Thursday, June 27, 2013

Tell me again about the public trust (Dia edition)

Held in the public trust ... until they're not.

Also, Cariou's En Banc Request Was Denied (UPDATED)

The Art Newspaper's Julia Halperin has the story.  Background here.

UPDATE:  Felix Salmon isn't optimistic about the chances the Supreme Court will take the case.

BREAKING: First Department Affirms Jancou Dismissal (UPDATED)

The holding:  "In light of Noland's assertion and a report showing that the work had been damaged and restoration had been performed on it, Sotheby's did not breach the contract or its fiduciary duty to plaintiff by withdrawing the work from auction."  (No link yet.)  Background here.

UPDATE:  More from Art in America's Tracy Zwick.  And from Cristina del Rivero, who points out that my original post wasn't as clear as it could have been.  This is the claim against Sotheby's, not Noland.

Monday, June 24, 2013

We're preparing the class action lawsuit right now

If the DIA's collection really is held in a charitable trust, as the Michigan AG claims, then who gave the museum permission to sell works over time, as they have, and use the proceeds to buy different art?

Shouldn't the "beneficiaries" of the trust sue for breach of fiduciary duty?

Related:  The Art Market Monitor interviewed by Now This News.

Wednesday, June 19, 2013

Pros and Cons (UPDATED)

Felix Salmon responds to the question I posed at the end of this post by saying the answer is "both":  the attorney general is "absolutely right" legally and normatively.

On the legal side, I think he's mistaken.  He argues:

"The Michigan AG has declared that 'the art collection is held in charitable trust for the people of Michigan and cannot be sold for purposes other than the acquisition of art'. That’s pretty unambiguous, legally."

I don't think that's right.  It's an unambiguous statement of the AG's view of the law, but the AG doesn't get to make the law.  Think, to mention another high-profile art law case, of the Barnes.  The Pennsylvania AG thought the move to Philadelphia was okay.  But that didn't mean it was okay; that was for Judge Ott to decide.  Or, in a case going the other way, the Tennessee AG was pretty unambiguous that the Fisk collection should not go to Crystal Bridges.  But the collection is going to Crystal Bridges.

In fact, Salmon's reasoning here is perfectly circular:  "the Michigan attorney general is absolutely right that the art collection of the Detroit Institute of Arts cannot be sold to satisfy the city’s financial obligations ... [because] ... [t]he Michigan AG has declared that 'the art collection is held in charitable trust for the people of Michigan and cannot be sold for purposes other than the acquisition of art'."  Nice work if you can get it!

On the normative side, I don't really take issue with anything he says.  He points out that, in return for a sale, the city "would get — well, nothing, really: all the proceeds would end up being pocketed by the insurance companies which wrapped Detroit’s municipal bonds."  If that's the case, then, yeah, a sale doesn't look too attractive.  But that's exactly how the argument has to go.  What will the world look like if the art isn't sold and what will it look like if it is sold and which do we prefer?  Will the money end up pocketed by insurance companies?  Or will it fix the broken streetlights, or employ more police and firefighters, or save pension and health benefits of municipal retirees?  I've never argued for a deaccessioning, in Detroit's case or any other.  All I've called for is a weighing of the relevant costs and benefits of each potential sale, just as museums do every day of the week when they violate the public trust deaccession to buy more art.

UPDATE:  Mark White emails:

"Your latest, Donn, falls short of your usual standards.  You usually see a step or two ahead at least, but you're falling for Deaccession Police propaganda on paying off the insurers who wrapped Detroit's bonds.  Liquidating that obligation doesn't just benefit the insurer.  With the general budget free of debt service, Detroit can redirect general revenues to resident services instead, providing more public safety, street lighting and blight removal.  These are higher priorities for most residents than the art institute services."

And, from the comments to Salmon's post (third one down):  "As for the moral aspect, I am not sure that an obligation to preserve art for future generations is any more sacred than an obligation to pay pensions to the present one."

Monday, June 17, 2013

"Some unutterably depressing reading"

Felix Salmon takes a look at the Detroit Proposal for Creditors. He summarizes "the litany of municipal woes," including a "crumbling" infrastructure (40% of its street lights are out of order).  And he points out that among the big losers here are going to be Detroit's municipal retirees, whose pension payments are going to be cut.

Still, he says the Michigan AG is "absolutely right" that the DIA's collection "is off-limits when it comes to satisfying the obligations of the City of Detroit."  It's not clear to me whether he means that as a statement about what the law is, or what he would like to see happen.

Friday, June 14, 2013

Thursday, June 13, 2013

"[Michigan Attorney General] Bill Schuette says in a formal opinion released Thursday that the artwork 'is held by the City of Detroit in charitable trust for the people of Michigan.'"

Really, isn't that convenient?  As I've said, I've got a better idea:  why stop at the art?  Why not declare that all of the City's assets are held in trust for the people and thus not available to pay back creditors?  Where do I send my bill?

"There ought to be some type of criteria developed to articulate the public interest and policy goals with regards to assets"

Interesting post re Detroit by "urban analyst" Aaron Renn:

"When it comes to asset disposals, perhaps cities should in fact look to museums. They are organizations that hold precious assets in trust with the idea that they will be cared for in perpetuity. However, there’s also a recognition that disposing of artwork can sometimes be appropriate, if safeguards are put in place.  As one example of how to do it right, the Indianapolis Museum of Art developed a formal deaccessioning policy that includes reasons for disposing of art work, the process for doing it, and restrictions on the use of proceeds. They also maintain a deaccessioning database where the public can review and comment on artwork that is proposed to be disposed of, and see which works were sold and where the proceeds actually went."

Headline of the Day

"Banana Mural Riles Indiana Town."

Monday, June 10, 2013

"There is ... a way Detroit could raise money and share its art with other cities without relinquishing its treasures altogether: ..."

"... a time share."

Virginia Postrel responds to some of the criticism her column on the DIA received last week.  This time, she looks to the Fisk-Crystal Bridges partnership as a model:

"Finding a partner or partners to buy shares in individual works or selected portions of the DIA’s collection would give the city a way to liquidate some of its assets without actually losing them."

As I've noted before, jointly-held work is generally seen as a good thing, but was outweighed in the Fisk case by the deaccessioning taboo.  By the "logic" of the Deaccession Police, if Museum A and Museum B chip in and buy some work, that's great, a win-win.  But if Museum A buys it and later sells half to Museum B (resulting in the same state of affairs as in the first example), that's repulsive, Stalinesque, etc.  Go figure.

The Art Market Monitor says that "as an idea, it actually doesn’t go quite far enough":

"[T]he BBC has pointed to a growing trend in the UK’s formerly wealthy industrial North where works of art accumulated during the heyday of English manufacturing—like Detroit’s cultural acquisitions when it ruled the automotive industry—are being organized into travelling exhibitions that produce enough in fees to help maintain the museums."

Tyler Cowen says that, if it sells work, Detroit "would be sending a signal that it will never even try to go back to what it was."  But he adds:  "perhaps that is where we are at with Detroit."  And, in the comments, Postrel shows up and recommends this dissertation:  Treasures in the Basement? An Analysis of Collection Utilization in Art Museums.

Friday, June 07, 2013

"Art lovers should stop equating the public good with the status quo."

Bloomberg columnist Virginia Postrel writes about the DIA issue today.  She gets a lot pushback in the comments on her assertion that it's a "relatively unpopular" museum, but, putting that issue to the side, she says some interesting things.

First, she points out that "suggestions that the museum can’t sell major works without risking violations of donor intent are disingenuous. ... [T]he records for the most valuable pieces are right on the museum’s website. The city bought those works, it owns them, and it should be able to sell them."

And she's interesting on the issue of how to define the "public good" in a case like this, and ends up endorsing an application of the Ellis Rule in this instance:

"A sale to satisfy Detroit’s creditors would certainly be a tragedy for the institution and its local constituents. But if buyers were limited to other museums, possibly even to museums in the U.S., the works wouldn’t disappear from public view. ... The public trust is no less served by art in Atlanta, Phoenix or Seattle than it is by art in Detroit. ... Letting the Getty add the Canaletto view of the Piazza San Marco now in Detroit wouldn’t constitute a rape or a bonfire of the vanities. Hanging Van Gogh’s self-portrait alongside his 'Irises' at the Getty or Bellini’s Madonna near his 'Christ Blessing' at the Kimbell would not betray the public trust. It would enhance it."

Thursday, June 06, 2013


Had to share another great email from Peter Dean, in response to my post on the AAMD letter about Detroit the other day:


There is such a lack of clear thinking on this issue.  It appears that many people just reach into their briefcases or file drawers and pull out a comforting slogan in the hope or belief that it will cure the problem, rather than looking at the real issues.  It is rather like medicine back in the 18th century when doctors might prescribe their favorite remedy for any number of ailments - regardless of likely effect.

One of the woolliest concepts is that of a “trust”, and its derivative a “public trust”.  What has been lacking is sustained legal analysis.  You might say that it is easy for a lawyer to claim that lawyers must have a say in this controversy, but in fact that kind of analysis is what is required.

Legal usage.  You and I know what the word “trust” means in the legal context (at least in the common law system, as I don’t think the Napoleonic Code really deals well with trusts).  It is a very powerful concept that imposes strict obligations on a trustee, but for there to be a trust there must be some intentional act that creates the trust, some defined property that is affected, and a trustee – and usually a defined beneficiary.  Sometimes the trust may arise as a matter of law when someone behaves very badly in a way that that leads to the imposition of a constructive trust, but I don’t think that applies in this case.

Other usage.  The term “trust” is also used frequently in other relationships, and, especially, one hears increasingly often of a “public trust”, but what is meant by that?

·       Sometimes it is an aspirational goal related to a transaction, but not necessarily creating legally enforceable rights and obligations.

·       Sometimes it is a relationship that arises as a result of legislative action (such as the creation of a national park).

·       Sometimes it reflects the residual power of the government (often exercised by an attorney-general) to ensure that assets donated for a charitable purpose continue to be used for a similar purpose of the first one fails or is completed.

·       Sometimes it is just a slogan.
Express trust.  There’s no doubt that one can create an express trust to encompass an art collection, and that the law will protect that.  Where the Wedgwood Museum failed was in not taking the necessary steps to make sure that the Wedgwood pottery collection was in fact conveyed to it under a legally enforceable trust.  Certainly that could have been done; but it was not.  I do not know the facts of the DIA situation, but if what I read is correct - that several decades ago the DIA transferred its collection to the City of Detroit in exchange for a promise of financial support – that arrangement could also have been set up as an express trust, that would now protect the collection from sale.  Was that done?  It sounds like it was not.

If a legally recognized trust is not created then the game is very different.  Of course, as you have noted many times, if a legally recognized trust were in fact created by the creation of a museum, then many de-accessioning sales could not occur, even if the proceeds are to be used for new acquisitions, unless the trust deed expressly permits that.  You really cannot have your trust cake and eat it too, at least not without careful planning and drafting.

When it comes to the hard issues of meeting obligations and paying bills, it is the law that will govern, not an aspirational slogan or policy.  Those who brandish the phrase a “public trust” as a cure-all against an evil, are not doing anyone a favor, but are confusing the issue  It would be better to explain what is actually required to create a trust.


"This is a crazy case." (UPDATED)

The judge presiding over the Perelman-Gagosian lawsuit urges settlement.  Background here.

UPDATE:  A fuller report from

Wednesday, June 05, 2013

Tell me again about the public trust (Clark Sickle-Leaf Carpet edition)

The Corcoran sold a Persion rug at Sotheby's for more than $30 million today.  James Panero says it's "first-rate work that has been in the collection since 1925."

Look.  I obviously enjoy calling them out for their hypocrisy, but this is a serious point.  Works in museum collections ARE NOT HELD IN THE PUBLIC TRUST.  They're just not.  And it's not me telling you that; it's the museums themselves, by their actions.

You can't sell this first-rate work for $30 million and then turn around and tell me, when I want to sell another work (to keep from going out of business, or to pay creditors, or to avoid laying off staff, and so on) that I can't do so because it's held in the public trust.  If my work is held in the public trust, why wasn't yours?  Why wasn't this Persian rug held in the public trust?

Why are we still having this conversation?

Why does anybody take the slightest bit seriously the dopey letter the AAMD issued the other day about Detroit?

I've been saying for four years that they need better talking points.  I'm still waiting.

Here's a better idea

Why don't they pass a law making all assets beyond the reach of creditors?  Fiscal problems solved.  You're welcome.

Warhol Foundation Sued in Canada

Sergio Muñoz Sarmiento says the "story is a bit unclear, but it seems that the issue boils down to who owns the actual Polaroids: the Warhol Foundation or Frans Wynans Fine Art."

"It’s too soon to know the significance of the Rosales arrest because we haven’t seen the full scope of the government’s investigation."

Laura Gilbert has the latest on the Knoedler story in The Art Newspaper.

"Sophisticated businesspeople would never do a business deal without asking questions, but somehow when they are buying art or collectibles, their common sense flies out of their head."

Forbes:  Thieves And Forgers Rush In Where Big Spenders Dare To Tread.

Tuesday, June 04, 2013

You'll never guess the AAMD's position on the possible Detroit sale (UPDATED)

Their letter to Governor Rick Snyder is here.  Let's take a look.  Here's what they have to say, with my comments interspersed in italics:

The Honorable Rick Snyder
Office of the Governor
P.O. Box 30013
Lansing, Michigan 48909

Dear Governor Snyder,

The Association of Art Museum Directors (AAMD) is deeply concerned that the Emergency Financial Manager responsible for addressing the City of Detroit’s financial problems has questioned whether works of art could be sold from the collection of the Detroit Institute of Arts (DIA) to pay for the city’s operating expenses and debt obligations.

Duly noted.  There is much to be concerned about in Detroit.

Taking such a step would violate fundamental principles long recognized by the museum community (and embedded in many organizational policies including those of the AAMD) ...

Watch how many times, here and elsewhere, opponents of a sale fall back on this sort of argument.  "You can't sell because it would violate the standards of the museum community."  But the question is whether those standards make sense in the first place.  You can't appeal to the standards as the reason they should be respected.  It's as if the American Philosophical Association announced a standard that philosophy professors have to be the highest paid members of any university faculty, and then, when a school tried to pay their economics professors more, argued that they couldn't do so because "taking such a step would violate fundamental principles long recognized by the philosophical community (and embedded in many organizational policies)."

... as well as constitute a breach of trust with the generations of donors, both of art and funds for acquisitions, to the DIA.

This, at least, is an argument:  to sell art constitutes a breach of trust with donors.  The problem is, as we've seen, museums sell work all the time.  Why is it only sometimes a breach of trust?

Furthermore, selling art for operations of the City would constitute a material change from the financial statements presented for many years to the public and others by the DIA.

I've never understood what the force of this argument is supposed to be (so it's a change from the financial statements -- so what?).  And neither apparently does the AAMD because, after this one mention, it doesn't come up again in their letter.  (Peter Dean had some thoughts on this issue here.)

The acquisition, conservation, and exhibition of a museum’s collection are at the very heart of the museum’s service to its community. These activities represent the fundamental responsibility museums have for the stewardship of the cultural assets they hold in trust for present and future generations. For these reasons, and many more, it is a fundamental professional principle that if works of art are removed (deaccessioned) from the collections of art museums, the funds realized from their sale can only be utilized to enhance their collections and for no other purpose.

A couple of weird things here.  First, they talk about what museums "hold," which ignores the fact that, in this particular case, the museum doesn't "hold" anything: the collection is owned by the city.  So the real question is what is the fundamental responsibility cities have for the stewardship of the cultural assets they hold, and how do they balance that with other responsibilities they have (like to keep the lights on, or to pay the pensions it promised to its workers).  And second, notice the sleight of hand:  in the first sentence, we hear about "acquisition, conservation and exhibition" of the collection, but by the last sentence we're down to just acquisitions ("to enhance their collections").  Why can't the proceeds also be used for "exhibitions" (e.g., to build more and better exhibition space)?

The DIA’s collection is one of the most significant in the United States, and the museum has long been an outstanding example of the role an arts institution can play as an anchor for its community. The DIA was a founding member of AAMD, which was established in 1916, and has continued to be an active participant in the Association and a leader in the museum community.

Okay, but doesn't really address the pickle the city finds itself in.  (The AAMD is not really in the pickle-acknowledging business.  They're an advocate for a particular outcome, not a fair-minded observer balancing competing considerations.)

The sale of any part of the DIA’s collection to provide funds for any purpose other than the acquisition of art would place it firmly outside the standards of the American museum community. 

Appealing again to their own standards as an argument for why the standards should be followed.

The impact of such a decision would be felt in many, many quarters.

Not just many.  Many, many.

For example, fund raising for any state, county or city owned museum in Michigan could be impacted. Donors of objects to state, county or city owned museums would be very concerned about making any donation of their property for fear it would be sold anytime the government had a financial issue.

This is another of their standard arguments.  Donors will be very concerned about making donations if they know the work can be sold "anytime the government had a financial issue."  First of all, is that what Detroit has?  A "financial issue"?  They're bankrupt, for God's sake.  More importantly, I'm trying to remember who it was who said, just the other day, that museums want gifts to be unrestricted, so they can sell the work whenever they want.  Under the AAMD's own "standards," donors of objects know that their property can be sold, not anytime the government "had a financial issue," but anytime the museum sees a shinier object they'd like to acquire.  Why aren't donors "very concerned" about that?  Aren't they more likely to have their work sold for that than as a result of a government "financial issue"?

Such a sale—even against the will of its staff and leadership—would mean that the museum would not be operating in compliance with nationally accepted professional principles. If such a step were taken, it would violate the guidelines defined for the stewardship of collections in the AAMD’s Professional Practices in Art Museums.

Not in compliance.  Violate the guidelines.  Blah blah blah.  See above.

It would, moreover, represent a breach of the City of Detroit’s responsibility to maintain and protect an invaluable cultural resource that has been entrusted to its care for the benefit of the public.

This is really the core of it.  It is undoubtedly true that the City of Detroit has breached its responsibility to its citizens, in "many many" ways.  Yes, it has a responsibility to protect these invaluable resources, but it has other responsibilities too.  The AAMD doesn't provide any suggestion for how the City ought to balance those responsibilities, doesn't even acknowledge that those other responsibilities exist.  We know how valuable the museum is; we didn't need the AAMD to write a short, uninteresting letter to tell us.  But that's only the beginning of the conversation, not the end.

The AAMD strongly encourages everyone involved in the process of seeking solutions to Detroit’s fiscal challenges to preserve this irreplaceable part of the heritage of the city. It is a link to Detroit’s past and a fundamental key to Detroit’s future.

Timothy Rub
President, Association of Art Museum Directors

Well, I guess that settles it then.  You can expect to see news that the City's emergency manager (he was appointed to deal with the City's "financial issue") has dropped the idea any day now.

UPDATE:  A different take on the letter from Lee Rosenbaum.

Are giraffes held in the public trust?

The latest from Detroit.

Monday, June 03, 2013

"There have been many successful art funds in the world ..."

". . . if you consider secondary dealers—many of whom have spread the risk through financial backers—to be art funds."

"It is at least a legitimate view that the tragedy that befalls working people when their pensions are affected by insolvency is at least as great as the tragedy that has befallen, or may now befall, the collection in this case."

An interesting email on the situation in Detroit from my friend Peter Dean, who, as I've mentioned before, was closely involved in the Randolph College deaccessioning controversy:

I have been following the unfolding saga at the Detroit Institute of Arts and the possibility that it may have to sell, or that the City of Detroit may sell, some of its very valuable collection to pay the City’s debts.  I understand that the DIA collection is in fact owned directly by the City of Detroit.
I read your Art Law Blog on this topic and, as always, thought your comments are right on point.  I have also seen the remarks of other commentators who have pointed out the difficulty of resolving the competing claims of those who wish to keep the collection intact and of city employees whose jobs and pensions are at risk.

There is a very interesting English court decision from December 2011 that deals with an analogous situation:  Young v Her Majesty’s Attorney-General, WedgwoodPlan Trustee Limited and The Pension Protection Fund [2011] EWHC 3782The case arose from the collapse and bankruptcy in 2009 of Waterford Wedgwood (I’ll refer to it as the Wedgwood Trading Company), leaving substantial unfunded liabilities in its pension plan.  This company is the successor to the famous Josiah Wedgwood and Sons Ltd. which has a history dating back to the 18th Century.  The question then arose as which assets are available to satisfy those pension liabilities.  This affected The Wedgwood Museum Trust Ltd. (the Museum Company), which is a separate but affiliated company that was organized in 1962 to take ownership from The Wedgwood Trading Company of the valuable and historically important Wedgwood collection of pottery and arrange for its public display.  
The Museum Company had only a few employees and was run separately from the Wedgwood Trading Company, but its employees had previously been employees of the Trading Company and were part of the same pension plan.  The Museum Company thus became subject to English multi-employer pension plan rules.  It did not file for bankruptcy at the same time as the Wedgwood Trading Company, but did so later when it became clear that the Museum Company might be responsible for the unfunded pension liabilities of the Wedgwood Trading Company and any other companies participating in the same plan, under “the last man standing rule”.  This rule is derived from a law enacted in the 1990s following some financial scandals, and was intended to make sure that even if some companies in a multi-employer plan went bust, the surviving companies would be responsible for the unfunded obligations under the plan. 

The administrator of the Museum Company brought an action to determine whether the Wedgwood pottery collection was to be regarded as part of the general assets of the company, and thus could be reached and sold to meet the claims of the Wedgwood pension plan trustee as well as the English equivalent of the Pension Benefit Guaranty Corporation.
The answer to that question was “Yes”.  The court held that the Museum Company’s collection is part of the general assets of the company and is not held under any legally recognized form of trust.  As such, the collection could be reached by the Museum Company’s creditors and is subject to being sold to meet the company’s obligations.  This was a surprise to many who thought that the assets were held in some kind of trust. 

The case contains a fascinating discussion of the ins and outs of corporate governance and family affairs through the middle decades of the 20th century, including donations to the collection by the composer Ralph Vaughan Williams, a Wedgwood relative, and others.  The court held that none of the various donors ever actually imposed conditions on their gifts that rose to the level of creating an express trust in the donated items.  It also held that, despite some rather vague use of the term “trust” in various documents, the transfer from the Wedgwood Trading Company to the Museum Company in 1964 was not carried out in a way that created a legally recognized trust.  As a result the Museum Company is the beneficial owner of the pottery collection which is a general asset reachable by its creditors. 

Despite the fact that the collection was transferred to the Museum Company to protect it from liabilities arising from the Trading Company’s business and to make it available for public display, the court held that no separate charitable trust was created and there was no suggestion that the collection is held in the “public trust” or any similar concept.  The British Government which had intervened in the case to argue that the collection ought to be protected from creditors has declined to appeal the decision.  Efforts are now under way to raise funds to keep the collection intact.
The last words from the court’s opinion are relevant to the DIA situation, and perhaps others.
This is a sad conclusion for those who are concerned to preserve a collection which is, as everyone recognises, part of our cultural heritage and of immense importance, but it is the combined result of the pension protection and insolvency legislation. It is at least a legitimate view that the tragedy that befalls working people when their pensions are affected by insolvency is at least as great as the tragedy that has befallen, or may now befall, the collection in this case.
A separate but related issue is likely to be the accounting treatment of the DIA collection.  Is the collection capitalized, i.e., is the value of the collection shown on a balance sheet of the DIA, or the City of Detroit?  I do not know which accounting rules apply to the City of Detroit, but I would think that the DIA, as a non-profit institution, is probably subject to FASB Rule 116.  That accounting standard gives a non-profit institution a choice as to how it treats its collection from an accounting perspective. 
  • If it adopts an express policy that the proceeds of sales from its collections may only be used to add to the collection (and some closely related purposes) then it does not need to disclose the collection on its balance sheet.
  • If it does not have such a policy it must disclose the value of the collection (presumably at cost) on its balance sheet.
I believe that most, but not all, institutions with collections held for public display adopt a policy restricting the use of sale proceeds, in part because that is what the museum organizations such as AAMD and AAM insist on as a requirement for accreditation as a museum.  Does the DIA have such a policy? 
Even if the DIA has such a policy restricting the use of sale proceeds, I expect that it is unlikely to have much legal effect in the current situation, because the policy can be changed by its board of directors or trustees, rather than being an express and legally recognized trust affecting the collection that cannot be altered without court approval. 

I doubt that any such policy would affect the legal issue of ownership and who has the legal power to sell, or the claims of creditors to reach the collection, but it would be interesting to know.  This is a difficult situation that will shed more light on a number of questions concerning collections held by institutions that come under financial stress.

"Serra Work Gains Protected Status in Ontario" (UPDATED)

In today’s New York Times, Randy Kennedy has some great news regarding (our client) Richard Serra’s site-specific landscape sculpture Shift.  Tyler Green wonders if anything new happened, but the answer is yes:  while the Township had already voted in Feb. to “prepare a bylaw” for the designation, last week they made it official:  the by-law was approved, by a 5-2 vote.

UPDATE:  More on Shift from Green here.