LIFE was good for Andrew Pridham in late 2007. Known as a "rainmaker" at JP Morgan, where he was the chairman of investment banking, Mr Pridham had long been one of Australian banking's pre-eminent deal makers.
The shopping centre tycoon Frank Lowy was among his clients and he had a seat on the board of his beloved Sydney Swans. The champagne was flowing after Mr Pridham and others helped the retail trust Centro Properties secure a US shopping centre company for $US3.7 billion, earning tens of millions of dollars in fees for his firm.
The global financial crisis was yet to bite and Mr Pridham was enjoying life and harbour views at his $6 million Mosman home in Sydney, with its tennis court and indoor pool.
In November 2007, the banker turned to the well-known auctioneer and Melbourne art adviser Anita Archer to help him buy some serious art. In return for a commission, Ms Archer was to identify works that would make a good investment. She soon told Mr Pridham she could get him a painting referred to as Lavender Bay, 1988, signed and dated "Brett Whiteley 1988". It was a sweeping vista of the harbour, apparently from the artist's home at North Sydney.
Only months before, a Whiteley painting of the Olgas sold at auction for $3.48 million, a record for the artist, so the Lavender Bay painting looked good at $2.5 million.
Mr Pridham took delivery of the painting in December and paid Ms Archer $300,000. But he became suspicious of its provenance and hired experts to investigate its authenticity.
That same month Centro hovered on the brink of collapse, with its executives revealing that Centro could not refinance debts of nearly $4 billion.
The disputed artwork is part of a much wider story that includes three allegedly fake Whiteley paintings circulating in the market. Some of the biggest names in the Australian art world, including two auction houses, several art dealers and a number of wealthy businessmen, have become embroiled in disputes about the paintings.
Now Mr Pridham is suing Ms Archer for selling him an "artwork that was not by the artist Brett Whiteley", and for allegedly failing to exercise all the "reasonable care, diligence and skill" required to verify and advise him on the painting's provenance, according to his statement of claim to the NSW Supreme Court.
Mr Pridham wants his $2.5 million back, plus money to cover the loss of the capital appreciation of the work, and what he spent insuring the painting and getting experts to check its authenticity.
Mr Pridham alleges that Ms Archer bought the painting from the controversial Melbourne art dealer and horse racing enthusiast Peter Gant for $2.2 million. Mr Gant declared himself bankrupt last June, with debts of at least $3.57 million.
His creditors include artists Charles Blackman and Robert Dickerson, who took Mr Gant to court in 2008 over three fake drawings attributed to them and traded by the art dealer. The court ordered they be destroyed.
Mr Gant has also been connected to the two other suspect Whiteleys: Lavender Bay Through the Window, which he gave to a well-known Melbourne restaurateur as security for money owed, and Orange Lavender Bay, sold to the Sydney car dealer Steven Nasteski for $1.1 million by the Melbourne art dealer John Playfoot, who got it from Mr Gant.
Frequently Asked Questions about this Article…
What is the legal dispute over the Brett Whiteley painting "Lavender Bay, 1988"?
Andrew Pridham bought a painting described as "Lavender Bay, 1988" for $2.5 million after being introduced to it by auctioneer and adviser Anita Archer. He later became suspicious about its provenance, commissioned expert checks and is now suing Ms Archer in the NSW Supreme Court, alleging the work is not by Brett Whiteley and that she failed to exercise reasonable care and skill. He is seeking his $2.5 million back plus losses such as missed capital appreciation, insurance and expert costs.
How does this Whiteley dispute illustrate the risks of art as an investment?
The case shows key risks: artworks can be the subject of authenticity and provenance disputes, advisers or dealers can be controversial, and buyers may face large financial losses plus extra costs (commissions, insurance, expert reports and legal fees) if a work is later judged inauthentic.
Why is provenance and expert authentication so important when buying expensive art?
Provenance and independent authentication help verify an artwork’s origin and authorship—issues at the centre of the Whiteley dispute. Without clear provenance or expert confirmation, buyers risk overpaying for works that may later be challenged as not being by the named artist.
What kinds of costs should investors expect beyond the purchase price of an artwork?
Beyond the purchase price, the article highlights common additional costs: adviser or commission fees (Mr Pridham paid $300,000 to his adviser), insurance premiums, fees for expert authentication, and potential legal costs or compensation if a dispute arises.
If I buy a painting that later turns out to be fake, what legal options are shown in this article?
The article shows that buyers can pursue civil claims—Andrew Pridham has sued his adviser in the NSW Supreme Court alleging misrepresentation and negligence. The article also notes other legal actions in the art market, such as artists taking a dealer to court over fake works, which resulted in court orders to destroy disputed drawings.
Should everyday investors use art advisers or auctioneers to buy high-value works?
The article illustrates both the appeal and the caution: advisers and auctioneers can source high-value works and provide market access, but investors should still do independent checks on reputation, provenance and authentication because advisers can become part of disputes, as happened in this case.
How common are fake or disputed artworks in the market, based on the article?
The article reports a wider problem in this instance: three allegedly fake Whiteley paintings were circulating and several major market participants—auction houses, dealers and wealthy buyers—became embroiled in disputes. It highlights that high-profile cases of suspected fakes do occur and can involve multiple parties.
Can broader market or financial events affect art investments?
Yes. The article notes that the Whiteley purchase and subsequent dispute happened as Centro Properties was facing severe refinancing stress, illustrating that wider financial turmoil and changes in liquidity or wealth can overlap with, and sometimes complicate, high-value art transactions and disputes.
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