We previously posted about John McEnroe’s successful replevin action arising out of his partnership with infamous fraudster Larry Salander. That decision was recently upheld by the Appellate Division and Johnny Mac remains the rightful owner of Gorsky’s Pirate II.
Salander and McEnroe had partnered to purchase the work, but Salander later sold it without permission to Joseph Carroll, an art dealer. The Court found that Salander had no ability to pass title because he sold the work in the name of a bogus company and not through the McEnroe and Salander partnership. Likewise, it was a sham conveyance outside of the ordinary course of the partnership’s business and Salander had no apparent authority to act for the partnership.
The Court also found that Carroll was not protected by the UCC because he obtained the artwork in a “grossly undervalued transaction”, he failed to make sufficient inquiries as to Salander’s authority to sell the work, and he did not “observe the reasonable commercial standards of the art trade” because of all of the red flags surrounding the transaction. The Court rejected all of the other arguments and upheld the trial court’s decision to award the work to McEnroe.
Please write to Mike Bono for more information.