Owner Has Standing Even Though It Was Not a Party to Consignment Agreement

On January 11, 2022, in Artemus USA LLC v Leila Taghinia-Milani Inc., 2022 NY Slip Op 00115, the First Department, inter alia, affirmed the denial of defendants’ motion to dismiss the breach of contract claim brought by the owner of artwork who was not a party to the consignment agreement for lack of standing. The Court explained:

The court correctly denied defendants' motion to dismiss Artemus's claims on the ground that Artemus was not a party to the consignment agreement. Plaintiffs alleged facts sufficient to permit an inference that plaintiff Edelman Arts, as consignor, was acting as the agent of the owners of the consigned artworks (see Aymes v Gateway Demolition Inc., 30 AD3d 196, 196 [1st Dept 2006]), and thus that Artemus, as the owner of the subject artwork, has an interest in the agreement as a third-party beneficiary (see Decolator, Cohen & DiPrisco v Lysaght, Lysaght & Kramer, 304 AD2d 86, 90 [1st Dept 2003]).

The attorneys at Schlam Stone & Dolan frequently litigate breach of contract claims. Please contact the Commercial Division Blog editors at commercialdivisionblog@schlamstone.com if you or a client have questions concerning such issues.