What an Art Advisory Agreement Should Contain

Sourcing, valuation, collection strategy, due diligence, sale management, installation supervision, insurance coordination and inventory management are distinct services, and a client who believes they engaged one and receives another has a real grievance.

Scope should also name what is excluded. Advisors are not appraisers for tax purposes unless qualified and engaged as such; they are not lawyers, conservators or tax advisers. Saying so protects both sides.

This is the clause that prevents the worst disputes. Can the advisor bid on the client's behalf, and to what limit? Can they commit to a purchase without prior written approval? Can they sign on the client's behalf, and for what?

Auction is where this becomes urgent, because bidding happens in seconds and instructions given in the room are hard to reconstruct afterwards. Bidding authority should be specific, in writing, and per-sale rather than standing.

• Scope of services, and what is expressly excluded
• Authority limits, especially bidding and commitment to purchase
• Fee basis, timing, and a no-other-compensation undertaking
• Expense policy: what is reimbursable and what requires approval
• Confidentiality, covering the collection's contents, values and location
• Term, termination and what happens to records on exit

The fee basis should be explicit: retainer, percentage, hourly or project, with timing and any minimum. Where a percentage applies, define what it applies to — hammer, hammer plus premium, or total landed cost, which are materially different numbers.

And the clause that matters most: that the advisor will receive no other compensation in connection with the client's transactions without written disclosure and consent. That single sentence resolves the field's central structural conflict.

Collection contents, values, locations and the client's identity are sensitive, and for security reasons as much as privacy ones. The clause should cover the advisor, their staff and any subcontractors, and it should survive the end of the engagement.

It is also worth addressing use in marketing. Whether the advisor may reference the engagement, name the client, or publish images of installed work should be decided in advance rather than discovered in a portfolio.

Termination should be possible by either side on reasonable notice, with fees settled for work done and any in-progress transactions defined.

The overlooked term is records. The research files, condition reports, provenance documentation and inventory assembled during the engagement are the client's institutional memory. The agreement should say that these are provided to the client on exit, in a usable format. Collections that change advisors without this provision routinely lose years of accumulated work.