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DAWSON v. G. MALINA

December 11, 1978

Joseph M. A. J. DAWSON, Plaintiff,
v.
G. MALINA, INC. and Gerald Malina, Defendants



The opinion of the court was delivered by: BONSAL

Plaintiff Joseph M. A. J. Dawson ("Dawson"), a resident of Jersey, Channel Islands, is suing defendants G. Malina, Inc. ("GMI"), a New York corporation, and Gerald Malina ("Malina"), a resident of New York, individually, for rescission, or alternatively, for damages for breach of warranty with respect to certain objects of Chinese art which Dawson purchased from GMI in 1974. This action was tried to the Court without a jury on April 25 and 27, and May 4, 9 and 11, 1978. The Court has jurisdiction over this action under 28 U.S.C. § 1332 based on the parties' diversity of citizenship.

In September, 1978, the Court held a conference with the parties. The Court suggested that in view of the differences of opinion amongst the expert witnesses who testified during the trial, it would be useful to obtain the testimony of an independent expert to be called by the Court to examine the objects involved and testify as to his findings, subject to cross examination by both counsel. By letter of October 23, 1978 plaintiff's counsel informed the Court that the parties did not wish to reopen the trial for this purpose.

 The dispute arises from the purchase in 1974 of eleven objects of Chinese art by Dawson from GMI for a total purchase price of $ 105,400. The items purchased, which included both Chinese ceramics and jade sculptures, consisted of items Dawson had seen on the occasion of a visit to GMI on March 25, 1974 as well as items which Malina had recommended to him in correspondence between the two subsequent to his visit.

 Malina shipped the objects to London in late September, 1974. However, when Dawson returned to London in the latter half of October, 1974, he learned that his taking possession of the objects in London could subject him to British customs regulations. Accordingly, Dawson requested and Malina (through his agent) agreed to have the goods forwarded to Dawson in Jersey, Channel Islands. The shipment arrived in Jersey, Channel Islands in late October, and on November 2, 1974 Dawson wrote to Malina acknowledging receipt of the goods in good condition.

 Prior to leaving London for the Channel Islands, Dawson showed a photograph of the item which Malina had represented to be a Sung Chun yao vase, to a London art dealer, Mr. Bandini, of Eskenazi Ltd., and Mr. Bandini expressed doubt that the vase was an authentic Sung piece. Consequently, Dawson brought the vase with him on a subsequent trip to London and asked various experts for their opinion as to whether the vase was an authentic Sung piece. According to Dawson, it was the conclusion of these experts that the vase was not in fact of the period of the Sung Dynasty.

 On November 25, 1974, Dawson visited Malina in New York bringing with him the large ceramic vase and a porcelain mirror-black vase, another one of the items he had purchased from GMI. Dawson informed Malina of the conclusions reached by the experts whom he had asked to examine the vase in London and stated that on the basis of those evaluations he wished to return the vase and obtain a refund of the $ 35,000 he had paid for it. In addition, Dawson sought a refund of $ 2,500 for the porcelain mirror-black vase. Dawson's desire to return this latter object and obtain a refund did not involve any question as to the accuracy of the period to which it had been ascribed by Malina. Rather, it appears that the sole reason for this returning of the porcelain mirror-black vase, which had been purchased sight unseen on the basis of Malina's recommendation in the course of their correspondence, was that he disliked the piece when he had occasion to view it personally after the shipment arrived in the Channel Islands.

 Although Malina initially agreed to give Dawson a refund for both of the items, on November 26, 1974 Malina refused to give a refund for the large ceramic vase. Malina explained that after closing the gallery the previous evening he had taken the vase to a Mr. Cox, whom he considered an expert on Chinese ceramics. Malina told Dawson that Cox had agreed with his own opinion that the vase dated back to the Sung Dynasty. In view of the difference of opinion between Malina and Cox on the one hand, and the experts in London who had examined the vase at Dawson's request on the other hand, Dawson suggested that the vase be submitted for evaluation to experts in New York and that they both agree to abide by the decision of these experts. Malina, however, declined Dawson's suggestion, and Dawson left the premises of GMI taking the vase with him. Since Dawson was scheduled to leave New York shortly thereafter, he left the vase with a friend in New York, asking her to take the vase to experts in New York for an appraisal.

 In early December, 1974, Malina wrote to Dawson, then in Hong Kong, informing him that he had applied the $ 2,500 refund on the mirror-black vase toward the costs of freight and insurance incurred by GMI in shipping the objects Dawson had purchased, stating that the total charges of freight and insurance amounted to $ 2,747. Malina's letter reflected a balance owing GMI by Dawson of $ 247. Malina's application of the $ 2,500 refund is a subject of dispute between the parties.

 Dawson returned to his home in Jersey, Channel Islands in late January, 1975. During February and March, 1975, he brought the remaining nine objects that he had purchased from Malina to London to have them appraised by experts there. Based on the results of these appraisals, Dawson turned this matter over to his London solicitor in March, 1975. In October, 1975, Dawson's London solicitor met with Malina at the premises of GMI and based upon the appraisals which had been rendered by the experts in London demanded that Malina accept the return of the objects which had been purchased by Dawson and which, according to Dawson's solicitor, had been found not to conform to the attributions made by Malina. As a result of Malina's refusal to accede to this demand, Dawson commenced this action against GMI and Malina on February 19, 1976.

 At the outset of trial defendants agreed to accept the return of four ceramic works which Dawson had purchased from GMI and to refund Dawson the purchase price. *fn1" Therefore, only five objects remain in dispute as the subjects of plaintiff's breach of warranty claims. These objects and the price paid by plaintiff for each are as follows:

 TABLE

 Each object and the warranties made will be discussed in detail later in this opinion.

 At trial, both Dawson and Malina testified as to the events surrounding the purchase of the disputed objects. Additionally, experts in the field of art testified for both sides.

 Dawson called James Lally, who is employed by Sotheby Parke Bernet Inc. in New York, to give testimony as to his opinion of the objects in issue here. The Court also received in evidence relevant portions of deposition testimony of Miss Margaret Medley, who is Curator of the Percival David Foundation of the University of London, and of Miss Suzanne Valenstein, who is Associate Curator of the Far Eastern Art Department of the New York Metropolitan Museum of Art.

 Defendants called the following expert witnesses to testify as to their opinion of the objects which were the subjects of this dispute: Anthony duBoulay, employed by Christie, Manson & Woods as a director of its New York branch and head of Decorative Arts Department; Robert Sistrunk, a dealer in works of Chinese art; Martin Frankel, a private collector of jade; Marilyn Priem, an appraiser of decorative arts and antiques; and Roger Priem, also an appraiser of decorative arts and antiques.

 The Issues

 The first issue involves the question of whether defendants are liable to plaintiff for breach of warranty in connection with the sale of the five items described above.

 The second issue involves the question of whether there was an oral agreement between Dawson and Malina that the cost of freight for transport of these items from New York to London and the cost of insurance to cover these items while in transit from New York to London, while in storage in London, and while in transit from London to Jersey, Channel Islands, were to be borne by Malina and GMI, as Dawson contends, or whether these costs were to be the responsibility of Dawson, as defendants contend. Ultimately at issue here is the propriety of Malina's application of the $ 2,500 refund owing to Dawson by reason of his return of the porcelain mirror-black vase toward reimbursement of expenses for freight and insurance which were initially paid by defendants.

 The third issue is whether Malina, individually (in addition to the corporate defendant GMI) can be held jointly and severally liable in his individual capacity in the event Dawson prevails on either or both of the above issues.

 By way of counterclaim, defendants allege that certain letters written by Dawson in February 1975 to the heads of two art associations in the United States to enlist their assistance in his efforts to obtain a refund for the large blue ceramic vase (represented by defendants to be a Sung piece) were defamatory; and whether these allegedly defamatory statements resulted in any damage to the defendants. Although this counterclaim was raised by defendants in their answer and the pretrial order submitted to the Court, the only evidence on this issue at trial was that Dawson did in fact write the letters. No proof was offered as to any damages defendants might have suffered in consequence of these letters; nor was there any mention of this claim in the post-trial materials submitted by defendants. Accordingly, the Court will consider the counterclaim to have been abandoned by defendants. *fn2"

 DISCUSSION

 I. Plaintiff Dawson's Claim for Breach ...


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