A High Court in London has ruled that two art dealers took an unlawful commission on the sale of a work by Leonardo DaVinci.

The Accidia Foundation hired Luxembourg Art Ltd. to find buyers for “Madonna and Child with St. Anne and a Lamb”. Luxembourg then hired Simon C Dickinson Ltd., art dealers, for assistance.

According to New Law Journal, Luxembourg had a secret agreement with Dickinson that the dealers could keep any profits from the sale above US$6 million. This is known as a “net return price” agreement and, although common in the art world, is the subject of much criticism by the court.

When the work sold for US$7 million, Dickinson kept US$1 million. However, Accidia was told that the sale price was only US$6m and understood that Luxembourg and Dickinson were splitting an agreed commission.

The dealers have been held liable to Accidia for a partial reimbursement of the commission fee (minus costs of restoring the drawing). According to the Art Newspaper, “the court found that [Dickinson] had been “unwise” not to check that the seller had authorised the arrangement. This judgment is therefore likely to have major ramifications for the London art trade.” This ruling places the duty on dealers to ensure that selling owners are fully aware of fee arrangements.

For a full breakdown of the complex and unlawful arrangement, read the article at the Art Newspaper.