Rich Man, Poor Man, Beggar Man, Thief

The Beaverbrook Art Gallery is an oddity—a major cultural attraction in one of Canada’s regional cities. For Fredericton, New Brunswick, the gallery is the jewel in the crown of Lord Beaverbrook’s munificence to that small city that included a library, a theatre and a hockey arena among many other donations. Adorning the gallery’s walls are paintings by Botticelli, Constable, Dali, Delacroix, Hogarth, Reynolds, Sickert and Turner. The Canadian collection includes paintings by Emily Carr, Paul Kane, Cornelius Krieghoff, David Milne, Jean-Paul Riopelle and the Group of Seven. Less known is the fact that the gallery keeps a number of lower quality paintings under wraps. When the Beaverbrook Art Gallery first opened in 1959, John Steegman of the Montreal Museum of Fine Arts recommended keeping the duds in storage where they would not detract from the beauty of the truly valuable paintings in the collection. Good advice as it turned out, but even then, the gallery could not avoid the jumble of styles and periods in the exhibition rooms.

At the source of this uneven and eclectic collection is Max Aitken, a.k.a. Lord Beaverbrook (1879–1964). Although he grew up in Newcastle, New Brunswick, Aitken moved on to the brighter lights of Halifax, then Montreal, in order to make buckets of money as a merger promoter and investment banker during one of the most expansionist periods in Canada’s history—the Laurier boom. He then moved on to Britain where he became Lord Beaverbrook, newspaper mogul and Cabinet minister in the two wartime governments of Lloyd George and Winston Churchill. Described as “a strange attractive gnome with an odour of genius about him” by Lady Diana Cooper, he was intimately connected to the political, business and literary elites of the Old World despite his New World and nouveau riche origins. ((See Gregory P. Marchildon, Profits and Politics: Beaverbrook and the Gilded Age of Canadian Finance (Toronto: University of Toronto Press, 1996). )) Although Roy Thomson (Lord Thomson of Fleet) and Conrad (Lord) Black eventually followed in the same footsteps as Canadian press barons in London, they never attained Beaverbrook’s power and influence.

Beaverbrook was an inveterate collector of people and things. Money (his own) lubricated his relationships with some of the most compelling and attractive as well as a few of the more odious individuals of the day. Their propensity to collect paintings rubbed off on him, and he used and abused a train of experts and agents to ferret out bargains. Once he had decided to establish a gallery in Canada, he insisted on getting “big pictures.” He purposely kept a diversified portfolio, once refusing a Turner because he already had “enough of that fellow.” Despite this, Beaverbrook was lucky enough to acquire authentic masterpieces including Salvador Dali’s Santiago el Grande, Thomas Gainsborough’s Peasant Girl Gathering Faggots (which he renamed Peasant Girl Gathering Sticks in one letter), J.M.W. Turner’s The Fountain of Indolence and Lucian Freud’s Hotel Bedroom.

I visited the Beaverbrook Art Gallery in the mid 1990s. It was the middle of winter and the middle of the day. I was stunned by the quality and range of paintings in the small gallery. Part way through, however, I felt something was missing. It finally dawned on me that I was alone—there were no other visitors in the gallery. What a contrast to the packed art galleries of Paris, London and New York. But I do not remember thinking about the ownership of the paintings at the time. I simply assumed that Beaverbrook had donated the paintings to his home province.

In 2004, the dispute between the Beaverbrook Art Gallery and Beaverbrook’s descendents became front page news in Canada. The issue, at least as portrayed by the media in Canada, appeared simple enough. The family seemed to have hit hard times and was asking for some paintings to be returned in order to raise some much needed cash, and it was reported Turner’s Fountain of Indolence and Freud’s Hotel Bedroom alone could raise about $30 million. It was true that Beaverbrook’s offspring had lost some, perhaps much, of their inherited fortune after the old man’s death in 1964—the familiar story of rags to riches to rags in three generations. The press resurrected the story of Jonathan Aitken, a former minister in the Conservative government of John Major, who was sent to jail for perjury after a sordid affair involving Arab arms dealers.

In Jacques Poitras’s new book on the dispute, Beaverbrook: A Shattered Legacy, this turns out to be a misleading account at least in part. For one thing, Jonathan Aitken was a red herring. However salacious his decline and fall (and his bizarre resurrection as a born-again Christian), Jonathan had nothing to do with the gallery dispute, his business relationship with Beaverbrook’s immediate family having terminated by the 1970s. The real protagonists in the gallery dispute were Beaverbrook’s two grandsons, Max Aitken (born 1951) and Tim Aitken (born 1944). Max, the second Lord Beaverbrook, is chair of the Beaverbrook UK Foundation, while Tim heads up the Beaverbrook Canada Foundation.

Max and Tim argued that their grandfather had loaned, not given, his collection of paintings to the gallery, and they therefore remained the property of the two foundations. The foundations were therefore at liberty to withdraw some of the paintings from the gallery. In 2002, Max made an offer: if the gallery turned over the Turner and Freud paintings, the foundation would use the money raised through their sale not only for the foundation’s UK activities, but also to make a charitable donation to the gallery as well as cover the higher insurance rates recently assessed on the collection. Denying that anyone would personally benefit from the money, the family argued that the infusion of cash was necessary to keep the gallery going. Still, it appeared that the family intended to earmark the lion’s share of the money for England rather than the gallery in Canada.

In effect, the gallery’s board and director were forced to choose between upsetting the family or giving up two of its more famous paintings. In the past, the gallery had acquiesced to the family’s demands, even when such actions damaged the gallery collection, as in fact happened when Lady Dunn, Beaverbrook’s second wife and eccentric widow, ransacked some of the collection in the years following his death. So it must have come as some surprise to the family when the gallery refused on the grounds that Beaverbrook had permanently gifted the paintings to the gallery.

A journalist with the CBC, Poitras followed the dispute from the beginning. He then took a temporary leave of absence in order to do the research on his book. He spent months working through archival records in New Brunswick and England. Surprisingly, Poitras was given full access to both antagonists to the dispute, the current Lord Beaverbrook and his family on the one hand, and the gallery director and board on the other, along with their respective lawyers. He even got access to archival material in the hands of the Beaverbrook Canadian Foundation, material that the foundation refused to let me see years before, when I was trying to figure out Lord Beaverbrook’s actual profit in the infamous Canada Cement Company merger before the First World War.

Poitras performs a useful service in recounting, in detail, the origins of this dispute. Focusing on the question of the gallery’s ownership of the paintings, he guides us through the intricate details. While interconnected, the dispute splits into two cases, each involving a different foundation, a different set of gallery paintings and a different legal process, each led by different personalities within the Beaverbrook family. A fighter by instinct, Tim Aitken (the Beaverbrook Canadian Foundation) sued through the courts. More willing to search out a compromise, Max Aitken (the Beaverbrook UK Foundation) agreed to the matter being arbitrated under the laws of the province. Since Tim’s lawsuit against the gallery has not yet reached the courts, Poitras focuses on the arbitration and the arbitrator’s final decision in March 2007. ((See the Media section of website of the Beaverbrook Art Gallery at www.beaverbrookartgallery.com/media.aspx?md=1 for the decision and the grounds of appeal. ))

Poitras’s book cannot be the definitive account because the dispute is probably far from over (even the arbitration decision has been appealed by the Beaverbrook UK Foundation). It is, however, an even-handed account of what led to the dispute. Since the gallery’s case is simpler—the first Lord Beaverbrook gifted the paintings to the gallery from the beginning—Poitras ends up having to devote much more space to the Aitken family’s version of the facts and, at first glance, the bulk of the written evidence appears to support the family’s argument. So it is a little shocking for the reader to discover, in the end, the extreme to which the arbitrator, well-respected former Supreme Court of Canada Justice Peter Cory, ultimately rejected the Beaverbrook UK Foundation’s argument in favour of the gallery’s position, pointing the finger not at the grandsons and the Beaverbrook Foundation but at Lord Beaverbrook himself. According to Cory, Beaverbrook tried to turn a permanent gift into a temporary loan the year after the gallery opened by amending the objects of the Beaverbrook Foundation and having his assistant replace the old accession records. Labels were suddenly placed on the paintings identifying them as the property of the foundation. Although Cory was forced to reconstruct Beaverbrook’s deception from bits and pieces of available evidence, I think it is the most plausible explanation of events given Beaverbrook’s character.

I spent close to five years reading the correspondence and contracts left behind by the first Lord Beaverbrook when he was still Max Aitken, a young and aggressive stock and merger promoter in Canada. Aitken may have got his start in life through a close relationship with John F. Stairs, the most important financier in the Maritimes, but after Stairs’s untimely death in 1904, Aitken was on his own by his mid twenties. ((For an interesting account of John F. Stairs and his connection to Max Aitken, see James D. Frost’s Merchant Princes: Halifax’s First Family of Finance, Ships and Steel (Toronto: Lorimer, 2003). )) Aitken directed one of the most entrepreneurial investment banks of the era—the Royal Securities Corporation (which would eventually be bought out by Merrill Lynch)—and promoted some of the largest industrial mergers in the country, including the Steel Company of Canada (Stelco) and the Canada Cement Company. He moved rapidly from deal to deal, bringing along those who were willing to sail under his orders but leaving behind those who disagreed with his decisions and his all-too-frequent changes in course. His business acumen was preternaturally advanced. Because of his fine-tuned intuition combined with natural craftiness, he was often two or three steps ahead of his partners and rivals. His enthusiasm and entrepreneurial energy were awe inspiring. Without a doubt, Beaverbrook was a force of nature. His courage was legendary, whether he was taking on the stodgy business establishment in Canada in his twenties or the political and media establishment in Great Britain in his later years.

It is hard not to be seduced by Beaverbrook’s spunk and his infectious appetite for life. Who can resist the urge to cheer for someone who regularly overturned convention in the most audacious and mischievous manner? Certainly, Beaverbrook worked his charms on A.J.P. Taylor. The iconoclastic English historian wrote Beaverbrook, an affectionate—at times fawning—biography of his friend and patron. David Adams Richards, who grew up in Beaverbrook’s hometown of Newcastle, New Brunswick, has just written Lord Beaverbrook, a very favourable, and immensely entertaining, portrait as part of John Ralston Saul’s series of “Extraordinary Canadians.” Knowing that Beaverbrook was hated and mistrusted by many in his day, Richards is quick to dismiss such views as motivated by the envy of bested competitors or triggered by class-based prejudice of an ambitious boy from the sticks. All true, but there was more, a darker side that I only realized after years of researching the man. The ends always seemed to justify the means in his mind, and he had few qualms about misleading both friends and foes if it got him what he wanted.

Richards tells us the story of Beaverbrook, as a teenager living in a rooming house, wanting his pants fixed in order to attend a local dance. He asked his landlady to sew the pants and he agreed to give her 50 cents for the job even though he was broke. He had spied 50 cents lying on his landlady’s fireplace mantle, later handing the money to her, saying “here’s your fifty cents”—the literal truth—but a fraud at the same time. It is a cute story, used to buttress the view of Beaverbrook as lovable scamp. But the truth is that dissembling and misleading were endemic to the man.

With success came hubris and even greater opportunity to use and abuse others. In business, Beaverbrook was an exciting but dangerous person to get close to. Working with him was, invariably, hell on wheels, in that he was mercurial, capable of changing the terms of any deal irrespective of existing commitments to associates or employees. But even his much-abused employees (including the talented and taciturn Izaak Walton Killam) had it good compared to his lawyers, whom he went through like water. Beaverbrook was almost never satisfied with their work and constantly complained of their “exorbitant” bills. The one constant in Aitken’s difficult relationship with his lawyers was the fact that he resisted the precise definition of rights and responsibilities in his agreements, and rejected any legal advice to the contrary. Instead, he preferred to make deals as rapidly as possible. He then used ambiguous promises and understandings, few of which were reduced to writing, to his own advantage in subsequent fights with business partners. His lawyers were driven crazy. They could not see the merit in Aitken’s approach, which, they reasoned, could only lead to misunderstanding and quarrels. But there was a method to Aitken’s madness. Ambiguous promises and understandings gave him greater room to manoeuvre in any business deal. Moreover if it turned into a dispute—and often it would—he would dare his “partners” to take him to court knowing that his “interpretation” of the arrangement could not be contradicted by the written documentation. ((I explored Beaverbrook’s relationship with the lawyers closest to him in “International Corporate Law from a Maritime Base: The Halifax Firm of Harris, Henry and Cahan,” in Beyond the Law: Lawyers and Business in Canada, 1830 to 1930, edited by Carol Wilton (Toronto: Osgoode Society, 1990), pages 201–234. )) It was a hard game; one that destroyed relationships and generated distrust of the man.

At times, Beaverbrook went even further. In the Canada Cement case, he fundamentally misled some of the owners of the companies he was buying out. Aspects of the affair became public and although the newspapers and the politicians never untangled the mess, the sordid affair precipitated a lawsuit that Beaverbrook settled out of court in order to avoid further negative publicity. While he escaped the infamy of a criminal prosecution—in this respect, he was much luckier than Conrad Black—the Canada Cement affair nonetheless left a permanent shadow hanging over his reputation. It is a shadow that continues to grow decades after his death because of a collection of paintings he said he gave to the people of New Brunswick and then surreptitiously tried to take back.