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Rogath v. Siebenmann - 129 F.3d 261 (2d Cir. 1997)

Rule:

A contractual term is ambiguous where it may be ascribed conflicting reasonable interpretations. As a general matter, when a contract is ambiguous, its interpretation becomes a question of fact and summary judgment is inappropriate.

Facts:

In July 1993, defendant-appellee seller Werner Siebenmann sold the painting entitled "Self Portrait" to David Rogath for $ 570,000. In the Bill of Sale, Siebenmann described the provenance of the painting and warranted that he was the sole owner of the painting, that it was authentic, and that he was not aware of any challenge to its authenticity. Problems arose three months later when Rogath sold the painting to Acquavella Contemporary Art, Inc. for $ 950,000. Acquavella learned of a challenge to the painting's authenticity and, on November 1, 1993, requested that Rogath refund the $ 950,000 and take back the painting. Rogath did so, and then sued Siebenmann in the Southern District of New York for breach of contract, breach of warranty and fraud. Rogath moved for partial summary judgment on the breach of warranty claims, and the district court granted his motion. The district court concluded that (1) Siebenmann was unsure of the provenance of the painting when he sold it to Rogath; (2) he was not the sole owner of the painting; and (3) when he sold the painting to Rogath he already knew of a challenge to the painting's authenticity by the Marlborough Fine Art Gallery in London. Siebenmann appealed the grant of partial summary judgment. Rogath cross-appealed the denial of his motion for attachment and the dismissal of his fraud and breach of contract claims.

Issue:

In an action for breach of warranty of provenance following the sale of a painting whose authenticity was in question, was partial summary judgment for plaintiff buyer proper?

Answer:

No

Conclusion:

The United States Court of Appeals for the Second Circuit reversed the grant of partial summary judgment to plaintiff-appellee buyer Rogath. Upon de novo review, the Court found there were conflicting affidavits which created a fact question as to whether Rogath knew of the challenge to the authenticity of the painting when he originally purchased it from defendant-appellant Siebenmann. At the very least, there was indisputable ambiguity in the affidavits about the pivotal exchange between Rogath and Siebenmann. Genuine issues of fact persisted. Accordingly, as regards the Marlborough challenge, summary judgment on Rogath's claims for breach of the warranties of provenance and no challenges to authenticity was inappropriate. The Court reinstated Rogath's other claims that had been dismissed because of the summary judgment and remanded the entire case for further proceedings.

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