Questions continue to dog Art Gallery of Calgary

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.

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