria, 2011, installation with oil on canvas, framed mirror, embroidery and cow skull with tatting lace, dimensions variable, at the Tiroche DeLeon Collection booth, Art Stage Singapore 2018. Photo by Lucas Schifres. Courtesy Art Stage. 

The last step would be for participating galleries, artists and collectors to calculate their losses. Generally, losses need to be proved to the court for damages to be awarded. This exercise involves taking out all invoices, receipts and agreements for which payments have been made or would have to be made. It is easiest to start from the biggest expense and move downwards. For galleries, the biggest expense would be the price of the booth. From the general application form, standard booth prices range from SGD 67,500 to SGD 26,250 (USD 49,700 to USD 19,300). Together with galleries, commissioned artists and collectors would have also incurred potentially substantial shipping costs, in addition to flights and accommodation. Records of these will need to be presented as evidence to a court.

While there may be the possibility of claiming loss of potential sales and even income, this will be harder to prove. To succeed in such claims for consequential losses, it must be shown to the court that the art fair or its organizers knew that such losses were reasonably foreseeable at the time the contract was entered into. The principle behind this is that the organizer’s liability should not be increased unless they knew about these special circumstances at the time of contracting, whereupon they would have had the opportunity to decline.

Litigation is usually the last resort. The option of resolving the dispute amicably or by other dispute-resolution mechanisms should first be explored. In fact, the general application form provides for arbitration in Singapore before a sole arbitrator under the Singapore International Arbitration Centre (SIAC) rules. In any case, it would be prudent to first undertake litigation and insolvency searches to decide if it is worth proceeding. These searches will show if the opposing party is already mired by lawsuits and if there are sufficient assets or funds available to satisfy your claim in the event that you are successful. This is an emotional time and it is best to stay calm to plan an appropriate course of action.

In Singapore, the litigation process usually starts with the aggrieved party issuing a letter of demand to the opposing party, setting out a list of demands that have to be satisfied within a stipulated time, failing which the action would be escalated and a writ of summons served unto the opposing party. Depending on the amount in dispute, the action would commence either in the state courts or the high court of Singapore.

There is also the possibility of resolving the dispute inexpensively and quickly at the Small Claims Tribunals at the State Courts of Singapore should the amount in dispute not exceed SGD 10,000 (USD 7,400) (or SGD 20,000 (USD 14,700), if agreed by parties). Lawyers are not allowed in the Small Claims Tribunals, and the referee should be able to make a decision on the spot.

2. Logistics and other service providers

Logistics and other service providers form the backbone of any art fair. They too are affected by a cancellation. As with the first group, their first step is to mitigate all losses, including cancelling shipments, stopping construction work like building partitions, printing catalogs and running advertisements. The next step is to look at all contracts with the art fair to see what their rights are. As these contracts are unlikely to be the standardized ones given to all exhibitors, they should pay particular attention to the choice of law and jurisdiction clauses, especially if these do not point to Singapore law or its courts. It would be onerous if a party familiar to Singapore and Singapore law was to resolve its disputes in a foreign place under foreign law. 

Logistics and storage service provider Le Freeport’s Singapore space. Image via Le Freeport. 

The stakes for logistics and other service providers may well be higher than that for participating galleries, artists and collectors. This is because these “infrastructure” type contracts would be: (1) of a higher value; (2) require much advance preparation and ordering of supplies; and (3) may involve subcontractors. These contracts each contain multiple parts and parties, and any default results in a domino effect. For example, a logistics company tasked to ship artwork from overseas would not only have a contract with the fair or gallery, but also with an overseas agent to perform overseas services, who in turn may have subcontractors, such as someone who only does wooden crating or fumigation of the crates. The key here is to stop the chain with minimal losses and to claim for wasted costs and costs that cannot be recovered.

It would be prudent of a logistics or other service provider to determine which party is contracted with it, and to channel all claims and attach all obligations to that person only. For example, if a logistics company was hired by a collector who was invited by the art fair to showcase his collection at the fair, only the collector would be answerable to the logistics company for any unpaid bills. This is not withstanding that it was the art fair that cancelled, resulting in the unnecessary or cancelled shipments, which may not be refundable. The collector still has to pay the logistics company (and the logistics company should ensure that this is the case). It would then be up to collector to take this bill to the art fair and demand that they be reimbursed for it.

3. Stakeholders and sponsors

Stakeholders and sponsors have much to be concerned about when an art fair is suddenly cancelled. The paramount concern for this group would be to mitigate reputational risk. Stakeholders and sponsors may have invited clients and key personnel to the art fair, and it would be a dicey affair to break the news that the partnership would no longer occur—a partnership that a sponsor would have at one point had to give convincing reasons for entering into. For a supporting bank, with reputation being the cornerstone of the financial industry, it would be particularly awkward to have had aligned itself to a now forlorn organization, not to mention how humiliating it would be to rescind invitations to the opening vernissage from its top clients.

In terms of legal rights, stakeholders and sponsors should look at their contracts with the fair and pay particular attention as to whether any sponsorship amounts paid previously can be clawed back, and whether there has been any contractual breach. They can also think in terms of tortious liability, to see if there was any misrepresentation or negligent misstatement made by the art fair and that they had suffered as a result. A claim in negligence may also be explored, if the aggrieved party can show that the organizers owed them a duty of care, and that they suffered loss as this duty was breached. 

Harm to this group goes beyond what the law considers as harmful. Stakeholders may include government agencies and policymakers that relied on the art fair in their planning and policies envisaged to benefit society. Efforts to establish Singapore as a “go-to destination for contemporary art” would be undermined by negative publicity, as confidence in Singapore’s position as a stable arts hub is eroded. As dreadful as this may sound, the law does not provide recourse in these instances. 

Installation view of Art Stage Singapore 2013’s VIP Lounge. Image via WY-TO Architects.
Installation view of Art Stage Singapore 2013’s VIP Lounge. Image via WY-TO Architects.

4. The public

The cancellation of Art Stage also affects the public. While the inability to enjoy an art fair is not a recognized legal cause of action, paying for tickets and not getting a refund for them from the doomed fair is. It must be remembered that the majority of people attending the fair are members of the public who may not be art buyers, but would like to enjoy a day out to see art. The SGD 30 (USD 22) for a standard ticket to the fair might be a substantial sum for someone who would like to enjoy art at the fair, or students who have purchased advance tickets. While it does not make economic sense to commence legal action for SGD 30, it is still an amount of money that they should not be wrongfully deprived of. The remedies for this would thus transcend the legal, and they should think of creative ways to recover these amounts, including the possibility of working with consumer protection organizations to advocate for ticket holder’s rights—especially when a large number of people are affected.

Lorenzo Rudolf, director of Art Stage Singapore. Courtesy Art Stage Singapore.

5. The art fair

For the organizer, cancelling the fair so close to the date means substantial losses suffered by the exhibitors and other parties. It would be onerous for the organizer to cancel the fair at such a late stage, unless the organizer were averting perhaps even more serious losses. Doing so opens the organizer up to tremendous legal liability, although the organizer may be insured against such risks. 

While this is an unfortunate and unprecedented situation for Singapore, the key takeaway from the exit of Art Stage is the Singapore art scene should be allowed to grow organically with room for fairs to come and go. The fall of Art Stage is a particularly hard one for all affected, made only more painful when all hope was pinned onto what was once a visionary art fair that shone a spotlight on the art and artists from region. In any case, the groundswell of support and offers to host stranded galleries and artists following its collapse is heartwarming. It is my wish for aggrieved parties to find the remedies that they seek and that we all move on from this unfortunate episode. 

Please note that this article is written for a general audience and is in no way a substitute for seeking proper legal advice. Also, there are other strategies and types of claim that cannot be discussed here in the interest of space and complexity.

Ryan Su is Counsel at WMH Law Corporation and a contributing editor to ArtAsiaPacific.

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