Section 12.01. Artist-art merchant relationships

1.  Notwithstanding any
  custom, practice or usage of the trade, any  provision  of  the  uniform
  commercial  code  or any other law, statute, requirement or rule, or any
  agreement, note, memorandum or writing to the contrary:
    (a)  Whenever  an  artist  or  craftsperson,  his  heirs  or  personal
  representatives,  delivers or causes to be delivered a work of fine art,
  craft or a print of his own creation to an art merchant for the  purpose
  of  exhibition  and/or  sale  on  a  commission,  fee  or other basis of
  compensation, the delivery to and acceptance thereof by the art merchant
  establishes a consignor/consignee relationship as between such artist or
  craftsperson and such art merchant with respect to the said work, and:
    (i) such consignee shall thereafter be deemed to be the agent of  such
  consignor with respect to the said work;
    (ii) such work is trust property in the hands of the consignee for the
  benefit of the consignor;
    (iii)  any  proceeds from the sale of such work are trust funds in the
  hands of the consignee for the benefit of the consignor;
    (iv)  such  work  shall  remain  trust  property  notwithstanding  its
  purchase by the consignee for his own account until the price is paid in
  full  to  the consignor; provided that, if such work is resold to a bona
  fide third party before the consignor has been paid in full, the  resale
  proceeds  are  trust funds in the hands of the consignee for the benefit
  of the consignor to the extent necessary to pay any balance still due to
  the consignor and such trusteeship shall continue  until  the  fiduciary
  obligation  of  the  consignee  with  respect  to  such  transaction  is
  discharged in full; and
    (v) no such  trust  property  or  trust  funds  shall  be  subject  or
  subordinate  to  any  claims,  liens or security interest of any kind or
  nature whatsoever.
    (b) Waiver of any provision of this section is absolutely void  except
  that  a  consignor  may lawfully waive the provisions of clause (iii) of
  paragraph (a) of this subdivision, if such waiver is clear, conspicuous,
  in writing and subscribed by the consignor, provided:
    (i) no such waiver shall be  valid  with  respect  to  the  first  two
  thousand five hundred dollars of gross proceeds of sales received in any
  twelve-month  period  commencing  with the date of the execution of such
  waiver;
    (ii) no such waiver shall be valid with respect to the proceeds  of  a
  work initially received on consignment but subsequently purchased by the
  consignee directly or indirectly for his own account; and
    (iii)  no  such  waiver  shall inure to the benefit of the consignee's
  creditors in any manner which might be inconsistent with the consignor's
  rights under this subdivision.
    (c) proceeds from the sale of consigned works covered by this  section
  shall  be  deemed  to be revenue from the sale of tangible goods and not
  revenue from the provision of  services  to  the  consignor  or  others,
  except that the provisions of this paragraph shall not apply to proceeds
  from the sale of consigned works sold at public auction.
    2.  Nothing in this section shall be construed to have any effect upon
  any written or oral  contract  or  arrangement  in  existence  prior  to
  September  first,  nineteen  hundred  sixty-nine or to any extensions or
  renewals thereof except by the mutual written  consent  of  the  parties
  thereto.