Speculation of financial turmoil at Ritchies continues after the established Toronto auctioneers closed their doors for a fortnight, laying off their entire staff.
The development followed the news, reported in ATG No 1901, August 8, that Sotheby’s had chosen not to renew its eight-year partnership agreement with the firm after payment deadlines to vendors were missed following a joint sale of Canadian art on May 25.
At the time of Sotheby’s announcement, Ritchies’ president and chief operating officer Stephen Ranger published a statement on the company’s website acknowledging the delay in payments but emphasising that lessons had been learnt and that it would now be business as usual.
However by Wednesday, July 29 he had resigned citing differences with management after 22 years with the company.
Two days later some 27 employees at the firm, dubbed ‘Canada’s premier auction house’, were laid off without notice on Friday, July 31 after it emerged there were insufficient funds available to pay salaries.
A sign pinned to the door of the saleroom at 380 King Street East, Toronto told nervous consignors that the company was on “summer holiday” until Monday, August 17 while a sale scheduled for August 11 had been postponed. Calls made after August 17 to Ira Hopmeyer, the company's chairman and sole shareholder, were not answered.
The concern now is that recent vendors to Ritchies, in business since 1967, will not be paid.
While Sotheby’s have voluntarily ensured that all payments due for the Can$3.6m joint sale on May 25 will be honoured, that promise did not extend to other auctions at the Toronto rooms.
It is not known if Ritchies have a client trust account that ring-fences deposits and sales receipts so that, in times of financial difficulty, they can not be spent on other business expenses.