Heritage Auctions Appraisal Services
All About Appraisals: When is Equitable Distribution Not Equitable?
By Meredith Meuwly
Whether it's an estate or a divorce situation, calculating equitable distribution can be a challenge even to the most seasoned of appraisers. Even though we do our best to determine the fair market value of an item based on comparable sale price, the best (and worst) quality of an auction is that anything can happen. Just because a piece is determined to be worth a particular amount, doesn't mean that two very competitive bidders won't drive up the final price. Take for instance the American oil painting by Jerome Thompson imaged here. One very similar example was estimated in 2006 to sell between $10,000 and $15,000. It sold in New York for $54,000, a world auction record for the artist at the time.
With this information in mind, Heritage estimates its slightly smaller painting to sell between $8,000 and $10,000, hoping to achieve a similar result. Only this work eventually sells for $512,500! What? Why? How? There are no exact answers to these questions, except that two very competitive telephone bidders were devoted to buying this painting and only one could win. Sometimes the opposite happens too. Just because a piece is correctly appraised at $5,000, maybe there isn't a bidder that day, and the piece fails to open at half the value. Do these situations mean the appraiser was wrong? Not necessarily. Sometimes crazy things happen at auction --- and is that fair to the family member or spouse who wasn't lucky to hit a home run with their piece?
The only true way to divide assets equally is to sell everything and split the money. This way, there is no lucky or unlucky person. Everyone wins and loses equally. Offering the property at a public auction also allows each party to bid if they want to do so. That way, if someone REALLY wants that Jerome Thompson painting, then he/she can bid for it. Bidding on one's own property at auction is allowed as long as the buyer pays full buyer's and seller's fees. Some states also require auctioneers to make a note in the catalogue that informs everyone that a person with interest in the lot may be bidding on it. As long as the interest is disclosed, then there's transparency for everyone involved in the auction process. True fair market values can then be achieved, resulting in the best equitable distribution of tangible assets.
To discuss more about equitable distribution appraisals and selling your collection, please contact the Appraisal Services department at MeredithM@HA.com or tel. 214-409-1631.
After five years at Christie's in New York, Meredith Meuwly joined Heritage Auctions in 2007 as Senior Consignment Director in the Fine & Decorative Arts Department and currently manages the Appraisal Services department. In 2009, Meredith participated as an appraiser for the Antiques Roadshow on PBS. She is also a member of the Fine Art committee for the International Society of Appraisers and looks forward to assisting with any formal appraisal needs.