Questions continue to dog AGC

The Art Gallery of Calgary holds its AGM today amidst futher allegations of mismanagement. This time the allegations aren’t directed at former president and CEO Valerie Cooper, who is alleged to have defrauded the gallery and facing both a civil suit and a criminal trial, but at the board of directors in relation to Art Divas Inc., an investment group tied to the AGC.

The Art Divas invested money to buy four test plates of Judy Chicago’s “Dinner Party Plates” and one “Toby Head” scultpure by the same artist. The investors were offered to buy shares in a plate or plates at various levels of investment, with some portion of the money going to the gallery as a donation. The gallery is responsible for maintenance, insurance and appraisal of the work.

Wendy Lyons, an Art Diva and a friend of Cooper, is frustrated by a lack of communication, saying she has been unable to get any information about her investment from Brian Hearst, the managing director of the gallery and the board treasurer. Lyons paid $5,000 for her share in one plate, with $2,500 going to the AGC.

After Cooper was fired put on administrative leave and later tendered her resignation from the gallery after the allegations of fraud first surfaced, Lyons grew concerned about her investment (she owns one share) and started seeking information. After not hearing back, she figured the gallery had enough to deal with and put off her inquiries over the summer.

“Then when I started asking again in the fall, I still didn’t get any responses,” says Lyons.

Lyons finally received an email sent out to inform members that the AGM was coming up, but instead of being able to buy memberships up until the day of the meeting, as was the custom in the past, members were informed the board had changed the rules. As a result, the deadline for purchasing memberships had already passed by the time Lyons was notified. Hearst’s response to her about the change was: “Regarding the AGC membership you have had all year to get one.”

He also addressed her investment queries. “Please contact the art divas directly with your questions. I am not their representative”

Hearst says the rules changed this year to allow members to vote in person, by mail or by email. “This was well received,” he says over email. “The minor catch, which is common to corporate AGMs, is that the memberships must have been valid at the date of notice. Memberships expire on March 31 each year, so interested members have had over six months up to the Notice of AGM to renew for $30.” (note: a membership costs $35)

He also says “The group of owners (approx. 40 individuals) formed Art Divas Inc. to act as legal trustees of their art investments, managed by themselves, not AGC.” Hearst, who says he is at home fighting the flu, has not replied to a message asking him about the gallery’s stated responsibilities for the work and its relationship with the investment group. His wife, Linda Hearst, is an investor.

Lyons grew more concerned when the gallery said it was unable to provide a refund owed to the Divas, particularly because the group’s money was supposed to be kept separate from gallery accounts, she says.

A source familiar with the matter, who wishes to remain anonymous, alleges that the investment money isn’t there and has been spent on gallery operations. The same source goes on to say that the artwork in question was grossly inflated in price when the investors were brought on board and that the work was not imported into the country under the proper procedures — it was imported for exhibition purposes only — calling into question the legal status of the investment. Fast Forward Weekly has been unable to corroborate these allegations at this time.

The intent of the Art Divas investment was to buy into work that would, hopefully, appreciate in value, and to tour the pieces to other venues.

Lyons says she hasn’t seen an appraisal of the work since it was first purchased a few years ago, but was recently forwarded an email indicating that the value is indeed up. The gallery is tasked with appraising the value of the work “not less than annually,” and she’s concerned about the work being insured as intended and what the value of the work is.

Her questions, and the fact that she refused to pay $500 for a new crate for the work and a catalogue so that the pieces can tour, have gotten her “blacklisted,” she says. She didn’t pay her fee because she wasn’t getting any answers to her questions. She speculates that it might also have something to do with her relationship to Cooper.
“So that’s when they decided that I didn’t get a vote or couldn’t receive minutes because I hadn’t paid, but I haven’t received anything from them asking me for the money, or any information, so I don’t know if I want to continue with the investment to begin with,” she says.

For Lyons, it’s not about the money. She says her concern is with the management of the gallery and the investment. “You know what? Any other investment I would have, if this was the management level that I got, I would have sold it a long time ago,” she says.

The AGM, scheduled for 5 p.m. tonight, will deal with the appointment of directors, appointment of auditors and approving bylaws. Many familiar faces are up for re-election to the board, including Brian Hearst, Fran Esler, Donale Gandossi, Donald House, Gwen Randall and David Rehn. Also up for election are four new faces: Royce Chwin, Mark Lindley, Matthew Pollock and Charles Robinson.

Although not mentioned in the annual report, or listed on the schedule for the AGM, Calgary Arts Development CEO Terry Rock confirms that the municipal entity has frozen its funding, “until we finalize due diligence around restoration of it. To date we have not provided them a grant for 2012.”

There are currently 102 members on a membership list, which was acquired by Fast Forward Weekly along with the gallery’s bylaws, but after accounting for duplications, there are 92 members eligible to vote in the AGM. Lyons is still listed, so it’s not clear whether this is the most up-to-date document.

What is most evident is that the AGC has created steep divisions. Hearst warns that information from some people in the investment group should be approached with caution — “According to Art Divas management group, there are very few ‘angry’ art divas. (Note the ex-president of AGC is a member of the group),” he writes. Lyons, meanwhile, cautions against talking to former staff because they have it out for Cooper.

Mention of the Art Divas has been removed from the AGC website. It is not known when this change occurred.

We will bring you more information as it becomes available.

** This story was updated to indicate the correct cost of a membership and to indicate that the cost per share for the Divas was not necessarily the same for everyone.

more in City     |     posted Nov 6th, 2012 at 2:50pm     

Comments: 7

leanintoit wrote:

so is the source saying that the 2 appraisals that were asked for and provided to the divas prior to purchasing each of the 5 Chicago artworks were inflated by the 2 commercial art dealers who have been respresenting Chicago and her work for many years one for 20+ years in NYC and the other 10+ years in New Mexico. I am sure the commercial art dealers,Chicago and the divas will all be happy to know what is being said by the source about this arrangement....

on Nov 7th, 2012 at 10:26am Report Abuse

Drew Anderson wrote:

Note: Wendy Lyons disagrees with the characterization of her thoughts regarding former staff. She says they were part of the allegations against Cooper. I believe the turn of phrase at the end of the story means the same thing.

I don't think anyone is calling into question the work of the gallery representatives in New Mexico and NYC. I'm waiting to hear back from the man who valued (note, not appraised) the plates to confirm his numbers and check against information provided to investors by the AGC.

on Nov 7th, 2012 at 12:19pm Report Abuse

wlyons wrote:

In regards to the appraisals, The appraisals requested for insurance purpose were addressed and sent directly to Marianne Elder- Senior Curator of Art at the AGC May 27, 2009 stating the insured value, which is what I have been asking about. NONE of the diva's would think that Gwen, Valerie or Cathy would have tried to inflate the price to us, so not sure where you are going with that? That has not been in question by any of us, as we trust in the valuation given by two separate experts as reported to Marianne. I have been requesting an updated appraisal or valuation to ensure the AGC had the collection insured for the full coverage to date.

on Nov 7th, 2012 at 3:42pm Report Abuse

Wanda Fuca wrote:

Starting with its name, this "Art Diva" consortium smacks at the very least of bad taste. Given the evidence that has come forward about Ms. Cooper, unequivocally defending her integrity on this matter raises questions of judgment.

on Nov 9th, 2012 at 10:26pm Report Abuse

wlyons wrote:

Too bad there is a whole board that still exists that is also involved in the management of both the AGC and the consortium of 37 professional women who might ofject to your bad taste in commnets.Too bad there is money missing under the management of The current board/trustees. Their is a bigger picture here, that remains to be explained, and I am trying to share the facts from emails written by these trustees. The information I have given is all transparent and provided by their comments or emails. I am not defending anyone but the investment.

on Nov 10th, 2012 at 8:38am Report Abuse

leanintoit wrote:

From researching the facts ARTdivas inc is a body corporate, incorporated under the laws of the province of Alberta. Each of the 5 artworks has been invested in by a group of approx 20 female investors(consortium). There are a total of 35-40 investors involved in ARTdivas inc.and they got started in 2008-9. They want to support female artists and began by collecting Chicago artwork and made donations to AGC who is cutodian of the collection. The name Art Diva.. no biggie you can call your company whatever you want its done all the time and I really dont think the divas care what other people think of their name it is a private investment group. One ARTDiva remarked that Chicago and the AGC have both benefittd from the activities of ARTdivas inc in many ways not just financially. As of March 2012 things have gone offside. Confirmed by a current AGC staff member Cooper is one of the 35-40 investors and are a number of current and past AGC board members and members of Friends of the AGC. All have collectively brought friends and collegues to the table to form the investment group. ARTdivas inc is legally and financially a completely separate entity from the AGC. ARTdivas inc has a legally binding cutodial agreement with the AGC and a trust agreement with the investors with a number of terms(articles) that have been agreed upon. These agreements have been signed off on by The AGC and the investors and are to be met to be in compliance. Lyons is claiming that the terms of the agreements have not been met in a number of instances since March 2012. The past chair of the AGC Board is also 1 of 2 officers of ARTdivas inc. inc Lyons has been trying to get to the bottom of a number of her concerns related to some financial, legal and operational issues of ARTdivas inc. She has tried to contact the ARTdivas inc. officer(s)now past Chair of AGC Board and the AGC managing director(cutodian)by sending multiple emails and phone calls. This has been going on for months and she has received rude email answers, been stonwalled and then was taken off the ARTdivas communications lists as she was targetted as a troublemaker. Her questions are related to the mismanagment of diva funds March 2012 to date. She has had no success in discussing her concerns with the managing director of the gallery or any of the ARTdivas inc officer(s). It is completley unreleavant as to whether Cooper is involved with ARTdivas inc or not as the AGC is either holding up their end of the bargain or not (cutodial agreement) as is ARTdivas inc (trust agreement with the investors.My hope for Lyons is that she gets some answers to her questions as an investor in ARTdivas inc, as an AGC donor and as a concerned individual who has been supporting the Calgary arts community for years. Wanda your judgement of Cooper is your judgement.In Canada it is the courts job to rule on difficulties between parties like this. Witch hunts leave a bad taste and often say as much about the hunters as they do about the individual being hunted ... suggest reading the history books.

on Nov 10th, 2012 at 12:42pm Report Abuse

leanintoit wrote:

interesting and the latest bit of news on this one provided by a staff source is that without the knowledge or approval of the members the by laws for the gallery have been changed between the AGM Sept 2011 and Nov AGM 2012 and also that a group of the divas are consulting with legal counsel regarding the misused funds approx 10k that were diverted from the funds collected from the divas for the care of their collection to pay for the gallery operations does it ever end

on Nov 29th, 2012 at 12:29pm Report Abuse

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