The Great Wine Swap Meet

An alcoholic beverage is the only legal personal property you can’t sell easily, which makes investing in wine quite a headache.

States prohibit wine sales without a license, which is hard to get, and there are other pitfalls as well.

* It is legal to sell wine by using a little-known California law permitting private parties to sell wine to a wine shop or restaurant that has a state license.

Known as the Milton Marks Law after the state senator who submitted the bill to the Legislature, the law (which became effective in January 1986) permits private parties to sell to licensees white wines that are at least five years old and red wines that are at least 10 years old.

The drawback is finding a licensee who wants the wine and is willing to pay a decent price for more than a few bottles. Typically, retail shop owners and restaurants want to pay low wholesale price; sellers usually want full retail price.

* One could sell wine through an auction house that sells wine. But houses such as Butterfield & Butterfield, Christie’s and Sotheby’s charge 15% to 20% to the seller and 10% to 15% to the buyer.

* As a last resort, one could donate wine to a charity auction and take a tax deduction--a money-loser.

Since these three plans all have their flaws, what often happens is that one wine lover sells a few bottles to another. This is illegal, though it is seldom prosecuted.

Now, AMC Trade Shows is offering a way to combine all three options to allow the sale of privately owned wine. AMC says its Vintage Wine Exchange, staged in conjunction with the trade show Wine Market Week, will offer wine at better prices for both buyer and seller than other options.

Scheduled for Oct. 3 and 4, the two-day exchange is like a swap meet for wine lovers. Those with large wine collections can rent booths for $600; those with small quantities of wine to sell can have them listed in a catalogue for a modest fee.

Buyers and sellers will meet at the show, which will use the license of a charity (yet to be named). The charity will buy the wine from the seller and then sell the wine to the new buyer, taking 7.5% from each for the transaction.

For example, say a bottle of wine is listed as having a value of $100. The new buyer agrees to the price, the charity buys it for $92.50 and immediately sells it to the new buyer for $107.50. The $15 differential goes to the charity.

The wine exchange is a separate portion of the trade show scheduled for San Francisco’s Fashion Center Oct. 3 to 5. Coordinator of the exchange is consultant Ed Everett, president of New World Wines of San Francisco.

Everett says sellers with tables may display bottles. Some may have photos of their cellars to show how it was stored. “That’s critical to buyers of old wine,” says Everett. He says some sophisticated buyers may even have proof of the date they acquired older wines. “I imagine a guy having a blowup of a receipt showing he bought his 1947 Lafite from a reputable wine shop in 1950.”

Among potential sellers are wineries with rare wines that they’d like to turn into cash. “Some wineries may view this as a good venue to sell some of their old wines,” says Everett. “Some of them may even offer tastes.”

He also expects estate sales--wines from the family of a deceased collector. “It’s distressing,” Everett says. “The scenario is all too familiar: Somebody dies and the widow finds 15 cases of old wine in the cellar, and she takes it to a retailer and he gives her $5 a bottle for stuff worth 20 times that amount.

“More of that goes on than people would like to admit.” He says survivors of even very savvy wine collectors have been left without any idea what their spouse’s wine was worth.

The exchange will create a master list of wine prices. Everett says, to give participants a range of price guidelines.

“We want to give the wine collector an honest ballpark appraisal as to what to price his wine,” Everett says. “And let the buyer know what’s a good price and what’s not.”

The exchange comes at a time when prices at major wine auctions are collapsing. One reason is the large amount of top-quality wine that’s being put on the market by those who bought wines over the last few years hoping to sell them at a profit.

Roger C. Livdahl of Los Angeles, an accredited wine appraiser who keeps tabs on wine auctions, says the large supply of some wines has been a headache for auction houses, and he suggests that sellers be cautious about how they try to liquidate their inventories.

“If you own 10 cases of a First Growth Bordeaux, you’d be a fool to sell more than two cases at a time,” says Livdahl. “The auction houses themselves are concerned.”

Moreover, some California wineries’ best wines are not holding their value at auction, Livdahl says. He says prices for Robert Mondavi Reserve and BV Private Reserve Cabernet Sauvignons have been very soft.

Michael Davis of Christie’s auction house in Chicago says that “all auctions have been hurt recently, the auction market has softened a bit.” He attributed this to “a lot of unwise investment over the last 10 years,” which has created a glut of fine wine that is harder to sell for top dollar.

For example, a week ago, a case of 1976 Chateau Mouton-Rothschild sold for $300 at a Christie’s auction in Los Angeles. When a wine that could have been expected to sell at $100 a bottle goes for $25, it is clear something strange is happening in the wine auction market.

On the other hand, says Livdahl, some older wines continue to sell extremely well. He says top 1985 Burgundies command high prices.

Advance tickets for the Vintage Wine Exchange will be $60 for both days, $75 at the door. All or a portion of fees will be tax deductible, the organizers says. For details on the exchange call (800) 252-0016.

Organizers say the event, which can take wine only from California cellars, will be annual. Buyers may be from out of state.

Wine of the Week

1990 Joseph Phelps Vineyards Vin du Mistral Rouge ($14) --Fans of Rhone-style wines will want to buy some of this superb wine, a blend of 52% Mourvedre, 26% Grenache, 9% Syrah, 7% Cinsault and 6% Carignane. To be released in two weeks, this wine has more flavor and spice than Phelps’ wonderful 1989 Rouge, even though it has less Syrah, the power grape of the Rhone. The aroma here is heady, with a mix of sweet fruit, anise, strawberry and cedar. The taste is lush and rewarding and not too tannic. It has a deeper flavor than the 1989 and more closely resembles a fine Chateauneuf-du-Pape. It should age well for five to 10 years. There’s even more good news: Some 3,800 cases of this one were made, compared with 900 of the prior vintage.

At the same time, Phelps will also release a stunning 1989 Syrah ($18), a deeper, more potent wine with depth and complexity. A third wine in the Rhone-leaning line, also to be released now, is the 1991 Vin du Mistral Rose ($9.50), a marvelous dry Grenache Rose that beats the pants off most blush wines now on the market. Clearly, Phelps’ winemaker Craig Williams is on a roll.