Consignment Contract

INTRODUCTION
Most galleries do not purchase work outright.  Instead, they accept the work “on consignment.”   In effect, they borrow work from an artist for display in the gallery, and then pay the artist only when it sells.  This arrangement limits the gallery’s capital outlay, so they can devote more of their resources to paying for rent, staff, publicity, or other costs of doing business.

A consignment arrangement has advantages and disadvantages.  For example, one advantage is that consignment can allow a gallery to show risky or difficult work, since their money is not tied up in purchasing inventory.  However, a disadvantage is that even though the artist’s work is in the gallery’s possession, the artist isn’t paid until the work is sold.  This business arrangement is complicated enough that misunderstandings and difficulties can arise if the parties have not been clear about the terms of the arrangement from the beginning.  

Even in the best relationships based on trust and a good working relationship, there is no substitute for a contract.  To minimize and hopefully avoid possible conflicts, the rights and obligations of both the artist and the gallery should be clearly written in a contract.  Do not rely on assumptions and the memories of verbal conversations.  A good contract, such as the consignment contract developed by the Professional Guidelines Committee, is fair to both parties.  It is in the interest of both parties to discuss all the issues presented here.  The contract outlines the responsibilities and rights of both the gallery and the artist.

Another important aspect of a Consignment Contract is if the gallery/store goes out of business. Your work is protected (by the contract) from the galleries/stores creditors that may want to claim inventory against the money they are owed.

Many galleries are accustomed to using their own contract.  If the gallery already has a contract that it wants to use, it can be signed “as is”, or it can be viewed as a starting point for further discussion.  The artist can use this contract as a checklist or guide for negotiating modifications and revisions.  Your business relationship with the gallery may include specific arrangements that require additions or deletions, which you should initial.  In addition, amendments that arise after the original contract has been signed should also be put in writing and signed by both parties.

Read the entire Introduction, Overview of every clause and use the Consignment Contract in the Professional Guidelines to protect your work.

Download PDF Consignment Contract

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