I Have To Appraise You Like I should

I have to appraise you like I should With the value of top-end instruments skyrocketing, should violin appraisers require a qualification to demonstrate their expertise? Insurers, dealers and experts all give their views

- Peter Somerford

Violin shops in America routinely offer insurance appraisals and appraisal updates for instruments and bows that they sell. In other situations, however, appraisals can be difficult to come by. For example, an unfamiliar instrument whose attribution is uncertain is not such an attractive appraisal prospect. But when one is required for tax purposes, getting the right appraisal from the right appraiser is critical.

The importance of a rigorous, unbiased appraisal in such circumstances was highlighted by a US tax court decision earlier this year, in a case involving a valuation not of classical violins but of Old Master paintings. The court found that the estate of New York collector Eva Kollsman had significantly undervalued two 17th century artworks she had owned. Soon after Kollsman’s death in August 2005, a Sotheby’s expert provided the estate with fair market value estimates of $500,000 and $100,000 for the paintings, and these figures were used for the estate tax return. At the same time, the expert proposed a consignment rights agreement, which the estate executor soon signed, giving Sotheby’s exclusive auction sale rights to the works for five years. Less than three and a half years later, the higher-valued painting sold at Sotheby’s in January 2009 for a hammer price of $2.1m. The Internal Revenue Service (IRS) determined that the paintings had been valued too low, and the estate challenged the determination in court.