law offices of epstein turner weiss gaile. wise · 2015. 4. 10. · (1949 mural contracts, art. 4,...

LAW OFFICES OF

EPSTEIN TURNER WEISS DAVID B. EPSTEIN JONATHAN M. TURNER MICHAEL R, WEISS GAILE. WISE ROBYN L. IKEHARA SHIV AS. DAVOUDIAN ADAM D. KIM T ALfN M. GREGORIAN JESSE M. KOPPIN

A Professional Corporation

633 W. Fifth Street, Suite 3330 Los Angeles, California 90071

Telephone: (213) 861-7487 Fax: (213) 861-7488

May 23, 2011

VIA FACSIMILE AND EMAIL

Planning and Land Use Management Committee of the Los Angeles City Council Councilmember Ed P. Reyes, Chair Councilmember Jose Huizar Councilmember Paul Krekorian 200 N. Spring Street, Room 395 Los Angeles, California 90012 Attn: Michael Espinosa, City Clerk's Office

Re: Cultural Heritage Commission Case No. CHC-2011-221-HCM, 1999 West Adams Boulevard/Detennination of Monument Status/ Golden State Mutual Life Insurance Company Home Office/Agenda Item No.7

Honorable Committee Members:

This office represents the Insurance Commissioner of the State of California in his capacity as the Court Appointed Liquidator (hereinafter "Liquidator") of Golden State Mutual Life Insurance Company ("Golden State").

This letter is submitted with reference to the repmi and findings by the Cultural Heritage Commission ("Connnission") recommending the inclusion of Golden State's former home office at 1999 West Adams Boulevard in Los Angeles ("Home Office" or "Building") as a HistoricCultural Monument (the "Building Designation") to be heard and considered at your meeting of May 24, 2011. The Liquidator opposes the inclusion of two removable murals located in the Building lobby in the proposed Building Designation, including the identification of the removable murals as character-defining features. The murals are identified as "The Negro in Califbrnia History-Settlement and Development" by Hale Woodruff, and "The Negro in California History--Exploration and Colonization" by Charles Alston.

The Liquidator opposes the inclusion of the murals in the Building Designation, and the murals do not constitute character-defining features, because (1) the murals are Golden State's personal property and are not the property of the Building's owner Community Impact Development II, LLC, (2) the murals are not Building fixtures but are art objects which are removable from the Building without damage to the Building or the murals, and (3) to the extent that any City determination or action is inconsistent with Golden State's ownership and control

999 I 0-00000/I 7798 I 4.2

EPSTEIN TURNER WEISS, P.C. Planning and Land Use Management Committee of the Los Angeles City Council Councilmember Ed P. Reyes, Chair Councilmember Jose Huizar Councilmember Paul Krekorian May 23,2011

of the murals or impairs or interferes with the value of the murals, then such City determination is pre-empted by the California Insurance Code.

Accordingly, the Liquidator requests that the City Council exclude the murals from the proposed Building Designation, pending a final determination of ownership of the murals. To the extent the City Council's and/or City's actions adversely impact the value and/or removability of the murals, or operate as a taking of the murals, the Liquidator reserves all rights and remedies.

1. The murals are Golden State's personal property.

In 1948 Golden State hired the two muralists to paint the murals. The contracts to paint the murals provided that Golden State owns the murals. (1949 Mural Contracts, Art. 4, p. 2, Exhibits 1 and 2.) In 1949, the murals were painted in New York, shipped to Los Angeles and then installed in the lobby of Golden State's Home Office. (1949 photographs and documents, Exhibits 3-6.) The murals are not painted on the walls of the Building; instead the murals are rendered on canvas and displayed in the interior lobby of the Building. (1949 photographs and documents, Exhibits 3-6.)

From 1949 through 2005, Golden State owned its Home Office. In2005, Golden State sold its Home Office, but not the murals, to EN Realty Associates, LLC ("EN Realty") and entered into a lease to remain as a tenant in its Home Office. The 2005 Purchase Agreement expressly and in writing excluded the murals from the sale and maintained ownership of the murals, stating: "The Property [to be sold] shall not include, and Seller [here, Golden State] shall retain title to and possession of, all personal property owned by Seller, whether located on or about the Building or the Land or otherwise, including furniture, office equipment, files and business records, business licenses and franchises, art (included removable murals), trademarks and service marks, tradenames owned or used by Seller." (Purchase Agreement, p. 1, Exhibit 7.) In 2008, EN Realty sold the Building to West Adams Investment Trust. In 2009, West Adams Investment Trust sold the Building to the current owner Community Impact Development II, LLC ("CID").

Notwithstanding the above, CID claims that it owns the murals. The Liquidator disagrees; however, in order to maintain the status quo (which is that the murals are in the Building) pending a determination of ownership, the Liquidator, Golden State and CID agreed to allow the murals to remain in the Building until such time that the Los Angeles Superior Court determines ownership of the murals. (Stipulation And Order Regarding Non-Removal Of Lobby Murals, p. 1, item No.2, Exhibit 8.) Based on the evidence to date, the Liquidator anticipates that the Los Angeles Superior Court will determine that Golden State owns the murals.

9991 0-000001!779814.2


2. The murals are removable from the Building.

As discussed below, the Los Angeles Superior Court has in rem jurisdiction over Golden State's assets in accordance with California Insurance Code§ 1058. Once the Los Angeles Superior Court confirms Golden State's ownership of the murals, the Liquidator is required to monetize the murals for distribution to Golden State's creditors in accordance with claim priority set forth in Insurance Code§ I 033. To do so, the murals may need to be removed from the Building.

The murals are removable from the Building. The murals are oil on canvas, were painted in New York City, shipped to Los Angeles and installed on the Building's walls, as evidenced by the enclosed documents and photographs. An art appraiser and two art conservators who recently submitted appraisals and two proposals for removal of the murals confirm that the murals are removable without damage to the Building or to the murals. The appraisals and removal proposals state the murals are "detachable from the wall," "[l]ight percussion by running the hand along the wall indicates that there are many areas that are detached" and "[a] fresh peel test along the left side of the door reveals relatively easy detachment [ ofthe murals] from the wall." (Exhibits 9-12.)

3. The City's determinations are pre-empted by California's Insurance Code.

Although the City has received leave from the Los Angeles Superior Court to proceed with the Building Designation proceedings, under California's Insurance Code the Liquidator remains responsible for managing Golden State's assets, which includes the murals, and the Los Angeles Superior Court maintains jurisdiction over the effect of the City's determinations on the murals. Thus, to the extent the City's determinations are inconsistent with Golden State's ownership of the murals or impair Golden State's ownership of the murals, then the City's determinations are pre-empted by California Insurance Code and subject to further orders of the Los Angeles Superior Court.

a. The Liquidator's broad authority.

As the Liquidator has previously advised the City, the Insurance Commissioner as Liquidator has exclusive authority to act on behalf of insolvent insurance companies and to manage and control the insurer's assets. Insurance Code § 1057 provides that the Insurance Commissioner "shall be deemed to be a trustee for the benefit of all creditors and other persons interested in the estate of' the insolvent insurance company. In In Re Executive Life Insurance Company (1995) 32 Cal.App.4th 344, the Court of Appeal stated that:

The Commissioner is an officer of the state ( Caminetti v. Pac. Mutual L. Ins. Co. (1943) 22 Cal.2d 344, 354 [139 P.2d 908])

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EPSTEIN TURNER WEISS, P.C. Planning and Land Use Management Committee of the Los Angeles City Council Councilmember Ed P. Reyes, Chair Councilmember Jose Huizar Councilmember Paul Krekorian May 23,2011 Page4

who, when he or she is a conservator, exercises the state's police power to carry forward the public interest and to protect policyholders and creditors of the insolvent insurer. (Carpenter v. Pacific Mut. Life Ins. Co. (1937) 10 Cal.2d 307,330-331 [74 P.2d 761].)

Even the California Attorney General's power to sue regarding issues of government cannot interfere with the rights of the Insurance Commissioner as Liquidator. (State v. Altus Finance, S.A. (2005) 36 Cal.4'h 1284, 1303-1304 (California Attorney General's claims barred by Insurance Commissioner's exclusive authority).)

b. The Los Angeles Superior Court's broad authority.

Insurance Code § 1058 provides that the Los Angeles Superior Court has "jurisdiction to hear and determine ... all actions or proceedings then pending or thereafter instituted by or against" the insolvent insurance company.

The purpose of section 1010 and following are similar [to bankruptcy], with the additional and more urgent purpose of protecting an insurance company's policyholders, as well as its creditors, by preventing dissipation of the company's assets when it is found by the Commissioner to be in a hazardous condition. [Citation.] As we have also observed, the business of insurance is affected with a strong public interest, and the state thus has a particularly vital interest in the liquidation or reorganization of such a business. [Citation.]

This being the case, the jurisdiction of a state court overseeing an insurance insolvency cannot, in reason, be any less comprehensive than that of a bankruptcy court in similar circumstances. State courts overseeing the reorganization of insolvent insurance companies must have equally broad jurisdiction where it is necessary to assure the continued operation of businesses which are so affected with the public interest (Garamendi v. Executive Life Ins. Co. (1993) 17 Cal.App.4th 504, 518-519 (emphasis added.).)

Insurance Code § 1020 provides, among other things, that the Los Angeles Superior Court shall issue "injunctions or orders as may be deemed necessary to prevent any" ... "interference with the commissioner or the proceeding," "waste of assets", "the institution or

99910-0000011779814.2


prosecution of any actions or proceedings," and "the obtaining of preferences" against the msurer.

California case law, interpreting the Commissioner's and the Los Angeles Superior Court's powers, holds that the City's efforts outside this Court to apply other processes (here action on the Building Designation) to impair Golden State's assets, is prohibited. "A State Court Overseeing an Insurance Insolvency Proceeding Has In Rem Jurisdiction Over the Assets of Third Parties Which Have an 'Identity oflnterest' With the Insolvent Insurer." (Garamendi, supra, 17 Cal.App.4'h at 516-520.) In WJ Jones & Son, Inc. v. Independence lndem. Co. (1942) 52 Cal.App.2d 374, 378-379, the Court stated:

The court which made the liquidation order was authorized to" ... issue such other injunctions or orders as may be deemed necessary to prevent. ... (d) The obtaining of preferences, judgments, attachments, or other liens against such person or its assets. (e) The making of any levy against any such person or its assets."(§ 1020, Ins. Code.) Section 1057 of the Insurance Code provides that the commissioner shall be deemed to be a trustee for all the creditors. It was his duty to collect the assets(§ 1037, Ins. Code) and distribute them ratably among the creditors(§ 1025, Ins. Code), subject to certain priorities(§ 1033, Ins. Code) in which appellant is not included.

If appellant, an unsecured general creditor, were permitted to levy on and obtain the dividends held by the bank receiver, the other creditors would be deprived of any share in those dividends, and appellant would obtain a preference or a greater percentage than other creditors.

The Los Angeles Superior Court functions in a fashion similar to a bankruptcy court, albeit with a different statutory scheme -the Insurance Code. "[I]n dealing with problems related to insurer insolvencies, California courts may properly look to federal bankruptcy law for instructive analysis." (Low v. Lan (2002) 96 Cal.App.4th 1371, 1378; see also Garamendi, supra, 17 Cal.App.4th at 518-519 ("[T]he jurisdiction of a state court overseeing an insurance insolvency cannot, in reason, be any less comprehensive than that of a bankruptcy court in similar circumstances.").)

In bankruptcy, just like the restraining orders issued under Insurance Code § I 020 here, the automatic stay prohibits the taking of any action against the debtor, the estate and the debtor's property by all "entities." (11 U.S.C. § 362(a).) "States and their agencies,

999!0-00000/!7798!4.2

EPSTEIN TURNER WEISS, P.C. Planning and Land Use Management Committee of the Los Angeles City Council Councilmember Ed P. Reyes, Chair Councilmember Jose Huizar Councilmember Paul Krekorian May 23, 2011

instrumentalities and political subdivisions, including cities and counties, are all subject to the stay." (Cal. Prac. Guide: Bankruptcy, Ch. 8(I)-B, § 8:166, citing 11 U.S.C. 101(27)(40); see also In re Karla Corp., 296 B.R. 305 (Bankr. S.D. N.Y. 2003), in which Bankruptcy Court enjoined city pursuant to the Bankruptcy Code's automatic stay from interfering with Chapter 11 debtor by terminating special use permit.)

Accordingly, under California's Insurance Code, to the extent the City's determinations are inconsistent with Golden State's ownership or control of the murals or impair Golden State's ownership or control of the murals, then the City's determinations are pre-empted by the California Insurance Code and subject to further orders of the Los Angeles Superior Court.

In sum, for the above reasons, the Liquidator opposes the inclusion of Golden State's two removable murals located in the lobby of Golden State's Home Office in the Building Designation and requests that the City Council exclude the murals from the Building Designation and any further determinations thereon pending a determination of ownership of the murals.

Please contact me should you require additional information.

MRW:aym Enclosures

cc: Terry P. Kaufmann Macias Adrienne S. Khorasanee Amy Brothers Deputy City Attorneys 70 l City Hall East 200 N. Main Street Los Angeles, CA 90012

99910-00000/1779814.2

Very truly yours,

~L~~ MICHAEL R. WEISS

EXHIBIT 1

TI!IS AGREEMhlUT rr:eJie this I?}:_ d.e.y of Anc:uzt in the year 1948 by and. between

l-'ir. Charles li. Alston., 555 Edgecomb Ave.~ :'Je\'<' York 32, Ue1~· York, hereinaftel" known a.s

the Artist, and the Golden State !CutUEJ Life Insurance CompeJ>y, 1;261 Central Ave.,

I1os .Angelec, California, hereinn.fter known rts the Ovmer,

~IITllESSETI!, that the Artist and. the Owner for the consideration :oereinafter

named, agree as follows:

Al!fHlLE 1. The Artist agrees to provide ali necessary labor, material,

research and er:tui~"Jment to )!JBke -sketches for anC ir..sta.:J..l the con:plet€Q :-.rura.l on the

northwest wall of the entrance foyer of ~he ne,·r h.ou:e offiee build inf now "teing erected

for the Owner at tf.:.e northefl,st carne:.• of ','!estern Avenue and Adams Bou1eYarc:l, Los Angeles,

CAlifornia, under the- direction of Md_ to the satisfe.ction of Paul R. Willia."t!.s, herein-

B.fter k:J.c"m as the Architect fer the above building.. '!~he mt;.!"e.l shF.ll be designed to

occupy the spe..ce a.lloted. to it 11 as s:::o\-:n on the a.ccompe:r_ying d.re.'lr!ing prepared by the

Architect. The entire ~outhwast ,,.,all of the fcyer ,..,riJ.l he- g-lazed B-l'"ld can be of an

ul traviclet-1~cy glass, if d.esired~ T~·;e northe'i.:::t 1r:i 11 -be ii ::'latt.-t.rel wood color hhich

v:ill blend ~<ith the lll:'trble wainscot. The ceiling color will be selected to compliment

the mural, how·ev-er at the wcment lt is pla...'1ned r~c use a shaCt_e of "blue -widch v:i.ll tie

in "'ith the sey tone of the mural. The entire floor will be a dark green terra?.zo and

tlLe :::;a.rble wg.inscot has Oeen tenta.tl.vely selected in sh?des of brmm and. tan.

ARTIC!Jl 2. The theE:e to Ge expressed in the mural is the participation of

the Negro in the early develo;nlient of C?.lifornia.

The Artist is to make a complete research of tr.e availe.ble ma.teri . ._l to

ascertain t: at the events. as depicted by him, \•Jill be authentic~ The composition and

the sequence of tbe subject depicted in the mu:;:a1 is tc oe left to the Artist, however

the 0\'mer reserves tl"_e :r-ight, thro~ the Architect, to the f1.na1 snnction n.s to wh:ich

sub,jects >~ill be used in iohe final r;dnting. It is recol!'.menried that the techni'lue be

vigorous and port1·a;y a feeling of "est;·rn a.ovent'lre and rugged indhidualism.

1

ARTICLE 3 ~ IJ:he Artist, upon com:~let:i.on of tho nec?s~_,:;J..ry research work, not smaller t.r_~~m lf.C"--¥.

inclu.clinp; necessary trjps to Californi&.., will rrepare prelirtirut.r;r sketches/a the (!f_/{tf;.

scale of lu equals 1 1 - on of the pro~oosed !Yftl!"e.l to the o,-rnc;:.•, thro·ugh the A.!" chi teet,

;for his approvaL. The Artist will also su.boi t a genet"?.l color scheme ard a brief

su;nmary. showing t:'le Artis-t 1 s thinking of the sub .. ~~cts uced. '3.long ""'i th the pre-

liminary sketches ..

Upon approval of the prelimine.cy ske t<:h ·,,:: i:h·~ Ol<r.e~·, thrOUE:h t.he Arc hi teet,

the Artist will proceed with the completion of and installations of tha final mural

ARTICLE /.f. All accepted sk~tches a."ld the oine.l "'ural sh.o.ll remain the

property o_:: the Ownei·.. The 0\\•n.e!' sh?ll l"o.t'l''-te tht, rir:ht to publish reproductions

of the :rru.ra.l a.t arr;r time. T'ne Artist shall receive f1lll Cl'ed.it in .,.ny publicity

concerning the ::::ural.

ARTICLE 5. The O"ne1' has, simuHa."leously, entered into a se:oara.te con-

tract vri th Mr-. Eale A. i•loodrttff for the completion an•i in£!.tal"l.tJt.icn of a mural to

~e installed at the opposite end of the entra.noo foyer-.. The A::"tist ag!'ees to coordin-

ate his \-tCr~r wit!·1 th?.t of' ;,'h:-. Hale A, ,tTood.ruff so that there will be harr,1ony in

0\·.rner 2-fS!"ees to S.!FLY to the Artist\ in. cur-:-ent f--xv:_s ~ the stJ;.;; of $7 ,,500o00 a.s

payment in full for Artist services ~<hich shall 'oe r1e.de as follo11s:

(a) $1,500.00 upon tbe executi~1n of thi-s co':ltract~~

(b) $2,000,00 upon the a:>:,roval of .:;>reliminary sl<etches b;,r the Owner.

(c) $2~000.GO when f-&gu.r·es and. grou..>1d. colors ~.r,;. "!.::lstalled on. final mural.

(d) Ee..lance of $2,000,00 u:oon i1lstallation ani acceutanca of mural by the

01-mer, through the Architect. The Artist s:1ell furnish the O,mer

1d.th satisfllctory release from all clairos befo:re fi·tal peyment is

made .. Ir~ the event of a delay ir~ the comtleti on

made of the final 'Pa.ymer~t, reta.inin~', &5500~ 00 an~.r nt-!cesearr tm;.ching up of tbe mura.l-~~ ... 2

of tb.-· 1;;>...Lt:Ji;;.g,. f.J. pa.rtial JJa,;nr::·-r~t. m:.:.;r te to cover the chzt ..1f the inr;.tall.aticn and

All expenses incurred. by the Artist i_t) the executiiJn of his v:o:rltj including ant ,;nr; 1t/, 'If• ~.t+.4

labor1 matBrh'tlt ~~trj.:;: to CB.l:i.fo.t"1ia., Rre to be borne by him and is in-

clu•l.ed in the fee st~.ted above.

LB.TICL.E 7. The Oi.rner reser7es th~ right 1 tht-r:1.1gh +.he Archi t~ct, to req_uest

o~ suggest ch--anges i!l the w·o~k, issue additionc.l ins'I:!"'1Ct1.ons as the \Vork -groe;resses.

~To additional fees i.vi:l be B-llowed. unless same hnYe been a·flthorized in '•:riting by

the Owner ..

ARTIGU 8.. The 01-'ner reserves the r-ight to ~JrC7ide- rnen an-"1 r..'1P..terial to

complete the mural should the Artist be unable to complete same "i thin a reasone.ble

tL·1e, and the BX})enses for s~.w"ne sh.a-l~be deducted. fr-::r·:: :.tc contr:'3..ct _price he:-ein

stated ..

ARTICLE 9. The Artists shall maintain such insurance as \fill protect him

and the Owner from claims under Work!nen 1s Comnen.sati.cn Acts and from any other

claims for d.ama.ges fo~ personal injury, which rrR~Y A-rise !:rom the com})letion of this

·~ontra.ct.. Certificates of such insura.:1ce she .. ll be filed. \1i':.h the 01-rner, if he so

re1uire, awl s:b..all be S 1ibject to his a::~;Jroval fo-r a3.eq~'9.cy of prot""ctione

AR'riCLE 10. The Artist she.ll keep the ]')remises free from accumulatio:1 of

'"aste ~aterial and rubbish A.n-1 leave the premises clean.

nr WIT:JESS ~.tiE~OF thA pPrties hereto executed. this Agreement, the day

ARTIST GOLD~U Sr.r'ATE HC.r:rtrAL L!F3 IHSUF.A1-TC3 COMPAlrY

by ___ -'-~

' .' . rt ( b~~ '---------------------------------------

EXHIBIT 2

_;. THIS AGREEMENT made this ~day of August in the yeer 1948 by and between

Mr. Hale A. Woodruff, 270 Convent Ave. New York 31, New York, hereinafter known as

the Artist, and the Golden State Mutual Life Insurance Company, 4261 Central Ave,,

Los 'Angeles, Ce.lHornio., hereinafter known o.s the Owner,

WITNr~S~~H, that the Artist and the Owner for the consideration hereinafter

named, agree as follows '1:

ARTICLE 1. The Artist agrees to pro·;ii:e all necesscry lobor, meJ:.;rhl,

research and equipment to make sketches for and install the completed mura1 on the

'SO'd!ih'II'IU!it wall of the entrance foyer of the naw home office building now being erected

for the Uwner at the northeast corner of Western Avenue and Adruns Boulevard, Loa Angeles,

California, under the direction of and to the satisfaction of Paul R. Williams, herein·

after known as the Architect for the Above building. The mural shall be designed to

oocupy the space o.lloted to it, as shown on the accompanying drawing prepared by th~

Architect. The entire southwest wall of the foyer Will be glazed and can be of an

ultraviolet-ray glass, if desired, The norteast will be a natural wood color which

will blend with the marble wainscot. The ceiling oolor will be selected to compliment

the mure.l, however at the mcment it is plonned to use a. shade of blDe which will tie

in with the sky tone of the mural. The entire floor will be a dark green terauo and

the marble wainscot has been tentatively selected in shades of brown and tan.

ARTICLE 2. The theme to be expressed in the mural is the participation of

the Negro in the early development of California,

The Artist is to make a complete research of' the available material to

ascertain that the events, as depicted by him, will be authentic. The composition and

the sequence of the subject depicted in the mural is to be left to the Artist, however

the Owner reserves the right, through the Architect, to the fin.al sanction as to whieh

subjects will be used in the final paintint;. It is recomnended. that the technique be

vigorous and portray a feeling of western adventure and rugged individualism.

ARTICLE 3~ The Artistt upon completion of tho necessnry resea:rch work, not smaller than

incl'J,iing neces.~~r-try trips to California~ will ::>rc::Ja.re .Prclim-~.na.!.:' sketches/a% the 't.P,!V· f.,__ I.,,,

scale of 1" e1uals 1 1 - ou of the propose.i mi.:tral to t1:.e Ov.ry:;.e:r-, ':hrot"tgh the Architect,

for hiE approval.. T'ne Artist will also submit a fSen.era.l color scheme nnd a brief

sunma.ry) shoving the ArtiHt 1s thinkint 0f the ~.ubjA·.::ts i . .ts.~i, along with the :pre-

the Artist \'ll'..i.ll proceed vli th the COIDlJletic..c. o~ A.n in.s"';:-o.llutions of ::!:<: i'inal r:\1!"9.1

in the ent.rance foyer oi' the Owner's building, rt?ferrP.ll to above.

~:ro-pert;y o:f the Owner~ The Owner s~.11 he.ve the right to :~u'Jlis£ ... reprod.u.ctions

corwern:ing the rrw~..;~ ..

ART! CLR ;;.. l'he C-vmer f-..at> 1 simu.J.+ ... f:.n_eou~ly, ent,e;·e-i !.nto a se:pErate con-~. f'),ty. ' ' IV ' t-~ , f, !/,

tr&ct "V:ith Hr. Ch~·lr:~ f4 .. .hlstOs f0!' ~he cornpletior· £·!L-": i·-.rstn.llation of a nmre.l to

·oe installed. at the opposite eufl, of the ent:rance fo:ter~ The· Artict Herees to coor-

,/ .:· -/'

(c) 82,000ti00 ,,,hen figures r.nd ground Cf'lOrs t;;,!'e installed on firw.l mural.

n;a6.e. t 1 t b In t r,e ever:t of a J.ela:,;,- iE the com-elation of tl:.e building, a T)ar. is .. paymen...__mc.y e 1 t t · · $500 CO to cover tJ:e cost of tne installB-vlOr. ma.dP of the fir.a pa;"'men ~ re 2nn1ng •

and any necessary touch-::r:g up of tr.e mu:ral.

2

A?.T!ST

All e:tT•ences _irlc·,:;rred ~ the .;_r:i::r~. in ~-he cxec',ttion of Lis w-;rl•~, including

ana ~~e trip n. O:p· .... · ·.

material,/~to ~<>lifo~iEL. f'·l-c tc ·s·e b::~·t'r!t? '"c:;J·· him C).n•:. is in.-

//

'·''~--------·--· --~--···-

EXHIBIT 3

EXHIBIT 4

EXHIBITS

~-.. orTt.'l!i:ll~ co~.:ry~~-fght Ti·~:is vvorJ< mav D.r:: protec:teo unoer u .. :::~.

C,~opyrlqht l.;,}!j\1 (Tfth-:: 17, U . .S. Cod,'S;) 1 which QOV,~::>rns reproduc~~~nr:

;:ii::;tribuUon, cHsplay1 and ct::tta.H"\ otl·H;:r use:; Cif works

\.Jses mav be al!o\ved with on frcnn thE~ rightsholch::rt en· if UH:~

on th~~ work has expfi·"ect, vr i-f U'i2· "fair use'; or wfth!n :Et cf t·hi:_-;

EXHIBIT 6

PAUL R. WILLIAMS, A. I. A.

ARCH!TEGI' and CONSULTANT

THIRTY SEVEN FIFTY S EVEN WILSHIRE B 0 U L E VA R D L 0 S AN G E L E S 5 TELEPHONE DREXEL 43&1

Mi::ia:e.n ... Cl:l2.rle" A'.tlltau & llala wo.l!l~:fi'. !<1111 ror!l:, lll\1,

li*~' }~1$ ~~l!l.n!l; iilt~J>tiil !>:iil"lii tn$. :ll!.d<~·

1ter"J t.~•lr ;reyl!l!'Ji,

Oll':!,;!\1\~i Qlf l?.WJ:, 1, ll'l;t.MAI\Iiil

!!){ Tai\;rt?. .lf:!.'l'<i!;tl a , s:e~r~~li'Y to •~fr'. W:tl:t~a!)ji\1

Dt -~ .•.

~-·'<Ill' ~l!Ol!!:il ~()~~.~~· 'lll!l!J

4'.ti'.t~l\' &W 'lfi;'l:l!lrtl'l!JW" :6/'tl/~

ln "' ~l~~ l:!et~~:mit.i<>il with Mr. :jious;J;o:n,. ~~"'"n \fooo:ru:l;'i' alld Al...,to!l. lli;ll;t<i11t !lhli!7~!!Wltl!c<i<'i th$ .lilll:11!>l.~_'W$r<• ifo .. bl:l· .ship:p'l!li ~"'* :l;'~.nt wo<!k i:rl ~·!>.oil tl'.!<t thq ~he ~r d 'l!.l:Wi.t t~,. '\!u;t ~ "'" th'<l ~t a:ll<l ~it7 tlw J;lM.ntt~ 1!11!'-'llll~ in d.lj\I'U~~ tlw,i; .i;h$ JU;b ~'l)tU!llHJ 'ii&ttel' ti l).l\intll 'Wil7fe !!illm1~ to djifl tl(m.t tnq <;~otUa speruil. s~ l!lii<l.i\l~:nal till!tl '!!!!. tem:~h!-~. t1;!l e,m .:ri!di~tl!l, Yhiiitl:t 1/f,\\tU/1, ~ l!he Job ).ook '!>otter, ·

~-~r ilta.t~ tr""t tJ:wy ~ t~ With; '11-11"' l:>ht1>J?:I.l'.g ±'i'Z'Ill tat llpetlia:l.i.s<~<~ .in tha liiM'.miU!i> -Qf -~rt axl.\l .. ~"" H<l;l!l11S ~l 1:~ :r,oUei!l <:)ll big dl'!".lltil. n 'WitH ta¥.» !5 ~« f'rnr li;a~clM\ati<:~:n. to .W$ .e~~l.esi

!JUlJ!Iy t~&~>l ~1~ lllttrli\l:a ,tll:'""' fO!!' llli!JJU~, }~ilOj .

'!lhile >:>.n tho ta1epl!J:mJil, ¢.0ll!l'.w.!llioa~io:n w~''' s~ta'l;>lishe<'. I>~ l:\, JU11i\l$l:!, arellit~t,. w:h.l> st~.t"'d tM;r weul;\. ;:,ot; ·~~ ;to;:; J;t.u;; ~J.g bofo:ifil! ~- ~§. nw11;t:l~ baok ~() tha l':!!'U~tl! .it $15 El.&;l'l%ld th.en l;h;e,t the"¢ W'tld be. !lhi~d ':!ll.ilt lal;a:!l' .flh21;n ,)'1Jly l.i!l, t"' aXTi.v<> .i1~. 7j:,M /~l.<'ll! b<11f'<lre th<~ 25'\!ll:..

!Jtnl!lf fuMher· s.tf;.:-ted,. iJ,hB.t _··tho _ '~;;e:·~ d1te ·_tn :EJ.O:Corr't~nc~-- _wi·t~h ·wa .. ··e:t}nt~-eil. l'torllhn, tlwt the;r .bad 'been "1'Il""'""hed -'I:Jy Lif!> ~~'dt10 1 Jaw 'fol'k l'o~a!>,. !1lteq ~rdtilg :pu.bUo;!.t;r <l:ll i;h$ ltrl!Nl!l, thh ti>m'1 Mrs:. B'iil..lrna,xl <l!O'W(Ir~d th$ pu.bU•! Jll'llait;ioaa )Jha<l!l in I>ClOIJ:t'itimO!\l with attaeh0d. ll!l!!ll'O.'

. .

Q!ll:ll'il'e:V$1lttioll eltl'~i!il _wi ill ~M a~auN.oo<:> MG!Ird~e 1!'1 tn tho lit bOW' ll;g:l'illOll<<ir.l'tl•·

EXHIBIT 7

PURCHASE AGREEMENT

THIS PURCHASE AGREEMENT (this "Agreement") is made and entered into as of this

'3 day of M~ rt.c. H , 2005 (the "Effective Date''), by and between EN REALTY

ASSOC!A TES, LLC, a Florida limited liability company ("Purchaser"). and GOLDEN STAT'E MUTUAL LIFE INSURANCE COMPANY, a California corporation ("Seller").

IN CONS!DERA TION of the agreements set forth below, Seller and Purchaser hereby

agree as follows:

I. Purchase and Sale.

Seller agrees to selt and convey to Purchaser, and Purchaser agrees to purchase frorn

Seller, on the terms and conditions set forth in this Agreement, the Property. The term

"Property" shall mean, collectively: (a) that certain parcel of land located in Los Angeles ..

California, and more particularly described on Exhibit~ attached hereto (the "Land"), together

with all of Seiter's right, title and interest in all rights, easements and interests appurtenant

thereto including) without !.imitation~ any streets or other public ways adjacent to the Lmd and

any development rights, water or mineral rights owned by Seller; (b) all improvements located

on the Land, including, but not limited to, a bttilding of approximately 54.236 rentable square

feet (the '"Building"), and ali other structures, systems, and utilities associnted with, and utiHztd

by Seller in the ownership and operation of the Building (all such improvements, together with

the Building, being referred to herein as the "Improvements"), (c) all fixtures and equipment

required tor the use, operation and maintenance of the Building ("Equipment"), (d) all service

contracts and agreements, all warranties and guaranties relating to the Property and aH permits,

certificates of occupancy and other certificates, licenses, approvals and entitlements for or used

in connection with the Property (the "lntangible Property"). The Proper1y shall not indnde, and

Sel.ler shall retain title to and possession of, all personal property owned by Seller, whdher

located on or nbout the Building o.r the Land or otherwise, including fumiture, oftke equipment,

files and business records, business licenses and franchises, artwork (including removable

murals), trademarks and service marks, tradenames owned or used by Seller.

2. Purchase Price.

(a) The purchase price of the Property shall be SEVEN MTLLlON SEVENTY

THOUSAND AND NO/I 00 DOLLARS ($7.070,000.00) (the "Purchase Price"). The Purchase

Price shall be paid to Seller at Closing (as de!1ned below), plus or minus adju.stments hereunder.

in the mmmer set fmih in Paragraph 2(b).

(b) The Purchase Ptice shall be paid as tollows:

(i) Within three (3) business days after the mutual execution and de!iverv of

this Agreement, Purchaser shall deposit FIFTY THOUSAND AND N0/1 00 DOLLARS

($50,000.00) (the "Initial Deposit"), with First American Title Insurance Company at 520 North

Central Avenue, Glendale CA 91203 ("Title Company"), who shall act as escrow holder under

this Purchase Agreement~ to secure Purchaser's performance hereunder. Within three (3)

business days after expiration of the 1nspection Period, hereinafter defined, Purchase shall

deposit with Title Company an additional Deposit (the "Additional Deposit") in the amount <lf

li\)CS!,A! :481 !9::!.4

l:'i3lH-2 ASS

CID-11 00123

EXHIBIT 8

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ABELSON I HERRON LLP Michael Bruce Abelson (State Bar No. 130739) Lisa Von Eschen (State Bm No 156798)

333 South Grand Avenue, Suite 1550 Los Angeles, California 90071-1559 Telephone: (213)402-1900 Facsimile: (213) 402-1901 mabelson@abelsonhenon com lvoneschen@abelsonherron com

Attorneys for Community Impact Development II, LLC

ORIGINAL FILED DEC 2 1 2010

LOS ANGELES SUPERIOR COURT

SUPERIOR COURT OF THE STATE OF CALIFORNIA

COUNTY OF LOS ANGELES

INSURANCE COMMISSIONER OF THE STATE OF CALIFORNIA,

Applicant,

v.

GOLDEN STATE MUTUAL LIFE INSURANCE COMPANY, a Califomia

CASE NO. BS123005

Assigned to Hon .. Ann I. Jones (Dept 86)

STIPULATION AND [~.5'$D] ORDER REGARDING NON-REMOVAL OF LOBBY MURALS

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Abelson 1 Herron l:f' STIPULATION AND [PROPOSED] ORDER RE. NON-REMOVAl OF LOBBY MURALS

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Abelson: Herron_,.

APPLICANT INSURANCE COMMISSIONER FOR THE STATE OF

CALIFORNIA IN HIS STATUTORY CAPACITY AS CONSERVATOR ("Conservator")

FOR GOLDEN STATE MUTUAL LIFE INSURANCE COMPANY ("Golden State") and

COMMUNITY IMPACT DEVELOPMENT II, LLC. ("CID II") (collectively, the

"Parties"), STIPULATE, AGREE AND REQUEST A COURT ORDER AS FOLLOWS:

WHEREAS, Golden State is an insurance company in conservation; and

WHEREAS, the Conservator asserts that Golden State owns two murals currently

located in the building located at 1999 West Adams Boulevard, Los Angeles, California

("Building") and described as: "The Negro in California History- Exploration and

Colonization" (1527- 1850) by Charles Henry Alston (1907- 1977) and 'The Negro in

California History- Settlement and Development" (1850- 1949) by Hale Woodruff (1900-

1980) (collectively, the "Murals"); and

WHEREAS, CID II is the owner of the Building and asserts that it owns the Murals;

and

WHEREAS, on or about September 30, 2009, this Court (hereinafter, "Court")

issued an Order Appointing Conservator And Restraining Order for Golden State and appointed

the Insurance Commissioner of the State of California as Conservator of Golden State; and

WHEREAS, the Conservator has given notice to CID II of its intent to remove the

Murals from the Building on or after December 22, 2010.

NOW, THEREFORE, the Parties stipulate, agree and propose:

(1) The Murals will remain in the Building until such time that the Court determines

whether Golden State or CID II owns the Murals;

(2) The Conservator, Golden State and CID II each agree that by allowing the

Murals to remain in the Building until such time that the Court determines whether Golden State

or CID II owns the Murals, the Conservator and Golden State have not voluntarily parted with or

relinquished control of the Murals and that the Conservator and Golden State continue to assert

that Golden State is the rightful owner of the Murals;

II

STIPULATION AND [PROPOSED] ORDER RE. NON-REMOVAL OF LOBBY MURALS

1 (3) CID II shall make the Murals available to the Conservator, his staff, his

2 representatives, invitees, consultant and successors, at all times.. The Conservator will attempt to

3 provide 24-hom notice to CID !!;

4 (4) CID II shall make no changes to the Mmals pending finther order of the Comt;

5 (5) CID II shall maintain the Murals in their cunent locations pending finther mder

6 of the Court;

7 (6) CID ll agrees to indernni:f'y the Conservator and/or Golden State for any loss

8 suffered by reason of damage to the Mmals including without limitation theft, total destruction,

9 partial destruction, damage, water damage, defiwement, and costs of repairs, for the time period

10 after the Conservatot vacates the Building on or about December 3 I, 2010 until further

I I agreement by the Conservator and CID II and/or order ofthe Comt; and

I 2 (7) This Stipulation shall imue to the benefit of the Conservator and his successors

13 and assigns including appointment of the Insurance Commissioner as liquidator of Golden State

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15 Dated: December 20, 2010

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Abelson [Herron t'~

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ABELSON I HERRON LLP

Michael Bruce Abelson Lisa Von Eschen

By~il~J%1 /"- Lisa Von Eschen

Attorneys fm Community Impact Development !I, LLC

STIPULATION AND [PROPOSED] ORDER RE. 2 NON-REMOVAL OF LOBBY MURALS

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Abelson l Herron" ..

DATE: December 20,2010

IT IS SO ORDERED

DEC 2 1 2010 DATED:

EDMUND G BROWN JR Attorney General of Califomia FELIX LEATHERWOOD W. DEAN FREEMAN Supervising Deputy Attomeys General MARTA L SMITH Deputy Attorney General

EPSTEIN TURNER WEISS A Professional Corporation

B : Jv(;.Jv.A.>DL~::.:~ y ---------------------

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MICHAEL R WEISS Attorneys for Applicant INSURANCE COMMISSIONER OF THE STATE OF CALIFORNIA

ANN I. JONES THE HONORABLE ANN I JONES Los Angeles Superior Court .Judge

------------ STIMATJON RE MURALS

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PROOF OF SERVICE

STATE OF CALIFORNIA, COUNTY OF LOS ANGELES

I am ovet the age of 18 and not a party to the within action; I am employed by Abelson I Heuon, LLP in the County of Los Angeles at 333 South Gtand Avenue, Suite 1550, Los Angeles, Califomia, 90071-1559

On Decembe1 20,2010, I setved the document below described as:

STIPULATION AND [PROPOSED] ORDER REGARDING NON-REMOVAL OF LOBBY MURALS

The document was served by the following means:

X BY U.S. MAIL I enclosed the document in sealed envelopes addTessed to the peTsons at the addresses in the attached se1vice list and placed the sealed envelopes for collection and mailing, following oUI ordinary business pmctices. I am readily familiru with this business's practice for collecting and processing correspondence for mailing, On the said date, they rue deposited in the ordinruy coUise of business with the United States Postal Service in sealed envelopes with postage fully prepaid.

13 I declrue under penalty ofpeijUiy undet the laws of State of Califomia that the foregoing

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AbeJson j Herron""

is true and couect

Executed on December20, 2010 at Los Angeles, California.. '

--~/\.__~ Soonja Bin

SERVICE LIST I

Insurance Commissioner oft he State of California v. Golden State Mutual Life Ins. Co. 2 LASC Case No.: BS123005

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Marta L. Smith, Esq. Deputy Attorney General 300 South Spring Street, Room 1702 Los Angeles, California 90013

Michael R. Weiss, Esq. EPSTEIN, TURNER & WEISS 633 West Fifth Street, Suite 3330 Los Angeles, California 90071

Verdun J. Amaud 2512 Glendower Avenue Los Angeles, California 90027

Ronald R. Dobbin 7736 Morgan Lane Laverock, Pennsylvania 19038

Gene Hale 1875 West Redondo Beach Boulevard, Suite 102 Gardena, California 90247

James C. Harrison 3 785 Sherbrook Court College Park, Georgia 30349

Lonear W. Heard-Davis 4900 Lincolnshire Avenue Buena Park, California 9070 I

Larkin Teasley 4581 Don Milagro Drive Los Angeles, California 90008

Frederick E. Wadibia 11260 Overland Avenue# liA Culver City, California 90230

Pension Benefit Guaranty Corporation Attn: Jon Chatalian 1200 K Street NW Washington D.C. 20005

Austin C. Moore, III, CLU President Golden State Mutual Life Alumni Association 34 31 Pomona Boulevard, Suite D Pomona, California 91768

Gloria Bell Edwards 1429 Thousand Oaks Boulevard Albany, California 94706

Counsel for Applicant INSURANCE COMMISSIONER OF THE STATE OF CALIFORNIA

Counsel for Applicant INSURANCE COMMISSIONER OF THE STATE OF CALIFORNIA

EXHIBIT 9

Appraisal Report Prepared for Golden State Mutual Insurance Company

By Eric Hanks July 28, 2010

Eric Hanks, ertified Member, Appraiser's Association of America

TABLE OF CONTENTS

I. Title............. ..... ..... ........................ ........... ............. ... . .......... J H. Purpose . .. .. ... .. ... .. .. . . .. .. . .... ....... ... . ...... ...... .. .. . . .. . ... .. ... . ..... .. ..... . ............ 1 HL Function ... .. ............ ..................... ... . ........................................ J IV. Definition of Value ............................................................................................... ! V. Approach to Value ................................................................................................... ! VI. Limiting Conditions ........................................................................................... ! VII. Liabilities ................................................................................................................ 2 VIII. Summary of Values ....................................................................................... .3 IX. Description ...................................................................................................... 7 X. Works Consulted ................................................................................................ .43 XL Other Sources Consulted .................................................................................. ..43 XII. Credentials.................................................... . ............................................... ..44

l. Title

Appraisal report for Golden State Mutual Insurance Company to estimate replacement value. Effective date is July 28,2010. Appraiser: Eric Hanks.

II. Purpose

The purpose of this report is to estimate replacement value of the artwork listed in the Summary of Values on page 3. On Monday, June 14,2010, Wednesday, June 16,2010, and, Friday, July 23,2010, I visited Golden State Mutual Insurance Company, !999 West Adams Boulevard, Los Angeles, CA 900!8, so that I could examine the artwork that is the subject of this appraisal.

IlL Function

The function of this repm1 is to provide values so the artwork being appraised can possibly be sold at auction and for the edification of the owners. There is no other use.

IV. Definition of Value

Fair Market Value is defined as "the price at which the property would change hands between a willing buyer and a willing seller, neither being under any compulsion to buy or sell and both having reasonable knowledge of relevant facts."

V. Approach to Value

The approach to valuation used in this report is the market comparison approach. The cost and income/revenue approaches are not re.levant to this appraisal.

The market comparison approach consrdcrs comparable sales of similar items in the same geographic area. However, sometimes it is necessary to go beyond the local area to national, or eveu international areas to seek the appropriate market where transactions involving similar items are occurring with frequency. The appraiser is obligated to find the most relevant and appropriate marketplace.

VI. Limiting Conditions

I have no present interest in the items being appraised. My fee is not related to the appraised value. This report does not guarantee that the estimated value of the item appraised will equal the proceeds from a sale of the item. This document consists of forty-four (44) pages and must be used in its entirety for its conclusions to be considered valid. I didn't examine any framed artwork outside of its frame. In addition, the expert examining the artwork from Africa didn't look at them in person but instead only viewed photographs of them.

vn. Liabilities

The submission of this report completes the duties of the assignment and it does not

require any further testimony without previous armngement.

This report is unbiased and is based on my background, experiences, research and

consultations with other professionals. 1 am not liable for the sources cited in this report. 1 am also not liable for questions of ownership or title.

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IX. Description

l. Artist: Title: Medium: Dimensions: Year: Condition: Subject Matter:

Notes: Value:

2. Artist: Title: Medium: Edition: Dimensions: Year: Condition: Subject Matter: Notes:

Value:

3. Artist: Title: Medium: Edition: Dimensions: Year: Condition: Subject Matter: Notes:

Value:

4. Artist: Title:

Medium: Dimensions:

A blade Dancing Women oil on canvas 24" x 32" (rmage) c. 1970s Good Several African women wearing traditional clothing are

dancing. Not signed. $450

Adams, Cedric untitled photo offset lithograph 1000 9 5!8" x JO 1/2" (image) 1974 Good A small boy with something in his hand. Signed "Cedric Adams" in the original lower right: signed "Cedric Adams" and numbered "27!1000" lower right: dated July !6, 19741ower left. $75

Adams, Cedric untitled photo offset lithograph 1000 7" x 10 3/4" (image) 1974 Good A small boy hugs a dog. Signed "Cedric Adams" in the original lower right; dated "January 22, 1974" in the original lower left; signed "Cedric Adams'' and numbered "25/ 1000" lower riaht.

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$75

Alston, Charles The Negro in California History-Exploration hOd Colonization oil on canvas (mural) 16' 5" X 9' 3 )/4"

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Year: Condition: Subject matter:

Notes:

Y alue:

5. Artist: Title: Medium: Edition: Artist's Proofs: Dimensions:

Year: Condition:

Subject matter:

Notes:

Value:

6. Artist: Title: Medium: Dimensions: Year: Condition:

1949 Good. Some yellowing of the varnish. Needs cleaning. African Americans who played a key role in the development and progress of California, from approximately 1527 to 1850, are depicted in this mural. Signed ("Alston") and dated ("1949") lower right. This mura.l is detachable from the wall. In fact, according to Oy!bert Garvin Coker in an exhibition catalogue titled Charles Alston: Artist and Teacher, the mural was created in a studio on 158'" and Broadway, New York City. A photograph in that catalogue shows Alston and Hale Woodruff painting their respective large canvases in the studio. $2,500,000

Barthe, Richmond William Nickerson, Jr. bronze on marble base 1 none 23 l/4" x 22" x 9 3i4" (excluding the base) 5" x 9" x 8" (base) 1948 Good. There is no matting, howevet·. It needs either a mat or spacers to prevent the artwork from touching the glass. A bust of William Nickerson, Jr., founder of Golden State Mutual insurance Company. Signed ("BartM") on the lower right side (as one faces the bust). A plaque on the front of the base reads as follows. "William Nickerson, Jr.; Founder and First President; A Life of Service to Others; 1879-1945; Memorial by Employes and Field Eepresentatives." The bust and base rest on a marble pedestal that is 36" x 20" x 16 1/2".

This is the only casting. The whereabouts of the mold is unknown. $65,000

Bassett Forms enamel on ceramic plate 14 5/B" in diameter 1979 Good

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I 25. Artist: Title:

Medium: Dimensions: Year: Condition: Subject Matter:

Notes:

Value:

J 26. Artist: Title: Medium: Dimensions: Yenr: Condition: Subject Matter: Notes: Value:

!27. Artist: Title: Medium: Dimensions: Year: Condition: Subject Matter: Notes:

Value:

Woodruff, Hale The Negro In California History-Settlement and Development oil on canvas (mural) !6' 5" X 9' 3 l/4" 1949 Good. Some yellowing of the varnish. Needs cleaning. African Americans who played a key role in the development and progress of California, from approximately 1850 to 1949, are depicted in this mural. Signed ("Hale Woodruff') and dated(" 1949") lower right. This mural is detachable from the wall. In fact, according to Gylber1 Garvin Coker in an exhibition catalogue titled Charles Alston: Artisr and Teacher, the mural was created in a studio on !58'" and Broadway, New York City. A photograph in that catalogue shows Woodruff and Charles Alston painting their respective large canvases in the studio. $2,500,000

Wyatt, Richard E. J. Johnson oil on canvas 28" x 22" (image) 1978 Good. A three quarters length portrait of E. J. Johnson. It's signed "Wyatt, JL" and dated "78" lower right $6,000

Wyatt. Richard The Insurance Man (study for the mural by the same name) graphite on paper 14" x 6" (image) 1985 Good. A.

It's signed "Wyatt, Jr." and dated "85" lower right; inscribed "Mural study entitled the 'Debit Man' 6' x 14' interior, artist Richard Wyatt, Jr. Site: Golden State Insurance Company" lower center. $3,000

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EXHIBIT 10

Appraisal Report Prepared for Golden State Mutual Insurance Company

By Eric Hanks October 8, 2010

>c~ Eric Hanks, Certified Member, Appraiser's Association of America

TABLE OF CONTENTS

I. Title .................................................................................................. 1 II. Purpose .......................................................................................... 1 III. Function ....................................................................................... 1 IV. Definition of Value ................................................................... 1 V. Approach to Value ..................................................................... 1 VI. Limiting Conditions .................................................................. 1 VII. Liabilities ..................................................................................... 2 VIII. Summary of Values ................................................................. 3 IX. Description .................................................................................. 4 X. Works Consulted ......................................................................... 11 XI. Other Sources Consulted .......................................................... 11 XII. Credentials ................................................................................. 12

I. Title

Appraisal report for Golden State Mutual Insurance Company to estimate replacement value. Effective date is October 8, 2010. Appraiser: Eric Hanks.

II. Purpose

The purpose of this report is to estimate liquidation value of the artwork listed in the Summary of Values on page 3. On Monday, June 14, 2010, Wednesday, June 16, 2010, and, Friday, July 23,2010, I visited Golden State Mutual Insurance Company, !999 West Adams Boulevard, Los Angeles, CA 90018, so that I could examine the artwork that is the subject of this appraisal. This report follows an earlier appraisal performed for Golden State Mutual Insurance Company. The differences between that appraisal and this one are the previous appraisal is estimating fair market value while this one uses liquidation value and the first looked at 128 works of art in the collection whereas this one examines only 18.

III. Function

The function of this report is to provide values so the artwork being appraised can be sold to satisfy creditors and close out the affairs of the now-defunct Golden State Mutual Insurance Company. There is no other use.

IV. Definition of Value

Liquidation Value is defined by the Appraisers Association of America, of which l am a certified member, as "the price realized in a sale situation under forced or limiting conditions and under time constraints. This action may be initiated by the owner or the crediting institution."

V. Approach to Value

The approach to valuation used in this report is the market comparison approach. The cost and income/revenue approaches are not relevant to this appraisal.

The market comparison approach considers comparable sales of similar items in the same geographic area. However, sometimes it is necessary to go beyond the local area to national, or even international areas to seek the appropriate market where transactions involving similar items are occurring with frequency. The appraiser is obligated to find the most relevant and appropriate marketplace.

VI. Limiting Conditions

l have no present interest in the items being appraised. My fee is not related to the appraised value. This report does not guarantee that the estimated value of the item

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appraised will equal the proceeds from a sale of the item. This document consists of twelve (12) pages and must be used in its entirety for its conclusions to be considered valid. I didn't examine any framed artwork outside of its frame. In addition, the expert examining the artwork from Africa didn't look at them in person but instead only viewed photographs of them.

VII. Liabilities

The submission of this report completes the duties of the assignment and it does not require any further testimony without previous arrangement.

This report is unbiased and is based on my background, experiences, research and consultations with other professionals. I am not liable for the sources cited in this report. lam also not liable for questions of ownership or title.

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IX. Description

I. Artist: Title:

Medium: Dimensions: Year: Condition: Subject matter:

Notes:

Value:

2. Artist: Title: Medium: Edition: Artist's Proofs: Dimensions:

Year: Condition:

Subject matter:

Notes:

Value:

Alston, Charles The Negro in California History-Exploration and Colonization oil on canvas (mural) !6' 5" X 9' 3 J/4" 1949 Good. Some yellowing of the varnish. Needs cleaning. African Americans who played a key role in the development and progress of California, from approximately 1527 to 1850, are depicted in this mural. Signed ("Alston") and dated ("1949") lower right. This mural is detachable from the wall. In fact, according to Gylbert Garvin Coker in an exhibition catalogue titled Charles Alston: Artist and Teacher, the mural was created in a studio on 158'h and Broadway, New York City. A photograph in that catalogue shows Alston and Hale Woodruff painting their respective large canvases in the studio. $350,000

Barthe, Richmond William Nickerson, Jr. bronze on marble base I none 23 1/4" x 22" x 9 3/4" (excluding the base) 5" x 9" x 8" (base) 1948 Good. There is no matting, however. It needs either a mat or spacers to prevent the artwork from touching the glass. A bust of William Nickerson, Jr., founder of Golden State Mutual insurance Company. Signed ("Barthe") on the lower right side (as one faces the bust). A plaque on the front of the base reads as follows. "William Nickerson, Jr.; Founder and First President; A Life of Service to Others; 1879-1945; Memorial by Employes and Field Representatives." The bust and base rest on a marble pedestal that is 36" x 20" x 16 1/2".

This is the only casting. The whereabouts of the mold is unknown. $13,000

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12. Artist: Title: Medium: Dimensions: Year: Condition: Subject Matter: Notes:

Value:

13. Artist: Title: Medium: Dimensions: Year: Condition: Subject Matter:

Notes: Value:

14. Artist: Title: Medium: Dimensions: Year: Condition: Subject Matter:

Notes: Value:

15. Artist: Title:

Medium: Dimensions: Year: Condition:

VanderZee, James Black Jews of Harlem sepia toned photograph 7 '4'' x 9" (image) 1958 Good. A group portrait of African American Jews. It's signed "Van der Zee" and dated "1958" lower left; inscribed "Kehal Beth Israel 20 and Lenox Ave NYC lower center. $850

Woodard, Beulah Cowrie Shell Mask wood, hair and cowrie shells 17 W' x 6 W' x 2" (image) unknown. Good. A mask similar to an African mask, made from cowrie shells. Not signed. $750

Woodard, Beulah Dagon Mask wood, hair and cowrie shells 23 J,:l" x 14 N" x 2" (image) unknown. Good. A mask similar to an African mask, made from wood and a small amount of metal. A note attached to the back of the piece indicates it's a funerary mask. Not signed. $850

Woodruff, Hale The Negro In California History-Settlement and Development oil on canvas (mural) 16' 5" X 9' 3 J/4" 1949 Good. Some yellowing of the varnish. Needs cleaning.

8

Subject Matter:

Notes:

Value:

16. Artist: Title: Medium: Dimensions: Year: Condition: Subject Matter: Notes: Value:

17. Artist: Title: Medium: Dimensions: Year: Condition: Subject Matter: Notes:

Value:

18. Artist: Title: Medium: Dimensions: Year: Condition:

African Americans who played a key role in the development and progress of California, from approximately 1850 to 1949, are depicted in this mural. Signed ("Hale Woodruff') and dated (" 1949") lower right. This mural is detachable from the wall. In fact, according to Gylbert Garvin Coker in an exhibition catalogue titled Charles Alston: Artist and Teacher, the mural was created in a studio on 158'" and Broadway, New York City. A photograph in that catalogue shows Woodruff and Charles Alston painting their respective large canvases in the studio. $350,000

Wyatt, Richard E. J. Johnson oil on canvas 28" x 22" (image) !978 Good. A three quarters length portrait of E. J. Johnson. It's signed "Wyatt, Jr." and dated "78" lower right $1,500

Wyatt, Richard The Insurance Man (study for the mural by the same name) graphite on paper 14" x 6" (image) 1985 Good. A.

It's signed "Wyatt, Jr." and dated "85" lower right; inscribed "Mural study entitled the 'Debit Man' 6' x 14' interior, artist Richard Wyatt, Jr. Site: Golden State Insurance Company" lower center. $750

Wyatt, Richard Woman with Roses oil on canvas 9" x 24" (image) 1984 Good.

9

EXHIBIT 11

Mural Proposal- Golden State Mutual 1 of3

BACKGROUND

At the request of Andreas E. Flinck (Golden State Mutual Life) Duane Chartier and Susanne Friend (ConservArt Associates, Inc.) met on November 6, 2008 at 1 0:30am to examine two murals in the foyer of the Golden State Mutual Building at 1999 West Adams Blvd., Los Angeles, CA 90018.

There are two oil paintings on canvas marouflaged (glued continuously) to the east and west walls, each 9'3" x 17'. They are flush to the ceiling and 11' off the floor. There is a 14' floor clearance with enough space to set up a 5' x 1 0' scaffolding.

The east wall mural is by Hale Woodruff, 1949. It is signed at bottom right. The condition is very good. A peel test was already done around the door jamb on the mezzanine level. On the right side of the door at the diagonal join line (original) a recent peel test has caused a small tear. These tests may have been done by GSM personnel and not by other conservators, although according to Mr. Flinck, other bids have been solicited. The adhesive was tested behind an already peeled area along the left side of the door jamb where the molding has been loosened. The adhesive is likely wheat starch paste or a commercial wall paper paste and it peels easily. Light percussion by running the hand along the wall indicates that there are many areas that are detached.


The west wall mural is by Charles Alston, 1949, signed bottom right. The condition is also very good. Surface percussion indicates some voids. The marouflage adhesive is likely the same as on the east wall. A fresh peel test along the left side of the door reveals relatively easy detachment from the wall. The canvas is not wrapped and is cut fiush to the door edge.

The tentative plan is to move the two murals some time in February to a new building on Wilshire Blvd. It is not necessary to retain the monochromatic painted parts that go around the doors; but these should be preserved in storage. The paintings are to be reinstalled on specially built walls in the entrance of the new building.

Proposal

The following proposal was broken up into three sections: deinstallation (no options) reinstallation (no options)

• optional cleaning and varnishing


Golden State Mutual Life - Murals 0Qer;ation I Materi;a! Cost Deinstallation Scaffold rental & set-up $600

Deinstallation $6,919

Tubes and other materials $200 Administration $400

Scaffold take-down & cleanup i.4.QQ Subtotal $8,519

5'%, contingency ~ Total (deinstallation} $8,945 -r J !/

Advance Payment $4,500

Balance on completion (net 30 calendar days) $4,445

Terms I Conditions Parking for up to 3 vehicles Access to water and electrical outlets Loading & unloading scaffold via front doors Storage of wrapped paintings on site Estimate valid until December 15. 2008

Reinstallation (new building) Scaffold rental & set-up $400

y Verso cleaning $1 ::iZ:l Reinstallation $7,863

Adhesive & masking $300 Administration $100 Scaffold take-down & cleanup $300

Subtotal $10,535 ~0/o contingency i2ll

Total ( einstallation) $11,062 Advance Payment $5.500

Balance on completion (net 30 calendar days) $5.562

Terms I Conditions Parking for up to 3 vehicles Access to water and electrical outlets Estimate valid until December 15, 2008

Optional Cleaning $6,290

Optional Varnishing $3,774

Terms I Conditions This price only with installation scaffolding in place

Prepared by:~~ November 10, 2008

Dr. Duane R. Chartier ConservArt Associates, Inc.

)) u! ~ IS


BACKGROUND

These murals were originally examined for deinstallation and reinstallation on

November 6, 2008 at the request of Andreas E. Flinck (Golden Slate Mutual

Life). Duane Chartier and Susanne Friend (ConservArtAssociates, Inc.)

examined two murals in the foyer of the Golden State Mutual Building at 1999

West Adams Blvd., Los Angeles, CA 90018.

There are two oil paintings on canvas marouflaged (glued continuously) to the

east and west walls, each 9'3" x 17'. They are flush to the ceiling and 11' off the

fioor. There is a 14' floor clearance with enough space to set up a 5' x 10'

scaffolding.

The east wall mural is by Hale Woodruff, 1949. It is signed at bottom right. The

condition is very good. A peel test was already done around the door jamb on

the mezzanine level. On the right side of the door at the diagonal join line

(original) a recent peel test has caused a small tear. These tests may have been

done by GSM personnel and not by other conservators, although according to

Mr. Flinck, other bids have been solicited. The adhesive was tested behind an

already peeled area along the left side of the door jamb where the molding has

been loosened. The adhesive is likely wheat starch paste or a commercial wall

paper paste and it peels easily. Light percussion by running the hand along the


wall indicates that there are many areas that are detached.

The west wall mural is by Charles Alston, 1949, signed bottom right. The

condition is also very good. Surface percussion indicates some voids. The

marouflage adhesive is likely the same as on the east wall. A fresh peel test

along the left side of the door reveals relatively easy detachment from the wall.

The canvas is not wrapped and is cut flush to the door edge.

The present plan is to remove the murals and store them until an appropriate reinstallation can be arranged.

We are generally very uncomfortable with deinstallation of in situ works without

an explicit plan for reinstallation. We are also generally opposed to any plan

that materially changes the artistically intended presentation. For example, we

would strongly oppose the ethically questionable practice of changing from a

solid support to a stretcher ... a convenience used by many conservators but not

in keeping with artistic intent and a path to accelerated deterioration.


Proposal

The following proposal for deinstallation only is essentially the same as the original with minor corrections for inflation and the fact that only one phase of work is requested.

Golden State Mutual Life -Murals Operation I Material Deinstallation Scaffold rental & set-up Deinstallation Verso cleaning {prep. for reinstall) Tubes and other materials Administration Scaffold take-down & cleanup

Subtotal 5% contingency

Total (deinstallation) Advance Payment

Balance on completion (net 30 calendar days) Estimated completion time

Terms I Conditions Parking for up to 3 vehicles Access to water and electrical outlets Loading & unloading scaffold via front doors Storage of wrapped pa1ntings on site Estimate valid until November 30, 2010

$650 $8,177 $2,000

$250 $450 ~§Jl

$11,977 nru!

$12,576 $6,000 $6,576

2-3 days

Prepared by: ~<:;;;;;; October 28, 2010

Dr. Duane R. Chartier ConseNArt Associates, Inc.

EXHIBIT 12

rkh'""' d< Pl<?"x"'~'-t{s Aneta Zebala (

J 7 c./ 1'1.J') ~ I/( PROPOSAL FOR TREATMENT _ _g_~_QQtQI?!'r 2008

Paintings Conservation

2237 22nd Street Santa Monrca, California 90405 310-396-2332

_Ch?fles 1\ISIQfl _______ _ 9ft 3 1/~~-x_17_fi_Qin_(g_!!183.2 em x 5 m 18.2 em) Ar1ist

The ['J(lgrg In C~lif<Jrf1L'!_I1istory_,_E_xj:>loration And Col~mization Tille

Oil Of1labric~marouflaged to wall MOOium

~~~9 __ -- - --~- N/A Datll/Period Frame

Examination Summary Two oil murals on canvas are mounted to the walls, at 11' above the ground leveL The two panels need to be removed from the walls and remonuted in another location.

Proposal for Treatment:

'fravel to site for the initial examination. Examine the panels.

TraveJ to site to prepare for the murals removal. Set up scaffolding tower.

Photograph to document condition before treatment and prepare condition report.

Vacuum the mural surfaces overall, and carry out the initial wet surface clec1ning.

Secure pulleys at the ceiling above the mural wall, and suspend a sonotubc to receive the canvas.

Remove the canvas from the wall by detaching it mcchanially using scalpels, and large spatulas. The adhesive has not been

identified but appears to be characteristic of hide glue.

Secure the canvas onto the temporary 10" sonotube and lower it to the ground, as safely possible.

Remove the canva'i from thetemporary tube and secure the canvas onto a prepared 10' long tube. Wrap the tube and prepare for

transportation.

Transport the canvas to the studio. Remove residual adhesive from the verso of the canvas and fiattcn overall on the suction table.

~ Mend any tears and reattach the smaller sections of canvas to the main large painting.

Line the canvas to a secondary fabric support using a heavier polyester fabric and Beva film, using the suction table.

Measure for a secondary modular rigid panel or a modular stretcher I strainer bar.

Apply a thin protective varnish layer ovcraH;> :-pill imd iflPaint any losScs'Of"iibraslori's:· -~

Transport the secondary support and the mural to its new location rolled up onto the tube. Mount the mural onto the

secondary support and install it on the new free standing wall.

PLEASE NOTE: The cost of materials and the new stretcher I panel system would be in addition to the cost of treatment.

COST OF LINING MATERlALS: $500- $800 COST OF NEW STRETCHER I STRAINER (exact support to be determined)- $1,000-$ I ,200

Authorization is hereby given to Aneta Zebala, Paintings Conservation (Zebala), to treat the above described work(s} of art as proposed.

T'l{e estimated cost of treatment is: $..1SQOQ,~ 8 7 50 DO

Terms: Balanca_due_ tblrt.¥-L3-0_)_day_s __ fi.OrrL_completion..oiJtnre,;ailtnm1fe:rnll.t ___ _

It is understood and agreed between Aneta Zebala, Paintings Conservation (Zebala), and the undersigned (Ovmer) that, at the sole discretion of Aneta Zebala, Paintings Conservation, the treatment may be halted or modified should new problems arise. After consultation wlth the owner or authorized agent, a new estimate may be given if the problems are more difficult and the treatment more time-consuming than apparent at first.

It is understood that the conditions and stipulations of the Agreement and Release are part of this agreement.

Owner or Authorized Agent I Oat!IOVmer) Aneta Zebala Paintings Conservation (Zebala}

PROPOSAL FOR TREATMENT

~~_Q9tober 2008

Aneta Zebala Paintings Conservation

2237 22nd Street Santa Monica, California 90405

310-396-2332

_ Hale Woo<fru_lf__ 9ft 31/2_ in x 17ft Qir:>J.2rn 83.2 em x 5rn1!lc2 em) __ Artist Dimensions

The_~''' In Californial-jistory- Settlement & D"yelopmellt__ Oil on fabrig, rnarouflager:l.!Q Y'illl

""'"" -----~----·

ntle

JJl4:9 _________ -·---- ---·-·---·- _N/A~---~---------- ------~-----Dall'l!Period Fmmo

Examination Summary Two oil murals on canvas are mounted to the walls, at 11' above the ground level. The two panels need to be removed from

the walls and remonuted in another location.

Proposal for Treatment

Travel to site for the initial examination. Examine the panels.

Travel to site to prepare for the murals removal. Set up scaffolding tower.

Photograph to document condition before treatment and prepare condition report.

Vacuum the mural surfaces overall, and carry out the initial wetsurfat:e cleaning.

Secure pulleys at the ceiling above the mural wall, and suspend a sonotube to receive the canvas.

Remove the canvas from the wall by detaching it mechanially using scalpels, and large spatulas. 1l1e adhesive has not been

identified but appears to be characteristic of hide glue.

Secure the canvas onto the temporary 10" sonotube and lower it to the ground, as safely possible.

Remove the canvas from thetcmporary tube and secure the canvas onto a prepared I 0' long tube. Wrap the tube and prepare for

transportation. Take down the scaffolding twer.

Transport the canvas to the studio. Remove residual adhesive from the verso of the canvas and flatten overall on the suction table.

Mend any tears and reattach thr:. smaller sections of canvas to the main large painting.

Line the canvas to a secondary fabric support using a heavier polyester fabric and Beva film, using the suction table.

Measure for a secondary modu Jar rigid panel or a modular stretcher I strainer bar,

Apply a thin protective varnish layer overall. Fill and inpainr any losses or abrasions.

Transport the secondary support and the mural to its new location rolled up onto the tube. Mount the mural onto the

secondary support and install it on the new free standing walL

PLEASE NOTE: The cost of materials and the new stretcher I panel system would be in addition to the cost of treatment.

COST OF LINING MA'fERJALS: $500- $800 COST OF NEW STRETCHER I STRAINER (exact support to be determined) - $1 ,000- $1 ,200

Authorization is hereby given to Aneta Zebala, Paintings Conservation (Zabala), to treat the above described work(s) of art as proposed.

The estimated cost of treatment ls: ll~llilO..olB 7 50 00

It is understood and agreed between Aneta Zebala, Paintings Conservation (Zebala), and the undersigned (Owner) that, at the sole discretion of Aneta Zebala, Paintings Conservation, the treatment may be halted or modified should new problems arise. After consultation with the owner or authorized agent. a new estimate may be given if the problems are more difficult and the treatment more time-consuming than apparent at first.

It is understood that the conditions and stipulations of the Agreement and Release are part of this agreement.

Owner or Authorized Agent I Dat~Dfmer) Aneta Zebala Paintings Conservation {Zebala)

law offices of epstein turner weiss gaile. wise · 2015. 4. 10. · (1949 mural contracts, art. 4,...

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