accession

The Solomon R. Guggenheim Foundation operates the Guggenheim Museum in New York City. In 1937 Solomon R. Guggenheim donated to the museum a Chagall gouache known alternately as Menageries or Le Marchand de Bestiaux, painted in 1912. The museum tracked the painting on accession cards that recorded loans to other institutions, its return after a 1961-1962 loan, its presence in the museum on April 2, 1965, and an undated later notation that the painting could not be located. The museum first realized the gouache was missing sometime in the late 1960s and confirmed the fact during a complete inventory conducted from 1969 to 1970. It did not notify the New York City Police, the FBI, Interpol, other museums, galleries, or artistic organizations of the theft. In 1974 the museum's Board of Trustees voted to deaccession the gouache and remove it from the museum's records. In May 1967 Rachel Lubell and her husband purchased the gouache from the Robert Elkon Gallery for $17,000. The invoice and receipt listed the prior owner as a named individual who later proved to be the museum mailroom employee suspected of the theft. The Lubells displayed the painting in their home for more than twenty years and exhibited it at the Elkon Gallery in 1967 and again in 1981. In 1985 a private art dealer brought a transparency of the painting to Sotheby's for an auction estimate. A person at Sotheby's who had previously worked at the Guggenheim recognized the gouache and notified the museum, which traced the painting to Mrs. Lubell. On January 9, 1986 the museum's director wrote demanding return of the gouache. Mrs. Lubell refused, and the museum commenced this action for recovery of the painting or $200,000 on September 28, 1987. In her answer Mrs. Lubell raised affirmative defenses including the statute of limitations. The trial court granted her cross motion for summary judgment. The Appellate Division modified by dismissing the statute of limitations defense and denying the cross motion for summary judgment, then granted leave and certified the question whether its order was properly made.

Frederick Walz, owner of real estate in Richmond County, New York, filed suit in New York state courts seeking an injunction to prevent the New York City Tax Commission from granting property tax exemptions to religious organizations for properties used solely for religious worship. The exemptions were authorized by Article 16, Section 1 of the New York Constitution, which permits exemptions for real or personal property used exclusively for religious, educational, or charitable purposes and owned by nonprofit corporations or associations organized exclusively for such purposes. Walz contended that the exemptions indirectly required him to contribute to religious bodies by increasing the tax burden on non-exempt property. The New York City Tax Commission moved for summary judgment. The trial court granted the motion. The Appellate Division of the New York Supreme Court affirmed, and the New York Court of Appeals also affirmed. The United States Supreme Court noted probable jurisdiction and heard oral argument on November 19, 1969. All fifty states provide tax exemptions for places of worship, most through constitutional provisions. New York has granted such exemptions since before the adoption of the First Amendment, and Congress has provided similar exemptions for church property in the District of Columbia since the early nineteenth century. The exemptions apply to a broad class of nonprofit organizations, including hospitals, libraries, scientific groups, and patriotic societies, not solely to religious organizations.