A Question of Money

by Hubertus Czernin

Published in the Austrian newspaper Der Standard March 4, 2000

The Bloch-Bauer Case: The Tricks of the Finance Ministry

The Bloch-Bauer heirs have sued the Republic of Austria for the return of five unrestituted Klimt paintings. But the proceedings threaten to fail -- because of the exorbitant costs. Standard journalist Hubertus Czernin reports.

Vienna -- Hardly anyone in Austria paid attention to the speech by Ronald S. Lauder, former U.S. Ambassador to Vienna, before the Finance Committee of
the U.S. House of Representatives on February 10, although the speech contained several bombshells. Lauder noted that Austria was praised at the 1998 Nazi Conference in Washington because of its initial measures toward returning plundered art or artworks that had been extorted from refugees after the war in the course of export proceedings.

But unfortunately, after a few initial instances of restitution, such as that of the Rothschilds, further claims were denied. "I see this as part of the movement to the far right, and the party of Jörg Haider." Thus, Austria indeed returned to the Bloch-Bauer heiress Maria Altmann a few pieces of old Viennese porcelain and some Klimt drawings from her uncle's collection, but not the portraits of her aunt Adele by Gustav Klimt.

Culture Minister Elisabeth Gehrer thereupon "invited" Mrs. Altmann to sue for the return of the five Klimt paintings, Lauder told the Committee. However, because of the unusually high value of these assets, the court in Vienna requires a "bond of half a million dollars just to get started." Lauder to those present: "Yes, you heard me correctly."

The case is truly unbelievable. There is no humanly conceivable way that the Bloch-Bauer heirs can pursue proceedings against the Republic. The court costs are too high.

Worth Billions

After Gehrer's refusal to return the pictures, Maria Altmann, today 84 years old, together with her two nephews, filed a lawsuit in September 1999 against the Republic to recover the five Klimt paintings, some of which have been displayed at the Österreichische Galerie since the Nazi era: looted property, which the heirs of the industrialist Ferdinand Bloch-Bauer were forced to give the Republic in the spring of 1948, in order to be allowed to bring the rest of his collection out of the country.

The value of the paintings was estimated at 2 billion shillings [approximately $143,000,000] in the lawsuit filed by Viennese lawyer Stefan Gulner. Because the cost of legal proceedings in civil suits is calculated according to the value of the claim, and because the market value of the pictures in this case is immeasurably high (the statutory rate alone would amount to more than 20 million shillings [$1,430,000]), Gulner immediately submitted a request for relief from the court fees.

Declaration of Assets

In order to grant this, an official assessment of the plaintiff's assets is required. Maria Altmann therefore had to disclose information about her financial situation: her house in Los Angeles, as she stated in the Declaration of Assets, was purchased for 900,000 shillings [$64,000]; she reported an annual income of around 200,000 shillings [$14,300] from the sale of women's clothing; she receives a monthly pension of 8,000 shillings [$570] and a yearly pension from Austria of 14,000 shillings [$1,000]; she has at her disposal cash in the amount of 600,000 shillings [$42,850] and two bank accounts each in the amount of 100,000 dollars. Mrs. Altmann's nephews also had to declare the value of their assets to the court.

At the beginning of November, the District Court for Civil Proceedings announced its decision: Mrs. Altmann was required to guarantee the proceedings with a 2 million shilling deposit [$140,300], and her nephews Trevor Mantle and Georg Bentley had to put up 1 million shillings [$71,500]. The decision reads as follows:

"Given that the statutory rate for a claim valued at 2 billion shillings amounts to about 20 million, it is evident that the demonstrated income and assets of the plaintiffs do not permit them to bear all the expenses themselves. Of course, it is [also] evident from the findings that they must pay the amount set by the statute themselves, because to that extent they can be required to draw upon their assets. In particular, there is no reason to spare [the plaintiffs'] savings accounts at the expense of the general public [i.e., the Austrian State]."

Presumably, this decision had already led the Bloch-Bauer heirs to withdraw their lawsuit. Because, as Gulner said, his clients would have been forced "to surrender their entire assets to the Republic to pay the court fees".

But even that wouldn't do for the Finance Ministry, which represents the Republic in legal proceedings. They disputed the [District Court's] decision in the middle of December. In addition, the Ministry accused Maria Altmann and her nephews of having made incorrect asset statements: The statements had failed to account for their shares in the 16 Klimt drawings and 22 pieces of old Viennese porcelain which Gehrer had granted them at the end of June 1999, in accordance with the Restitution Law. [But which were not actually released to the family until November.]

Threatening Punishment

The Finance Ministry therefore reminded the court of Paragraph 69 of the Civil Code, whereby "the court with original jurisdiction may impose a nuisance fine on those who attempt to illicitly obtain relief from court costs by falsifying their assets." The Ministry demanded in their appeal the denial of any relief. In that event, it could be presumed that the case would never come to trial.

With that, Elisabeth Gehrer's invitation to Maria Altmann and the other heirs to sue Austria for the return of the Klimt paintings seems to have come to nothing: on one side, because of the family's limited assets, on the other side because of the Republic's lawyers. In a last-ditch attempt to achieve a fair and righteous settlement of this claim on behalf of a family that was banished and robbed following the Anschluss, Stefan Gulner has begun to write letters -- to the Finance Ministry, to the new head of the Government, to the Freedom Party (FPÖ) Chairman, to the Foreign Minister, to the representatives of the USA, and also to Gehrer.

Gulner's proposal: a mutual agreement to value the claim at 660,000 shillings [$47,100]; an agreement that each party bear its legal costs, regardless of the outcome of the trial; and finally, that the Finance Ministry, as representative of the Republic, waive the statute of limitations in advance of the proceedings.

Gulner to the Finance Ministry: "Because this decision has fundamental bearing on the future livelihood of my clients, I request an answer by March 3, 2000".

According to a spokesperson for the Finance Ministry, Stefan Gulner yesterday [Friday, March 3] agreed to a postponement of the final decision -- on account of the tight deadline, and, as always, for the sake of political expediency.

Translated from the German
by Kim Brockway, Galerie St. Etienne, New York