The opinion of the court was delivered by: SWEET
This is a drama concerning the star-crossed relationship of a man and a woman which masquerades as a diversity action brought by the plaintiff, Julian Sherrier ("Julian"
), a London resident and a citizen of Pakistan and Great Britian, against the defendant Bernice Richard ("Bernice"), a New York resident. Julian seeks a declaration of rights and a mandatory injunction concerning the ownership interests in five pieces of Gandharan art,
the value of which ranges from $600,000 to over $2 million, depending upon the purpose for which the valuation is made. On the following findings of fact and conclusions of law, judgment will be entered in accordance with this opinion declaring Julian to be the owner of the Fasting, Princely and Elongated Buddhas, and Bernice to be the owner of the Standing and Seated Buddhas. In addition, judgment will be entered in Bernice's favor for $236,500 with interest from the date of entry of the judgment.
Both parties testified to the facts at length and frequently to widely differing effect in a ten-day bench trial. The testimony recounted intercontinental romance and dealings in art. To state the facts simply is to sketch the peaks and valleys of the efforts of two complicated individuals with differing motivations to create a realtionship of trust, an effort which ultimately failed with such significant results that the consequences can only be unravelled in this court of last resort, appeal, of course aside. This is not the customary diversity case, these are not the familiar dramatis personna of litigation in this court, and exotic art objects are relatively infrequently the subject of declaratory judgments. The application of legal theories ranging from partnership to joint venture must acknowledge the realities of the conflicting emotions which have powered the creation, continuation and presentation of this complicated dispute. Fortunately, I have been greatly assisted by highly-skilled counsel for both parties who have presented this difficult trial with cool and competent professionalism.
Julian filed his complaint on June 7, 1982 alleging that he owned five pieces of Gandharan art which were wrongfully being withheld by Bernice. At the same time by order to show cause he sought relief by way of preliminary injunction. Bernice answered and counterclaimed for moneys due and owing, and for a declaration of ownership in the same five pieces. Both sides engaged in expedited discover, agreed that the hearing on the preliminary injunction and the trial on the merits would take place at the same time, and with great effort and application by counsel thirteen witnesses were presented in ten trial days.
The testimony of Julian and Bernice on many critical issues is directly contradictory. Neither has been completely credible, and the following facts are found after a painful search, relying on corroboration where it exists, the circumstances at the time of the events described, and the evaluation of the truth-telling capacity of Bernice and Julian on each of the issues, having in mind their respective motivations and concerns. It is difficult to imagine a more tortuous path to truth, or one more dependent on the evaluation of the credibiity of the witnesses.
In the fall of 1978 Julian was in New York making the rounds of various art dealers and attending to his interests as a dealer and authority in Gandaran art. He was born in India, educated there and in England, and was the husband of Elizabeth and the father of a daughter, Romany. By occupation he was a sometimes actor, but he was principally occupied in the world of Gandharan and Asian art as a dealer in art objects of the period and as a lecturer on the subject. In that connection in July, 1977, he had obtained a loan from First London Securities Ltd. ("Rossminster") in order to purchase a piece of Gandharan art, referred to as the Nataraj,
an Indian bronze sculpture also known as the Dancing Shiva. The terms of the loan included a provision for the payment of interest at the rate of 60% per annum. Julian was hard-pressed financially, and under pressure from what he referred to as his "merchant bankers." He had sought and obtained renegotiated terms which required certain payments by May, 1979.
In the fall of 1978 Bernice was a wealthy New Yorker, and the widow of George N. Richard. She lived in her townhouse on 5 East 64th Street. She too had more than a nodding acquaintance with drama and had appeared on the musical comedy stage and in supper clubs. Although she had not obtained any degrees, she had studied philosophy and had become a student of languages, traveled considerably, and was a patron of the arts. She possessed substantial art, including important Impressionist paintings. She too had a daughter and a number of friends in the art world, including Dara Zargar ("Dara"), whom she invited to join her at a benefit and dinner on Thursday evening in late November.Dara was also a friend of Julian's, and it was arranged that Julian would join the party, as did Nadine Castro ("Nadine") who was, or became, engaged to Dara.
Julian and Bernice immediately hit it off, and their second evening together the following Saturday terminated at six in the morning accompanied by mutual curiosity and Bernice's coffee.They met again on Sunday, the exploration continued and included sexual intercourse, referred to in the vocabulary of the trial as "intimacy." From that time until Julian's departure for London the following Wednesday, the couple were together much of the day and night. At a very early stage of the relationship Julian described his difficulties, both financial and marital, referring in particular to the loan from the merchant bankers and the coolness of his wife Elizabeth.
Soon after leaving New York, Julian wrote the first of a series of letters which provide something of a chronicle of the relationship with Bernice. At some time during the relationship at the suggestion of his long-time friend, Peter Paone ("Peter"), Julian destroyed the letters received from Bernice as well as whatever business records he possessed, an act which was defended as prudent at the time but which in this context has reduced Julian's assertions to simple uncorroborated testimony in certain critical areas. However, there is little dispute that in the fall of 1978, a romantic affair was burgeoning, the future was uncertain, and the deepest motivations of Julian and Bernice presumably were unknown to each.
Julian sought help in dealing with his merchant bankers, and Bernice offered to send a letter to his bankers indicating that she might be an interested buyer for his art. Bernice consulted her counsel, who objected to the sending of such a letter. She sought the assistance of Dara who referred her to his lawyer, Robert Ross ("Ross"). Ross conferred with Bernice and assisted her in preparing a letter. Bernice gave it to Dara to be typed on the letterhead of the George N. Richard Foundation, a charitable foundation which had been dissolved the year before, a fact which Bernice asserted she had forgotten despite her prior execution of the Articles of Dissolution. It was signed by her in her capacity as President and sent off, indicating perhaps at least subliminally that she heard her lawyer's initial objection to any meaningful action.
Telephone calls and correspondence were exchanged between Bernice and Julian. It was noted that Bernice's Foundation letter had failed to assuage the merchant bankers. Out of these exchanges emerged a practice which became symbolic of the difficulties ahead. Julian reversed the charges on his calls, and Bernice thus adopted the role of financier to the relationship.
Early in 1979 Julian arranged to have certain small pieces sent to Bernice's home as an appropriate place for display and sent as well his New York folio, a collection of photos of pieces that he had available for sale. The possibility of a purchase by Bernice of one of Julian's pieces, the Muchalinga, was discussed and then rejected. A loan by Bernice was considered as an alternative.
In April 1979, Julian returned to New York to pursue his business, to consult with museum directors, give lectures, and refresh the relationship with Bernice, all of which was accomplished. Julian and Bernice spent a great deal of time together, traveled to Worcester (for a meeting) and to the Ritz Carlton in Boston (for pleasure), and Julian described his problems and the potentialities of his business. The unsettled political conditions in Pakistan at the time and increased Islamic militancy combined in his view to present an opportunity to acquire Gandharan art from those whose willingness to sell might be increased by their fear of not being able to retain their collections. Bernice expressed interest in helping him, and at a luncheon with the Paones she stated that she and Julian were going to do business together employing his knowledge and her resources.
At the end of the two week visit she agreed to loan him approximately $127,000 to relieve the pressure of the London loan. On Friday afternoon, April 14, 1979, Bernice in company with Julian went to her bank to arrange for the transfer of $112,000 to Julian's account in London. Saturday morning in her kitchen he gave her a hand-written receipt for the loan, a document no longer in existence. He left for London that evening after an unsuccessful effort at intimacy which ended in a shopping trip and subsequent concern by Bernice. The letter, written by Julian from the plane, apparently affectionate and concerned, is not regarded by Bernice as a "fraud," deceitful in its overall purpose and intent, but it served its purpose at the time, since the relationship continued to expand and deepen. Shortly after Julian returned to London, Bernice wired an additional $7,000 to Julian's account and an additional $8,000 was later given by her.
Bernice, however, was equipped with advisors, and as she expressed some misgivings, they counseled her to protect her interests, in particular, the loan. She told Ross to take care of it. He called Julian, asked for security for the initial loan, and the execution of a more formal promissory note. Julian readily agreed and may even have suggested the security, the Fasting Buddha. In any case, it was agreed that the Fasting Buddha, Julian's most important piece in New York,
would be delivered to Bernice as collateral, a delivery which was accomplished in July, 1979. The note was never returned, but Julian has consistently acknowledged the loan.
The Fasting Buddha was therefore turned over to Bernice as collateral for the loan. This is the most important of the five pieces involved, worth from $300,000 to over $1 million depending upon the basis for which the evaluation is made. While there is no dispute as to the interests in the Fasting Buddha at the time of its delivery to Bernice's home in July 1979, she maintains that she ...