Take-in of Estate Jewelry: Proceed with Caution

Although taking in pieces for repair or appraisal is a routine part of a jeweler’s job, there could be costly consequences for your business if procedures aren’t properly followed. If the jewelry is rare or antique (100 years old or older), its value could be stratospheric. But even if an estate item is worth little in today’s market, to the owner, it’s the priceless family jewels, and you risk alienating the customer if you’re not extremely sensitive.

“Secondhand pieces are often related to family histories and therefore carry a huge emotional wallop,” cautions Tom Tivol of Tivol, with stores in Kansas City, Mo., and Overland Park, Kan.

“People are a lot more nervous about estate jewelry,” explains Patti Geolat, a top appraiser in Dallas. “Nothing will make them happy if they perceived you damaged it.”

Geolat recalls a client who asked her to appraise a ring while she was still wearing it because she promised her dying mother she would never remove it. Geolat, a Graduate Gemologist, managed to examine the ring under magnification and determined the stone wasn’t a diamond. She attempted to explain the situation to the client, who reacted with denial and incredulity. “She went through a flood of emotions. She was going through a whole other loss,” Geolat says. “There was nothing I could do to comfort her. She had so much emotional commitment to that stone being a diamond. It was a classic example of shooting the messenger.”

Jim Rosenheim of the Tiny Jewel Box, a store in Washington, D.C., calls take-in “the single most important thing we do in business.” If something happens to a customer’s jewelry, “it reflects horribly on us,” he says. Even if the jeweler’s insurance covers the loss, “the issue is that you lose the client. It could damage your reputation because people might assume you were negligent. I emphasize to my staff that this is a very, very serious responsibility we take on.”

There are several keys to avoiding landmines: Take the time to follow the procedure completely, carry insurance to cover any eventuality, make sure the customer receipt includes a signed disclaimer, discuss every important detail with the client, and—most crucial of all—understand the limits of your knowledge and know which jobs to decline. “Jewelers have to understand that they have a responsibility to preserve the integrity of the jewelry and its survival through history,” says Joyce Jonas, director of the 21st Annual Antique & Period Jewelry and Gemstone Conference in Smithfield, R.I.

What to look for. In today’s world of labor-saving devices and time-management seminars, speed has become de rigueur. Take-in of jewelry, however, requires a methodical approach, not a hurried one. “Rushing through the take-in is where you run into a lot of problems,” says James Comer, a bench jeweler at David Baker Creative Jewelers in Dublin, Ohio.

With so much at risk, many stores permit only personnel with gemological training to handle take-in. When the store is busy, however, a gemologist may not be available. In such situations, it’s common for a sales associate to do the preliminary paperwork and offer coffee to the customer while she waits for the gemologist.

Examine an estate piece carefully and assess the condition of all its components. Be sure you tell customers about damage or wear, synthetic stones, and gem enhancements. “If [a problem] wasn’t pointed out to them when they left it with you, they will swear up and down that it was perfect,” Geolat warns.

“If the jeweler wants to protect himself and not have a piece come back to haunt him, disclosure is the name of the game,” adds Jonas.

• Gemstones: Note whether the gemstones are old-style cuts and whether they appear to be the item’s original stones. Note any missing, loose, or mismatched gems, and don’t assume the customer already knows about them. Check each stone thoroughly for cracks or chipping around the edges. “If you don’t mention it, and the customer never saw it before, then you’re on the hook for a repolish and a value change,” says Comer.

Consider the situation from the consumer’s perspective. “Even if they have small diamonds, people think they might be switchable,” says William D. Hoefer Jr. of Hoefer’s Gemological Services, San Jose, Calif. Customers don’t realize that even for an unscrupulous jeweler, the potential gain in switching one tiny diamond for another would not be worth the labor involved.

Tell the customer that replacing old-style cut stones could be expensive and time-consuming, Comer advises. In one case, it took 2 1/2 years for his store to find a replacement for an old-style diamond.

In art deco pieces (1920s to early 1940s), synthetic gems frequently were used, sometimes in combination with natural stones because craftsmen were concerned primarily with exact color matches. Customers may be surprised to learn that a synthetic stone is original to the piece. “Synthetics were a lot more prevalent than people realize,” Geolat says. “They think that in pieces from before the ’40s or ’50s, everything has to be real.”

• Settings. Examine the mounting thoroughly for signs of wear. Check clasps and hinges. Look for “marriages” of old and new components.

“People are used to considering their jewelry as workhorses,” says David Baker, Comer’s boss. A customer might not realize that the antique ring she received on her engagement shouldn’t be worn every day. “I tell them, ‘If you owned a Model T, you wouldn’t drive it down the highway at 70 miles per hour,’ ” Baker says. “You’re a custodian of this piece of history to hand down to the next generation.”

For example, an estate ring with an 18k white gold filigree engagement-style mounting that has been worn daily next to a wedding band is likely to have a crushed undergallery. Telling the client that the mounting should be restored to avoid drastic problems in the future is good customer service, but not every jeweler can do the work, Baker says. “Every day, more and more pieces are being damaged and destroyed by people who don’t have the talent to work on them. We approach it from the standpoint that they’re all booby-trapped.”

Jonas recalls a silver and diamond en tremblant brooch—a floral design in which the flowers move—from the 19th century that had been lead-soldered in the back. With a delicate mounting and a razor-thin stem supporting the flower, it was inevitable that the piece would break, but soldering with lead instead of gold had cut its value in half.

For jewelers, the issue is clear-cut, Rosenheim says. “Do you think you know enough to lay $50,000 on the line to take a piece in for a repair that you’re going to charge $100 for?”

Beware of counterfeits. Technological advances have made it easier to manufacture high-quality reproduction jewelry, even down to the gemstone cuts. The ethically challenged may represent these pieces as old; others are genuinely ignorant about what they have. You can’t authenticate a piece by consulting an antique jewelry reference book to see if the item resembles one of its illustrations, Rosenheim warns. “People who produce copies have the same book.”

Rosenheim says he became a cynic “at age 10 or 12,” when his father showed him a Victorian coffeepot from 1860 and pointed out that the piece had 1820 vintage hallmarks that had been soldered onto it from a Georgian teaspoon. Learning to recognize these subtleties “takes years and years of work and handling thousands of pieces of antique jewelry,” he says.

“There are really complex issues here that are very subtle,” Rosenheim says. “There aren’t very many people who can resolve those issues. Is a piece really art deco, or is it a piece that looks art deco? The difference in price could be tens of thousands of dollars.” Counterfeit signatures abound, as well, he notes.

Put it in writing. It’s essential to give the customer a receipt that includes provisional descriptions of the stones and the metal pending a complete appraisal by the jeweler. Most of the industry veterans interviewed for this article have a gemologist fully describe the item at take-in to provide maximum protection for jeweler and client. However, the practice of providing only a generic description, such as “one red stone in white metal,” is widespread in the industry. For more information, see “Getting the Most from Your Repair Shop,” JCK, May 1998, p. 106.

The receipt also should assign a provisional value to each item and include a disclaimer limiting the jeweler’s liability in case of loss. The receipt is a contract between jeweler and customer that establishes how a loss will be handled, Hoefer explains. Suggested language for these agreements is available through Jewelers of America and the American Gem Society. Tivol recommends attaching a Polaroid photo or color photocopy of the jewelry to the receipt. In the event of a loss, the photo could be sent to the FBI or the shipping service to trace the item.

If a loss occurs and there is no signed agreement, the applicable local court will determine the jeweler’s liability, says Hoefer, who’s been researching jewelry-related cases for years. “If you don’t like taking the risk of what that might mean, it’s best to have your own agreement,” Hoefer says. The disclaimer can limit the jeweler’s liability to a small amount if the customer doesn’t state a value on the receipt (the JA form limits liability to $75), but courts generally won’t permit the jeweler to limit liability to zero or almost zero. The limitations must be conspicuous (not buried in a long paragraph of legal parlance) and understandable to the average reader.

Even if there is a signed agreement, evidence of fraud will override it, Hoefer notes. Whether the jeweler is required to tell the customer that her pieces are being sent to another jeweler for repair varies from jurisdiction to jurisdiction. If you have a sign saying, “All work done on premises,” however, it’s fraudulent to farm any work out unless you inform the customer.

Assigning a value. Assigning a value to an estate item sometimes requires diplomatic skills. “The jeweler at take-in is obligated to understand the consumer’s belief about the value,” says Tivol, a law school graduate. As an example, he offers a hypothetical platinum-and-diamond bracelet that the jeweler suspects is worth $8,000. The customer, however, has an appraisal that states the value at $15,000. “If the jeweler and the consumer agree at take-in that the bracelet is worth $15,000, the jeweler must make sure that bracelet is covered for $15,000,” Tivol says. “Even though $8,000 might be an honorable and fair replacement cost, there’s an oral understanding, if not downright agreement, about the piece’s value at take-in.” Make certain that you have “stated value” insurance coverage as opposed to “replacement value” coverage, Tivol notes.

“If the person makes any kind of statement that the piece is sentimental—’It’s an heirloom’ or ‘It belonged to my mother’—and the jeweler doesn’t stop them and say, ‘You understand, of course, that I’m only responsible for the market value,’ then the jeweler can be responsible for the sentimental value,” Hoefer says. In one California case, a court awarded a customer the value of her jewelry plus an additional $4,000 for mental anguish. “Jewelry is special to the people who inherit it,” Hoefer says. “And who determines the special value? The jury or the judge.”

Are you covered? It’s essential that all staff who handle take-in know the terms of the store’s insurance coverage and can explain them to anxious customers. The jeweler’s block policy is “an à la carte menu,” according to Howard Herzog, president of International Jewelers Block in Newport Beach, Calif. This means that several key situations are excluded under the standard policy and require purchase of additional coverage. These include losses of customer goods, losses sustained at trade shows, losses of items in transit from one store location to another, and losses of goods the jeweler has consigned to others (such as a bench jeweler to whom repairs are farmed out).

“Sometimes jewelers get sloppy on the details, and they don’t get the consignment signed,” notes Herzog. He cites a situation in which a jeweler farmed out some pieces to a bench jeweler who passed away with no written record of consigning the items. “The wife of the jeweler who passed away said she knew nothing about anything and couldn’t find the merchandise,” Herzog says. “You see things like this all the time.”

If you have questions about the limits of your policy, discuss them with your agent or broker. “It’s easiest to deal with insurance matters when a crisis isn’t pending,” says Rob Washburn, a Columbus, Ohio, attorney who has handled lost-jewelry cases. “Jewelers should run possible scenarios past their agent.” For more information, see “Getting the Insurance You Need,” JCK, June 1999, p. 158.

“Rushing through the take-in is where you run into a lot of problems.” – Bench jeweler James Comer

Customer relations. When you’re dealing with a customer’s prized heirloom, it’s best to inform her about any problems you encounter. “The minute you realize that something isn’t kosher, pick up the phone and call the customer,” Hoefer advises. “The longer you wait, the more apt they are to become suspicious.”

At the Tiny Jewel Box, “Every discussion or telephone conversation is logged into the computer and dated for historical purposes,” Rosenheim says. “We keep complete, detailed records of everything that goes on so we can reconstruct all of the facts.” Some bench jewelers require a faxed customer signature authorizing them to proceed with work in problematic cases, such as the discovery of a chip in a stone. It’s also advisable to get your client’s permission before sending a stone to a gemological lab for testing.

If you encounter a customer who’s so paranoid that nothing you do will make her comfortable leaving her jewelry with you, it’s probably better to decline the job. “You have to use good judgment and play it by ear with the client,” says Geolat. “If the person is being unreasonable and just asking too much, it’s not going to be worth your time.”

When it comes to antique and period jewelry, experts say, the best way to endear yourself to customers is not to touch it if you aren’t thoroughly familiar with all of the issues involved. If you can’t do the job properly, “the best thing you can do is recommend it to someone who can,” Jonas says. “You know that customer’s going to come back, because they’ll think, ‘Boy, that person was honest.’

“It’s protection for everybody, and it’s really good business.”

“Jewelers have to understand that they have a responsibility to preserve the integrity of the jewelry and its survival through history.” — Estate jewelry expert Joyce Jonas