Yaacov Agam. Photo: Edward Kaprov / Wikipedia
Internationally renowned artist Yaacov Agam has succeeded in the latest step of his legal battle to stop his work being sold against his will.
His works include lenticular art, which gives an impression of movement and can change depending on the viewer's perspective.
Each piece of lenticular art starts as a digital design and technical processes are then used to turn the design into a physical form.
Agam, in his 90s, had been having his work printed by New Zealand-based company Outer Aspect (OAIP) but in recent years the relationship soured.
The company and its director, Jonathan Moon, claimed Agam owed the business millions of dollars - but he disputed the bill.
The company then said it would sell the artworks it had in its possession to cover the amount owing. The sale has gone as far as to be advertised, and an auction date was set for the weekend after the case was heard by the Court of Appeal.
In April 2024, Agam learned Moon had approached galleries wanting a valuation and exploring the potential sale of artworks in his position.
In September 2024, Agam learned that OAIP was planning to sell a large number of the pieces it held to cover the amounts it claimed were owing.
Agam went to court to obtain an interim injunction restraining Moon and OAIP from taking steps to sell the artwork or create copies of it.
OAIP and Moon applied to rescind the injunction or, alternatively, to vary it to require Agam to pay security for his undertaking as to damages. They also applied for an order for security for costs.
The High Court continued the injunction on the grounds that Agam paid $2 million into a trust account as security. Agam appealed and Moon and OAIP cross-appealed.
The Court of Appeal has now released its ruling that the interim injunction is granted and has set aside the $2m requirement.
The Court of Appeal judgment from justices Courtney, Powell and Cull said OAIP had not established the terms of the contract between it and Agam so it could not exert a contractual right at this stage,
"Nor do we see a basis, at least in the context of the present appeal, on which OAIP could demonstrate that it has a common law artificer's lien.
"The judge identified the competing factors affecting the balance of convenience. On the one hand: OAIP had attempted to sell the artworks without notifying Agam and the proposed sale risked devaluing Agam's brand, and was also unfair to the owners of existing pieces," they said.
"Agam wished, not unreasonably, to inspect the artworks to ascertain their condition. Since OAIP still had possession of the works, it had a form of valuable security. OAIP had taken a long time to resolve its outstanding accounts and '[did] not exactly have clean hands in this respect'."
But they said the judge laid out that Moon's evidence was that OAIP would face significant hardship because of the dispute.
It faced a loan of $1.788m that was due and had costs of producing the artwork it could not repay without payment from Agam of the disputed invoices or the sale of the prints.
"We have already indicated that the evidence provided by OAIP to date does not support its assertion as to what is owing. It is not possible to say how much Agam will ultimately be found to owe, if anything.
"As to OAIP's financial position, we do not think it was necessary for OAIP to show that the company's debt was related to the work it had done for Agam. However, that was how the argument was advanced and the evidence does not support it. Moon says that since the Covid-19 pandemic, OAIP's work for Agam has been the company's only real source of income and that it has continued to incur ongoing costs for storage, staff, insurance and operating the studio."
The Court of Appeal said the evidence did not support the assertion Agam owed US$1.78m nor that the debt related to work done for Agam.
"Yet these factors clearly influenced the judge's assessment of the balance of convenience, and to a significant degree. We also note that, while acknowledging that an order requiring Agam to pay security would not enable OAIP to repay or refinance its loan, the judge nevertheless accepted the submission made by OAIP's counsel that the payment would "provide significant comfort to creditors that money will be available promptly once quantum is determined … [which] may well enable OAIP to delay enforcement".
There was, however, no evidence that this was the case. The emails OAIP had produced from the financier recording the amount owing by OAIP contained nothing to indicate whether payment of further security by Agam would have any effect on OAIP's position.
"We therefore consider that the judge erred in giving weight to these factors. Leaving them aside, the balance of convenience strongly favoured Agam. The extent to which the amounts invoiced for will be shown at trial to be owing is unknown. There are serious issues over the terms of trade that apply, including whether OAIP is entitled to claim the level of interest that makes up a substantial "
They said the High Court justice Andrew Becroft erred in making continuation of the injunction conditional on Agam paying security to support the undertaking as to damages.
They said the threshold had also not been met for requiring an undertaking for security for costs in the usual way.
"Even if it had, that it would not have been appropriate to order security for costs in this case. Agam may live overseas but OAIP has possession of valuable artworks which, ultimately, can be sold. There is, therefore, no reason to think that OAIP's and Moon's costs would go unpaid if they prevail at trial."
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