Stillman v. De Vos

Background

Roy Stillman alleged that in 2004 he purchased from Jacques De Vos and Galerie Jacques De Vos a table ostensibly made by Diego Giacometti. Stillman alleged that De Vos represented the table as authentic, provided an invoice and a certificate of authenticity, and promised that, if Stillman became sincerely concerned about its authenticity after one year, De Vos would return the purchase price of $190,000.

The amended complaint asserted claims for breach of contract, fraud, fraudulent concealment, unjust enrichment, and breach of warranty. The defendants moved to dismiss under Federal Rule of Civil Procedure 12(b)(6), which tests whether a complaint adequately states a legal claim.

Statutes of Limitations and Delay

The defendants argued that the claims were barred by statutes of limitations or laches, a defense based on unreasonable delay in asserting a claim. The court explained that dismissal on those grounds at the pleading stage is appropriate only when the defense is clear from the face of the complaint.

For the contract, unjust-enrichment, and warranty claims, the parties disputed which New York limitations period applied. The court noted uncertainty about whether the agreement was governed by the four-year period for sales of goods or the six-year period for general contract claims, and whether De Vos’s repurchase promise was a distinct agreement. The court held that factual development and further briefing were necessary.

The court also declined to dismiss the warranty claim based on the limitations period. Although the court had serious doubts about one basis for equitable tolling, it concluded that the issue should be considered later, after a fuller factual record.

For the fraud and fraudulent-concealment claims, the parties agreed that New York’s discovery rule applied. That rule generally allows the claim to be filed within two years after the fraud was discovered or reasonably could have been discovered, subject to the statute’s other timing provision. The court found nothing on the face of the amended complaint showing that Stillman should have discovered the alleged fraud before Sotheby’s refused to consign the table after his August 2021 inquiry. The complaint did not specify exactly when that refusal occurred, and the defendants had raised some related arguments for the first time in their reply brief. The court therefore declined to dismiss the fraud claims as untimely or barred by laches.

Claims Against Jacques De Vos Personally

The defendants argued that all claims against De Vos should be dismissed. For the contract claims, the court stated that a corporate officer or agent may be personally liable for a corporation’s obligation only when there is clear and explicit evidence that the officer intended to assume personal liability. At the pleading stage, the court found Stillman’s allegations sufficient to infer that De Vos may have intended to be personally liable for the repurchase obligation because the complaint identified the promised refund amount and the contract terms at issue.

The court did not consider De Vos’s declaration stating that he had not signed a guaranty or other separate acknowledgment of individual liability. That declaration was outside the pleadings, and the court declined to convert the motion into one for summary judgment, which is a procedure for deciding a case based on evidence after the parties have had an opportunity for discovery.

For the tort claims, the court explained that a corporate officer may be personally liable for torts, including fraudulent statements, that the officer personally commits or participates in. The court found that Stillman adequately alleged De Vos’s personal participation by alleging that De Vos warranted the table’s authenticity and supplied the invoice and certificate of authenticity.

Ruling

The court denied the defendants’ motion to dismiss. The ruling did not decide whether Stillman will ultimately prove that the table was counterfeit, whether the defendants are liable, or whether the defenses may succeed later. The Clerk of Court was directed to close Docket Number 18.